8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 23, 2005

i2 Technologies, Inc.

(Exact name of registrant as specified in its charter)

Delaware	000-28030	75-2294945
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
One i2 Place
11701 Luna Road
Dallas, Texas		75234
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (469) 357-1000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01. Entry into a Material Definitive Agreement

On November 21, 2005, i2 Technologies, Inc. entered into a Purchase Agreement with certain qualified institutional buyers, pursuant to which we agreed to issue and sell (i) $75 million in aggregate principal amount of our 5% Senior Convertible Notes due 2015 (the “Notes”) and (ii) warrants (the “Warrants”) to purchase up to 484,889 shares of our Common Stock, par value $.00025 per share (“Common Stock”). The Notes and the Warrants were issued on November 23, 2005. In accordance with the terms of the Purchase Agreement, we have also granted the investors an option to purchase up to an additional $11.25 million in aggregate principal amount of Notes, on a pro rata basis based on the aggregate principal amount of Notes originally purchased. The investors have 60 days from the closing of the private placement of the Notes to exercise this option.

In connection with the sale of the Notes, on November 23, 2005 we entered into an Indenture with JPMorgan Chase Bank, National Association, as trustee, relating to the Notes. The Notes will mature on November 15, 2015 and bear interest at a rate of 5% per annum, payable semiannually on May 15 and November 15, beginning May 15, 2006. The Notes are senior obligations and rank equally with any of our present and future senior obligations. The Notes are effectively junior to any of our secured obligations to the extent of the value of the assets securing such obligations.

The Notes are convertible, subject to certain conditions, into cash and shares, if any, of our Common Stock, at an initial conversion price of $15.4675 per share of Common Stock (which is equivalent to a conversion rate of approximately 64.6517 shares of Common Stock per $1,000 principal amount of Notes). The initial conversion price of the Notes represents a 15% premium to the last reported sale price of our Common Stock on The Nasdaq National Market (“Nasdaq”) on November 21, 2005. The conversion price is subject to adjustment.

Upon conversion, we will satisfy our conversion obligation with respect to the principal amount of the Notes to be converted in cash, with any remaining amount to be satisfied in shares of Common Stock. The total number of shares of Common Stock deliverable upon conversion of the Notes and exercise of the Warrants is limited to approximately 4.1 million shares, absent receipt of stockholder approval of the issuance of additional shares. Subject to certain conditions, to the extent that more shares of Common Stock would otherwise be issuable upon the conversion of Notes or the exercise of Warrants, we will be required to settle such conversions or exercises in cash by paying the value of the Common Stock into which the Notes would otherwise be convertible or the Warrants would otherwise be exercisable.

Prior to May 15, 2010, holders may convert their Notes:

• If the Notes have been called for redemption;

• If the average of the trading prices for the Notes during any five consecutive trading-day period is less than 98% of the average of the conversion values for the Notes (the product of the last reported sale price of our Common Stock and the conversion rate) during that period; or

• Upon certain distributions to all holders of our Common Stock, upon the occurrence of specified corporate transactions constituting a “fundamental change” (as such term is defined in the Indenture), or if our Common Stock ceases to be approved for listing on Nasdaq and is not listed for trading on a U.S. national securities exchange or any similar U.S. system of automated securities price dissemination.

In addition, at any time after May 15, 2008 and prior to the close of business on May 15, 2010, holders of the Notes may surrender their Notes for conversion during any fiscal quarter if the closing sale price of our Common Stock is equal to or greater than 150% of the conversion price then in effect for at least 20 trading days in the 30 consecutive trading day period ending on the last trading day of the immediately preceding fiscal quarter.

On or after May 15, 2010 and on or prior to the close of business on the business day immediately prior to the stated maturity date, the Notes will be convertible at any time at the option of the holder.

In addition, following a “fundamental change” that occurs prior to November 15, 2010, a holder who elects to convert in connection with such “fundamental change” will be entitled to receive an additional (or “make-whole”) premium, equal to the approximate lost option time value.

Prior to May 20, 2008, the Notes are not redeemable at our option. On or after May 20, 2008, we may redeem the Notes at any time or from time to time in whole or in part, for cash, at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest to but excluding the redemption date, so long as (i) the last reported sale price of our Common Stock has exceeded 175% of the conversion price then in effect for at least 20 trading days in the 30 consecutive trading days ending on the trading day prior to the date upon which we deliver to the holders the notice of redemption and (ii) on the date that we deliver a redemption notice through the date of redemption, the Common Stock issuable upon conversion of the Notes is either (1) covered by a registration statement covering resales thereof that is effective and available for use and is expected to remain effective and available for use for the 30 days following the date of such redemption notice or (2) eligible to be resold by non-affiliates pursuant to Rule 144(k) under the Securities Act of 1933, as amended (the “Securities Act”).

Holders of the Notes have the right to require us to repurchase all or any portion of the Notes on November 15, 2010 at a purchase price equal to 100% of the principal amount of the Notes to be repurchased plus any accrued and unpaid interest to but excluding such repurchase date.

If we redeem our Series B Preferred Stock, we must also offer to repurchase the Notes for cash at a purchase price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest to but excluding the repurchase date; provided, that if we redeem less than all of the outstanding shares of our Series B Preferred Stock, we shall be obligated to repurchase only a proportionate amount of the Notes.

Upon the occurrence of a “fundamental change,” each holder of the Notes will have the right to require us to repurchase for cash any or all of its Notes at a purchase price of 100% of the principal amount plus any accrued and unpaid interest to but excluding the repurchase date. A “fundamental change” means the occurrence of a Change of Control or Termination of Trading (as such terms are defined in the Indenture).

The Trustee or the holders of at least 25% in aggregate principal amount of the Notes then outstanding may declare the principal amount of the Notes, together with all accrued and unpaid interest, any premium, including any make-whole premium and liquidated damages, if any, to be immediately due and payable upon the occurrence of an event of default, including our: (i) failure to pay principal of or premium, including any make-whole premium on any Note when due at maturity, or failure to pay the redemption or repurchase price when due; (ii) failure to pay interest on the Notes; (iii) failure to provide notice of a “fundamental change” when required; (iv) failure to convert the Notes into cash or shares of common stock, if any, upon exercise of a holder’s conversion right; (v) failure to perform or observe any other covenant required by the Notes; (vi) default under other indebtedness in an aggregate outstanding principal amount in excess of $25.0 million, which default (A) is caused by failure to pay principal or interest when due or (B) results in acceleration of such indebtedness; (vii) failure to pay final judgments in excess of $20.0 million; or (viii) bankruptcy, insolvency, dissolution or liquidation.

The Warrants are exercisable at an initial exercise price of $15.4675 per share of Common Stock. The term of the Warrants is ten years. The Warrants were distributed to the investors on a pro rata basis in accordance with their investment in the Notes. The Warrants contain traditional anti-dilution adjustments.

In connection with the sale of the Notes and the Warrants, on November 23, 2005 we entered into a Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to file with the Securities and Exchange Commission within 120 days of the date of the original issuance of the Notes and Warrants, a shelf registration statement covering resales of the shares of Common Stock issuable upon conversion of the Notes and exercise of the Warrants. We agreed to use our reasonable best efforts to

cause the shelf registration statement to become effective within 270 days after the date of original issuance of the Notes and Warrants and to remain effective until the earliest of (1) the date on which all such Common Stock held by non-affiliates is eligible to be sold to the public pursuant to Rule 144(k) under the Securities Act or any successor provision thereof, (2) the date when each of the shares of Common Stock covered by the shelf registration statement has been effectively registered under the Securities Act and disposed of in accordance with the shelf registration statement, (3) the date on which all such Common Stock has been resold pursuant to Rule 144 under the Securities Act, (4) the date on which all the Notes, the Warrants and the underlying Common Stock cease to be outstanding and (5) the date that is the three-year anniversary of the issue date. If the registration statement has not been declared effective within 270 days or if, thereafter, we fail to maintain the effectiveness of the registration statement, we will be required to pay additional interest at the rate of 0.50% per annum to holders of the Notes and the Warrants for the first 90 days and an additional 0.50% per annum thereafter.

The Notes and Warrants will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws. The Notes and Warrants were sold in a private placement pursuant to the exemption from the registration requirements of the Securities Act afforded by Section 4(2) of the Securities Act.

The foregoing summary is qualified in its entirety by reference to the Purchase Agreement, the Indenture, the Registration Rights Agreement, the form of Notes and the form of Warrants, copies of which are attached hereto as Exhibits 10.1, 4.1, 10.2, 4.2 and 4.3, respectively, and are incorporated herein by reference.

ITEM 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure under Item 1.01 of this Current Report on Form 8-K relating to the Notes and the Warrants is incorporated herein by reference.

ITEM 3.02. Unregistered Sales of Equity Securities.

The disclosure under Item 1.01 of this Current Report on Form 8-K relating to the Notes and the Warrants is incorporated herein by reference.

ITEM 8.01. Other Events.

On November 28, 2005, we publicly announced that we have called $235 million of our $260 million of outstanding 5.25% convertible subordinated notes due December 2006 for redemption. We expect that the redemption will be completed on December 28, 2005. After the fourth quarter, we will evaluate remaining options to redeem the $25 million balance of the convertible subordinated notes left outstanding.

ITEM 9.01. Financial Statements and Exhibits.

(c) Exhibits.

Exhibit Number	Description
4.1	Indenture dated as of November 23, 2005 between i2 Technologies, Inc. and JPMorgan Chase Bank, National Association, as Trustee
4.2	Form of 5% Senior Convertible Notes due 2015
4.3	Form of Warrants
10.1	Purchase Agreement dated as of November 21, 2005 by and among i2 Technologies, Inc. and the purchasers set forth on Schedule I thereto

  10.2   Registration Rights Agreement dated as of November 23, 2005 by and among i2 Technologies, Inc. and the parties set forth on Schedule I thereto

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, hereunto duly authorized.

i2 TECHNOLOGIES, INC.
By:	/s/ Michael Berry
	Name: Michael Berry
	Title: Executive Vice President and Chief Financial Officer

Dated: November 29, 2005

INDEX TO EXHIBITS

Exhibit Number	Description
4.1	Indenture dated as of November 23, 2005 between i2 Technologies, Inc. and JPMorgan Chase Bank, National Association, as Trustee
4.2	Form of 5% Senior Convertible Notes due 2015
4.3	Form of Warrants
10.1	Purchase Agreement dated as of November 21, 2005 by and among i2 Technologies, Inc. and the purchasers set forth on Schedule I thereto
10.2	Registration Rights Agreement dated as of November 23, 2005 by and among i2 Technologies, Inc. and the parties set forth on Schedule I thereto

EX-4.1

EXHIBIT 4.1

i2 TECHNOLOGIES, INC.

5% SENIOR CONVERTIBLE NOTES DUE 2015

INDENTURE

DATED AS OF NOVEMBER 23, 2005

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,

AS TRUSTEE

TABLE OF CONTENTS

		Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE		2
Section 1.1.	Definitions	2
Section 1.2.	Other Definitions	7
Section 1.3.	Trust Indenture Act Provisions	8
Section 1.4.	Rules of Construction	9
ARTICLE 2. THE SECURITIES		9
Section 2.1.	Form and Dating	9
Section 2.2.	Execution and Authentication	11
Section 2.3.	Registrar, Paying Agent and Conversion Agent	12
Section 2.4.	Paying Agent to Hold Money in Trust	13
Section 2.5.	Securityholder Lists	13
Section 2.6.	Transfer and Exchange	13
Section 2.7.	Replacement Securities	14
Section 2.8.	Outstanding Securities	15
Section 2.9.	Treasury Securities	15
Section 2.10.	Temporary Securities	16
Section 2.11.	Cancellation	16
Section 2.12.	Legend; Additional Transfer and Exchange Requirements	16
Section 2.13.	CUSIP Numbers	19
Section 2.14.	Rank	19
ARTICLE 3. REDEMPTION AND REPURCHASE		19
Section 3.1.	Election to Redeem; Notice to Trustee	19
Section 3.2.	Selection of Securities to Be Redeemed	20
Section 3.3.	Notice of Redemption	20
Section 3.4.	Effect of Notice of Redemption	21
Section 3.5.	Deposit of Redemption Price	22
Section 3.6.	Securities Redeemed in Part	22
Section 3.7.	[Reserved]	22
Section 3.8.	Repurchase of Securities at Option of the Holder on Specified Date	22

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TABLE OF CONTENTS

(continued)

		Page
Section 3.9.	Repurchase of Securities at Option of the Holder Upon Redemption of Series B Preferred Stock	24
Section 3.10.	Repurchase of Securities at Option of the Holder Upon Fundamental Change	26
Section 3.11.	Effect of Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice; Withdrawal of Notice	30
Section 3.12.	Deposit of Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Repurchase Price	31
Section 3.13.	Securities Repurchased in Part	32
Section 3.14.	Compliance with Securities Laws Upon Repurchase of Securities	32
ARTICLE 4. CONVERSION		32
Section 4.1.	Conversion Privilege	32
Section 4.2.	Conversion Procedure	35
Section 4.3.	Fractional Shares	37
Section 4.4.	Taxes on Conversion	37
Section 4.5.	Payment Upon Conversion	38
Section 4.6.	Adjustment of Conversion Price	40
Section 4.7.	No Adjustment	47
Section 4.8.	Adjustment for Tax Purposes	47
Section 4.9.	Notice of Adjustment	47
Section 4.10.	Notice of Certain Transactions	47
Section 4.11.	Effect of Reclassification, Consolidation, Merger or Sale on Conversion Privilege	48
Section 4.12.	Trustee’s Disclaimer	49
Section 4.13.	Voluntary Reduction	49
ARTICLE 5. PAYMENT OF INTEREST AND MAKE-WHOLE PREMIUM		50
Section 5.1.	Interest Payments	50
Section 5.2.	Make-Whole Premium	50
Section 5.3.	Adjustments Relating to Make-Whole Premium	53
ARTICLE 6. COVENANTS		53
Section 6.1.	Payment of Securities	53

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TABLE OF CONTENTS

(continued)

		Page
Section 6.2.	SEC Reports	54
Section 6.3.	Compliance Certificates	55
Section 6.4.	Further Instruments and Acts	55
Section 6.5.	Maintenance of Corporate Existence	55
Section 6.6.	Rule 144A Information Requirement	55
Section 6.7.	Resale of Certain Securities	56
Section 6.8.	Stay, Extension and Usury Laws	56
Section 6.9.	Book-Entry System	56
Section 6.10.	Payment of Liquidated Damages	56
Section 6.11.	Incurrence of Indebtedness	56
Section 6.12.	Stockholder Approval	63
ARTICLE 7. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE		64
Section 7.1.	Company May Consolidate, Etc., Only on Certain Terms	64
Section 7.2.	Successor Substituted	65
ARTICLE 8. DEFAULT AND REMEDIES		65
Section 8.1.	Events of Default	65
Section 8.2.	Acceleration	67
Section 8.3.	Other Remedies	67
Section 8.4.	Waiver of Defaults and Events of Default	68
Section 8.5.	Control by Majority	68
Section 8.6.	Limitations on Suits	68
Section 8.7.	Rights of Holders to Receive Payment and to Convert	69
Section 8.8.	Collection Suit by Trustee	69
Section 8.9.	Trustee May File Proofs of Claim	69
Section 8.10.	Priorities	70
Section 8.11.	Undertaking for Costs	70
Section 8.12.	Waiver of Stay or Extension Laws	70
Section 8.13.	Restoration of Rights and Remedies	70
ARTICLE 9. TRUSTEE		71
Section 9.1.	Duties of Trustee	71

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TABLE OF CONTENTS

(continued)

		Page
Section 9.2.	Rights of Trustee	72
Section 9.3.	Individual Rights of Trustee	73
Section 9.4.	Trustee’s Disclaimer	73
Section 9.5.	Notice of Default or Events of Default	73
Section 9.6.	Reports by Trustee to Holders	73
Section 9.7.	Compensation and Indemnity	74
Section 9.8.	Replacement of Trustee	74
Section 9.9.	Successor Trustee by Merger, Etc.	75
Section 9.10.	Eligibility; Disqualification	76
Section 9.11.	Preferential Collection of Claims Against Company	76
ARTICLE 10. SATISFACTION AND DISCHARGE OF INDENTURE		76
Section 10.1.	Satisfaction and Discharge of Indenture	76
Section 10.2.	Application of Trust Money	77
Section 10.3.	Repayment to Company	77
Section 10.4.	Reinstatement	77
ARTICLE 11. AMENDMENTS, SUPPLEMENTS AND WAIVERS		78
Section 11.1.	Without Consent of Holders	78
Section 11.2.	With Consent of Holders	79
Section 11.3.	Compliance with Trust Indenture Act	80
Section 11.4.	Revocation and Effect of Consents	80
Section 11.5.	Notation on or Exchange of Securities	81
Section 11.6.	Trustee To Sign Amendments, Etc.	81
Section 11.7.	Effect of Supplemental Indentures	81
ARTICLE 12. MISCELLANEOUS		81
Section 12.1.	Trust Indenture Act Controls	81
Section 12.2.	Notices	82
Section 12.3.	Communications by Holders with Other Holders	82
Section 12.4.	Certificate and Opinion as to Conditions Precedent	82
Section 12.5.	Record Date for Vote or Consent of Securityholders	83
Section 12.6.	Rules by Trustee, Paying Agent, Registrar and Conversion Agent	83

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TABLE OF CONTENTS

(continued)

		Page
Section 12.7.	Governing Law	83
Section 12.8.	No Adverse Interpretation of Other Agreements	84
Section 12.9.	No Recourse Against Others	84
Section 12.10.	Successors	84
Section 12.11.	Multiple Counterparts	84
Section 12.12.	Separability	84
Section 12.13.	Table of Contents, Headings, Etc.	84

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CROSS-REFERENCE TABLE*

TIA SECTION		INDENTURE SECTION
Section	310	12.1
	310(a)(1)	9.10
	(a)(2)	9.10
	(a)(3)	N.A.**
	(a)(4)	N.A.
	(a)(5)	9.10
	(b)	9.10
	(c)	N.A.
Section	311	12.1
	311(a)	9.11
	(b)	9.11
	(c)	N.A.
Section	312	12.1
	(a)	N.A.
	(b)	12.3
	(c)	12.3
Section	313	12.1
	313(a)	9.6(a)
	(b)(1)	N.A.
	(b)(2)	9.6(a)
	(c)	9.6(a)
	(d)	9.6(b)
Section	314	12.1
	314(a)	N.A.
	(b)	N.A.
	(c)(1)	12.4(a)
	(c)(2)	12.4(a)
	(c)(3)	N.A.
	(d)	N.A.
	(e)	N.A.
	(f)	N.A.
Section	315	12.1
Section	316	12.1
Section	317	12.1
Section	318(c)	12.1

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

** N.A. means Not Applicable.

THIS INDENTURE dated as of November 23, 2005 is between i2 Technologies, Inc., a corporation duly organized under the laws of the State of Delaware (the “Company”), and JPMorgan Chase Bank, National Association, a national banking association organized and existing under the laws of the United States, as Trustee (the “Trustee”).

In consideration of the purchase of the Securities (as defined herein) by the Holders thereof, both parties agree as follows for the benefit of the other and for the equal and ratable benefit of the Holders of the Company’s 5% Senior Convertible Notes due 2015.

ARTICLE 1.

DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.1. Definitions.

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

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

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

“Bloomberg” means Bloomberg Financial Markets.

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

“Business Day” means each day that is not a Legal Holiday.

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

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

“Certificated Security” means a Security that is in substantially the form attached hereto as Exhibit A and that does not include the information or the schedule called for by footnotes 1 and 3 thereof.

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“Closing Sale Price” of the Common Stock means, as of any date of determination, the closing per share sale price (or, if no such closing sale price is reported on such day, the average of the bid and asked prices or, if more than one in either case, the average of the average bid and the average asked prices) at 4:00 p.m., New York time, as reported in composite transactions for the principal U.S. securities exchange on which the Common Stock is traded or, if the Common Stock is not listed on a U.S. national or regional securities exchange, as reported on the Nasdaq System or by the National Quotation Bureau Incorporated. If the Common Stock is not so listed or quoted, the Closing Sale Price shall be determined by two nationally recognized independent investment banks selected by the Trustee.

“Common Stock” means the common stock of the Company, $0.00025 par value per share, as it exists on the date of this Indenture and any shares of any class or classes of capital stock of the Company resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company and which are not subject to redemption by the Company; provided, however, that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable on conversion of Securities shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications.

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

“Conversion Rate” means, as of any date, an amount equal to $1,000 divided by the then applicable Conversion Price on such date. As of the date hereof and subject to adjustment pursuant to Section 4.6, the Conversion Price is $15.4675 and, accordingly, the Conversion Rate with respect to the Securities is 64.6517 shares of Common Stock for each $1,000 principal amount of Securities.

“Conversion Value” of a Security means, as of any date of determination, the product of the Closing Sale Price of the Common Stock on that date multiplied by the Conversion Rate of that Security on that date.

“Corporate Trust Office” means the office of the Trustee at which at any particular time the trust created by this Indenture shall be administered which office at the date of the execution of this Indenture is located at 600 Travis Street, Suite 1150, Houston, Texas 77002; Attention: Corporate Trust Services (i2 Technologies, Inc. 5% Senior Convertible Notes due 2015) or at any other time at such other address as the Trustee may designate from time to time by notice to the Company.

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

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

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“Final Maturity Date” means November 15, 2015.

“Fiscal Quarter” means, with respect to the Company, the quarters ending March 31, June 30, September 30 and December 31, respectively.

“GAAP” means generally accepted accounting principles in the United States of America as in effect as of the date of this Indenture, including those set forth in (1) the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, (2) the statements and pronouncements of the Financial Accounting Standards Board, (3) such other statements by such other entity as approved by a significant segment of the accounting profession and (4) the rules and regulations of the SEC governing the inclusion of financial statements (including pro forma financial statements) in registration statements filed under the Securities Act and periodic reports required to be filed pursuant to Section 13 of the Exchange Act, including opinions and pronouncements in staff accounting bulletins and other official written statements from the accounting staff of the SEC expressing the views of the SEC therein.

“Global Security” means a permanent global security that is in substantially the form attached hereto as Exhibit A and that includes the information and schedule called for by footnotes 1 and 3 thereof and which is deposited with the Depositary or its custodian and registered in the name of the Depositary or its nominee.

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

“Indenture” means this Indenture, as amended or supplemented from time to time pursuant to the terms of this Indenture.

“Interest Payment Date” means May 15 and November 15 of each year.

“Legal Holiday” is a Saturday, Sunday or a day on which state or federally chartered banking institutions in New York, New York and the state in which the Corporate Trust Office is located are not required to be open. If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a Regular Record Date is a Legal Holiday, the record date shall not be affected.

“Liquidated Damages” means all “Liquidated Damages” (as defined in the Registration Rights Agreement) then owing pursuant to the Registration Rights Agreement and all Filing Failure Liquidated Damages then owing pursuant to the provisions of Section 6.2. All references herein to interest accrued or payable as of any date shall include any Liquidated Damages accrued or payable as of such date, whether or not a specific reference thereto is made.

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

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“Officers’ Certificate” means a certificate signed by two Officers; provided, however, that for purposes of Sections 4.11 and 6.3, “Officers’ Certificate” means a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company and by one other Officer.

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

“Person” or “person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

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

“Redemption Date” when used with respect to any Security to be redeemed, means the date fixed by the Company for such redemption pursuant to this Indenture, as set forth in Section 3.1 and in the form of Security annexed as Exhibit A hereto.

“Redemption Price” when used with respect to any Security to be redeemed, means the price fixed for such redemption pursuant to this Indenture, as set forth in Section 3.1(a) and in the form of Security annexed as Exhibit A hereto.

“Registration Rights Agreement” means the Registration Rights Agreement, dated as of November __, 2005, by and among the Company and the Purchasers thereunder, as the same may be amended or modified from time to time in accordance with the terms thereof.

“Regular Record Date” means, with respect to each Interest Payment Date, the close of business on the May 1 or November 1, as the case may be, immediately preceding such Interest Payment Date.

“Regulation S” means Regulation S under the Securities Act or any successor for such Rule.

“Restricted Global Security” means a Global Security that is a Restricted Security.

“Restricted Security” means a Security required to bear the restricted legend set forth in the form of Security set forth in Exhibit A of this Indenture.

“Rule 144” means Rule 144 under the Securities Act or any successor to such Rule.

“Rule 144A” means Rule 144A under the Securities Act or any successor to such Rule.

“SEC” means the Securities and Exchange Commission.

“Securities” means the 5% Senior Convertible Notes due 2015, or any of them (each, a “Security”), as amended or supplemented from time to time, that are issued under this Indenture.

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

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

“TIA” means the Trust Indenture Act of 1939, as amended, and the rules and regulations thereunder as in effect on the date of this Indenture, except as provided in Section 11.3, and except to the extent any amendment to the Trust Indenture Act expressly provides for application of the Trust Indenture Act as in effect on another date.

“Trading Day” means (i) if the Common Stock is quoted on the Nasdaq National Market or any other system of automated dissemination of quotations of securities prices, days on which trades may be effected through such system, (ii) if the Common Stock is listed or admitted for trading on any national or regional securities exchange, days on which such national or regional securities exchange is open for business, (iii) if the Common Stock is not listed on a national or regional securities exchange or quoted on the Nasdaq National Market or any other system of automated dissemination of quotation of securities prices, days on which the Common Stock is traded regular way in the over-the-counter market and for which a closing bid and a closing asked price for the Common Stock are available; or (iv) if the Common Stock is not so listed, quoted or traded, any Business Day.

“Trading Price” means, on any date of determination with respect to any Security, the average of the secondary bid quotations per Security obtained by the Conversion Agent for $2,500,000 principal amount of Securities at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers selected by the Company; provided, that, if at least three such bids cannot reasonably be obtained, but two such bids can reasonably be obtained, then the average of these two bids shall be used; provided, further, that, if at least two such bids cannot reasonably be obtained, but one such bid can reasonably be obtained, this one bid shall be used. If the Conversion Agent cannot reasonably obtain at least one bid for $2,500,000 principal amount of the Securities from an independent nationally recognized securities dealer, then the Trading Price of such Securities will equal (a) the applicable Conversion Rate of such Securities multiplied by (b) the Closing Sale Price of the Common Stock.

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

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

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

“Warrants” means the Warrants to purchase Common Stock of the Company issued pursuant to Section 1 of the Securities Purchase Agreement dated as of November 23, 2005, by and among the Company and the investors referred to therein.

Section 1.2. Other Definitions.

Term	Defined in Section
“90% Condition”	3.10
“Additional Premium Table”	5.2
“Agent Members”	2.1
“Bankruptcy Law”	8.1
“beneficial owner”	3.9
“beneficially own”	3.9
“beneficially owned”	3.9
“Change in Control”	3.9
“Company Notice”	3.8
“Company Order”	2.2
“Conversion Agent”	2.3
“Conversion Date”	4.2
“Conversion Limitation”	4.2
“Conversion Notice”	4.2
“Conversion Obligation”	4.5
“Conversion Period”	4.5
“Conversion Price”	4.6
“Current Market Price”	4.6
“Custodian”	8.1
“Daily Conversion Value”	4.5
“Daily Net Share Settlement Value”	4.5
“Depositary”	2.1
“DTC”	2.1
“EBITDA”	6.11
“Effective Date”	5.2
“Event of Default”	8.1
“Expiration Date”	4.6
“Expiration Time”	4.6
“Filing Failure Liquidated Damages”	6.2
“Fundamental Change”	3.9
“Fundamental Change Company Notice”	3.9
“Fundamental Change Conversion/Repurchase Period”	3.10
“Fundamental Change Repurchase”	3.10
“Fundamental Change Repurchase Notice”	3.9

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Term	Defined in Section
“Fundamental Change Repurchase Price”	3.9
“group”	3.9
“Indebtedness”	6.11
“Interest Expense”	6.11
“Liens”	6.11
“Make-Whole Premium”	5.2
“Net Income”	6.11
“Notice of Convertibility”	4.1
“Paying Agent”	2.3
“Permitted Indebtedness”	6.11
“Permitted Purchase Money Security Interest”	6.11
“person”	3.9
“Preferred Redemption Company Notice”	3.9
“Preferred Redemption Repurchase Date”	3.9
“Preferred Redemption Repurchase Price”	3.9
“Primary Registrar”	2.3
“Purchase Agreement”	2.1
“Purchased Shares”	4.6
“QIB”	2.1
“Redemption Fraction”	3.9
“Redemption Notice	3.8
“Registrar”	2.3
“Repurchase Date”	3.8
“Repurchase Notice	3.8
“Repurchase Price”	3.8
“Rights Plan”	4.6
“Series B Preferred Stock”	3.9
“Spinoff Valuation Period”	4.6
“Stockholder Approval”	6.12
“Stock Price Cap”	5.2
“Stock Price Threshold”	5.2
“Stock Price”	5.2
“tender offer”	4.6
“tendered shares”	4.6
“Termination of Trading”	3.9
“Trigger Event”	4.6
“Triggering Distribution”	4.6
“Volume Weighted Average Price”	4.5
“voting stock”	3.9

Section 1.3. Trust Indenture Act Provisions.

Whenever this Indenture refers to a provision of the TIA, that provision is incorporated by reference in and made a part of this Indenture. This Indenture shall also include those provisions of the TIA required to be included herein by the provisions of the Trust Indenture

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Reform Act of 1990. The following TIA terms used in this Indenture have the following meanings:

“indenture securities” means the Securities;

“indenture security holder” means a Securityholder;

“indenture to be qualified” means this Indenture;

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

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

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

Section 1.4. 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;

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

(d) provisions apply to successive events and transactions;

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

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

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

ARTICLE 2.

THE SECURITIES

Section 2.1. Form and Dating.

The Securities and the corresponding Trustee’s certificate of authentication shall be substantially in the respective forms set forth in Exhibit A, which Exhibit is incorporated in and made part of this Indenture. The Securities may have notations, legends or endorsements

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required by law, stock exchange rule or usage. The Company shall provide any such notations, legends or endorsements to the Trustee in writing. Each Security shall be dated the date of its authentication. The Securities are being offered and sold by the Company pursuant to a Purchase Agreement dated as of November 21, 2005 (the “Purchase Agreement”) between the Company and the Purchasers thereunder, in transactions exempt from, or not subject to, the registration requirements of the Securities Act.

(a) Restricted Global Securities. All of the Securities are initially being offered and sold to qualified institutional buyers as defined in Rule 144A (collectively, “QIBs” or individually, each a “QIB”) and shall be issued initially in the form of one or more Restricted Global Securities, which shall be deposited on behalf of the purchasers of the Securities represented thereby with the Trustee, at its Corporate Trust Office, as custodian for the depositary, The Depository Trust Company (“DTC,” and such depositary, or any successor thereto, being hereinafter referred to as the “Depositary”), and registered in the name of its nominee, Cede & Co., duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Restricted Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian with respect to the Securities in global form, as hereinafter provided, subject in each case to compliance with the Applicable Procedures.

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

Members of, or participants in, the Depositary (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary or under the Global Security, and the Depositary (including, for this purpose, its nominee) may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner and Holder of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall (1) 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 (2) impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security.

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(c) Book Entry Provisions. The Company shall execute and the Trustee shall, in accordance with this Subsection 2.1(c) and Section 2.2, authenticate and deliver initially one or more Global Securities that (1) shall be registered in the name of Cede & Co. or as otherwise instructed by the Depositary, (2) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary’s instructions and (3) shall bear legends substantially to the following effect:

“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO i2 TECHNOLOGIES, INC. (THE “COMPANY”) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.”

Section 2.2. Execution and Authentication.

(a) The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is limited to $75,000,000 (subject to increase by up to an additional aggregate principal amount of $11,250,000 in the event the Purchasers (as defined in the Purchase Agreement) exercise the right to purchase Additional Securities (as defined in the Purchase Agreement) pursuant to the Purchase Agreement) except as provided in Sections 2.6 and 2.7.

(b) An Officer shall sign the Securities for the Company by manual or facsimile signature attested by the manual or facsimile signature of the Secretary or an Assistant Secretary of the Company. Typographic and other minor errors or defects in any such facsimile signature shall not affect the validity or enforceability of any Security which has been authenticated and delivered by the Trustee.

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

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

(e) The Trustee shall authenticate and make available for delivery Securities for original issue upon receipt of a written order or orders of the Company signed by two Officers of the Company (a “Company Order”). Subject to Section 2.2(a), the Company Order shall specify the amount of Securities to be authenticated, shall provide that all such Securities will be represented by a Restricted Global Security and the date on which each original issue of Securities is to be authenticated.

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

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

Section 2.3. Registrar, Paying Agent and Conversion Agent.

(a) The Company shall maintain one or more offices or agencies where Securities may be presented for registration of transfer or for exchange (each, a “Registrar”), one or more offices or agencies where Securities may be presented for payment (each, a “Paying Agent”), one or more offices or agencies where Securities may be presented for conversion (each, a “Conversion Agent”) and one or more offices or agencies where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Company shall at all times maintain a Registrar, Paying Agent, Conversion Agent and an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served in the Borough of Manhattan, The City of New York. One of the Registrars (the “Primary Registrar”) shall keep a register of the Securities and of their transfer and exchange.

(b) The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture. If the Company fails to maintain a Registrar, Paying Agent, Conversion Agent or agent for service of notices and demands in any place required by this Indenture, or fails to give the foregoing notice, the Trustee shall act as such. The Company or any Affiliate of the Company may act as Paying Agent (except for the purposes of Section 6.1 and Article 10).

(c) The Company hereby initially designates the Trustee as Registrar, Paying Agent and Conversion Agent, and each of the Corporate Trust Office of the Trustee and the office or agency of the Trustee in the Borough of Manhattan, The City of New York (which shall

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initially be JPMorgan Chase Bank, N.A., Worldwide Securities Services, 4 New York Plaza, New York, N.Y. 10004) to be such office or agency of the Company for each of the aforesaid purposes.

Section 2.4. Paying Agent to Hold Money in Trust.

Prior to 11:00 a.m., New York City time, on each due date of the principal of, or interest on, any Securities, the Company shall deposit or cause to be deposited with a Paying Agent a sum sufficient to pay such principal or interest so becoming due. Subject to Section 10.2, a Paying Agent shall hold in trust for the benefit of Securityholders or the Trustee all money held by the Paying Agent for the payment of principal of, or interest on, the Securities, and shall notify the Trustee of any default by the Company (or any other obligor on the Securities) in making any such payment. If the Company or an Affiliate of the Company acts as Paying Agent, it shall, before 11:00 a.m., New York City time, on each due date of the principal of, or interest on, any Securities, segregate the money and hold it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee, and the Trustee may at any time during the continuance of any default, upon written request to a Paying Agent, require such Paying Agent to pay forthwith to the Trustee all sums so held in trust by such Paying Agent. Upon doing so, the Paying Agent (other than the Company) shall have no further liability for the money.

Section 2.5. Securityholder 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 Securityholders. If the Trustee is not the Primary Registrar, the Company shall furnish to the Trustee on or before each semiannual Interest Payment Date, and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders.

Section 2.6. Transfer and Exchange.

(a) Subject to compliance with any applicable additional requirements contained in Section 2.12, when a Security is presented to a Registrar with a request to register a transfer thereof or to exchange such Security for an equal principal amount of Securities of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested; provided, however, that every Security presented or surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by an assignment form and, if applicable, a transfer certificate, each in the form included in Exhibit A, and in form satisfactory to the Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing. To permit registration of transfers and exchanges, upon surrender of any Security for transfer or exchange at an office or agency maintained pursuant to Section 2.3, the Company shall execute and the Trustee shall authenticate Securities of a like aggregate principal amount at the Registrar’s request. Any exchange or transfer shall be without charge, except that the Company or the Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto; provided, that this sentence shall not apply to any exchange pursuant to Section 2.10, 2.12(a), 3.6, 3.13, or 11.5.

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(b) None of the Company, any Registrar or the Trustee shall be required to exchange or register a transfer of (1) any Securities for a period of 15 days next preceding mailing of a notice of Securities to be redeemed, (2) any Securities or portions thereof selected or called for redemption (except in the case of redemption of a Security in part, the portion thereof not to be redeemed) or (3) any Securities or portions thereof in respect of which a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice has been delivered and not withdrawn by the Holder thereof (except, in the case of the repurchase of a Security in part, the portion thereof not to be repurchased).

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

(d) Any Registrar appointed pursuant to Section 2.3 hereof shall provide to the Trustee such information as the Trustee may reasonably require in connection with the delivery by such Registrar of Securities upon transfer or exchange of Securities.

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

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

Section 2.7. Replacement Securities.

(a) If any mutilated Security is surrendered to the Company, a Registrar or the Trustee, or the Company, a Registrar and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, and there is delivered to the Company, the applicable Registrar and the Trustee such security or indemnity as will be required by them to save each of them harmless, then, in the absence of notice to the Company, such Registrar or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute, and upon its written request the Trustee shall authenticate and deliver, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.

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

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(c) Upon the issuance of any new Securities under this Section 2.7, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the reasonable fees and expenses of the Trustee or the Registrar) in connection therewith.

(d) Every new Security issued pursuant to this Section 2.7 in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.

(e) The provisions of this Section 2.7 are (to the extent lawful) exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

Section 2.8. Outstanding Securities.

(a) Securities outstanding at any time are all Securities authenticated by the Trustee, except for those canceled by it, those redeemed or repurchased pursuant to Article 3, those converted pursuant to Article 4, those delivered to the Trustee for cancellation or surrendered for transfer or exchange and those described in this Section 2.8 as not outstanding.

(b) If a Security is replaced pursuant to Section 2.7, it ceases to be outstanding unless the Company receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser.

(c) If a Paying Agent (other than the Company or an Affiliate of the Company) holds in respect of the outstanding Securities on a Redemption Date, a Repurchase Date, a Preferred Redemption Repurchase Date, a Fundamental Change Repurchase Date or the Final Maturity Date money sufficient to pay the principal of (including premium, if any) and accrued interest on Securities (or portions thereof) payable on that date, then on and after such Redemption Date, Repurchase Date, Preferred Redemption Repurchase Date, Fundamental Change Repurchase Date or Final Maturity Date, as the case may be, such Securities (or portions thereof, as the case may be) shall cease to be outstanding and interest on them shall cease to accrue; provided, that if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision thereof satisfactory to the Trustee has been made.

(d) Subject to the restrictions contained in Section 2.9, a Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.

Section 2.9. Treasury Securities.

In determining whether the Holders of the required principal amount of Securities have concurred in any notice, direction, waiver or consent, Securities owned by the Company or any other obligor on the Securities or by any Affiliate of the Company or of such other obligor shall be disregarded, except that, for purposes of determining whether the Trustee shall be protected in relying on any such notice, direction, waiver or consent, only Securities which a Trust Officer of

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the Trustee actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Securities and that the pledgee is not the Company or any other obligor on the Securities or any Affiliate of the Company or of such other obligor.

Section 2.10. Temporary Securities.

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

Section 2.11. Cancellation.

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

Section 2.12. Legend; Additional Transfer and Exchange Requirements.

(a) If Securities are issued upon the transfer, exchange or replacement of Securities subject to restrictions on transfer and bearing the legends set forth on the forms of Securities attached hereto as Exhibit A (collectively, the “Legend”), or if a request is made to remove the Legend on a Security, the Securities 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 if requested by the Company or such Registrar, 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, Rule 144 or Regulation S under the Securities Act or that such Securities are not “restricted” within the meaning of Rule 144 under the Securities Act; provided, that no such evidence need be supplied in connection with the sale of such Security pursuant to a registration statement that is effective at the time of such sale. Upon (1) provision of such satisfactory evidence if requested, or (2) notification by the Company to the Trustee and Registrar of the sale of such Security 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 Security that does not bear the Legend. If the Legend

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is removed from the face of a Security and the Security is subsequently held by an Affiliate of the Company, the Legend shall be reinstated.

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

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

(d) The restrictions imposed by the Legend upon the transferability of any Security shall cease and terminate when such Security has been sold pursuant to an effective registration statement under the Securities Act or transferred in compliance with Rule 144 under the Securities Act (or any successor provision thereto) or, if earlier, upon the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision). Any Security 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 Security 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 or any successor provision, by, if requested by the Company or the Registrar, an opinion of counsel reasonably acceptable to the Company and addressed to the Company in form acceptable to the Company, to the effect that the transfer of such Security has been made in compliance with Rule 144 or such successor provision), be exchanged for a new Security, of like tenor and aggregate principal amount, which shall not bear the restrictive Legend. The Company shall inform the Trustee of the effective date of any registration statement registering the Securities under the Securities Act. The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the aforementioned opinion of counsel or registration statement.

As used in the preceding Subsections 2.12(c) and (d), the term “transfer” encompasses any sale, pledge, transfer, hypothecation or other disposition of any Security.

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(e) The provisions below shall apply only to Global Securities:

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

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

(3) Subject to the provisions of clause (5) of this Subsection 2.12(e), the registered Holder may grant proxies and otherwise authorize any Person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.

(4) In the event of the occurrence of any of the events specified in clause (1) of this Subsection 2.12(e) above, the Company will promptly make available to the Trustee a reasonable supply of Certificated Securities in definitive, fully registered form, without interest coupons.

(5) Neither Agent Members nor any other Persons on whose behalf Agent Members may act shall have any rights under this Indenture with respect to any Global Security registered in the name of the Depositary or any nominee thereof, or

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under any such Global Security, and the Depositary or such nominee, as the case may be, may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner and holder of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or such nominee, as the case may be, or impair, as between the Depositary, its Agent Members and any other Person on whose behalf an Agent Member may act, the operation of customary practices of such Persons governing the exercise of the rights of a holder of any Security.

Section 2.13. CUSIP Numbers.

The Company in issuing the Securities may use one or more “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption or repurchase as a convenience to Holders; provided, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption or repurchase and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption or repurchase 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. Rank.

The Securities shall constitute senior indebtedness of the Company and shall rank pari passu with all other senior indebtedness of the Company and senior to all other indebtedness of the Company.

ARTICLE 3.

REDEMPTION AND REPURCHASE

Section 3.1. Election to Redeem; Notice to Trustee.

(a) Prior to May 20, 2008, the Securities shall not be redeemable at the Company’s option. On or after May 20, 2008, the Company may, at its option, redeem the Securities in whole at any time or in part from time to time, upon not more than 60 days and not less than 30 days’ notice given in the manner set forth in Section 3.3 (a “Redemption Notice”), if (i) on the date that the Company gives such Redemption Notice, the Closing Sale Price of the Common Stock exceeds 175% of the Conversion Price for at least 20 Trading Days in the 30 consecutive Trading Day period, including the last day of the period, ending on the Trading Day immediately prior to the date the Company delivers the Redemption Notice, appropriately adjusted to take into account the occurrence, during such 30 Trading Day period, of any event described in Sections 4.6 and 4.11 and (ii) on the date that the Company delivers such Redemption Notice through the Redemption Date, the Common Stock issuable upon conversion of the Securities is either (1) covered by a registration statement covering resales thereof that is effective and available for use and is expected to remain effective and available for use for the 30 days following the date of such Redemption Notice or (2) eligible to be resold by non-affiliates

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pursuant to Rule 144(k) under the Securities Act, at a Redemption Price equal to 100% of the principal amount of the Securities being redeemed, in each case, for cash in whole, or from time to time in part (which must be equal to $1,000 or any integral multiple thereof), plus accrued and unpaid interest (including any accrued and unpaid Liquidated Damages) to, but excluding, the Redemption Date; provided, that if the Redemption Date falls after a Regular Record Date and on or before the related Interest Payment Date, then the interest will be payable to the Holders in whose names the Securities were registered at the close of business on such Regular Record Date. Securities or portions of the Securities called for redemption may be converted by the Holder in accordance with the provisions of Article 4 until 5:00 p.m., New York City time, on the second Trading Day prior to the Redemption Date.

(b) If the Company elects to redeem Securities pursuant to this Section 3.1, it shall notify the Trustee at least 30 days prior to the Redemption Date as fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee) of the Redemption Date and the principal amount of Securities to be redeemed.

Section 3.2. Selection of Securities to Be Redeemed.

(a) If less than all of the Securities are to be redeemed, unless the procedures of the Depositary provide otherwise, the Trustee shall, at least 30 days but not more than 60 days prior to the Redemption Date, select the Securities to be redeemed. The Trustee shall make the selection from the Securities outstanding and not previously called for redemption by lot or, in its discretion, on a pro rata basis. Securities in denominations of $1,000 may only be redeemed in whole. The Trustee may select for redemption portions (equal to $1,000 or any integral multiple thereof) of the principal of Securities that have denominations larger than $1,000. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption.

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

Section 3.3. Notice of Redemption.

(a) At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail or cause to be mailed a Redemption Notice to each Holder of Securities to be redeemed at such Holder’s address as it appears on the Registrar’s books.

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

(1) the Redemption Date;

(2) the Redemption Price;

(3) briefly, the conversion rights of the Securities;

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

(5) the Conversion Price (including any adjustments thereto);

(6) that Securities called for redemption must be presented and surrendered to a Paying Agent to collect the Redemption Price;

(7) that Holders who wish to convert Securities into Cash and Common Stock (if any) pursuant to Article 4 of this Indenture must surrender such Securities for conversion no later than 5:00 p.m., New York City time, on the second Trading Day immediately preceding the Redemption Date and must satisfy the other requirements set forth in the Securities and Article 4 hereof;

(8) that, unless the Company defaults in making the payment of the Redemption Price, interest on Securities called for redemption shall cease to accrue on and after the Redemption Date and the only remaining right of the Holder shall be to receive payment of the Redemption Price payable to such Holder upon presentation and surrender to a Paying Agent of the Securities;

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

(10) the CUSIP number of the Securities.

If any of the Securities to be redeemed is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the procedures of the Depositary applicable to redemptions. At the Company’s written request, which request shall set forth all relevant information required by clauses (1) through (10) of Subsection 3.3(b), the Trustee shall give the notice of redemption to each Holder in the Company’s name and at the Company’s expense.

Section 3.4. Effect of Notice of Redemption.

Once notice of redemption is mailed, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price payable upon redemption, except for Securities that are converted in accordance with the provisions of Article 4. On or after the Redemption Date and upon presentation and surrender to a Paying Agent, Securities called for redemption shall be paid at the Redemption Price; provided, that if the Redemption Date falls after a Regular Record Date and on or before the related Interest Payment Date, then interest on the Securities will be payable to the Holders in whose names the Securities are registered at the close of business on such Regular Record Date.

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Section 3.5. Deposit of Redemption Price.

Prior to 11:00 a.m., New York City time, on the Redemption Date, the Company shall deposit with a Paying Agent (or, if the Company acts as Paying Agent, shall segregate and hold in trust) an amount of money (in immediately available funds if deposited on such Redemption Date) sufficient to pay the Redemption Price of all Securities to be redeemed on that date, other than Securities or portions thereof called for redemption on that date which have been delivered by the Company to the Trustee for cancellation or have been converted. The Paying Agent shall as promptly as practicable return to the Company any money not required for that purpose because of the conversion of Securities pursuant to Article 4 or, if such money is then held by the Company in trust and is not required for such purpose, it shall be discharged from the trust.

Section 3.6. Securities Redeemed in Part.

Upon presentation and surrender of a Security that is redeemed in part, the Company shall execute and the Trustee shall authenticate and deliver to the Holder a new Security equal in principal amount to the unredeemed portion of the Security surrendered.

Section 3.7. [Reserved].

Section 3.8. Repurchase of Securities at Option of the Holder on Specified Date.

(a) All or any portion of the Securities of any Holder equal to $1,000 or an integral multiple of $1,000 shall be repurchased by the Company, at the option of such Holder, on November 15, 2010 (the “Repurchase Date”) at a purchase price equal to 100% of the principal amount of the Securities to be repurchased together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Repurchase Date (the “Repurchase Price”); provided, however, if the Repurchase Date falls after a Regular Record Date but on or before the related Interest Payment Date, then the interest on the Securities payable on such date shall be payable to the Holders in whose name the Securities were registered at the close of business on such Regular Record Date.

(b) Not more than 60 days and not less than 30 days prior to the Repurchase Date, the Company, or, at the written request and expense of the Company, the Trustee, shall mail a written notice of the Repurchase Date (the “Company Notice”) to the Trustee (if the Trustee does not mail such notice) and to each Holder (and to beneficial owners as required by applicable law). The notice shall include the form of a Repurchase Notice to be completed by the Holder and shall state:

(1) the date by which a Repurchase Notice pursuant to this Section 3.8 must be given;

(2) the Repurchase Date:

(3) the Repurchase Price;

(4) the Holder’s right to require the Company to repurchase the Securities;

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(5) briefly, the conversion rights of the Securities;

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

(7) the Conversion Price (including any adjustments thereto);

(8) that Securities as to which a Repurchase Notice has been given may be converted into Cash and Common Stock (if any) pursuant to Article 4 of this Indenture only to the extent that the Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

(9) that, unless the Company defaults in making the payment of the Repurchase Price, interest on Securities called for repurchase shall cease to accrue on and after the Repurchase Date and the only remaining right of the Holder shall be to receive payment of the Repurchase Price payable to such Holder upon presentation and surrender to a Paying Agent of the Securities;

(10) the procedures that the Holder must follow to exercise rights under this Section 3.8;

(11) the procedures for withdrawing a Repurchase Notice, including a form of notice of withdrawal;

(12) that the Holder must satisfy the requirements set forth in the Securities and Article 4 hereof in order to convert the Securities; and

(13) the CUSIP number of the Securities.

If any of the Securities is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the procedures of the Depositary applicable to the purchase of Global Securities.

(c) A Holder may exercise its rights specified in this Section 3.8 upon delivery of a written notice (which shall be in substantially the form included in Exhibit A hereto and which may be delivered by letter, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, may be delivered electronically or by other means in accordance with the Depositary’s customary procedures) of the exercise of such rights (a “Repurchase Notice”) to any Paying Agent at any time prior to the close of business on the second Trading Day next preceding the Repurchase Date.

(1) The delivery of such Security to any Paying Agent (together with all necessary endorsements) at the office of such Paying Agent shall be a condition to the receipt by the Holder of the Repurchase Price therefor.

(2) The Company shall only be obliged to repurchase, pursuant to this Section 3.8, a portion of a Security if the principal amount of such portion is $1,000 or

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an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

(3) Notwithstanding anything herein to the contrary, any Holder delivering to a Paying Agent the Repurchase Notice contemplated by this Subsection 3.8(c) shall have the right to withdraw such Repurchase Notice in whole or in a portion thereof that is a principal amount of $1,000 or in an integral multiple thereof at any time prior to 5:00 p.m., New York City time, on the second Trading Day next preceding the Repurchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 3.11.

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

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

Section 3.9. Repurchase of Securities at Option of the Holder Upon Redemption of Series B Preferred Stock.

(a) If at any time that Securities remain outstanding the Company shall redeem any shares of its outstanding 2.5% Series B Convertible Preferred Stock, par value $0.001 per share (“Series B Preferred Stock”), all or any portion of the Securities of any Holder equal to $1,000 or an integral multiple of $1,000 shall be repurchased by the Company, at the option of such Holder, on the date of the Series B Preferred Stock redemption (the “Preferred Redemption Repurchase Date”) at a purchase price equal to 100% of the principal amount of the Securities to be repurchased together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Preferred Redemption Repurchase Date (the “Preferred Redemption Repurchase Price”); provided, however, that if less than all of the outstanding shares of Series B Preferred Stock are redeemed by the Company, the Company shall not be obligated to redeem any portion of the Securities of any Holder in excess of the amount determined by multiplying the aggregate principal amount of Securities then held by such Holder by a fraction (the “Redemption Fraction”) of which the numerator shall be the number of shares of Series B Preferred Stock redeemed by the Company and of which the denominator shall be the total number of shares of Series B Preferred Stock outstanding at the time of such redemption; and, provided, further, if the Preferred Redemption Repurchase Date falls after a Regular Record Date but on or before the related Interest Payment Date, then the interest on the Securities payable on such date shall be payable to the Holders in whose name the Securities were registered at the close of business on such Regular Record Date.

(b) Not more than 60 days and not less than 30 days prior to the Preferred Redemption Repurchase Date, the Company, or, at the written request and expense of the Company, the Trustee, shall mail a written notice of the Preferred Redemption Repurchase Date (the “Preferred Redemption Company Notice”) to the Trustee (if the Trustee does not mail such notice) and to each Holder (and to beneficial owners as required by applicable law). The

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notice shall include the form of a Preferred Redemption Repurchase Notice to be completed by the Holder and shall state:

(1) the date by which a Preferred Redemption Repurchase Notice pursuant to this Section 3.9 must be given;

(2) the Preferred Redemption Repurchase Date;

(3) the Preferred Redemption Repurchase Price;

(4) the Holder’s right to require the Company to repurchase the Securities and the applicable Redemption Fraction;

(5) briefly, the conversion rights of the Securities;

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

(7) the Conversion Price (including any adjustments thereto);

(8) that Securities as to which a Preferred Redemption Repurchase Notice has been given may be converted into Cash and Common Stock (if any) pursuant to Article 4 of this Indenture only to the extent that the Preferred Redemption Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

(9) that, unless the Company defaults in making the payment of the Preferred Redemption Repurchase Price, interest on Securities called for repurchase shall cease to accrue on and after the Preferred Redemption Repurchase Date and the only remaining right of the Holder shall be to receive payment of the Preferred Redemption Repurchase Price payable to such Holder upon presentation and surrender to a Paying Agent of the Securities;

(10) the procedures that the Holder must follow to exercise rights under this Section 3.9;

(11) the procedures for withdrawing a Preferred Redemption Repurchase Notice, including a form of notice of withdrawal;

(12) that the Holder must satisfy the requirements set forth in the Securities and Article 4 hereof in order to convert the Securities; and

(13) the CUSIP number of the Securities.

If any of the Securities is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the procedures of the Depositary applicable to the purchase of Global Securities.

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(c) A Holder may exercise its rights specified in this Section 3.9 upon delivery of a written notice (which shall be in substantially the form included in Exhibit A hereto and which may be delivered by letter, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, may be delivered electronically or by other means in accordance with the Depositary’s customary procedures) of the exercise of such rights (a “Preferred Redemption Repurchase Notice”) to any Paying Agent at any time prior to the close of business on the second Trading Day next preceding the Preferred Redemption Repurchase Date.

(1) The delivery of such Security to any Paying Agent (together with all necessary endorsements) at the office of such Paying Agent shall be a condition to the receipt by the Holder of the Preferred Redemption Repurchase Price therefor.

(2) The Company shall only be obliged to repurchase, pursuant to this Section 3.9, a portion of a Security if the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

(3) Notwithstanding anything herein to the contrary, any Holder delivering to a Paying Agent the Preferred Redemption Repurchase Notice contemplated by this Subsection 3.9(c) shall have the right to withdraw such Preferred Redemption Repurchase Notice in whole or in a portion thereof that is a principal amount of $1,000 or in an integral multiple thereof at any time prior to 5:00 p.m., New York City time, on the second Trading Day next preceding the Preferred Redemption Repurchase Date by delivery of a written notice of withdrawal to a Paying Agent in accordance with Section 3.11.

(4) A Paying Agent shall promptly notify the Company of the receipt by it of any Preferred Redemption Repurchase Notice or written withdrawal thereof.

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

Section 3.10. Repurchase of Securities at Option of the Holder Upon Fundamental Change.

(a) If at any time that Securities remain outstanding there shall have occurred a Fundamental Change, all or any portion of the Securities of any Holder equal to $1,000 or an integral multiple of $1,000 shall be repurchased by the Company (a “Fundamental Change Repurchase”), at the option of such Holder, at a purchase price equal to 100% of the principal amount of the Securities to be repurchased, together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Fundamental Change Repurchase Date (the “Fundamental Change Repurchase Price”), payable in cash, subject to satisfaction by or on behalf of the Holder of the requirements set forth in Section 3.10(d); provided, however, if the Fundamental Change Repurchase Date falls after a Regular Record Date but on or before the related Interest Payment Date, then the interest on the Securities payable on such date shall be

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payable to the Holders in whose name the Securities were registered at the close of business on such Regular Record Date. “Fundamental Change Repurchase Date” means the Effective Date for a Fundamental Change; provided, however, that with respect to any Securities for which a Fundamental Change Repurchase Notice has been delivered after the Effective Date and during the Fundamental Change Conversion/Repurchase Period, the Fundamental Change Repurchase Date with respect to such Securities shall mean the date that is three (3) Business Days following the end of the Fundamental Change Conversion/Repurchase Period. “Fundamental Change Conversion/Repurchase Period” means the period beginning upon receipt of the Fundamental Change Company Notice (or, for purposes of Section 4.1(b)(5), the period beginning upon receipt of the Notice of Convertibility) and ending thirty (30) Trading Days after the Effective Date.

(b) For purposes of this Indenture, the following terms shall have the following meanings:

A “Fundamental Change” shall mean the occurrence of a Change in Control or a Termination of Trading.

A “Change in Control” shall be deemed to have occurred if any of the following occurs after the date hereof:

(1) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the Company’s assets to any person or group of related persons (other than to any of the Company’s wholly owned Subsidiaries);

(2) the approval by the holders of the Company’s Capital Stock of any plan or proposal for the liquidation or dissolution of the Company;

(3) if any person or group shall become the beneficial owner, directly or indirectly, of shares representing more than 50% of the aggregate ordinary voting power represented by issued and outstanding voting stock of the Company;

(4) at any time the following persons cease for any reason to constitute a majority of the Company’s Board of Directors: (i) individuals who on the date hereof constituted the Company’s Board of Directors; (ii) any new directors who are elected to the Company’s Board of Directors by the holders of the Series B Preferred Stock; and (iii) any other new directors whose appointment to the Company’s Board of Directors or whose nomination for election by the Company’s stockholders was approved by at least a majority of the directors of the Company then still in office either (A) who were directors of the Company on the date hereof, (B) were elected to the Company’s Board of Directors by the holders of the Series B Preferred Stock or (C) whose appointment or nomination for election was previously so approved; or

(5) any consolidation or merger by the Company where persons who are beneficial owners, directly or indirectly, of the Company’s shares of voting stock immediately prior to such transaction no longer beneficially own, directly or indirectly, at

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least a majority of the aggregate ordinary voting power represented by issued and outstanding voting stock of the continuing or surviving corporation or entity.

For purposes of the definition of Change in Control: (i) “person” or “group” have the meanings given to them for purposes of Sections 13(d) and 14(d) of the Exchange Act or any successor provisions, and the term “group” includes any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act (or any successor provision); (ii) a “beneficial owner” will be determined in accordance with Rule 13d-3 under the Exchange Act, as in effect on the date of this Indenture; (iii) “beneficially owned” and “beneficially own” have meanings correlative to that of beneficial owner; and (iv) “voting stock” means any class or classes of Capital Stock pursuant to which the holders of Capital Stock under ordinary circumstances have the power to vote in the election of the board of directors, managers or trustees of any person or other persons performing similar functions irrespective of whether or not, at the time, Capital Stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency.

Notwithstanding anything in this Indenture to the contrary, a merger or consolidation shall not be deemed to constitute a “Change in Control” if at least 90% of the consideration (excluding cash payments for fractional shares and cash payments pursuant to dissenters’ appraisal rights) in the merger or consolidation consists of shares of Capital Stock or American Depositary Shares that are (A) listed on, or immediately after the transaction will be listed on, the New York Stock Exchange or (B) approved, or immediately after the transaction will be approved, for quotation on the Nasdaq National Market, and as a result of such transaction the Daily Net Share Settlement Value (if any) of any Securities surrendered for conversion would be in the form of such publicly traded securities (the “90% Condition”).

A “Termination of Trading” means that the Common Stock or other securities into which the Securities are convertible are neither listed for trading on a U.S. national securities exchange nor approved for listing on the Nasdaq National Market, the Nasdaq Capital Market or any similar U.S. system of automated dissemination of quotations of securities prices, and no American Depositary Shares or similar instruments for such Common Stock or other securities are so listed or approved for listing in the United States on any such exchange or automated quotation system.

(c) Within 10 Business Days after the Company knows or reasonably should know that a Fundamental Change will occur, the Company, or, at the written request and expense of the Company, the Trustee, shall mail a written notice of the Fundamental Change (the “Fundamental Change Company Notice”) to the Trustee (if the Trustee does not mail such notice) and to each Holder (and to beneficial owners as required by applicable law). The notice shall include the form of a Fundamental Change Repurchase Notice to be completed by the Holder and shall state:

(1) the anticipated Effective Date of such Fundamental Change and, briefly, the events causing such Fundamental Change;

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(2) the date by which the Fundamental Change Repurchase Notice pursuant to this Section 3.10 must be given (assuming the anticipated Effective Date stated pursuant to clause (1) above);

(3) the Fundamental Change Repurchase Date (assuming the anticipated Effective Date stated pursuant to clause (1) above), both as to a Fundamental Change Repurchase Notice provided prior to the Effective Date and a Fundamental Change Repurchase Notice provided after the Effective Date and during the Fundamental Change Conversion/Repurchase Period;

(4) the anticipated Fundamental Change Repurchase Price;

(5) the Holder’s right to require the Company to repurchase the Securities;

(6) briefly, the conversion rights of the Securities;

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

(8) the Conversion Price (including any adjustments thereto);

(9) that Securities as to which a Fundamental Change Repurchase Notice has been given may be converted into Cash and Common Stock (if any) pursuant to Article 4 of this Indenture only to the extent that the Fundamental Change Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

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

(11) the procedures for withdrawing a Fundamental Change Repurchase Notice, including a form of notice of withdrawal;

(12) that, unless the Company defaults in making the payment of the Fundamental Change Repurchase Price or any applicable Make-Whole Premium, Securities covered by any Fundamental Change Purchase Notice will cease to be outstanding and interest and Liquidated Damages, if any, will cease to accrue on and after the Fundamental Change Purchase Date;

(13) the CUSIP number of the Securities;

(14) that the Holder must satisfy the requirements set forth in the Securities and Article 4 hereof in order to convert the Securities; and

(15) that a Make-Whole Premium is required to be paid by the Company upon any conversion in connection with a Fundamental Change.

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If any of the Securities is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the procedures of the Depositary applicable to the purchase of Global Securities.

(d) A Holder may exercise its rights specified in this Section 3.10 upon delivery of a written notice (which shall be in substantially the form included in Exhibit A hereto and which may be delivered by letter, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, may be delivered electronically or by other means in accordance with the Depositary’s customary procedures) of the exercise of such rights (a “Fundamental Change Repurchase Notice”) to any Paying Agent at any time prior to the close of business on the second Trading Day next preceding a Fundamental Change Repurchase Date.

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

(2) The Company shall only be obliged to repurchase, pursuant to this Section 3.10, a portion of a Security if the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

(3) Notwithstanding anything herein to the contrary, any Holder delivering to a Paying Agent the Fundamental Change Repurchase Notice contemplated by this Subsection 3.10(d) shall have the right to withdraw such Fundamental Change Repurchase Notice in whole or in a portion thereof that is a principal amount of $1,000 or in an integral multiple thereof at any time prior to 5:00 p.m., New York City time, on the second Trading Day next preceding the Fundamental Change Repurchase Date by delivery of a written notice of withdrawal to a Paying Agent in accordance with Section 3.11.

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

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

Section 3.11. Effect of Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice; Withdrawal of Notice.

(a) Upon receipt by any Paying Agent of a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, the Holder of the Security in respect of which such Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, was given shall (unless such Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice is withdrawn as specified below) thereafter be entitled to receive the Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Repurchase

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Price with respect to such Security. Such Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Repurchase Price shall be paid to such Holder promptly following the later of (1) the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, with respect to such Security (provided that the conditions in Subsection 3.8(c), Subsection 3.9(c) or Subsection 3.10(d), as applicable, have been satisfied) and (2) the time of delivery of such Security to a Paying Agent by the Holder thereof in the manner required by Subsection 3.8(c), Subsection 3.9(c) or Subsection 3.10(d), as applicable. Securities in respect of which a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, has been given by the Holder thereof may not be converted into Cash and Common Stock (if any) pursuant to Article 4 on or after the date of the delivery of such Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, unless such Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice has first been validly withdrawn.

(b) A Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, may be withdrawn by means of a written notice (which may be delivered by mail, overnight courier, hand delivery, facsimile transmission or in any other written form and, in the case of Global Securities, may be delivered electronically or by other means in accordance with the Depositary’s customary procedures) of withdrawal delivered by the Holder to a Paying Agent at any time prior to 5:00 p.m., New York City time, on the second Trading Day immediately preceding the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, specifying the principal amount of the Security or portion thereof (which must be a principal amount of $1,000 or an integral multiple of $1,000 in excess thereof) with respect to which such notice of withdrawal is being submitted.

Section 3.12. Deposit of Repurchase Price, Preferred Redemption Repurchase Price or or Fundamental Change Repurchase Price.

(a) On or before 11:00 a.m., New York City time, on the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, the Company shall deposit with the Trustee or with a Paying Agent (other than the Company or an Affiliate of the Company) an amount of money (in immediately available funds if deposited on such Repurchase Date, Preferred Redemption Repurchase Date or Fundamental Change Repurchase Date) sufficient to pay the aggregate Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Repurchase Price, as the case may be, of all the Securities or portions thereof that are to be repurchased as of such Repurchase Date, Preferred Redemption Repurchase Date or Fundamental Change Repurchase Date, as the case may be. 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; provided, that such deposit shall be made in a manner such that the Trustee or a Paying Agent shall have immediately available funds on the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be.

(b) If a Paying Agent holds, in accordance with the terms hereof, money sufficient to pay the Repurchase Price, the Preferred Redemption Repurchase Price or the

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Fundamental Change Repurchase Price, as the case may be, of any Security for which a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, has been tendered and not withdrawn in accordance with this Indenture, then, on the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, such Security will cease to be outstanding and the rights of the Holder in respect thereof shall terminate (other than the right to receive the Repurchase Price, the Preferred Redemption Repurchase Price or the Fundamental Change Repurchase Price as aforesaid). The Company shall publicly announce the principal amount of Securities repurchased on or as soon as practicable after the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be.

(c) To the extent that the aggregate amount of cash deposited by the Company pursuant to this Section 3.12 exceeds the aggregate Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Repurchase Price, as the case may be, of the Securities or portions thereof that the Company is obligated to repurchase, then promptly after the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, the Trustee or a Paying Agent, as the case may be, shall return any such excess cash to the Company.

Section 3.13. Securities Repurchased in Part.

Any Security that is to be repurchased only in part shall be surrendered at the office of a Paying Agent, and promptly after the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, of such authorized denomination or denominations as may be requested by such Holder, in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Security so surrendered that is not repurchased.

Section 3.14. Compliance with Securities Laws Upon Repurchase of Securities.

In connection with any offer to repurchase Securities under Section 3.8, 3.9 or 3.10, the Company shall (a) comply with Rule 13e-4 and Rule 14e-1 (or any successor to either such Rule), if applicable, under the Exchange Act, (b) file the related Schedule TO (or any successor or similar schedule, form or report) if required under the Exchange Act, and (c) otherwise comply with all federal and state securities laws in connection with such offer to repurchase Securities, all so as to permit the rights of the Holders and obligations of the Company under Sections 3.8 through 3.13 to be exercised in the time and in the manner specified therein.

ARTICLE 4.

CONVERSION

Section 4.1. Conversion Privilege.

(a) Subject to the further provisions of this Article 4 and paragraph 8 of the Securities, a Holder of a Security may convert the principal amount of such Security (or any

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portion thereof equal to $1,000 or any integral multiple of $1,000 in excess thereof) into Cash and Common Stock (if any) under the circumstances and during the periods set forth in Sections 4.1(b), 4.1(c) and 4.1(d) at the Conversion Price then in effect; provided, however, that, if such Security is submitted for redemption or repurchase pursuant to Article 3, such conversion right shall terminate at the close of business on the second Trading Day immediately preceding the Redemption Date, the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, for such Security or such earlier date as the Holder presents such Security for redemption or repurchase (unless the Company shall default in making the Redemption Price, Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Purchase Price payment when due, in which case the conversion right shall terminate at the close of business on the date such default is cured and such Security is redeemed or repurchased).

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

A Security in respect of which a Holder has delivered a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice pursuant to Subsection 3.8(c), Subsection 3.9(c) or Subsection 3.10(d), as applicable, exercising the option of such Holder to require the Company to repurchase such Security may be converted only if such Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, is withdrawn by a written notice of withdrawal delivered to a Paying Agent prior to 5:00 p.m., New York City time, on the second Trading Day immediately preceding the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Repurchase Date, as the case may be, in accordance with Section 3.11.

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

(b) At any time prior to the close of business on May 15, 2010, Holders may convert their Securities only upon the occurrence of one of the following events or as provided in Section 4.1(c):

(1) if a Security has been called for redemption pursuant to Article 3 hereof, a holder may surrender such Security for conversion at any time prior to 5:00 p.m., New York City time, on the second Trading Day immediately preceding the Redemption Date for such Security;

(2) if, after any five consecutive Trading Day period, the average of the Trading Prices for the Securities for that five-Trading Day period was less than 98% of the average of the Conversion Values for the Securities during that period, a Holder may surrender Securities for conversion at any time during the 10 Trading Days following the later of (A) such five-Trading Day period and (B) the date the Holder receives a Notice of Convertibility relating thereto. If a Holder provides the Company with reasonable evidence that the Trading Price for the Securities is less than 98% of the Conversion Value for the Securities, the Company shall require the Conversion Agent to determine the Trading Price

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of the Securities for each of the five consecutive Trading Days immediately after the Company receives such evidence. In the event that the average of the Trading Prices of the Securities during such five consecutive Trading Day period is less than 98% of the average of the Conversion Values for the Securities during such five consecutive Trading Day period, the Company shall require the Conversion Agent to determine the Trading Prices for the Securities on each successive Trading Day until the Trading Day ending any five consecutive Trading Day period during which the average of the Trading Price for the Securities is greater than or equal to 98% of the average of the Conversion Values for the Securities during such five consecutive Trading Day period;

(3) in the event that the Company declares a dividend or distribution of any rights or warrants to all holders of Common Stock entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the Current Market Price per share (as defined in Section 4.6(g)) on the record date for such dividend or distribution (other than a distribution of rights by the Company to its stockholders pursuant to the Company’s Rights Agreement, dated as of January 17, 2002 and amended on April 27 and April 28, 2004, between the Company and Mellon Investor Services LLC, as Rights Agent, and any successor or similar stockholders rights plan until the occurrence of a triggering event under such plan), then the Securities may be surrendered for conversion beginning on the date the Company gives notice to the Holders of such right, which shall not be less than 30 days prior to the ex-dividend time for such dividend or distribution, until the earlier of the close of business on the Business Day prior to the ex-dividend time or until the Company announces that such distribution will not take place;

(4) in the event that the Company declares a dividend or distribution of cash, debt securities (or other evidences of indebtedness) or other assets to all holders of Common Stock where the fair market value of such dividend or distribution per share of Common Stock, as determined in this Indenture, exceeds 10% of the Current Market Price of the Common Stock as of the Trading Day immediately prior to the date of declaration for such dividend or distribution, then the Securities may be surrendered for conversion beginning on the date the Company gives notice to the Holders of such right, which shall not be less than 30 days prior to the ex-dividend time for such dividend or distribution, until the earlier of the close of business on the Business Day prior to the ex-dividend time or until the Company announces that such distribution will not take place; or

(5) if any event constituting a Fundamental Change (without regard to the 90% Condition) occurs, the Securities may be surrendered for conversion during the Fundamental Change Conversion/Repurchase Period.

(c) At any time after May 15, 2008 and prior to the close of business on May 15, 2010, Holders may surrender their Securities for conversion during any Fiscal Quarter (and only during such Fiscal Quarter) if the Closing Sale Price is equal to or greater than 150% of the Conversion Price then in effect for at least 20 Trading Days in the 30 consecutive Trading Day period ending on the last Trading Day of the immediately preceding Fiscal Quarter (it being understood for purposes of this Section 4.1(c ) that the Conversion Price in effect at the close of business on each of the 30 consecutive Trading Days should be used).

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(d) Holders may surrender their Securities for conversion at any time on or after May 15, 2010 and prior to the close of business on the Business Day immediately preceding the Final Maturity Date.

Whenever the Securities shall become convertible pursuant to this Section 4.1, the Company or, at the Company’s request, the Trustee (or other Conversion Agent appointed by the Company) in the name and at the expense of the Company, shall promptly notify the Holders in writing (a “Notice of Convertibility”) of the event triggering such convertibility in the manner provided in Section 12.2, and the Company shall also publicly announce such information and publish it on the Company’s web site. Such written Notice of Convertibility and public announcement shall include:

(1) a description of such event;

(2) the periods during which the Securities shall be convertible as provided in this Article 4 as a result of such event;

(3) the name and address of each Conversion Agent;

(4) the procedures that the Holder must follow to convert their Securities in accordance with this Article 4; and

(5) whether a Make-Whole Premium shall be payable upon conversion of the Securities in connection with such event.

Section 4.2. Conversion Procedure.

(a) The right to convert any Security may be exercised, if such Security is represented by a Global Security, by book-entry transfer to the Conversion Agent (which initially shall be the Trustee) through the facilities of the Depositary in accordance with the Applicable Procedures or, if such Security is represented by a Certificated Security, by delivery of such Security at the specified office of the Conversion Agent, accompanied, in either case, by (a) a completed and duly signed conversion notice, in the form as set forth on the reverse of Security attached hereto as Exhibit A (a “Conversion Notice”); (b) if the Security is represented by a Certificated Security and such Certificated Security has been lost, stolen, destroyed or mutilated, a notice to the Conversion Agent in accordance with Section 2.7 regarding the loss, theft, destruction or mutilation of such Security; (c) appropriate endorsements and transfer documents if required by the Conversion Agent; and (d) payment of any tax or duty, in accordance with Section 4.4, which may be payable in respect of any transfer involving the issue or delivery of the Common Stock in the name of a Person other than the Holder of the Security. The “Conversion Date” shall be the Business Day on which the Holder satisfies all of the requirements set forth in the immediately preceding sentence, if all such requirements shall have been satisfied by 5:00 p.m., New York City time, on such day, and in all other cases, the Conversion Date shall be the next succeeding Business Day; provided, however, that if a Holder surrenders for conversion a Security at any time after the twenty-fifth scheduled Trading Day prior to the Final Maturity Date, the Conversion Date shall be deemed to be the Business Day immediately preceding such Security’s Final Maturity Date. On the third Business Day following the last day of the related Conversion Period, subject to Section 4.5, the Company

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shall deliver to the Holder through a Conversion Agent, (i) (A) provided the Conversion Agent is participating in DTC’s Fast Automated Securities Transfer Program, such aggregate number of whole shares of Common Stock to which the applicable Holder shall be entitled to such Holder’s or its nominee’s or nominees’ balance account with DTC through its Deposit Withdrawal Agent Commission system or (B) if the Conversion Agent is not participating in the DTC’s Fast Automated Securities Transfer Program, certificates for the number of whole shares of Common Stock, if any, to which such Holder or such Holder’s nominee or nominees shall be entitled and (ii) and cash (including cash in lieu of any fractional shares pursuant to Section 4.3).

(b) The person in whose name the shares of Common Stock issued upon conversion is registered shall be deemed to be a stockholder of record on the Conversion Date; provided, however, that no surrender of a Security on any date when the stock transfer books of the Company shall be closed shall be effective to constitute the person or persons entitled to receive the shares of Common Stock upon such conversion as the record holder or holders of such shares of Common Stock on such date, but such surrender shall be effective to constitute the person or persons entitled to receive such shares of Common Stock as the record holder or holders thereof for all purposes at the close of business on the next succeeding day on which such stock transfer books are open. Upon conversion of a Security, such person shall no longer be a Holder of such Security. No payment or adjustment will be made for dividends or distributions on shares of Common Stock issued upon conversion of a Security.

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

(d) The Company shall not effect any conversion of a Security, and no Holder or any holder of an interest in a Security shall have the right to convert any portion of such Security, to the extent that after giving effect to such conversion, such Holder or holder (together with such Holder’s or holder’s affiliates) would beneficially own in excess of 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to such conversion (the “Conversion Limitation”). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by such Holder or holder of an interest in a Security and its affiliates shall include the number of shares of Common Stock issuable upon conversion of a Security with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) conversion of the remaining, nonconverted portion of any Security beneficially owned by such Holder or holder or any of its affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by such Holder or holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act. For purposes of this Section 4.2(d), in determining the number of outstanding shares of Common Stock, such Holder or holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent annual, quarterly or current report on Form 10-K, 10-Q or Form 8-K, respectively, as the case may be; (y) a more recent public announcement by the Company or (z) any other notice by the Company setting forth the number of shares of Common Stock outstanding. For any reason at any time,

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upon the written or oral request of a Holder or a holder of an interest in a Security, the Company shall within two Business Days confirm orally and in writing to such Holder or holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including any Security, by such Holder or holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. By written notice to the Company, any Holder or holder of an interest in a Security may increase or decrease the Conversion Limitation to any other percentage not in excess of 9.99% specified in such notice; provided, that (i) any such increase will not be effective until the 61st day after such notice is delivered to the Company, and (ii) any such increase or decrease will apply only to the Holder or holder sending such notice and not to any other Holder or holder of Securities. Notwithstanding the foregoing, the Conversion Limitation shall not be applicable (i) on any of the ten Trading Days up to and including the Final Maturity Date, or (ii) on any of the ten Trading Days up to and including the Effective Date of a Fundamental Change or (iii) during the Fundamental Change Conversion/Repurchase Period.

(e) Until Stockholder Approval shall have been obtained, the Company may not (and shall not) issue or deliver more than 41.96 shares of Common Stock (subject to appropriate adjustment for any stock splits, stock dividends and similar events pursuant to subsection (a) of Section 4.6) (the “Conversion Shares Cap”) for each $1,000 principal amount of Securities upon conversion thereof pursuant to Section 4.5 and/or as payment of a Make-Whole Premium with respect to such $1,000 principal amount of Securities pursuant to Section 5.2 hereof. The provisions of this Section 4.2(e) shall limit solely the number of shares of Common Stock issuable in satisfaction of amounts owing by the Company in respect of the Conversion Obligation and the Make-Whole Premium upon conversion of the Securities (which amounts, to the extent they exceed the Conversion Shares Cap, shall be paid in cash as herein set forth) and shall in no way be construed as a limitation on the Conversion Price or Conversion Rate of the Securities or on the Company’s obligation to pay the Make-Whole Premium in accordance with the provisions of Article 5.

Section 4.3. Fractional Shares.

The Company will not issue fractional shares of Common Stock upon conversion of Securities. In lieu thereof, the Company will deliver a number of shares of Common Stock equal to the aggregate of the fractional shares otherwise deliverable for each Trading Day during the Conversion Period (rounding down to the nearest whole number) and cash equal to the remainder multiplied by the Volume Weighted Average Price of the Common Stock on the last day of the Conversion Period.

Section 4.4. Taxes on Conversion.

If a Holder converts a Security, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the issue of shares of Common Stock upon such conversion. However, the Holder shall pay any such tax which is due because the Holder requests the shares to be issued in a name other than the Holder’s name. The Conversion Agent may refuse to deliver the certificate representing the Common Stock being issued in a name other than the Holder’s name until the Conversion Agent receives a sum sufficient to pay any tax which will be

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due because the shares are to be issued in a name other than the Holder’s name. Nothing herein shall preclude any tax withholding required by law or regulation.

Section 4.5. Payment Upon Conversion.

(a) In the event that the Company receives a Holder’s Conversion Notice:

(1) For each $1,000 aggregate principal amount of Securities surrendered for conversion, the Company shall be required to pay to such Holder the sum of the following amounts (the “Conversion Obligation”) for each of the twenty Trading Days beginning on the third Trading Day following the Conversion Date (such twenty Trading Day period, a “Conversion Period”):

(A) if the Daily Conversion Value (as defined below) for such Trading Day for each $1,000 aggregate principal amount of Securities exceeds $50.00, (1) a Cash payment of $50.00 and (2) the remaining Daily Conversion Value (the “Daily Net Share Settlement Value”) in shares of Common Stock; or

(B) if the Daily Conversion Value for such Trading Day for each $1,000 aggregate principal amount of Securities is less than or equal to $50.00, a Cash payment equal to the Daily Conversion Value.

(C) For purposes of the foregoing and to give effect to the provisions of the penultimate sentence of Section 4.2(a), if a Holder surrenders for conversion a Security at any time after the twenty-fifth scheduled Trading Day immediately preceding the Final Maturity Date, (i) the Conversion Date will be deemed to be the Business Day immediately preceding the Final Maturity Date, (ii) the Conversion Period for such conversion will be the twenty Trading Day period commencing on the Trading Day immediately following the Final Maturity Date, and (iii) notwithstanding the provisions of the last sentence of Section 4.2 and in lieu of receiving any Cash payments or Common Stock pursuant to clauses (A) and (B) above, such Holder shall be entitled to receive on the Final Maturity Date a Cash payment of $1,000 per $1,000 aggregate principal amount of Securities surrendered and on the third Business Day following the last day of such Conversion Period such Holder shall be entitled to receive an amount of shares of Common Stock, if any, based on the sum of the Daily Net Share Settlement Values for each Trading Day during such Conversion Period.

(2) The amount to be paid to a converting Holder shall be computed in accordance with the following:

(A) The “Daily Conversion Value” for each Trading Day during the Conversion Period for each $1,000 aggregate principal amount of Securities is equal to one-twentieth of the product of the then applicable Conversion Rate multiplied by the Volume Weighted Average Price of the Common Stock (or such other form of consideration into which the Common Stock has been converted in accordance with the provisions of Section 4.11) on such Trading Day;

(B) The number of shares of Common Stock to be delivered under Section 4.5(a)(1)(A)(2) or 4.5(a)(1)(C) calculated on each Trading Day during the

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applicable Conversion Period, shall be determined by dividing the Daily Net Share Settlement Value by the Volume Weighted Average Price of the Common Stock (or such other form of consideration into which the Common Stock has been converted in accordance with the provisions of Section 4.11) for such Trading Day;

(C) For purposes of this Section 4.5, “Volume Weighted Average Price” per share of Common Stock (or any security into which the Common Stock has been converted in accordance with the provisions of Section 4.11) on any Trading Day means the volume weighted average price on the principal exchange or over-the-counter market on which the Common Stock (or such other security) is then listed or traded, from 9:30 a.m. to 4:00 p.m. (New York City time) on that Trading Day as reported by Bloomberg, or if such Volume Weighted Average Price is not available, the Board of Directors’ reasonable, good faith estimate of the volume weighted average price of the shares of Common Stock (or other security) on such Trading Day;

(D) Solely for purposes of valuing any non-cash consideration received by holders of Common Stock in any Change in Control, to the extent any component of such non-cash consideration is not listed on a U.S. national or regional securities exchange or reported on Nasdaq, the value of such non-cash consideration will be determined by two independent nationally recognized investment banks selected by the Trustee and, to the extent any component of such non-cash consideration is listed on a U.S. national or regional securities exchange or reported on Nasdaq, the value of such non-cash consideration will be determined by reference to its Volume Weighted Average Price.

(3) To the extent the Company is precluded from issuing shares of Common Stock under clause (1) of this Section 4.5(a) upon conversion of any Securities prior to obtaining Stockholder Approval due to the Conversion Shares Cap, then the Daily Conversion Value for any Trading Day during the applicable Conversion Period after the Conversion Shares Cap has been reached shall be paid by the Company in Cash.

(4) If such Conversion Notice shall be delivered upon a conversion in connection with a Fundamental Change pursuant to Section 4.1(b)(5), such Holder shall be entitled to receive, in addition to any Cash, shares of Common Stock or other forms of consideration provided for in clauses (1) and (2) of this Section 4.5(a), a Make-Whole Premium in accordance with Section 5.2. To the extent the Company is precluded from issuing shares of Common Stock as payment of a Make-Whole Premium upon conversion of any Securities prior to obtaining Stockholder Approval due to the Conversion Shares Cap, then the Make-Whole Premium shall be paid by the Company in Cash calculated by multiplying the number of shares of Common Stock otherwise payable as such Make-Whole Premium by the applicable Stock Price.

(b) The Company shall, prior to the issuance of any Securities hereunder, and from time to time as may be necessary, reserve at all times and keep available, free from preemptive rights, out of its authorized but unissued Common Stock, a sufficient number of shares of Common Stock deliverable upon conversion of all of the Securities (including after taking into account any adjustment to the Conversion Price pursuant to Section 4.6).

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(c) All shares of Common Stock that may be issued upon conversion of the Securities shall be newly issued shares, shall be duly authorized, validly issued, fully paid and nonassessable and shall be free of any preemptive rights and free of any lien or adverse claim.

(d) The Company shall endeavor to comply promptly with all applicable securities laws regulating the offer and delivery of any Common Stock upon conversion of Securities and shall list or cause to have quoted such shares of Common Stock on each national securities exchange or on Nasdaq or other over-the-counter market or such other market on which the Common Stock is then listed or quoted. Any Common Stock issued upon conversion of a Security hereunder which at the time of conversion was a Restricted Security shall also be a Restricted Security.

Section 4.6. Adjustment of Conversion Price.

The conversion price as stated in paragraph 8 of the Securities (the “Conversion Price”) shall be adjusted from time to time by the Company as follows:

(a) In case the Company shall pay a dividend on its Common Stock in shares of Common Stock or make a distribution on its Common Stock in shares of Common Stock, the Conversion Price in effect immediately prior to the record date for the determination of stockholders entitled to receive such dividend or distribution shall be decreased so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to such record date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on such record date and of which the denominator shall be the sum of the number of shares of Common Stock outstanding at the close of business on such record date plus the total number of shares of Common Stock constituting such dividend or other distribution. If the Company shall subdivide its outstanding Common Stock into a greater number of shares, or combine its outstanding Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to the day upon which such subdivision or combination becomes effective shall be, in the case of a subdivision of Common Stock, proportionately decreased and, in the case of a combination of Common Stock, proportionately increased. An adjustment made pursuant to this subsection (a) shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of subdivision or combination.

(b) In case the Company shall issue rights, options or warrants to all or substantially all holders of its Common Stock entitling them (for a period commencing no earlier than the record date described below and expiring not more than 60 days after such record date) to subscribe for or purchase shares of Common Stock (or securities convertible into or exercisable or exchangeable for Common Stock) at a price per share (or having a conversion, exercise or exchange price per share) less than the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 4.6) on the record date for the determination of stockholders entitled to receive such rights, options or warrants(or if no record date is fixed, the Business Day immediately prior to the date of announcement of such issuance) (treating the conversion, exercise or exchange price per share of the securities convertible into or exercisable or exchangeable for Common Stock as equal to (x) the sum of (i) the price for a unit of the security convertible into or exercisable or exchangeable for Common

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Stock and (ii) any additional consideration initially payable upon the conversion of such security into or exercise or exchange of such security for Common Stock divided by (y) the number of shares of Common Stock initially underlying such security), the Conversion Price in effect immediately prior thereto shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to such record date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on such record date (or if no record date is fixed, the date immediately prior to the date of announcement of such issuance) plus the number of shares which the aggregate offering price of the total number of shares of Common Stock so offered (or the aggregate conversion, exercise or exchange price of the securities so offered, which shall be determined by multiplying the number of shares of Common Stock issuable upon conversion, exercise or exchange of such securities by the applicable conversion, exercise or exchange price per share of Common Stock pursuant to the terms of such securities) would purchase at the Current Market Price per share (as defined in subsection (g) of this Section 4.6) of Common Stock on such record date, and of which the denominator shall be the number of shares of Common Stock outstanding on such record date (or if no record date is fixed, the date immediately prior to the date of announcement of such issuance) plus the number of additional shares of Common Stock offered (or into which the securities so offered are convertible, exchangeable or exercisable). Such adjustment shall be made successively whenever any such rights, options or warrants are issued and shall become effective immediately after such record date. If at the end of the period during which such rights, options or warrants are exercisable not all rights or warrants shall have been exercised, the adjusted Conversion Price shall be immediately readjusted to what it would have been based upon the number of additional shares of Common Stock actually issued (or the number of shares of Common Stock issuable upon conversion of convertible securities actually issued).

(c) In case the Company shall distribute to all or substantially all holders of its Common Stock any shares of capital stock of the Company (other than Common Stock), evidences of indebtedness or other non-cash assets (including securities of any person other than the Company but excluding (1) dividends or distributions paid exclusively in cash or (2) dividends or distributions referred to in subsection (a) of this Section 4.6), or shall distribute to all or substantially all holders of its Common Stock rights, options or warrants to subscribe for or purchase any of its securities (excluding those rights, options and warrants referred to in subsection (b) of this Section 4.6 and also excluding the distribution of rights to all holders of Common Stock pursuant to a Rights Plan (as defined below)), then in each such case the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the current Conversion Price by a fraction of which the numerator shall be the Current Market Price per share (as defined in subsection (g) of this Section 4.6) of the Common Stock on the record date mentioned below less the fair market value on such record date (as determined by the Board of Directors, whose determination shall be conclusive evidence of such fair market value and which shall be evidenced by an Officers’ Certificate delivered to the Trustee) of the portion of the capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights, options or warrants applicable to one share of Common Stock (determined on the basis of the number of shares of Common Stock outstanding on the record date), and of which the denominator shall be the Current Market Price per share (as defined in subsection (g) of this Section 4.6) of the Common Stock on such record date. Such adjustment shall be made successively whenever any such distribution is made and shall become effective

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immediately after the record date for the determination of shareholders entitled to receive such distribution.

In the event the then fair market value (as so determined) of the portion of the capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights or warrants applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on such record date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of a Security shall have the right to receive upon conversion the amount of capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights, options or warrants such Holder would have received had such Holder converted each Security on 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 which 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 4.6(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price of the Common Stock.

Notwithstanding the foregoing, if the securities distributed by the Company to all or substantially all holders of its Common Stock consist of capital stock of, or similar equity interests in, a Subsidiary or other business unit, the Conversion Price shall be decreased so that the same shall be equal to the rate determined by multiplying the Conversion Price in effect on the record date with respect to such distribution by a fraction the numerator of which shall be the average Closing Sale Price of one share of Common Stock over the Spinoff Valuation Period, and of which the denominator shall be the sum of (x) the average Closing Sale Price of one share of Common Stock over the ten consecutive Trading Day period (the “Spinoff Valuation Period”) commencing on and including the fifth Trading Day after the date on which “ex-dividend trading” commences on the Common Stock on the Nasdaq National Market or such other national or regional exchange or market on which the Common Stock is then listed or quoted and (y) the average Closing Sale Price over the Spinoff Valuation Period of the portion of the securities so distributed applicable to one share of Common Stock such adjustment to become effective immediately prior to the opening of business on the fifteenth Trading Day after the date on which “ex-dividend trading” commences.

In lieu of the foregoing, the Company may at the time of the public announcement of such distribution elect in a writing provided to the Trustee and the Holders to reserve the pro rata portion of such Securities so that each Holder of securities shall have the right to receive upon conversion the amount of such shares of capital stock or similar equity interests of such Subsidiary or business unit that such Holder of Securities would have received if such Holder of Securities had converted such Securities on the record date with respect to such distribution.

With respect to any rights under a preferred shares rights plan of the Company (“Rights Plan”), upon conversion of the Securities into Common Stock, to the extent that the Rights Plan is still in effect upon such conversion, the Holders of Securities will receive, in addition to the Common Stock, the rights described therein (whether or not the rights have separated from the Common Stock at the time of conversion), subject to the limitations set forth in any such Rights Plan (including such limitations as would be applicable to a Holder if the Holder is or becomes

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an “Acquiring Person” or “Adverse Person” as such terms are defined in the Rights Plan). If the Rights Plan provides that upon separation of rights under such plan from the Common Stock that the Holders would not be entitled to receive any such rights in respect of the Common Stock issuable upon conversion of the Securities, the Conversion Price will be adjusted as provided in this Section 4.6 (with such separation deemed to be the distribution of such rights), subject to readjustment in the event of the expiration, termination or redemption of the rights; provided, however, that there shall be no such adjustment in respect of any Holder that is or becomes an “Acquiring Person” or “Adverse Person” under the Rights Plan and, in the event an adjustment to the Conversion Price shall have already been made under this paragraph in respect of such separation of rights, it shall be readjusted and rescinded in respect of any Holder that is or becomes an “Acquiring Person” or “Adverse Person.” Any distribution of rights or warrants pursuant to a Rights Plan complying with the requirements set forth in the immediately preceding sentence of this paragraph shall not constitute a distribution of rights or warrants pursuant to this Section 4.6(c).

Rights, options or warrants (other than rights issued pursuant to a Rights Plan) distributed by the Company to all or substantially 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, options or warrants, until the occurrence of a specified event or events (“Trigger Event”): (i) are deemed to be transferred with such shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this Section 4.6 (and no adjustment to the Conversion Price under this Section 4.6 will be required) until the occurrence of the earliest Trigger Event, whereupon such rights, options and warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Price shall be made under this Section 4.6(c). If any such right, options or warrant, including any such existing rights, options or warrants distributed prior to the date of this Indenture, are subject to events, upon the occurrence of which such rights, options or warrants become exercisable to purchase different securities, evidences of indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and record date with respect to new rights, options or warrants with such rights (and a termination or expiration of the existing rights, options or warrants without exercise by any of the holders thereof). In addition, in the event of any distribution (or deemed distribution) of rights, options or warrants, or any Trigger Event or other event (of the type described in the preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Price under this Section 4.6 was made, (1) in the case of any such rights, options 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 or holders of Common Stock with respect to such rights, options or warrants (assuming such holder had retained such rights, options or warrants), made to all or substantially all holders of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights, options or warrants which shall have expired or been terminated without exercise by any holders thereof, the Conversion Price shall be readjusted as if such rights, options and warrants had not been issued.

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(d) In case the Company shall, by dividend or otherwise, at any time distribute (a “Triggering Distribution”), to all or substantially all holders of its Common Stock, Cash, the Conversion Price shall be reduced so that the same shall equal the price determined by dividing such Conversion Price in effect on the record date with respect to such Cash dividend or distribution by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 4.6) as of the day before the “ex” date with respect to the dividend or distribution, and the denominator shall be such Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 4.6) as of the day before the “ex” date with respect to the dividend or distribution less the amount per share of the Cash dividend or distribution, such decrease to become effective immediately prior to the opening of business on the day following the date on which the Triggering Distribution is paid; provided, however, that, in the event the portion of the Triggering Distribution applicable to one share of Common Stock is equal to or greater than the Current Market Price on such 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 the amount of Cash such Holder would have received had such Holder converted each Security on 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 effect if such dividend or distribution had not been declared.

(e) In case any tender offer made by the Company or any of its Subsidiaries for Common Stock shall expire and such tender offer (as amended upon the expiration thereof) shall involve the payment of aggregate consideration in an amount (determined as the sum of the aggregate amount of cash consideration and the aggregate fair market value (as determined by the Board of Directors, whose determination shall be conclusive evidence thereof and which shall be evidenced by an Officers’ Certificate delivered to the Trustee thereof) of any other consideration) that exceeds an amount equal to the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 4.6) as of the last date (the “Expiration Date”) tenders could have been made pursuant to such tender offer (as it may be amended) (the last time at which such tenders could have been made on the Expiration Date is hereinafter sometimes called the “Expiration Time”), then, immediately prior to the opening of business on the day after the Expiration 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 the Expiration Date by a fraction of which the numerator shall be the product of the number of shares of Common Stock outstanding (including tendered shares but excluding any shares held in the treasury of the Company) at the Expiration Time multiplied by the Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 4.6) on the Trading Day next succeeding the Expiration Date and the denominator shall be the sum of (x) the aggregate consideration (determined as aforesaid) payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender offer) of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares and excluding any shares held in the treasury of the Company) at the Expiration Time and the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 4.6) on the Trading Day next succeeding the Expiration Date, such reduction to become effective immediately prior to the opening of business

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on the day following the Expiration Date. In the event that the Company is obligated to purchase shares pursuant to any such tender offer, but the Company is permanently prevented by applicable law from effecting any or all such purchases or any or all such purchases are rescinded, the Conversion Price shall again be adjusted to be the Conversion Price which would have been in effect based upon the number of shares actually purchased. If the application of this Section 4.6(e) to any tender offer would result in an increase in the Conversion Price, no adjustment shall be made for such tender offer under this Section 4.6(e).

For purposes of this Section 4.6(e), the term “tender offer” shall mean and include both tender offers and exchange offers, all references to “purchases” of shares in tender offers (and all similar references) shall mean and include both the purchase of shares in tender offers and the acquisition of shares pursuant to exchange offers, and all references to “tendered shares” (and all similar references) shall mean and include shares tendered in both tender offers and exchange offers.

(f) In case the Company shall issue, prior to June 3, 2006, shares of Common Stock (or securities convertible into Common Stock) at a price per share (or having a conversion price per share) less than $13.45 (subject to adjustment in the same manner as the Conversion Price is adjusted pursuant to this Section 4.6) (treating the conversion price per share of the securities convertible into Common Stock as equal to (x) the sum of (i) the price for a unit of the security convertible into Common Stock and (ii) any additional consideration initially payable upon the conversion of such security into Common Stock divided by (y) the number of shares of Common Stock initially underlying such security), the Conversion Price in effect immediately prior thereto shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the date of such issuance by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on such date plus the number of shares which the aggregate issuance price of the total number of shares of Common Stock so issued (or the aggregate conversion price of the convertible securities so issued, which shall be determined by multiplying the number of shares of Common Stock issuable upon conversion of such convertible securities by the conversion price per share of Common Stock pursuant to the terms of such convertible securities) would purchase at $13.45 per share of Common Stock (subject to adjustment in the same manner as the Conversion Price is adjusted pursuant to this Section 4.6), and of which the denominator shall be the number of shares of Common Stock outstanding on such date plus the number of additional shares of Common Stock issued (or into which the convertible securities so issued are convertible). Such adjustment shall be made successively whenever any such Common Stock (or securities convertible into Common Stock) are issued and shall become effective immediately after issuance. If at the end of the period during which any such securities convertible into Common Stock are convertible not all such securities shall have been converted, the adjusted Conversion Price shall be immediately readjusted to what it would have been based upon the number of additional shares of Common Stock actually issued upon conversion of such convertible securities. Notwithstanding the foregoing provisions of this Section 4.6(f), (i) no adjustment to the Conversion Price shall be required to be made hereunder in respect of the first $25 million of Common Stock (or securities convertible into Common Stock) issued after the date hereof at a price per share (or having a conversion price per share) less than $13.45 (subject to adjustment in the same manner as the Conversion Price is adjusted pursuant to this Section 4.6), and (ii) no adjustment to the Conversion Price shall be required to be made hereunder unless a similar

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adjustment to the conversion price of the Series B Preferred Stock is required to be made under Sections 5(b)(iii) and 5(b)(iv) of the Certificate of Designations of the Series B Preferred Stock as in effect on the date hereof. The provisions of this Section 4.6(f) shall expire and be of no further force or effect on June 3, 2006. Until such time as the Company receives the Stockholder Approval, no adjustment shall be made pursuant to this Section 4.6(f) that shall cause the Conversion Price to be less than $13.4725 (subject to adjustment in the same manner as the Conversion Price is adjusted pursuant to Section 4.6(a) hereof) (the “Series B Limitation”); provided, however, upon receipt of the Stockholder Approval, any adjustment previously required pursuant to this Section 4.6(f) that was not made by reason of the Series B Limitation shall immediately take effect.

(g) For the purpose of any computation under subsections (b), (c), (d) or (e) of this Section 4.6, the current market price (the “Current Market Price”) shall mean, with respect to any date of determination, the average of the Closing Sale Prices per share of Common Stock for the ten consecutive Trading Days ending on the date of determination. For purposes hereof, the term “ex” date, when used with respect to any dividend 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 Sale Price was obtained without the right to receive such dividend or distribution.

(h) In any case in which this Section 4.6 shall require that an adjustment be made following a record date or Expiration Date, as the case may be, established for purposes of this Section 4.6, the Company may elect to defer (but only until five Business Days following the filing by the Company with the Trustee of the certificate described in Section 4.9) issuing to the Holder of any Security converted after such record date or Expiration Date the shares of Common Stock and other capital stock of the Company issuable upon such conversion over and above the shares of Common Stock and other capital stock of the Company issuable, or Cash payable, upon such conversion only on the basis of the Conversion Price prior to adjustment; and, in lieu of the shares the issuance of which, or Cash the payment of which, is so deferred, the Company shall issue or cause its transfer agents to issue due bills or other appropriate evidence prepared by the Company of the right to receive such shares or Cash, as the case may be. If any distribution in respect of which an adjustment to the Conversion Price is required to be made as of the record date or Expiration Date therefor is not thereafter made or paid by the Company for any reason, the Conversion Price shall be readjusted to the Conversion Price which would then be in effect if such record date had not been fixed or such effective date or Expiration Date had not occurred.

(i) For purposes of this Section 4.6, “record date” shall mean, with respect to any dividend, distribution or other transaction or event in which the holders of Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged or converted into any combination of cash, securities or other property, the date fixed for determination of stockholders entitled to receive such cash, security or other property (whether or not such date is fixed by the Board of Directors or by statute, contract or otherwise).

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Section 4.7. No Adjustment.

No adjustment in the Conversion Price shall be required unless the adjustment would require an increase or decrease of at least 1% in the Conversion Price as last adjusted; provided, however, that any adjustments which by reason of this Section 4.7 are not required to be made shall be carried forward and taken into account in any subsequent adjustment and, in any event, shall be carried forward and taken into account regardless of whether the aggregate adjustment is less than 1% upon the announcement by the Company of a Fundamental Change, upon any Repurchase Date, upon any notice of redemption of the Securities and at the Final Maturity Date. All calculations under this Article 4 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be.

Except as otherwise provided herein, no adjustment need be made for issuances of Common Stock pursuant to a Company plan for reinvestment of dividends or interest or for a change in the par value or a change to no par value of the Common Stock.

To the extent that the Securities become convertible into the right to receive cash, no adjustment need be made thereafter as to the cash. Interest will not accrue on the cash.

Section 4.8. Adjustment for Tax Purposes.

The Company shall be entitled to make such reductions in the Conversion Price, in addition to those required by Section 4.6, as it in its discretion shall determine to be advisable in order to avoid or diminish any tax to stockholders in connection with any stock dividends, subdivisions of shares, distributions of rights to purchase stock or securities or distributions of securities convertible into or exchangeable for stock hereafter made by the Company to its stockholders.

Section 4.9. Notice of Adjustment.

Whenever the Conversion Price or conversion privilege is adjusted, the Company shall promptly mail to Securityholders a notice of the adjustment and file with the Trustee an Officers’ Certificate briefly stating the facts requiring the adjustment and the manner of computing it. Unless and until the Trustee shall receive an Officers’ Certificate setting forth an adjustment of the Conversion Price, the Trustee may assume without inquiry that the Conversion Price has not been adjusted and that the last Conversion Price of which it has knowledge remains in effect.

Section 4.10. Notice of Certain Transactions.

In the event that:

(a) the Company takes any action which would require an adjustment in the Conversion Price;

(b) the Company consolidates or merges with, or transfers all or substantially all of its property and assets to, another corporation and stockholders of the Company must approve the transaction; or

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(c) there is a dissolution or liquidation of the Company,

the Company shall mail to Holders and file with the Trustee a notice stating the proposed record or effective date, as the case may be. The Company shall mail the notice at least 10 days before such proposed date. Failure to mail such notice or any defect therein shall not affect the validity of any transaction referred to in clause (a), (b) or (c) of this Section 4.10.

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

If any of the following shall occur, namely: (a) any reclassification or change of shares of Common Stock issuable upon conversion of the Securities (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, or any other change for which an adjustment is provided in Section 4.6); (b) any consolidation or merger or combination to which the Company is a party other than a merger in which the Company is the continuing corporation and which does not result in any reclassification of, or change (other than 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) in, outstanding shares of Common Stock; or (c) any sale or conveyance as an entirety or substantially as an entirety of the property and assets of the Company, directly or indirectly, to any person, then the Company, or such successor, purchasing or transferee corporation, as the case may be, shall, as a condition precedent to such reclassification, change, combination, consolidation, merger, sale or conveyance, execute and deliver to the Trustee a supplemental indenture providing that (A) the Holder of each Security then outstanding shall have the right to convert such Security into cash and, with respect to the portion of the Conversion Obligation in excess (if any) of the principal amount of Securities being converted, the kind and amount of shares of stock and other securities and property (including cash) receivable upon such reclassification, change, combination, consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock deliverable upon conversion of such Security immediately prior to such reclassification, change, combination, consolidation, merger, sale or conveyance (provided that, if the type or amount of shares of stock and other securities and property (including cash) receivable upon such reclassification, change, combination, consolidation, merger, sale or conveyance is more than a single type of consideration (determined based in part upon any form of stockholder election), then the type and amount of consideration will be deemed to be the weighted average of the kind and amounts of consideration received by the holders of the Company’s Common Stock that affirmatively make such an election) and (B) any additional shares of Common Stock which a Holder is entitled to receive as a Make-Whole Premium upon conversion in connection with a Fundamental Change, shall not be payable in shares of Common Stock, but will represent a right to receive the kind and amount of shares of stock and other securities and property (including cash) receivable upon such reclassification, change, combination, consolidation, merger, sale or conveyance by a holder of the additional shares of Common Stock had such additional shares of Common Stock been outstanding immediately prior to such reclassification, change, combination, consolidation, merger, sale or conveyance. Such supplemental indenture shall provide for adjustments of the Conversion Price which shall be as nearly equivalent as may be practicable to the adjustments of the Conversion Price provided for in this Article 4. If, in the case of any such consolidation, merger, combination, sale or conveyance, the stock or other securities and property (including cash) receivable thereupon by a holder of Common Stock

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include shares of stock or other securities and property of a person other than the successor, purchasing or transferee corporation, as the case may be, in such consolidation, merger, combination, sale or conveyance, then such supplemental indenture shall also be executed by such other person and shall contain such additional provisions to protect the interests of the Holders of the Securities as the Board of Directors shall reasonably consider necessary by reason of the foregoing. The provisions of this Section 4.11 shall similarly apply to successive reclassifications, changes, combinations, consolidations, mergers, sales or conveyances.

In the event the Company shall execute a supplemental indenture pursuant to this Section 4.11, the Company shall promptly file with the Trustee (x) an Officers’ Certificate briefly stating the reasons therefor, the kind or amount of shares of stock or other securities or property (including cash) receivable by Holders of the Securities upon the conversion of their Securities after any such reclassification, change, combination, consolidation, merger, sale or conveyance, any adjustment to be made with respect thereto and that all conditions precedent have been complied with and (y) an Opinion of Counsel that all conditions precedent have been complied with, and shall promptly mail notice thereof to all Holders.

Section 4.12. Trustee’s Disclaimer.

The Trustee shall have no duty to determine when an adjustment under this Article 4 should be made, how it should be made or what such adjustment should be, but may accept as conclusive evidence of that fact or the correctness of any such adjustment, and shall be protected in relying upon, an Officers’ Certificate, including the Officers’ Certificate with respect thereto which the Company is obligated to file with the Trustee pursuant to Section 4.9. The Trustee makes no representation as to the validity or value of any securities or assets issued upon conversion of Securities, and the Trustee shall not be responsible for the Company’s failure to comply with any provisions of this Article 4.

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

Section 4.13. Voluntary Reduction.

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 if the reduction is irrevocable during the period if the Board of Directors determines that such reduction would be in the best interest of the Company or to avoid or diminish income tax to holders of shares of the Common Stock in connection with a dividend or distribution of stock or similar event, and the Company provides 15 days prior notice of any reduction in the Conversion Price; provided, however, that in no event may the Company reduce the Conversion Price to an amount that is less than the par value of a share of Common Stock.

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ARTICLE 5.

PAYMENT OF INTEREST AND MAKE-WHOLE PREMIUM

Section 5.1. Interest Payments.

(a) The Company shall pay interest on the Securities at the rate of 5.0% per annum. The Company shall pay interest semiannually in arrears on May 15 and November 15 of each year, commencing May 15, 2006. Interest on the Securities shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from November 23, 2005; provided, however, that if there is not an existing default in the payment of interest and if a Security is authenticated between a Regular Record Date and the next succeeding Interest Payment Date, interest shall accrue from such Interest Payment Date. Interest will be computed on the basis of a 360-day year, comprised of twelve 30 day months. In the event of the maturity, conversion, redemption or repurchase of a Security by the Company at the option of the Holder, interest shall cease to accrue on such Security.

(b) Upon conversion of a Security, (i) a Holder shall not receive any cash payment of interest (unless such conversion occurs between a Regular Record Date and the Interest Payment Date to which it relates, in which case a Holder at the close of business on the Regular Record Date will receive on the Interest Payment Date accrued and unpaid interest) and the Conversion Price shall not be adjusted to account for accrued and unpaid interest and (ii) except as set forth in clause (c) below, the Company’s delivery to a Holder of cash and shares of Common Stock, if any, into which the Security is convertible shall be deemed to satisfy its obligation with respect to such Security, and any accrued but unpaid interest shall be deemed to be paid in full upon conversion, rather than cancelled, extinguished or forfeited.

(c) Securities surrendered for conversion by a Holder after the close of business on any Regular Record Date but prior to the next Interest Payment Date must be accompanied by payment of an amount equal to the interest that has accrued on the Securities being converted (other than overdue interest, if any, that has accrued on such Security) for the interest period ending on such Interest Payment Date, unless such Security has been called for redemption by the Company pursuant to Article 3.

Section 5.2. Make-Whole Premium.

(a) If a Fundamental Change occurs prior to November 15, 2010, the Company shall pay the Make-Whole Premium to Holders of the Securities who convert their Securities in connection with a Fundamental Change pursuant to Section 4.1(b)(5) at any time during the Fundamental Change Conversion/Repurchase Period. The Make-Whole Premium shall be paid on the Effective Date of the Fundamental Change (or, in the event the Securities are converted after the Effective Date but during the Fundamental Change Conversion/Repurchase Period, on the third Business Day following the end of the Fundamental Change Conversion/Repurchase Period) and shall be paid solely in shares of the Common Stock (other than Cash paid in lieu of fractional shares) or in the same form of consideration into which all or substantially all of the shares of Common Stock have been converted or exchanged in connection with the Fundamental Change, as described below. The Make-Whole Premium shall be equal to

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an additional number of shares of Common Stock calculated in accordance with Section 5.2(b) hereof. The Make-Whole Premium will be in addition to, and not in substitution for, any Cash, securities or other assets otherwise due to Holders of Securities upon conversion as described in this Indenture.

(b) The “Make-Whole Premium” shall be equal to the principal amount of the Securities to be converted divided by $1,000 and multiplied by the applicable number of shares of Common Stock determined by reference to the table below (the “Make-Whole Premium Table”) and is based on the Effective Date and the Stock Price.

Make-Whole Premium Table

(Number of Additional Shares of Common Stock)

Stock Price	$12.50	$13.50	$15.50	$17.50	$19.50	$21.50	$23.50	$25.50	$27.50	$29.50	$31.50	$33.50	$35.50	$37.50
Effective Date
November 22, 2005	9.6977	9.6977	9.6977	9.6977	9.6977	8.0376	6.3074	4.9569	3.8913	3.0439	2.3651	1.8193	1.3789	1.0235
November 22, 2006	9.6977	9.6977	9.6977	9.6977	9.5217	7.2654	5.5536	4.2408	3.2253	2.4346	1.8161	1.3308	0.9503	0.6531
November 22, 2007	9.6977	9.6977	9.6977	9.6977	8.3944	5.9930	4.1991	2.8673	1.8911	1.1883	0.6954	0.3629	0.1523	0.0340
November 22, 2008	9.6977	9.6977	9.6977	9.6977	7.8579	5.3308	3.3875	1.9210	0.8336	0.2031	0.0060	0.0000	0.0000	0.0000
November 22, 2009	9.6977	9.6977	9.6977	9.6977	7.5462	5.0591	3.1531	1.7078	0.6761	0.1384	0.0000	0.0000	0.0000	0.0000
November 22, 2010	9.6977	9.6977	9.6977	9.6977	7.3796	4.9716	3.1106	1.6886	0.6504	0.1137	0.0000	0.0000	0.0000	0.0000
November 22, 2011	9.6977	9.6977	9.6977	9.6977	7.1942	4.8177	2.9847	1.5950	0.6033	0.1088	0.0000	0.0000	0.0000	0.0000
November 22, 2012	9.6977	9.6977	9.6977	9.6977	6.7153	4.4433	2.7149	1.4180	0.5100	0.0710	0.0000	0.0000	0.0000	0.0000
November 22, 2013	9.6977	9.6977	9.6977	8.5053	5.7189	3.6858	2.1895	1.1030	0.3686	0.0366	0.0000	0.0000	0.0000	0.0000
November 22, 2014	9.6977	9.6977	9.5838	5.9664	3.6357	2.1179	1.1274	0.4937	0.1220	0.0000	0.0000	0.0000	0.0000	0.0000
November 22, 2015	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000	0.0000

(1) The exact Stock Price and Effective Date may not be set forth on the Make-Whole Premium Table, in which case, if the Stock Price is between two Stock Prices on the Make-Whole Premium Table or the Effective Date is between two Effective Dates on the Make-Whole Premium Table, the Make-Whole Premium shall be determined by straight-line interpolation between Make-Whole Premium amounts set forth for the higher and lower Stock Prices and the two Effective Dates, as applicable, based on a 365-day year (or a 366-day year if the Effective Date occurs in a leap year). The Stock Prices set forth in the column headers are subject to adjustment pursuant to Section 5.3.

(2) If the Stock Price is less than or equal to $12.49 (subject to adjustment pursuant to Section 5.3, the “Stock Price Threshold”), the Make-Whole Premium shall be equal to zero shares of Common Stock.

(3) If the Stock Price is equal to or greater than $37.51 (subject to adjustment pursuant to Section 5.3, the “Stock Price Cap”), the Make-Whole Premium shall be equal to zero shares of Common Stock.

(4) “Stock Price” means the price paid per share of Common Stock in the transaction constituting the Fundamental Change, determined as follows: (i) if holders of Common Stock receive only Cash in the transaction constituting the Fundamental Change, the Stock Price shall equal the cash amount paid per share of Common Stock; and (ii) in all other cases, the Stock Price shall equal the arithmetic average of the Closing Sale Prices of a share of Common Stock over the five Trading Day period ending on the fifth Trading Day immediately preceding the Effective Date; and “Effective Date” means the date that a Fundamental Change becomes effective.

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(c) The Company shall pay the Make-Whole Premium solely in shares of Common Stock (other than Cash paid in lieu of fractional shares) or in the same form of consideration into which all or substantially all of the shares of Common Stock have been converted or exchanged in connection with the Fundamental Change. If holders of the Common Stock receive or have the right to receive more than one form of consideration in connection with such Fundamental Change, then, for purposes of the foregoing, the forms of consideration in which the Make-Whole Premium shall be paid shall be in proportion to the different forms of consideration paid to holders of Common Stock in connection with such Fundamental Change.

(d) The Company shall, from time to time, appoint an independent nationally recognized investment bank to serve as calculation agent with respect to calculation of the Make-Whole Premium (the “Calculation Agent”). The Calculation Agent shall, on behalf of and on request by the Company, calculate (A) the Stock Price and (B) the Make-Whole Premium with respect to such Stock Price, based on the Effective Date specified by the Company, and shall deliver its calculation of the Stock Price and Make-Whole Premium to the Company and the Trustee within three Business Days of the request by the Company or the Trustee. The Company or, at the Company’s request, the Trustee, in the name and at the expense of the Company, (X) shall notify the Holders of the Stock Price and Make-Whole Premium with respect to a Fundamental Change as part of the Fundamental Change Repurchase Notice or otherwise in accordance with the notice provisions of the Indenture and (Y) shall notify the Holders, promptly upon the opening of business on the Effective Date of the number of shares of Common Stock (or such other securities, assets or property (including Cash) into which all or substantially all of the shares of Common Stock have been converted as of the Effective Date as described above) to be paid in respect of the Make-Whole Premium in connection with such Fundamental Change, in the manner provided in this Indenture. The Company shall verify, in writing, all calculations made by the Calculation Agent pursuant to this Section 5.2(d).

(e) On or prior to the Fundamental Change Repurchase Date, the Company shall deposit with the Trustee or with one or more Paying Agents (or, if the Company or an Affiliate or Subsidiary of the Company is acting as the Paying Agent, set aside, segregate and hold in trust) a number of shares of Common Stock (or, in the case of a Fundamental Change in which all or substantially all of the shares of Common Stock have been, as of the Effective Date, converted into or exchanged for the right to receive securities or other assets or property (including Cash), an amount of such other securities or other assets or property (including Cash)) sufficient to pay the Make-Whole Premium with respect to all the Securities converted in connection with such Fundamental Change; provided, that, if such payment is made on the Fundamental Change Repurchase Date, it must be received by the Trustee or Paying Agent, as the case may be, by 11:00 a.m., New York City time, on such date. Payment of the Make-Whole Premium for Securities surrendered for conversion during the Fundamental Change Conversion/Repurchase Period shall be made promptly on the Fundamental Change Repurchase

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Date by mailing checks in respect of Cash and otherwise delivering entitlements to securities, other assets or property for the amount payable to the Holders of such Securities entitled thereto as they shall appear in the register kept by the Registrar.

(f) Promptly after determination of the actual number of shares of Common Stock to be issued in respect of the Make-Whole Premium, the Company shall publish a notice containing this information in a newspaper published in the English language, customarily published each Business Day and of general circulation in the City of New York or publish such information on the Company’s website or through such other public medium as the Company may use at that time.

Section 5.3. Adjustments Relating to Make-Whole Premium.

Whenever the Conversion Price shall be adjusted from time to time by the Company pursuant to Section 4.6, the Stock Price Threshold and the Stock Price Cap shall be adjusted and each of the Stock Prices set forth in the Make-Whole Premium Table shall be adjusted. The adjusted Stock Price Threshold, Stock Price Cap and Stock Prices set forth in the Make-Whole Premium Table shall equal the Stock Price Threshold, Stock Price Cap and such Stock Prices, as the case may be, immediately prior to such adjustment multiplied by a fraction, the numerator of which is the Conversion Price as so adjusted and the denominator of which is the Conversion Price immediately prior to the adjustment giving rise to such adjustment. Each of the share amounts set forth in the body of the Make-Whole Premium Table shall also be adjusted in the same manner and at the same time.

ARTICLE 6.

COVENANTS

Section 6.1. Payment of Securities.

(a) The Company shall promptly make all payments in respect of the Securities on the dates and in the manner provided in the Securities and this Indenture. An installment of principal or interest or Liquidated Damages, if any, shall be considered paid on the date it is due if the Paying Agent (other than the Company) holds by 11:00 a.m., New York City time, on that date money, deposited by or on behalf of the Company sufficient to pay the installment. The Company shall, to the fullest extent permitted by law, pay interest in immediately available funds on overdue principal (including premium, if any) and overdue installments of interest at the rate per annum borne by the Securities.

(b) Payment of the principal of (and premium, if any) and interest (and Liquidated Damages, if any), on the Securities shall be made at any office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York or at the Corporate Trust Office of the Trustee in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address appears in the Register; provided, further, that a Holder with an aggregate principal amount in excess of $2,000,000 will

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be paid by wire transfer in immediately available funds at the election of such Holder if such Holder has provided wire transfer instructions to the Company and the Trustee at least 10 Business Days prior to the payment date.

Section 6.2. SEC Reports.

(a) The Company shall file all reports and other information and documents which it is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act and, within 15 days after it files with the SEC, the Company shall file copies of all such reports, information and other documents with the Trustee; provided, that any such reports, information and documents filed with the SEC pursuant to its Electronic Data Gathering, Analysis and Retrieval system shall be deemed to be filed with the Trustee. If the Company fails to file any periodic report with the SEC within 30 days after the date it is required to do so pursuant to the Exchange Act (the “Filing Failure”), then beginning on the 31^st day following such Filing Failure liquidated damages (“Filing Failure Liquidated Damages”) shall accrue on the Securities at a rate per annum equal to the following for the periods during which the Filing Failure shall continue and until the Filing Failure is cured: (i) for the first six 30-day periods during which the Filing Failure shall continue, one-quarter of one percent per annum (0.25%) of the aggregate principal amount of the Securities; (ii) for the next six such 30-day periods, one-half of one percent per annum (0.50%) of the aggregate principal amount of the Securities; and (iii) thereafter, three-quarters of one percent per annum (0.75%) of the aggregate principal amount of the Securities. Such Filing Failure Liquidated Damages shall be payable as and when Liquidated Damages are payable under this Indenture. The rate of accrual of Filing Failure Liquidated Damages shall not exceed the rate provided for notwithstanding the occurrence of multiple concurrent Filing Failures.

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

(c) At any time when the Company is not subject to Section 13 or 15(d) of the Exchange Act, the Company shall furnish to the Trustee (i) quarterly financial statements within 45 days after the end of each fiscal quarter that are substantially equivalent to those the Company would otherwise be required to file with the Commission in a Quarterly Report on Form 10-Q, (ii) annual financial statements within 90 days after the end of each fiscal year that are substantially equivalent to those the Company would be required to file with the Commission in an Annual Report on Form 10-K, including a report thereon by the Company’s certified independent accountants, and (iii) accompanying each of the financial statements required by (i) and (ii) above, information substantially equivalent to that required by Regulation S-K Item 303, “Management Discussion and Analysis of Financial Condition and Results of Operations;” provided, that in each case the delivery of materials to the Trustee by electronic means shall be deemed “furnished” to the Trustee for purposes of this Section 6.2(c); provided, further, that the Company shall be deemed to have satisfied its obligations under each of (i), (ii) and (iii) above if it files such information with the Commission (if the Commission will accept such filing) or

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otherwise makes such financial statements and other information available on or through its web site.

Section 6.3. Compliance Certificates.

The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year of the Company (beginning with the fiscal year ending December 31, 2005), an Officers’ Certificate as to the signer’s knowledge of the Company’s compliance with all conditions and covenants on its part contained in this Indenture and stating whether or not the signer knows of any default or Event of Default. If such signer knows of such a default or Event of Default, the Officers’ Certificate shall describe the default or Event of Default and the efforts to remedy the same. For the purposes of this Section 6.3, compliance shall be determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture.

The Company shall promptly deliver to the Trustee and in any event within five Business Days after the Company becomes aware of the occurrence of any Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default, an Officers’ Certificate setting forth the details of such Event of Default or default and the action which the Company is taking or proposes to take with respect thereto.

Section 6.4. 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 6.5. Maintenance of Corporate Existence.

Subject to Article 7, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence.

Section 6.6. Rule 144A Information Requirement.

Within the period prior to the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), the Company covenants and agrees that it shall, during any period in which it is not subject to Section 13 or 15(d) under the Exchange Act, upon the request of any Holder or beneficial holder of Securities or any Common Stock issued upon conversion thereof, make available to such Holder or beneficial holder of Securities or Common Stock in connection with any sale thereof, and to any prospective purchaser of such Securities or Common Stock designated by such Holder or beneficial holder, the information required pursuant to Rule 144A(d)(4) under the Securities Act and it will take such further action as any Holder or beneficial holder of such Securities or such Common Stock may reasonably request, all to the extent required from time to time to enable such Holder or beneficial holder to sell its Securities or Common Stock without registration under the Securities Act within the limitation of the exemption provided by Rule 144A, as such Rule may be amended from time to time. Upon the request of any Holder or any beneficial holder of the Securities or such Common Stock, the Company will deliver to such Holder or holder a written statement as to whether it has complied with such requirements.

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Section 6.7. Resale of Certain Securities.

During the period beginning on the date on which any of the Securities are originally issued and ending on the date that is two years from such date, the Company shall not, and shall use its best efforts not to permit any of its “affiliates” (as defined under Rule 144) to, resell any Securities which constitute “restricted securities” under Rule 144 that have been reacquired by any of them. The Trustee shall have no responsibility in respect of the Company’s performance of its agreement in the preceding sentence.

Section 6.8. Stay, Extension and Usury Laws.

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

Section 6.9. Book-Entry System.

If the Securities cease to trade in the Depositary’s book entry settlement system, the Company covenants and agrees that upon the request of Holders of at least 25% in aggregate principal amount of the Securities then outstanding, it shall use reasonable efforts to make such other book entry arrangements that it determines are reasonable for the Securities.

Section 6.10. Payment of Liquidated Damages.

If Liquidated Damages are payable by the Company pursuant to the Registration Rights Agreement, the Company shall deliver to the Trustee a certificate to that effect stating (i) the amount of such Liquidated Damages that are payable, (ii) the reason why such Liquidated Damages are payable and (iii) the date on which such Liquidated Damages are payable. Unless and until a Trust Officer of the Trustee receives such a certificate, the Trustee may assume without inquiry that no such Liquidated Damages are payable. If the Company has paid Liquidated Damages directly to the Persons entitled to such Liquidated Damages, the Company shall deliver to the Trustee a certificate setting forth the particulars of such payment.

Section 6.11. Incurrence of Indebtedness.

The Company shall not, and the Company shall not permit any Subsidiary to, directly or indirectly, incur or guarantee, or assume any Indebtedness (including any Acquired Indebtedness), other than Permitted Indebtedness.

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“Permitted Indebtedness” means:

(1) the Securities;

(2) Indebtedness outstanding on the date hereof;

(3) Indebtedness incurred under the Company’s revolving letter of credit line from JPMorgan Chase Bank, National Association, effective from April 28, 2005 to May 1, 2006, as the same may be amended and/or extended from time to time, that is either unsecured or secured only by cash collateral;

(4) trade debt and similar unsecured indebtedness incurred in the ordinary course of business that are not overdue by 90 days or more or are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted;

(5) intercompany Indebtedness between or among the Company and its wholly-owned Subsidiaries; provided, however, that (i) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Securities and (ii)(A) any subsequent issuance or transfer of Capital Stock that results in any such Indebtedness being held by a Person other than the Company or a Subsidiary thereof or (B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Subsidiary thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (5);

(6) Indebtedness in an aggregate amount not exceeding $10,000,000 incurred in connection with the obligations of a Person as lessee which are capitalized in accordance with GAAP to the extent incurred in the ordinary course of business for the purpose of financing all or any of the purchase price or cost of construction, installation, design, or improvement of real or personal property, plant or equipment used in the business of the Company;

(7) Indebtedness incurred pursuant to performance bonds, bid bonds and other similar instruments entered into in the ordinary course of business;

(8) Indebtedness in an aggregate amount not exceeding $5,000,000 incurred in the ordinary course of business in connection with Permitted Purchase Money Security Interests;

(9) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is satisfied within five Business Days of incurrence;

(10) Indebtedness consisting of indemnification, adjustment of purchase price or similar obligations, in each case incurred in connection with the disposition of any assets of the Company or any Subsidiary (other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition) in a principal amount not to

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exceed the gross proceeds actually received by the Company or any Subsidiary in connection with such disposition;

(11) the incurrence by a Subsidiary of the Company of Acquired Indebtedness; provided that (A) at the time of the acquisition or merger or consolidation in connection with which such Acquired Indebtedness is incurred, such Subsidiary shall not own or hold any property or assets other than the property or assets acquired in such acquisition or the property or assets of the Person that was merged or consolidated with or into such Subsidiary, (B) any liens or other security interest granted to secure such Acquired Indebtedness shall not extend to or cover any property or assets of the Company or any of its Subsidiaries other than the property or assets that secured such Acquired Indebtedness prior to the time such Acquired Indebtedness became Acquired Indebtedness of the Subsidiary of the Company, (C) such Acquired Indebtedness was not incurred by such Person in connection with, or in anticipation or contemplation of, such Person becoming a Subsidiary or such acquisition, merger or consolidation and (D) such Indebtedness is without recourse to the Company or any of its other Subsidiaries or to any of their respective properties or assets;

(12) unsecured Indebtedness incurred in connection with transactions entered into for the purpose of hedging foreign exchange risk of the Company and its Subsidiaries or for the purpose of hedging interest rate exposure on Permitted Indebtedness; provided that (A) in the case of agreements for hedging foreign exchange risk, such agreements do not increase the Indebtedness of the Company and its Subsidiaries outstanding other than as a result of fluctuations in foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder and (B) in the case of agreements for hedging interest rate exposure, such agreements are entered into for the purpose of fixing or hedging interest rates with respect to any fixed or variable rate Indebtedness that is permitted by this Indenture to be outstanding to the extent that the notional amount of any obligations under such agreement does not exceed the principal amount of Indebtedness to which such obligation relates;

(13) cash management arrangements (including, but not limited to: electronic funds transfer programs, daylight overdraft facilities, F/X settlement risk facilities, and other facilities involving intra-day/inter-day settlement risk); unadvised treasury risk facilities (including facilities provided for conducting F/X and hedging/derivative transactions); bank overdraft lines, including cash collateral in connection with any of the foregoing, all in the ordinary course of business of the Company or such Subsidiary and as is consistent with past practice of the Company or such Subsidiary;

(14) senior secured Indebtedness not included in any of the foregoing; provided, however, that immediately after giving effect to any such incurrence, the aggregate principal amount of all Indebtedness incurred pursuant to this clause (14) then outstanding does not exceed the lesser of (A) $50,000,000 and (B) the sum of $25,000,000 plus (I) until such time as the Company has filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2006, 100% of the EBITDA of the Company earned during the period commencing July 1, 2005 and ending on the last day of the most recently

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ended fiscal quarter or fiscal year on or prior to June 30, 2006 and prior to the date of such incurrence for which the Company has filed its Quarterly Report on Form 10-Q or its Annual Report on Form 10-K, as calculated in accordance herewith based upon such Annual Report for such fiscal year or such Quarterly Report for such fiscal quarter and the Quarterly Reports for any prior fiscal quarters included in such period and (II) at such time as the Company has filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2006 and thereafter, 200% of the EBITDA of the Company earned during the twelve month period ending on the last day of the fiscal quarter or fiscal year most recently ended prior to the date of such incurrence for which the Company has filed its Quarterly Report on Form 10-Q or its Annual Report on Form 10-K, as calculated in accordance herewith based upon such Annual Report for such fiscal year or such Quarterly Report for such fiscal quarter and the Quarterly Reports for any prior fiscal quarters included in such period;

(15) unsecured Indebtedness not included in any of the foregoing that is expressly subordinate in right of payment to the Indebtedness evidenced by the Securities, and which Indebtedness does not provide at any time for the payment, prepayment, repayment, repurchase, redemption or defeasance, directly or indirectly, of any principal or premium, if any, thereon until 91 days after November 15, 2010; provided, however, that immediately after giving effect to any such incurrence the aggregate principal amount of all Indebtedness incurred under this clause (15) and then outstanding does not exceed the sum of $100,000,000 plus (I) until such time as the Company has filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2006, 100% of the EBITDA of the Company earned during the period commencing July 1, 2005 and ending on the last day of the most recently ended fiscal quarter or fiscal year on or prior to June 30, 2006 and prior to the date of such incurrence for which the Company has filed its Quarterly Report on Form 10-Q or its Annual Report on Form 10-K, as calculated in accordance herewith based upon such Annual Report for such fiscal year or such Quarterly Report for such fiscal quarter and the Quarterly Reports for any prior fiscal quarters included in such period and (II) at such time as the Company has filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2006 and thereafter, 200% of the EBITDA of the Company earned during the twelve month period ending on the last day of the fiscal quarter or fiscal year most recently ended prior to the date of such incurrence for which the Company has filed its Quarterly Report on Form 10-Q or its Annual Report on Form 10-K, as calculated in accordance herewith based upon such Annual Report for such fiscal year or such Quarterly Report for such fiscal quarter and the Quarterly Reports for any prior fiscal quarters included in such period;

(16) Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease, repay, prepay, redeem, retire or refund, Indebtedness that was permitted by clauses (1), (3), (11) or (16) of this definition; and

(17) the guarantee of any Indebtedness otherwise permitted by this Indenture to be incurred.

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Subject to the next succeeding paragraph below, for purposes of clarification, all Indebtedness incurred under clause (14) or (15) of the definition of Permitted Indebtedness shall continue to be Permitted Indebtedness for so long as such Indebtedness shall remain outstanding regardless of whether that Indebtedness would be permitted to be incurred under clause (14) or (15) of such definition as of any date subsequent to the date of incurrence of such Indebtedness.

Notwithstanding the foregoing, any Permitted Indebtedness that is unsecured at the time of incurrence and becomes secured on any date thereafter (such date, the “Secured Date”) shall cease to be Permitted Indebtedness hereunder unless such Indebtedness could have been incurred as secured Permitted Indebtedness on the Secured Date.

For purposes of determining compliance with this Section 6.11, (i) in the event that an item of Indebtedness meets the criteria of more than one of the types of Indebtedness included in the definition of Permitted Indebtedness, the Company, in its sole discretion, may classify such item of Indebtedness at the time of its incurrence and only be required to include the amount and type of such Indebtedness in one of the clauses of such definition and (ii) an item of Indebtedness may be divided and classified in more than one of the types of Indebtedness included in the definition of Permitted Indebtedness.

“Acquired Indebtedness” means, with respect to any specified Person, Indebtedness of any other Person (i) existing as of the time such other Person is merged with or into or became a Subsidiary of such specified Person or (ii) assumed by the specified Person in connection with an acquisition of assets.

“Indebtedness” of any Person means, at any date, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person to pay the deferred purchase price of property or services, all conditional sale obligations and all obligations under any title retention agreement, (iv) all obligations of such Person as lessee which are capitalized in accordance with GAAP, (v) all obligations of others which are secured by a Lien on any asset of such Person (the amount of such obligations being deemed to be the lesser of the fair market value of such asset or the amount of the obligations so secured), whether or not such Person is otherwise liable for such obligations, (vi) all obligations of others which are, directly or indirectly, guaranteed by such Person or for which such Person has agreed (contingently or otherwise) to assure a creditor against loss, including without limitation, through an agreement to purchase or otherwise acquire such obligations, (vii) all reimbursement and other obligations with respect to letters of credit, bankers’ acceptances, surety bonds or similar credit transactions, whether or not matured, (viii) all obligations of such Person under commodity price hedging arrangements, in each case whether contingent or matured, (ix) all obligations of such Person under any foreign exchange contract, currency swap agreement, interest rate swap, cap or collar agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates, in each case whether contingent or matured, (x) all obligations in respect of financial instruments which are classified as a liability on the balance sheet of such Person and (xi) all Disqualified Equity Interests issued by such Person (with the amount of Indebtedness represented by such Disqualified Equity Interests being equal to the greater of its voluntary or involuntary liquidation preference and its maximum fixed repurchase price, but excluding accrued dividends, if any).

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For purposes hereof, the “maximum fixed repurchase price” of any Disqualified Equity Interests which does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Equity Interests as if such Disqualified Equity Interests were repurchased on any date on which Indebtedness shall be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the fair market value of such Disqualified Equity Interests, such fair market value shall be determined reasonably and in good faith by the board of directors of the issuer of such Disqualified Equity Interests. The amount of any Indebtedness outstanding as of any date shall be (i) the outstanding balance at such date of all unconditional obligations, together with any interest thereon that is more than 30 days past due, or the accreted value thereof, in the case of any Indebtedness issued with original issue discount, or (ii) with respect to contingent obligations, the maximum liability upon the occurrence of the contingency giving rise to the obligation.

“Disqualified Equity Interest” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable or exercisable, at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the sole option of the holder thereof, in whole or in part, prior to 91 days after November 15, 2010, for cash or is convertible into or exchangeable or exercisable for debt securities of the Company or any its Subsidiaries at any time prior to such date. Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Equity Interests solely because the holders of the Capital Stock have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control will not constitute a Disqualified Equity Interest if the terms of such Capital Stock provide that the definition of change of control for the purposes of such Capital Stock is the same as the definition of Change of Control under this Indenture and that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless prior to such repurchase or redemption, the Company shall have repurchased the Securities required to be repurchased under Section 3.10 hereof.

“Permitted Purchase Money Security Interest” means any Lien on any property or asset created, issued or assumed to secure Indebtedness incurred, assumed or issued to satisfy, in whole or in part, the purchase price of such property or asset (including installation costs) and expenditures made for any construction, development or improvements performed thereon or added thereto, provided that such Lien, or any agreement or other instrument under which such Lien is constituted, is limited to (and any Indebtedness incurred in connection therewith does not exceed 85% of the fair market value of) the property or asset acquired in connection with the assumption, issuance or incurring of such Indebtedness and is created, issued or assumed concurrently with the acquisition of such property or assets.

“Liens” means, with respect to any asset, any mortgages, pledges, liens, charges, security agreements or other encumbrances of any kind in respect of such asset (whether or not filed, recorded or otherwise perfected under applicable law) or any other arrangements that in substance secure payment or performance of an obligation, statutory and other non-consensual liens or encumbrances and includes the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement.

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“EBITDA” means, with respect to the Company for any applicable period, the Net Income of the Company and its Subsidiaries for such period plus (without duplication) the sum of the following amounts for the Company and its Subsidiaries for such period and to the extent deducted in determining Net Income for such period: (1) Interest Expense, (2) income tax expense, (3) depreciation expense, (4) amortization expense, (5) non-recurring cash transaction costs incurred in connection with any acquisition in an amount not exceeding $2,000,000 in the aggregate during such period, (6) non-recurring cash severance costs in an amount not exceeding $10,000,000 in the aggregate during such period and (7) all other non-cash charges (excluding any such non-cash charge to the extent that it represents an accrual of or reserve for cash expenditures in any future period), determined on a consolidated basis in accordance with GAAP. If since the beginning of the applicable period the Company or any of its Subsidiaries shall have acquired assets constituting all or substantially all of a product line or an operating unit of a business or shall have acquired (by merger or otherwise) any corporation or other person which becomes a Subsidiary, EBITDA for such period shall be calculated after giving pro forma effect thereto as if such acquisition occurred (and any Acquired Indebtedness in connection with such acquisition was incurred) on the first day of such period. If since the beginning of the applicable period the Company or any of its Subsidiaries shall have disposed of assets constituting all or substantially all of a product line or an operating unit of a business or shall have disposed of any Capital Stock of any Subsidiary such that after giving effect to such disposition such Subsidiary ceases to constitute a Subsidiary hereunder, EBITDA for such period shall be calculated after giving pro forma effect thereto as if such disposition occurred on the first day of such period.

“Net Income” means, with respect to the Company for any applicable period, the net income of the Company and its Subsidiaries for such period determined on a consolidated basis and in accordance with GAAP; provided, however, that the calculation of Net Income shall exclude the net income, if any, from any contract revenue and related contract expense recognized during such period.

“Interest Expense” means, with respect to the Company for any applicable period, the total interest expense of the Company and its Subsidiaries for such period determined on a consolidated basis and in accordance with GAAP.

“Permitted Refinancing Indebtedness” means any Indebtedness of the Company or any of its Subsidiaries issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease, repay, prepay, redeem, retire or refund other Indebtedness of the Company or any of its Subsidiaries (other than intercompany Indebtedness); provided that:

(i) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount of (or accreted value, if applicable), plus fees, expenses, premiums, defeasance costs and accrued interest on, the Indebtedness so extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded;

(ii) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness

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being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded;

(iii) if the Indebtedness being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded is subordinated in right of payment to the Securities, then the Permitted Refinancing Indebtedness must be subordinated in right of payment to the Securities on terms at least as favorable, taken as a whole, to the Securityholders as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded; and

(iv) if the Indebtedness being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded is secured, then the Permitted Refinancing Indebtedness is not secured by any property or assets of the Company and its Subsidiaries other than the property and assets that secured the Indebtedness being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded; and

(v) such Indebtedness is incurred either by the Company or by the Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased, repaid, prepaid, redeemed, retired or refunded.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (ii) the then outstanding principal amount of such Indebtedness.

Section 6.12. Stockholder Approval.

The Company agrees to use its reasonable best efforts to seek and obtain affirmative approval in accordance with the Company’s Certificate of Incorporation and the rules of The Nasdaq Stock Market at the next special or annual meeting of its stockholders, which shall be held no later than May 31, 2006, for the issuance of a number of shares of Common Stock sufficient to fully provide for the conversion of the Securities and the exercise of the Warrants from time to time as such Securities and Warrants are presented for conversion or exercise, including without limitation the issuance of all such shares in excess of the Conversion Shares Cap and Exercise Shares Cap (as defined in the Warrants) (such affirmative approval being referred to as the “Stockholder Approval”). If the Company shall not obtain the Stockholder Approval at its next meeting of stockholders, the Company shall use its reasonable best efforts to obtain such approval at each succeeding meeting of its stockholders until such time as it shall have obtained approval for the issuance of a number of shares of Common Stock sufficient to fully provide for the conversion of the Securities and the exercise of the Warrants. Upon receipt by the Company of the Stockholder Approval, the Company shall deliver a written notice thereof

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to the Trustee and the Paying Agent, and the Trustee shall in turn give prompt written notice thereof to the Holders in the manner set forth in the Indenture.

ARTICLE 7.

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

Section 7.1. Company May Consolidate, Etc., Only on Certain Terms.

The Company shall not consolidate with or merge into any other Person (in a transaction in which the Company is not the surviving corporation) or convey, transfer or lease its properties and assets substantially as an entirety to any Person, unless:

(1) in case the Company shall consolidate with or merge into another Person (in a transaction in which the Company is not the surviving corporation) or convey, transfer or lease its properties and assets substantially as an entirety to any Person, the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Company substantially as an entirety shall be a corporation, limited liability company, partnership, trust or other entity organized and validly existing under the laws of the United States of America, any State thereof or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of and any premium and interest, including any Make-Whole Premium and Liquidated Damages, if any, on all the Securities and the performance or observance of every covenant of this Indenture on the part of the Company to be performed or observed and the conversion rights shall be provided for in accordance with Article 4, by the Person (if other than the Company) formed by such consolidation or into which the Company shall have been merged or by the Person which shall have acquired the Company’s assets;

(2) if as a result of such transaction, the Securities become convertible into Common Stock or other securities of a third party, such third party fully and unconditionally guarantees all obligations of the Company or such successor under the Indenture and the Securities;

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

(4) the Company has 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 and Article XI and that all conditions precedent herein provided for relating to such transaction have been complied with.

The provisions of this Section 7.1 shall similarly apply to successive consolidations, mergers, conveyances, transfers or leases.

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Section 7.2. Successor Substituted.

Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer or lease of the properties and assets of the Company substantially as an entirety in accordance with Section 7.1, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

ARTICLE 8.

DEFAULT AND REMEDIES

Section 8.1. Events of Default.

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

(1) the failure of the Company to pay the principal of, or premium, including any Make-Whole Premium, if any, on, any Security at the Final Maturity Date, upon a redemption or repurchase pursuant to Article 3, or otherwise;

(2) the failure of the Company to pay any interest, including Liquidated Damages, if any, on any Security when due that continues for 30 days;

(3) the failure of the Company to provide a Fundamental Change Company Notice when required by Section 3.10;

(4) the failure of the Company to convert the Securities into Cash or shares of Common Stock (if any) upon exercise of a Holder’s conversion right and such failure continues for 10 days;

(5) the failure of the Company to perform or observe any other covenant required by this Indenture or the Securities, if such failure continues for 30 days after the Notice of Default specified below is given;

(6) a default under any indebtedness for money borrowed by the Company or any Subsidiary in an aggregate outstanding principal amount in excess of $25.0 million, for a period of 30 days after written notice of default is given to the Company by the Trustee or to the Company and the Trustee by Holders of not less than 25% in aggregate principal amount of the Securities then outstanding, which default (A) is caused by the failure to pay principal or interest when due on such indebtedness by the end of the applicable grace period, if any, unless such indebtedness is discharged, or (B) results in the acceleration of such indebtedness, unless such acceleration is waived, cured, rescinded or annulled or unless such indebtedness is discharged;

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(7) the entry against the Company or any of its Subsidiaries of a final judgment or judgments (not subject to appeal and not covered by insurance) aggregating in excess of $20.0 million, which judgments remain unpaid, unstayed, undischarged or unbonded for a period of 60 days;

(8) the Company pursuant to 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;

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

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

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

(A) is for relief against the Company in a voluntary or involuntary case or proceeding or otherwise adjudicates the Company insolvent or bankrupt;

(B) appoints a Custodian of the Company or for, or to take possession of, all or substantially all of the property of the Company; or

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

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

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

(b) A default under clause (5) of Subsection 8.1(a) 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 Securities then outstanding notify the Company and the Trustee, in writing of the default, and the Company does not cure the default within the time specified in clause (5) of Subsection 8.1(a) after receipt of such notice. The notice given pursuant to this Section 8.1 must specify the default, demand that it be remedied and state that the notice is a “Notice of Default.” When any default under this Section 8.1 is cured, it ceases.

(c) The Trustee shall not be charged with knowledge of any Event of Default unless written notice thereof shall have been given to a Trust Officer at the Corporate Trust

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Office of the Trustee by the Company, a Paying Agent, any Holder or any agent of any Holder or unless it acquires actual knowledge of such Event of Default in the course of performing other duties pursuant to this Indenture.

Section 8.2. Acceleration.

If an Event of Default (other than an Event of Default specified in clause (8) or (9) of Subsection 8.1(a)) occurs and is continuing with respect to the Company, the Trustee may, by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding may, by notice to the Company and the Trustee, declare the principal amount, plus all accrued and unpaid interest, any premium, including any Make-Whole Premium, and Liquidated Damages, if any, to the date of acceleration on the Securities then outstanding (if not then due and payable) to be due and payable upon any such declaration, and the same shall become and be immediately due and payable. If an Event of Default specified in clause (8) or (9) of Subsection 8.1(a) occurs and is continuing with respect to the Company, the principal amount, plus all accrued and unpaid interest, any premium, including any Make-Whole Premium, and Liquidated Damages, if any, of the Securities then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. The Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may rescind an acceleration and its consequences if (a) all existing Events of Default, other than the nonpayment of the principal of the Securities which has become due solely by such declaration of acceleration, have been cured or waived; (b) to the extent the payment of such interest is lawful, interest (calculated at the rate per annum borne by the Securities) on overdue installments of interest and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid; (c) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and (d) all payments due to the Trustee and any predecessor Trustee under Section 9.7 have been made. No such rescission shall affect any subsequent default or impair any right consequent thereto.

Section 8.3. Other Remedies.

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

(b) The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

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(c) No remedy is exclusive of any other remedy. All available remedies are cumulative to the extent permitted by law. The assertion or employment of any right or remedy hereunder shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

Section 8.4. Waiver of Defaults and Events of Default.

Subject to Sections 8.7 and 11.2, the Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may waive an existing default or Event of Default and its consequences, except a default or Event of Default in the payment of the principal of, or interest and any premium, including any Make-Whole Premium, and Liquidated Damages, if any, on, any Security, a failure by the Company to convert any Securities into Common Stock or any default or Event of Default in respect of any provision of this Indenture or the Securities which, under Section 11.2, cannot be modified or amended without the consent of the Holder of each Security affected. When a default or Event of Default is waived, it is cured and ceases.

Section 8.5. Control by Majority.

The Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of another Holder or the Trustee, or that may involve the Trustee in personal liability unless the Trustee is furnished indemnity reasonably satisfactory to it; provided, however, that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

Section 8.6. Limitations on Suits.

(a) A Holder may not pursue any remedy with respect to this Indenture or the Securities (except actions for payment of overdue principal, premium, if any, or interest for the conversion of the Securities pursuant to Article 4) unless:

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

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

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

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

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

(b) A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over such other Holder.

Section 8.7. Rights of Holders to Receive Payment and to Convert.

Notwithstanding any other provision of this Indenture, the right of any Holder of a Security to receive payment of the principal of, or interest and any premium, including any Make-Whole Premium, and Liquidated Damages, if any, on, the Security on or after the respective due dates expressed in the Security and this Indenture, to convert such Security in accordance with Article 4 and to bring suit for the enforcement of any such payment on or after such respective dates or the right to convert, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.

Section 8.8. Collection Suit by Trustee.

If an Event of Default in the payment of principal or interest specified in clause (1) or (2) of Subsection 8.1(a) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or another obligor on the Securities for the whole amount of principal and accrued interest remaining unpaid, together with, to the extent that payment of such interest is lawful, interest on overdue principal and overdue installments of interest in each case at the rate per annum borne by the Securities and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

Section 8.9. Trustee May File Proofs of Claim.

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor on the Securities), its creditors or its property and shall be entitled and empowered to collect and receive any money or other property payable or deliverable on any such claims and to distribute the same, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.7, and to the extent that such payment of the reasonable compensation, expenses, disbursements and advances in any such proceedings shall be denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other property which the Holders may be entitled to receive in such proceedings, whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to, or, on behalf of

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any Holder, to authorize, accept or adopt, any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

Section 8.10. Priorities.

(a) If the Trustee collects any money pursuant to this Article 8, it shall pay out the money in the following order:

(1) First, to the Trustee for amounts due under Section 9.7;

(2) Second, to Holders for amounts due and unpaid on the Securities for principal and interest (including Liquidated Damages, if any), ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest (including Liquidated Damages, if any), respectively; and

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

(b) The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 8.10.

Section 8.11. Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an 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 8.11 does not apply to a suit made by the Trustee, a suit by a Holder pursuant to Section 8.7, or a suit by Holders of more than 10% in aggregate principal amount of the Securities then outstanding.

Section 8.12. Waiver of Stay or Extension Laws.

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

Section 8.13. Restoration of Rights and Remedies.

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or

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has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

ARTICLE 9.

TRUSTEE

Section 9.1. Duties of Trustee.

(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

(b) Except during the continuance of an Event of Default:

(1) the Trustee need perform only those duties as are specifically set forth in this Indenture and no others; and

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. The Trustee, however, shall examine any certificates and opinions which by any provision hereof are specifically required to be delivered to the Trustee to determine whether or not they conform to the requirements of this Indenture.

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

(1) this paragraph does not limit the effect of subsection (b) of this Section 9.1;

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

(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 8.5.

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

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(e) Every provision of this Indenture that in any way relates to the Trustee is subject to subsections (a), (b), (c) and (d) of this Section 9.1.

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

Section 9.2. Rights of Trustee.

Subject to Section 9.1:

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

(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel, which shall conform to Section 12.4(b). The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel.

(c) The Trustee may act through its agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care by it hereunder.

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

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

(f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have furnished to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

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

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

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

Section 9.3. Individual Rights of Trustee.

The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate of the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 9.10 and 9.11.

Section 9.4. Trustee’s Disclaimer.

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

Section 9.5. Notice of Default or Events of Default.

If a default or an Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to each Securityholder notice of the default or Events of Default within 20 days after it occurs. However, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding notice is in the interests of Securityholders, except in the case of a default or an Event of Default in payment of the principal of, or interest and any premium, including any Make-Whole Premium, and Liquidated Damages, if any, on, any Security when due or in the payment of any redemption or repurchase obligation.

Section 9.6. Reports by Trustee to Holders.

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

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

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any quotation system and any changes in the stock exchanges or quotation systems on which the Securities are listed or admitted to trading and of any delisting thereof.

Section 9.7. Compensation and Indemnity.

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

(b) The Company shall indemnify the Trustee or any predecessor Trustee (which for purposes of this Section 9.7 shall include its officers, directors, employees and agents) for, and hold it harmless against, any and all loss, liability or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), including reasonable legal fees and expenses, incurred by it in connection with the acceptance or administration of its duties under this Indenture or any action or failure to act as authorized or within the discretion or rights or powers conferred upon the Trustee hereunder, including the reasonable costs and expenses of the Trustee and its counsel in defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim asserted against the Trustee for which it may seek indemnity. The Company need not pay for any settlement effected without its prior written consent, which shall not be unreasonably withheld.

(c) The Company need not reimburse the Trustee for any expense or indemnify it against any loss or liability incurred by it resulting from its gross negligence or bad faith.

(d) To secure the Company’s payment obligations in this Section 9.7, the Trustee shall have a senior claim to which the Securities are hereby made subordinate on all money or property held or collected by the Trustee, except such money or property held in trust to pay the principal of, or interest and any premium, including any Make-Whole Premium, and Liquidated Damages, if any, on, particular Securities. The obligations of the Company under this Section 9.7 shall survive the satisfaction and discharge of this Indenture or the resignation or removal of the Trustee.

(e) When the Trustee incurs expenses or renders services after an Event of Default specified in clause (8) or (9) of Subsection 8.1(a) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. The provisions of this Section shall survive the termination of this Indenture.

Section 9.8. Replacement of Trustee.

(a) The Trustee may resign by so notifying the Company and the Holders of Securities. The Holders of a majority in aggregate principal amount of the Securities then outstanding may remove the Trustee at any time by so notifying the Trustee and may, with the

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Company’s written consent, appoint a successor Trustee. The Company may remove the Trustee if:

(1) the Trustee fails to comply with Section 9.10;

(2) the Trustee is adjudged a bankrupt or an insolvent;

(3) a receiver or other public officer takes charge of the Trustee or its property; or

(4) the Trustee becomes incapable of acting.

(b) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. The resignation or removal of a Trustee shall not be effective until a successor Trustee shall have delivered the written acceptance of its appointment as described below.

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

(d) If the Trustee fails to comply with Section 9.10, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

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

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

(g) Notwithstanding replacement of the Trustee pursuant to this Section 9.8, the Company’s obligations under Section 9.7 shall continue for the benefit of the retiring Trustee.

Section 9.9. Successor Trustee by Merger, Etc.

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust assets (including the administration of this Indenture) to, another corporation, the resulting, surviving or transferee corporation, without any further act, shall be the successor Trustee, provided such transferee corporation shall qualify and be eligible under Section 9.10. Such successor Trustee shall promptly mail notice of its succession to the Company and each Holder.

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Section 9.10. Eligibility; Disqualification.

The Trustee shall always satisfy the requirements of paragraphs (1), (2) and (5) of TIA Section 310(a). The Trustee (or its parent holding company) shall have a combined capital and surplus of at least $50,000,000. If at any time the Trustee shall cease to satisfy any such requirements, it shall resign immediately in the manner and with the effect specified in this Article 9. The Trustee shall be subject to the provisions of TIA Section 310(b). Nothing herein shall prevent the Trustee from filing with the SEC the application referred to in the penultimate paragraph of TIA Section 310(b).

Section 9.11. Preferential Collection of Claims Against Company.

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

ARTICLE 10.

SATISFACTION AND DISCHARGE OF INDENTURE

Section 10.1. Satisfaction and Discharge of Indenture.

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

(1) all Securities theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.7 and (ii) Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company as provided in Section 10.3) have been delivered to the Trustee for cancellation;

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

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

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 9.7 shall survive.

(b) The Company may discharge its obligations to pay principal of, and interest and any premium, including any Make-Whole Premium, and Liquidated Damages, if any, on, the Securities (but not its other obligations under this Indenture, including, but not

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limited to, its obligation to convert the Securities in accordance with the terms thereof and of this Indenture) when all Securities not theretofore delivered to the Trustee for cancellation

(1) have become due and payable, or

(2) will become due and payable at the Final Maturity Date within one year,

and the Company, in the case of clause (1) or (2) above, has irrevocably, subject to the limitations set forth in the following sentence, deposited or caused to be irrevocably, subject to the limitations set forth in the following sentence, deposited with the Trustee or a Paying Agent (other than the Company or any of its Affiliates), as trust funds in trust for the purpose, cash in an amount sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and interest, to the date of such deposit (in the case of Securities which have become due and payable) or to the Final Maturity Date. In the event that the Company exercises its right to redeem the Securities as provided for in Article 3 herein, the Company shall have the right to withdraw its funds previously deposited with the Trustee or Paying Agent pursuant to the immediately preceding sentence.

Section 10.2. Application of Trust Money.

Subject to the provisions of Section 10.3, the Trustee or a Paying Agent shall hold in trust, for the benefit of the Holders, all money deposited with it pursuant to Section 10.1(b) and shall apply the deposited money in accordance with this Indenture and the Securities to the payment of the principal of, premium, if any, and interest on the Securities.

Section 10.3. Repayment to Company.

(a) The Trustee and each Paying Agent shall promptly pay to the Company upon request any excess money (1) deposited with them pursuant to Section 10.1(b) and (2) held by them at any time.

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

Section 10.4. Reinstatement.

If the Trustee or any Paying Agent is unable to apply any money in accordance with Section 10.2 by reason of any legal proceeding or by reason of any order or judgment of any

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court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 10.1(b) until such time as the Trustee or such Paying Agent is permitted to apply all such money in accordance with Section 10.2; provided, however, that if the Company has made any payment of the principal of or premium or interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive any such payment from the money held by the Trustee or such Paying Agent.

ARTICLE 11.

AMENDMENTS, SUPPLEMENTS AND WAIVERS

Section 11.1. Without Consent of Holders.

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

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

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

(3) increasing the Conversion Rate, provided that the increase will be in accordance with the terms of this Indenture and will not adversely affect the interests of Holders in any material respect;

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

(5) making any changes or modifications to this Indenture necessary in connection with the registration of the Securities 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;

(6) curing any ambiguity, omission, inconsistency or correcting or supplementing any defective provision contained in this Indenture, provided that such modification or amendment does not adversely affect the interests of the Holders in any material respect;

(7) 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;

(8) complying with the provisions of this Indenture in the event of a merger, consolidation or transfer or lease of assets (including the provisions of Section 4.11 and Article 7);

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(9) providing for uncertificated Securities in addition to the Certificated Securities so long as such uncertificated Securities are in registered form for purposes of the Internal Revenue Code of 1986, as amended; or

(10) appointing a successor Trustee.

Section 11.2. With Consent of Holders.

(a) The Company and the Trustee may amend or supplement this Indenture or the Securities with the written consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding 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 Securities represented at the meeting. The Holders of at least a majority in aggregate principal amount of the Securities then outstanding may waive compliance in a particular instance by the Company with any provision of this Indenture or the Securities without notice to any Holder. However, notwithstanding the foregoing but subject to Section 11.4, without the written consent of each Holder affected, an amendment, supplement or waiver, including a waiver pursuant to Section 8.4, may not:

(1) change the stated maturity of the principal of, the date of payment of any installment of interest on or any Liquidated Damages with respect to any Security;

(2) reduce the principal amount of, premium, if any, or interest on, or any Liquidated Damages, or the amount payable upon redemption or repurchase pursuant to Article 3, with respect to any Security;

(3) change the currency of payment of principal of, premium, if any, or interest on any Security;

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

(5) modify the Company’s obligation to repurchase Securities at the option of Holders or the Company’s right to redeem Securities, in a manner adverse to the Holders;

(6) make any change that adversely affects the repurchase option of Holders upon a Fundamental Change or the conversion rights of Holders;

(7) reduce the percentage in aggregate principal amount of Securities outstanding necessary to modify or amend this Indenture or to waive any past default;

(8) modify the provisions in Section 3.1 in any manner adverse to Holders;

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(9) reduce the quorum or voting requirements under this Indenture;

(10) modify any of the provisions of this Section 11.2 or Section 8.4, except to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each outstanding Security affected thereby;

(11) reduce the percentage of the principal amount of the outstanding Securities the consent of whose Holders is required for any such supplemental indenture or the consent of whose Holders is required for any waiver provided for in this Indenture;

(12) modify in any manner the calculation of the Make-Whole Premium; or

(13) change the ranking of the Securities in a manner adverse to the Holders.

It shall not be necessary for the consent of the Holders under this Section 11.2 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

(b) After an amendment, supplement or waiver under this Section 11.2 becomes effective, the Company shall promptly mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, supplement or waiver.

Section 11.3. Compliance with Trust Indenture Act.

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

Section 11.4. Revocation and Effect of Consents.

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

(b) After an amendment, supplement or waiver becomes effective, it shall bind every Securityholder, unless it makes a change described in any of clauses (1) through (13) of Subsection 11.2(a). In that case the amendment, supplement or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.

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Section 11.5. Notation on or Exchange of Securities.

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

Section 11.6. Trustee To Sign Amendments, Etc.

The Trustee shall sign any amendment or supplemental indenture authorized pursuant to this Article 11 if the amendment or supplemental indenture does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, in its sole discretion, but need not sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee shall be entitled to receive, and, subject to Section 9.1, shall be fully protected in relying upon, an Opinion of Counsel stating that such amendment or supplemental indenture is authorized or permitted by this Indenture. The Company may not sign an amendment or supplement indenture until the Board of Directors approves it.

Section 11.7. Effect of Supplemental Indentures.

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

ARTICLE 12.

MISCELLANEOUS

Section 12.1. Trust Indenture Act Controls.

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

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Section 12.2. Notices.

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

If to the Company, to:

i2 Technologies, Inc.

11701 Luna Road

Dallas, Texas 75234

Attention: General Counsel

Facsimile No.: (469) 357-6566

Telephone No.: (469) 357-1000

if to the Trustee, to:

JPMorgan Chase Bank, National Association

600 Travis Street, Suite 1150

Houston, Texas 77002

Attn: Corporate Trust Services

(i2 Technologies, Inc. Notes due 2015)

Facsimile No.: (713) 216-6590

Telephone No.: (713) 216-6815

Such notices or communications shall be effective when received.

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

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

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

Section 12.3. Communications by Holders with Other Holders.

Securityholders may communicate pursuant to TIA Section 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Trustee shall comply with TIA Section 312(b) relating to Securityholder communications. The Company, the Trustee, the Registrar and any other person shall have the protection of TIA Section 312(c).

Section 12.4. Certificate and Opinion as to Conditions Precedent.

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

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

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

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

(1) a statement that the person making such certificate or opinion 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 certificate or opinion are based;

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

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

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

Section 12.5. Record Date for Vote or Consent of Securityholders.

The Company (or, in the event deposits have been made pursuant to Section 10.1, the Trustee) may set a record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture, which record date shall not be more than thirty (30) days prior to the date of the commencement of solicitation of such action.

Section 12.6. Rules by Trustee, Paying Agent, Registrar and Conversion Agent.

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

Section 12.7. Governing Law.

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

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Section 12.8. No Adverse Interpretation of Other Agreements.

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary of the Company. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

Section 12.9. No Recourse Against Others.

All liability described in paragraph 16 of the Securities of any director, officer, employee or stockholder, as such, of the Company is waived and released.

Section 12.10. Successors.

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

Section 12.11. Multiple Counterparts.

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

Section 12.12. Separability.

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

Section 12.13. Table of Contents, Headings, Etc.

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

[SIGNATURE PAGE FOLLOWS]

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

i2 TECHNOLOGIES, INC.
By:	/s/ Michael Berry
	Name: Michael Berry
	Title: EVP, CFO
By:	/s/ Robert C. Donohoo
	Name: Robert C. Donohoo
	Title: Senior Vice President, General Counsel and Secretary
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as Trustee
By:	/s/ Carol Logan
	Name: Carol Logan
	Title: Vice President

[Signature Page to the Indenture]

EX-4.2

Exhibit 4.2

[FORM OF NOTE]

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO i2 TECHNOLOGIES, INC. (THE “COMPANY”) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.

THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. NOTWITHSTANDING THE FOREGOING, THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THIS SECURITY.

THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH i2 TECHNOLOGIES, INC. OR ANY AFFILIATE OF i2 TECHNOLOGIES, INC. WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO i2 TECHNOLOGIES, INC. OR ANY

PARENT OR SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO i2 TECHNOLOGIES, INC.’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION REASONABLY SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF) AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.

i2 TECHNOLOGIES, INC.

CUSIP: 465754 AG 4 R-1

5% SENIOR CONVERTIBLE NOTES DUE 2015

i2 Technologies, Inc., a Delaware corporation (the “Company”, which term shall include any successor corporation under the Indenture referred to on the reverse hereof), promises to pay to Cede & Co., or registered assigns, the principal sum of seventy-five million dollars ($75,000,000) on November 15, 2015 or such greater or lesser amount as is indicated on the Schedule of Exchanges of Securities on the other side of this Security.

Interest Payment Dates:	May 15 and November 15.
Regular Record Dates:	May 1 and November 1.

This Security is convertible as specified on the other side of this Security. Additional provisions of this Security are set forth on the other side of this Security.

This Security may be signed on behalf of the Company with counterpart signature pages, each of which shall be an original and both of which shall together constitute the due execution hereof by the Company.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

i2 TECHNOLOGIES, INC.
By:
	Name:
	Title:
By:
	Name:
	Title:

Dated: November 23, 2005
Trustee’s Certificate of Authentication: This is one of the Securities referred to in the within-mentioned Indenture.
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as Trustee
By:
	Authorized Signatory

i2 TECHNOLOGIES, INC.

5% SENIOR CONVERTIBLE NOTES DUE 2015

1. INTEREST

i2 Technologies, Inc., a Delaware corporation (the “Company”, which term shall include any successor corporation under the Indenture hereinafter referred to), promises to pay interest on the principal amount of this Security at the rate of 5.0% per annum. The Company shall pay interest semiannually in arrears on May 15 and November 15 of each year, commencing May 15, 2006. Interest on the Securities shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from November 23, 2005; provided, however, that if there is not an existing default in the payment of interest and if this Security is authenticated between a Regular Record Date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such Interest Payment Date. Interest will be computed on the basis of a 360 day year, comprised of twelve 30 day months. Any reference herein to interest accrued or payable as of any date shall include any Liquidated Damages accrued or payable on such date.

No sinking fund is provided for the Securities.

2. METHOD OF PAYMENT

The Company shall pay interest on this Security (except defaulted interest) to the person who is the Holder of this Security at the close of business on May 1 or November 1, as the case may be (each, a Regular Record Date), immediately preceding the related Interest Payment Date. The Holder must surrender this Security to a Paying Agent to collect payment of principal. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company may, however, pay principal and interest in respect of any Certificated Security by check or wire transfer payable in such money; provided, however, that a Holder with an aggregate principal amount in excess of $2,000,000 will be paid by wire transfer in immediately available funds at the election of such Holder if such Holder has provided wire transfer instructions to the Company and the Trustee. The Company may mail an interest check to the Holder’s registered address. Notwithstanding the foregoing, so long as this Security is registered in the name of a Depositary or its nominee, all payments hereon shall be made by wire transfer of immediately available funds to the account of the Depositary or its nominee.

3. PAYING AGENT, REGISTRAR AND CONVERSION AGENT

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

4. INDENTURE, LIMITATIONS

This Security is one of a duly authorized issue of Securities of the Company designated as its 5% Senior Convertible Notes due 2015 (the “Securities”), issued under an Indenture dated as of November 23, 2005 (together with any supplemental indentures thereto, the “Indenture”), between the Company and the Trustee. The terms of this Security include those stated in the Indenture and those required by or made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended, as in effect on the date of the Indenture. This Security is subject to all such terms, and the Holder of this Security is referred to the Indenture and said Act for a statement of them.

The Securities are unsecured obligations of the Company limited to $75,000,000 in aggregate principal amount (subject to increase by up to an additional aggregate principal amount of $11,250,000 in the event the Purchasers (as defined in Purchase Agreement dated as of November 21, 2005 (the “Purchase Agreement”) between the Company and the Purchasers thereunder) exercise the right to purchase Additional Securities (as defined in the Purchase Agreement) pursuant to the Purchase Agreement). Pursuant to the terms of the Indenture, the Company shall not, and the Company shall not permit any Subsidiary to, directly or indirectly, incur, guarantee or assume any Indebtedness (including Acquired Indebtedness), other than, Permitted Indebtedness.

5. OPTIONAL REDEMPTION

Prior to May 20, 2008, this Security shall not be redeemable. On or after May 20, 2008, the Company may, at its option, redeem this Security if (i) on the date that the Company gives the Redemption Notice the Closing Sale Price of the Common Stock exceeds 175% of the Conversion Price for at least 20 Trading Days in any 30 consecutive Trading Day period, including the last day of the period, ending on the Trading Day prior to the date the Company delivers the Redemption Notice, appropriately adjusted to take into account the occurrence, during such 30 Trading Day period, of any event described in Sections 4.6 and 4.11 of the Indenture and (ii) on the date that the Company delivers such Redemption Notice through the Redemption Date, the Common Stock issuable upon conversion of the Securities is either (1) covered by a registration statement covering resales thereof that is effective and available for use and is expected to remain effective and available for use for the 30 days following the date of such Redemption Notice or (2) eligible to be resold by non-affiliates pursuant to Rule 144(k) under the Securities Act, at a Redemption Price equal to 100% of the principal amount of the Securities being redeemed, in each case for cash in whole, or from time to time in part (which must be equal to $1,000 or any integral multiple thereof), plus accrued and unpaid interest (including any accrued and unpaid Liquidated Damages) to, but excluding, the Redemption Date; provided, that if the Redemption Date falls after a Regular Record Date and on or before an Interest Payment Date, then the interest will be payable to the Holder in whose names this Security is registered at the close of business on such Regular Record Date. Securities or portions of this Security called for redemption may be converted by the Holder in accordance with the provisions of Article 4 of the Indenture until 5:00 p.m., New York City time, on the second Trading Day prior to the Redemption Date.

6. NOTICE OF REDEMPTION

Notice of redemption, as set forth in Section 3.3 of the Indenture, will be mailed by first-class mail at least 30 days but not more than 60 days before the Redemption Date to each Holder of Securities to be redeemed at its registered address. Securities in denominations larger than $1,000 may be redeemed in part, but only in whole multiples of $1,000. On and after the Redemption Date, subject to the deposit with the Paying Agent of funds sufficient to pay the Redemption Price plus accrued interest to, but excluding, the Redemption Date, interest shall cease to accrue on Securities or portions of them called for redemption.

7. REPURCHASE OF SECURITIES AT OPTION OF HOLDER ON A SPECIFIED DATE; REPURCHASE OF SECURITIES AT OPTION OF HOLDER UPON REDEMPTION OF SERIES B PREFERRED STOCK; REPURCHASE OF SECURITIES AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE

At the option of the Holder and subject to the terms and conditions of the Indenture, the Company shall become obligated to repurchase all or any part specified by the Holder (so long as the principal amount of such part is $1,000 or an integral multiple of $1,000 in excess thereof) of the Securities held by such Holder on November 15, 2010, at a purchase price equal to 100% of the principal amount thereof together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Repurchase Date. The Holder shall have the right to withdraw any Repurchase Notice (in whole or in a portion thereof that is $1,000 or an integral multiple of $1,000 in excess thereof) at any time prior to 5:00 p.m., New York City time, on the second Trading Day next preceding the Repurchase Date by delivering a written notice of withdrawal to the Paying Agent in accordance with the terms of the Indenture.

At the option of the Holder and subject to the terms and conditions of the Indenture, the Company shall become obligated to repurchase all or any part specified by the Holder (so long as the principal amount of such part is $1,000 or an integral multiple of $1,000 in excess thereof) of the Securities held by such Holder, at a purchase price equal to 100% of the principal amount thereof together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Preferred Redemption Repurchase Date; provided, however, that if less than all of the outstanding shares of Series B Preferred Stock are redeemed by the Company, the Company shall not be obligated to redeem any portion of the Securities of any Holder in excess of the amount determined by multiplying the aggregate principal amount of Securities then held by such Holder by a fraction of which the numerator shall be the number of shares of Series B Preferred Stock redeemed by the Company and of which the denominator shall be the total number of shares of Series B Preferred Stock outstanding at the time of such redemption. The Holder shall have the right to withdraw any Preferred Redemption Repurchase Notice (in whole or in a portion thereof that is $1,000 or an integral multiple of $1,000 in excess thereof) at any time prior 5:00 p.m., New York City time, on the second Trading Day next preceding the Preferred Redemption Repurchase Date by delivering a written notice of withdrawal to the Paying Agent in accordance with the terms of the Indenture.

At the option of the Holder and subject to the terms and conditions of the Indenture, the Company shall become obligated to repurchase all or any part specified by the Holder (so long as the principal amount of such part is $1,000 or an integral multiple of $1,000

in excess thereof) of the Securities held by such Holder, on the Fundamental Change Repurchase Date at a purchase price equal to 100% of the principal amount thereof together with interest and Liquidated Damages, if any, accrued and unpaid to, but excluding, the Fundamental Change Repurchase Date. The Holder shall have the right to withdraw any Fundamental Change Repurchase Notice (in whole or in a portion thereof that is $1,000 or an integral multiple of $1,000 in excess thereof) at any time prior 5:00 p.m., New York City time, on the Trading Day next preceding the Fundamental Change Repurchase Date by delivering a written notice of withdrawal to the Paying Agent in accordance with the terms of the Indenture.

8. CONVERSION

Subject to and upon compliance with the provisions of the Indenture, a Holder of a Security may convert the principal amount of such Security (or any portion thereof equal to $1,000 or any integral multiple of $1,000 in excess thereof) into cash and shares of Common Stock (if any) under the circumstances and during the periods set forth in Sections 4.1(b), 4.1(c) and 4.1(d) of the Indenture; provided, however, that, if such Security is submitted for redemption or repurchase pursuant to Article 3 of the Indenture, such conversion right shall terminate at the close of business on the second Trading Day immediately preceding the Redemption Date, the Repurchase Date, the Preferred Redemption Repurchase Date or the Fundamental Change Purchase Date, as the case may be, for such Security or such earlier date as the Holder presents such Security for redemption or repurchase (unless the Company shall default in making the Redemption Price, Repurchase Price, Preferred Redemption Repurchase Price or Fundamental Change Purchase Price payment when due, in which case the conversion right shall terminate at the close of business on the date such default is cured and such Security is redeemed or repurchased).

Until Stockholder Approval shall have been obtained, the Company may not (and shall not) issue or deliver more than 41.96 shares of Common Stock (subject to appropriate adjustment for any stock splits, stock dividends and similar events pursuant to subsection (a) of Section 4.6 of the Indenture) (the “Conversion Shares Cap”) for each $1,000 principal amount of Securities upon conversion thereof pursuant to Section 4.5 of the Indenture and/or as payment of a Make-Whole Premium with respect to such $1,000 principal amount of Securities. To the extent the Company is precluded from issuing shares of Common Stock upon conversion of any Securities prior to obtaining Stockholder Approval due to the Conversion Shares Cap, then the Daily Conversion Value for any Trading Day during the applicable Conversion Period after the Conversion Shares Cap has been reached shall be paid by the Company in Cash.

The initial Conversion Price is $15.4675 per share, and the initial Conversion Rate is 64.6517 shares of Common Stock, in each case subject to adjustment under certain circumstances as provided in the Indenture. No fractional shares will be issued upon conversion; in lieu thereof, the Company shall deliver a number of shares of Common Stock equal to the aggregate of the fractional shares otherwise deliverable for each of the twenty Trading Days during the Conversion Period following the Conversion Date (rounding down to the nearest whole number) and shall pay an amount in cash for the remainder based upon the Volume Weighted Average Price of the Common Stock on the twentieth Trading Day of such Conversion Period.

The right to convert any Security may be exercised, if such Security is represented by a Global Security, by book-entry transfer to the Conversion Agent (which initially shall be the Trustee) through the facilities of the Depositary in accordance with the Applicable Procedures or, if such Security is represented by a Certificated Security, a Holder must (a) complete and manually sign the conversion notice set forth below and deliver such notice to a Conversion Agent, (b) surrender the Security to a Conversion Agent, (c) furnish appropriate endorsements and transfer documents if required by a Registrar or a Conversion Agent and (d) pay any transfer or similar tax, if required. A Holder may convert a portion of a Security equal to $1,000 or any integral multiple thereof.

A Security in respect of which a Holder had delivered a Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, exercising the option of such Holder to require the Company to repurchase such Security may be converted only if the Repurchase Notice, Preferred Redemption Repurchase Notice or Fundamental Change Repurchase Notice, as the case may be, is withdrawn in accordance with the terms of the Indenture.

9. DENOMINATIONS, TRANSFER, EXCHANGE

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

10. PERSONS DEEMED OWNERS

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

11. UNCLAIMED MONEY

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

12. AMENDMENT, SUPPLEMENT AND WAIVER

Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding, and an existing default or Event of Default and its consequence or compliance with any provision of the Indenture or the Securities may be waived in a particular instance with the consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. Without the consent of or notice to any Holder, the Company and the Trustee may amend or supplement the Indenture or the Securities to, among

other things, cure any ambiguity, defect or inconsistency or make any other change that does not adversely affect the rights of any Holder.

13. SUCCESSOR ENTITY

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

14. DEFAULTS AND REMEDIES

The Holder of this Security is entitled to certain remedies upon the occurrence of an Event of Default as set out in Article 8 of the Indenture.

15. TRUSTEE DEALINGS WITH THE COMPANY

JPMorgan Chase Bank, National Association, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from and perform services for the Company or an Affiliate of the Company, and may otherwise deal with the Company or an Affiliate of the Company, as if it were not the Trustee.

16. 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 Securities or the Indenture nor for any claim based on, in respect of or by reason of such obligations or their creation. The Holder of this Security by accepting this Security waives and releases all such liability. The waiver and release are part of the consideration for the issuance of this Security.

17. AUTHENTICATION

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

18. ABBREVIATIONS AND DEFINITIONS

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

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

19. INDENTURE TO CONTROL; GOVERNING LAW

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

The Company will furnish to any Holder, upon written request and without charge, a copy of the Indenture. Requests may be made to: i2 Technologies, Inc., 11701 Luna Road, Dallas, Texas 75234; Attention: General Counsel.

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

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

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

and irrevocably appoint

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

	Your Signature:
Date:  ________________________
	(Sign exactly as your name appears on the other side of this Security)

*Signature guaranteed by:

By:

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

CONVERSION NOTICE

To convert this Security into Cash and Common Stock (if any) of the Company, check the box: ¨

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

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

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

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

	Your Signature:
Date:  ________________________
	(Sign exactly as your name appears on the other side of this Security)

*Signature guaranteed by:

By:

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

REPURCHASE NOTICE

To: i2 Technologies, Inc.

The undersigned registered owner of this Security hereby requests and instructs i2 Technologies, Inc. (the “Company”) to repurchase the entire principal amount of this Security, or the portion thereof (which is $1,000 or an integral multiple thereof) below designated, in accordance with the terms of the Indenture referred to in this Security at the Repurchase Price, together with accrued interest to, but excluding, such date, to the registered Holder hereof.

Dated: ____________
	Signature(s)
	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 redeemed

(in an integral multiple of $1,000, if less than all):

___________________________

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

PREFERRED REDEMPTION REPURCHASE NOTICE

To: i2 Technologies, Inc.

The undersigned registered owner of this Security hereby requests and instructs i2 Technologies, Inc. (the “Company”) to repurchase the entire principal amount of this Security, or the portion thereof (which is $1,000 or an integral multiple thereof) below designated, in accordance with the terms of the Indenture referred to in this Security at the Preferred Redemption Repurchase Price, together with accrued interest to, but excluding, such date, to the registered Holder hereof. Notwithstanding the foregoing, the undersigned acknowledges and agrees that under the terms of the Indenture the Company shall not be obligated to redeem any portion of this Security in excess of the amount determined by multiplying the aggregate principal amount of this Security by a fraction of which the numerator shall be the number of shares of Series B Preferred Stock redeemed by the Company and of which the denominator shall be the total number of shares of Series B Preferred Stock outstanding at the time of such redemption.

Dated: ____________
	Signature(s)
	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 redeemed

(in an integral multiple of $1,000, if less than all):

___________________________

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

OPTION TO ELECT REPURCHASE

UPON A FUNDAMENTAL CHANGE

To: i2 Technologies, Inc.

The undersigned registered owner of this Security hereby irrevocably acknowledges receipt of a notice from i2 Technologies, Inc. (the “Company”) as to the occurrence of a Fundamental Change with respect to the Company and requests and instructs the Company to repurchase the entire principal amount of this Security, or the portion thereof (which is $1,000 or an integral multiple thereof) below designated, in accordance with the terms of the Indenture referred to in this Security at the Fundamental Change Repurchase Price, together with accrued interest to, but excluding, such date, to the registered Holder hereof.

Dated: ____________
	Signature(s)
	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 redeemed

(in an integral multiple of $1,000, if less than all):

___________________________

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

SCHEDULE OF EXCHANGES OF SECURITIES

The following exchanges, redemptions, repurchases or conversions of a part of this global Security have been made:

Principal Amount
of this Global Note
Following Such
Decrease Date
of Exchange (or Increase) Authorized
Signatory of
Securities Custodian Amount of Decrease
in Principal Amount
of this Global Note Amount of Increase
in Principal Amount
of this Global Note

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION

OF TRANSFER OF RESTRICTED SECURITIES³

Re: 5% Senior Convertible Notes due 2015 (the “Securities”) of i2 Technologies, Inc.

This certificate relates to $_______ principal amount of Securities owned in (check applicable box) ¨ book-entry or ¨ definitive form by _____________ (the “Transferor”).

The Transferor has requested a Registrar or the Trustee to exchange or register the transfer of such Securities.

In connection with such request and in respect of each such Security, the Transferor does hereby certify that the Transferor is familiar with transfer restrictions relating to the Securities as provided in Section 2.12 of the Indenture dated as of November 23, 2005 between i2 Technologies, Inc. and JPMorgan Chase Bank, National Association, as trustee (the “Indenture”), and the transfer of such Security is being made pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”) (check applicable box) or the transfer or exchange, as the case may be, of such Security does not require registration under the Securities Act because (check applicable box):

¨ Such Security is being transferred pursuant to an effective registration statement under the Securities Act.

¨ Such Security is being acquired for the Transferor’s own account, without transfer.

¨ Such Security is being transferred to the Company or a Subsidiary (as defined in the Indenture) of the Company.

¨ Such Security is being transferred to a person the Transferor reasonably believes is a “qualified institutional buyer” (as defined in Rule 144A or any successor provision thereto (“Rule 144A”) under the Securities Act) that is purchasing for its own account or for the account of a “qualified institutional buyer”, in each case to whom notice has been given that the transfer is being made in reliance on such Rule 144A, and in each case in reliance on Rule 144A.

¨ Such Security is being transferred pursuant to and in compliance with an exemption from the registration requirements under the Securities Act in accordance with Rule 144 (or any successor thereto) (“Rule 144”) under the Securities Act.

¨ Such Security is being transferred to a non-U.S. Person in an offshore transaction in compliance with Rule 904 of Regulation S under the Securities Act (or any successor thereto).

¨ Such Security is being transferred pursuant to and in compliance with an exemption from the registration requirements of the Securities Act (other than an exemption referred to above) and as a result of which such Security will, upon such transfer, cease to be a “restricted security” within the meaning of Rule 144 under the Securities Act.

The Transferor acknowledges and agrees that, if the transferee will hold any such Securities in the form of beneficial interests in a global Security which is a “restricted security” within the meaning of Rule 144 under the Securities Act, then such transfer can only be made pursuant to (i) Rule 144A under the Securities Act and such transferee must be a “qualified institutional buyer” (as defined in Rule 144A) or (ii) Regulation S under the Securities Act.

Date:  _______________________
	(Insert Name of Transferor)

EX-4.3

EXHIBIT 4.3

[FORM OF WARRANT]

THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. NOTWITHSTANDING THE FOREGOING, THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THIS SECURITY.

THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH i2 TECHNOLOGIES, INC. OR ANY AFFILIATE OF i2 TECHNOLOGIES, INC. WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO i2 TECHNOLOGIES, INC. OR ANY PARENT OR SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO i2 TECHNOLOGIES, INC.’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION REASONABLY SATISFACTORY TO IT, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRANSFER AGENT. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS DEFINED BELOW) AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.

i2 TECHNOLOGIES, INC.

WARRANT TO PURCHASE COMMON STOCK

Warrant No.:                     

Number of Shares of Common Stock: [                    ]

Date of Issuance: November ___, 2005 (“Issuance Date”)

i2 Technologies, Inc., a corporation incorporated under the laws of the state of Delaware (the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, [BUYER], the registered holder hereof or its permitted assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, upon surrender of this Warrant To Purchase Common Stock (including any Warrants To Purchase Common Stock issued in exchange, transfer or replacement hereof, the “Warrant”), at any time or times on or after the date hereof, but not after 11:59 p.m., New York Time, on the Warrant Expiration Date (as defined below), [            ] fully paid and nonassessable shares of Common Stock (the “Warrant Shares”). Except as otherwise defined herein, capitalized terms in this Warrant shall have the meanings set forth in Section 14. This Warrant is one of the Warrants to purchase Common Stock (the “SPA Warrants”) issued pursuant to Section 1 of that certain Purchase Agreement (the “Securities Purchase Agreement”), dated as of November ___, 2005 (the “Subscription Date”), by and among the Company and the investors referred to therein (the “Buyers”).

1. EXERCISE OF WARRANT.

(a) Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)), this Warrant may be exercised by the Holder on any day on or after the date hereof, in whole or in part, by (i) delivery by facsimile with a confirmatory written notice by overnight delivery, in the form attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant and (ii)(A) payment to the Company of an amount equal to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate Exercise Price”) in cash or wire transfer of immediately available funds or (B) by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the second Business Day following the date on which the Company has received each of the Exercise Notice and the Aggregate Exercise Price (or notice of a Cashless Exercise) (the “Exercise Delivery Documents”), the Company shall transmit by facsimile an acknowledgment of confirmation of receipt of the Exercise Delivery Documents to the Holder and the Company’s transfer agent (the “Transfer Agent”). On or before the third Business Day following the date on which the Company has received all of the Exercise Delivery Documents (the “Share Delivery Date”), the Company shall, subject to applicable laws (X) provided that the Transfer Agent is participating in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program, upon the request of the Holder, credit such

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aggregate number of shares of Common Stock to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through its Deposit Withdrawal Agent Commission system (which balance account shall be specified in the Exercise Notice), or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and dispatch by overnight courier to the address as specified in the Exercise Notice a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery of the Exercise Notice and Aggregate Exercise Price referred to in clause (ii)(A) above or notification to the Company of a Cashless Exercise referred to in clause (ii)(B) above, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates evidencing such Warrant Shares. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than five Business Days after any exercise and at its own expense, issue a new Warrant (in accordance with Section 6(d)) representing the right to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional shares of Common Stock are to be issued upon the exercise of this Warrant, but rather the number of shares of Common Stock to be issued shall be rounded up to the nearest whole number. The Company shall pay any and all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any issuance of Warrant Shares to any Person other than the Holder or with respect to any income tax due by the Holder with respect to such Warrant Shares. The Warrant Shares shall bear the legends referred to in Section 4(n) of the Securities Purchase Agreement, to the extent required thereby.

(b) Exercise Price. For purposes of this Warrant, “Exercise Price” means $15.4675, subject to adjustment as provided herein.

(c) Company’s Failure to Timely Deliver Securities. Subject to Section 12, if within three (3) Trading Days after the Company’s receipt of the facsimile copy of an Exercise Notice, with confirmatory notice by overnight delivery, the Company shall fail to issue and deliver a certificate to the Holder and register such Common Stock on the Company’s share register or credit the Holder’s balance account with DTC for the number of shares of Common Stock to which the Holder is entitled upon such holder’s exercise hereunder, and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Company (a “Buy-In”), then the Company shall, within three Business Days after the Holder’s request and in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased (the “Buy-In Price”), at which point the Company’s obligation to deliver such certificate (and to issue such Common Stock) shall terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such shares of Common Stock and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-

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In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing Sale Price on the date of exercise.

(d) Cashless Exercise. Notwithstanding anything contained herein to the contrary, if a Shelf Registration Statement (as defined in the Registration Rights Agreement) covering the Warrant Shares that are the subject of the Exercise Notice (the “Unavailable Warrant Shares”) is not available for the resale of such Unavailable Warrant Shares, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the “Net Number” of shares of Common Stock determined according to the following formula (a “Cashless Exercise”):

Net Number = (A x B) - (A x C)

                        B

For purposes of the foregoing formula:

A= the total number of shares with respect to which this Warrant is then being exercised.

B= the arithmetic average of the Volume Weighted Average Price of the Common Stock during the five (5) Trading Days immediately preceding the date of the Exercise Notice.

C= the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.

(e) Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance with Section 11.

(f) Limitations on Exercises; Beneficial Ownership. The Company shall not effect the exercise of this Warrant, and no holder of SPA Warrants shall have the right to exercise any SPA Warrants, to the extent that after giving effect to such exercise, any holder (together with such holder’s affiliates) would beneficially own in excess of 4.99% of the shares of Common Stock outstanding immediately after giving effect to such exercise (the “Exercise Limitation”). For purposes of the foregoing sentence, the shares of Common Stock beneficially owned by a holder and its affiliates shall include the Common Stock issuable upon exercise of any SPA Warrants with respect to which the determination of such sentence is being made, but shall exclude Common Stock which would be issuable upon (i) exercise of the remaining, unexercised portion of any Warrants beneficially owned by such holder or any of its affiliates and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by such holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d) of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of this Warrant, in determining the number of

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shares of outstanding Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent annual, quarterly or current report on Form 10-K, 10-Q or Form 8-K, respectively, as the case may be; (y) a more recent public announcement by the Company or (z) any other notice by the Company setting forth the number of shares of Common Stock outstanding. For any reason at any time, upon the written or oral request of the Holder, the Company shall within two Business Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including the SPA Notes and the SPA Warrants, by the Holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. By written notice to the Company, the Holder may increase or decrease the Exercise Limitation to any other percentage not in excess of 9.99% specified in such notice; provided, that (i) any such increase will not be effective until the 61st day after such notice is delivered to the Company, and (ii) any such increase or decrease will apply only to the Holder and not to any other holder of SPA Warrants. Notwithstanding the foregoing, the Exercise Limitation shall not be applicable on any of the ten Trading Days up to and including the effective date of a Change of Control.

(g) Until Stockholder Approval shall have been obtained, the Company may not (and shall not) issue or deliver more than 500,000 shares of Common Stock (subject to appropriate adjustments for any stock splits, stock dividends and similar events pursuant to Section 2(a) (the “Exercise Shares Cap”) upon exercise of the SPA Warrants pursuant to Section 1(a) thereof.

(h) To the extent the Company is precluded from issuing shares of Common Stock upon any exercise of this Warrant prior to obtaining Stockholder Approval due to the Exercise Shares Cap, then the Company shall pay to the Holder in cash an amount equal to the product of the Closing Sale Price on the Exercise Date multiplied by the number of Warrant Shares the Company is so precluded from issuing.

2. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:

(a) In case the Company shall (i) pay a dividend on its Common Stock in shares of Common Stock, (ii) make a distribution on its Common Stock in shares of Common Stock, (iii) subdivide its outstanding Common Stock into a greater number of shares, or (iv) combine its outstanding Common Stock into a smaller number of shares, the Exercise Price and number of Warrant Shares in effect immediately prior thereto shall be adjusted so that the Holder of any Warrant thereafter surrendered for exercise shall be entitled to receive that number of shares of Common Stock which it would have owned immediately following the happening of such event had such Warrant been exercised immediately prior to the record date of such event or the happening of such event. Adjustments made pursuant to this subsection (a) shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of subdivision or combination.

(b) In case the Company shall issue rights, options or warrants to all or substantially all holders of its Common Stock entitling them (for a period commencing no earlier

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than the record date described below and expiring not more than 60 days after such record date) to subscribe for or purchase shares of Common Stock (or securities convertible into or exercisable or exchangeable for Common Stock) at a price per share (or having a conversion, exercise or exchange price per share) less than the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 2) on the record date for the determination of stockholders entitled to receive such rights, options or warrants (or if no record date is fixed the Business Day immediately prior to the date of announcement of such issuance). (treating the conversion exercise or exchange price per share of the securities convertible into or exercisable or exchangeable for Common Stock as equal to (x) the sum of (i) the price for a unit of the security convertible into or exercisable or exchangeable for Common Stock and (ii) any additional consideration initially payable upon the conversion of such security into or exercise or exchange of such security for Common Stock divided by (y) the number of shares of Common Stock initially underlying such security), the Exercise Price in effect immediately prior thereto shall be adjusted so that the same shall equal the price determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on such record date (or if no record date is fixed, the date immediately prior to the date of announcement of such issuance) plus the number of shares which the aggregate offering price of the total the number of shares of Common Stock so offered (or the aggregate conversion exercise or exchange price of the securities so offered, which shall be determined by multiplying the number of shares of Common Stock issuable upon conversion, exercise or exchange of such securities by the applicable conversion, exercise or exchange price per share of Common Stock pursuant to the terms of such securities) would purchase at the Current Market Price per share (as defined in subsection (g) of this Section 2) of Common Stock on such record date, and of which the denominator shall be the number of shares of Common Stock outstanding on such record date (or if no record date is fixed, the date immediately prior to the date of announcement of such issuance) plus the number of additional shares of Common Stock offered (or into which the securities so offered are convertible, exchangeable or exercisable). Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. The adjustments contemplated by this Section 2(b) shall be made successively whenever any such rights, options or warrants are issued and shall become effective immediately after such record date. If at the end of the period during which such rights, options or warrants are exercisable not all rights or warrants shall have been exercised, the adjusted Exercise Price and adjusted number of Warrant Shares shall be immediately readjusted to what they would have been based upon the number of additional shares of Common Stock actually issued (or the number of shares of Common Stock issuable upon conversion of convertible securities actually issued).

(c) In case the Company shall distribute to all or substantially all holders of its Common Stock any shares of capital stock of the Company (other than Common Stock), evidences of indebtedness or other non-cash assets (including securities of any person other than the Company but excluding (1) dividends or distributions paid exclusively in cash or (2) dividends or distributions referred to in subsection (a) of this Section 2), or shall distribute to all or substantially all holders of its Common Stock rights, options or warrants to subscribe for or purchase any of its securities (excluding those rights, options and warrants referred to in

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subsection (b) of this Section 2 and also excluding the distribution of rights to all holders of Common Stock pursuant to a Rights Plan (as defined below)), then in each such case the Exercise Price shall be adjusted so that the same shall equal the price determined by multiplying the current Exercise Price by a fraction of which the numerator shall be the Current Market Price per share (as defined in subsection (g) of this Section 2) of the Common Stock on the record date mentioned below less the fair market value on such record date (as determined by the Board of Directors, whose determination shall be conclusive evidence of such fair market value and which shall be evidenced by an Officers’ Certificate delivered to the Trustee) of the portion of the capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights, options or warrants applicable to one share of Common Stock (determined on the basis of the number of shares of Common Stock outstanding on the record date), and of which the denominator shall be the Current Market Price per share (as defined in subsection (g) of this Section 2) of the Common Stock on such record date. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. The adjustments contemplated by this Section 2(c) shall be made successively whenever any such distribution is made and shall become effective immediately after the record date for the determination of shareholders entitled to receive such distribution.

In the event the then fair market value (as so determined) of the portion of the capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights or warrants applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on such record date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of a Warrant shall have the right to receive upon exercise the amount of capital stock, evidences of indebtedness or other non-cash assets so distributed or of such rights, options or warrants the Holder would have received had such Holder exercised this Warrant on such record date. In the event that such dividend or distribution is not so paid or made, the Exercise Price and number of Warrant Shares shall again be adjusted to be the Exercise Price and number of Warrant Shares which 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 2(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price of the Common Stock.

Notwithstanding the foregoing, if the securities distributed by the Company to all or substantially all holders of its Common Stock consist of capital stock of, or similar equity interests in, a Subsidiary or other business unit, the Exercise Price shall be decreased so that the same shall be equal to the rate determined by multiplying the Exercise Price in effect on the record date with respect to such distribution by a fraction the numerator of which shall be the average Closing Sale Price of one share of Common Stock over the Spinoff Valuation Period and of which the denominator shall be the sum of (x) the average Closing Sale Price of one share of Common Stock over the ten consecutive Trading Day period (the “Spinoff Valuation Period”) commencing on and including the fifth Trading Day after the date on which “ex-dividend trading” commences on the Common Stock on the Nasdaq National Market or such

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other national or regional exchange or market on which the Common Stock is then listed or quoted and (y) the average Closing Sale Price over the Spinoff Valuation Period of the portion of the securities so distributed applicable to one share of Common Stock, such adjustment to become effective immediately prior to the opening of business on the fifteenth Trading Day after the date on which “ex-dividend trading” commences. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment.

In lieu of the foregoing, the Company may at the time of the public announcement of such distribution elect in a written notice provided to the Holder to reserve the pro rata portion of such securities so that the Holder shall have the right to receive upon exercise the amount of such shares of capital stock or similar equity interests of such Subsidiary or business unit that the Holder would have received if the Holder had exercised this Warrant on the record date with respect to such distribution.

With respect to any rights under a preferred shares rights plan of the Company (“Rights Plan”), upon any exercise of the SPA Warrants, to the extent that the Rights Plan is still in effect upon such exercise, the holders of SPA Warrants will receive, in addition to the Common Stock, the rights described therein (whether or not the rights have separated from the Common Stock at the time of exercise), subject to the limitations set forth in any such Rights Plan (including such limitations as would be applicable to a Holder if the Holder is or becomes an “Acquiring Person” or “Adverse Person” as such terms are defined in the Rights Plan). If the Rights Plan provides that upon separation of rights under such plan from the Common Stock that the Holders would not be entitled to receive any such rights in respect of the Common Stock issuable upon any exercise of the SPA Warrants, the Exercise Price will be adjusted as provided in this Section 2 (with such separation deemed to be the distribution of such rights), subject to readjustment in the event of the expiration, termination or redemption of the rights; provided, however, that there shall be no such adjustment in respect of any Holder that is or becomes an “Acquiring Person” or “Adverse Person” under the Rights Plan and, in the event an adjustment to the Exercise Price shall have already been made under this paragraph in respect of such separation of rights, it shall be readjusted and rescinded in respect of any Holder that is or becomes an “Acquiring Person” or “Adverse Person.” Any distribution of rights or warrants pursuant to a Rights Plan complying with the requirements set forth in the immediately preceding sentence of this paragraph shall not constitute a distribution of rights or warrants pursuant to this Section 2(c).

Rights, options or warrants (other than rights issued pursuant to a Rights Plan) distributed by the Company to all or substantially 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, options 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 2 (and no adjustment to the Exercise Price under this Section 2 will be required) until the occurrence of the earliest Trigger Event, whereupon such rights, options and warrants shall be

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deemed to have been distributed and an appropriate adjustment (if any is required) to the Exercise Price and number of Warrant Shares shall be made under this Section 2(c). If any such right, options or warrant, including any such existing rights, options or warrants distributed prior to the date of this Warrant, are subject to events, upon the occurrence of which such rights, options or warrants become exercisable to purchase different securities, evidences of indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and record date with respect to new rights, options or warrants with such rights (and a termination or expiration of the existing rights, options or warrants without exercise by any of the holders thereof). In addition, in the event of any distribution (or deemed distribution) of rights, options or warrants, or any Trigger Event or other event (of the type described in the preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Exercise Price and number of Warrant Shares under this Section 2 was made, (1) in the case of any such rights, options or warrants which shall all have been redeemed or repurchased without exercise by any holders thereof, the Exercise Price and number of Warrant Shares shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of Common Stock with respect to such rights, options or warrants (assuming such holder had retained such rights, options or warrants), made to all or substantially all holders of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights, options or warrants which shall have expired or been terminated without exercise by any holders thereof, the Exercise Price and number of Warrant Shares shall be readjusted as if such rights and warrants had not been issued.

(d) In case the Company shall, by dividend or otherwise, at any time distribute (a “Triggering Distribution”) to all or substantially all holders of its Common Stock Cash, the Exercise Price shall be reduced so that the same shall equal the price determined by dividing such Exercise Price in effect on the record date with respect to such Cash dividend or distribution by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 2) as of the day before the “ex” date with respect to the dividend or distribution, and the denominator shall be such Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 2) as of the day before the “ex” date with respect to the dividend or distribution less the amount per share of the Cash dividend or distribution, such decrease to become effective immediately prior to the opening of business on the day following the date on which the Triggering Distribution is paid; provided, however, that, in the event the portion of the Triggering Distribution applicable to one share of Common Stock is equal to or greater than the Current Market Price on such record date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon exercise the amount of Cash such Holder would have received had such Holder exercised each Warrant on such record date. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. In the event that such dividend or distribution is not so paid or made, the Exercise Price and number of Warrant Shares shall again be adjusted to be the Exercise Price and number of Warrant Shares that would then be effect if such dividend or distribution had not been declared.

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(e) In case any tender offer made by the Company or any of its Subsidiaries for Common Stock shall expire and such tender offer (as amended upon the expiration thereof) shall involve the payment of aggregate consideration in an amount (determined as the sum of the aggregate amount of cash consideration and the aggregate fair market value (as determined by the Board of Directors, whose determination shall be conclusive evidence thereof and which shall be evidenced by an Officers’ Certificate delivered to the Trustee thereof) of any other consideration) that exceeds an amount equal to the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 2) as of the last date (the “Expiration Date”) tenders could have been made pursuant to such tender offer (as it may be amended) (the last time at which such tenders could have been made on the Expiration Date is hereinafter sometimes called the “Expiration Time”), then, immediately prior to the opening of business on the day after the Expiration Date, the Exercise Price shall be reduced so that the same shall equal the price determined by multiplying the Exercise Price in effect immediately prior to the close of business on the Expiration Date by a fraction of which the numerator shall be the product of the number of shares of Common Stock outstanding (including tendered shares but excluding any shares held in the treasury of the Company) at the Expiration Time multiplied by the Current Market Price per share of the Common Stock (as determined in accordance with subsection (g) of this Section 2) on the Trading Day next succeeding the Expiration Date and the denominator shall be the sum of (x) the aggregate consideration (determined as aforesaid) payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender offer) of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares and excluding any shares held in the treasury of the Company) at the Expiration Time and the Current Market Price per share of Common Stock (as determined in accordance with subsection (g) of this Section 2) on the Trading Day next succeeding the Expiration Date, such reduction to become effective immediately prior to the opening of business on the day following the Expiration Date. Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. In the event that the Company is obligated to purchase shares pursuant to any such tender offer, but the Company is permanently prevented by applicable law from effecting any or all such purchases or any or all such purchases are rescinded, the Exercise Price and number of Warrant Shares shall again be adjusted to be the Exercise Price and number of Warrant Shares which would have been in effect based upon the number of shares actually purchased. If the application of this Section 2(e) to any tender offer would result in an increase in the Exercise Price, no adjustments shall be made for such tender offer under this Section 2(e).

For purposes of this Section 2(e), the term “tender offer” shall mean and include both tender offers and exchange offers, all references to “purchases” of shares in tender offers (and all similar references) shall mean and include both the purchase of shares in tender offers and the acquisition of shares pursuant to exchange offers, and all references to “tendered shares” (and all similar references) shall mean and include shares tendered in both tender offers and exchange offers.

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(f) In case the Company shall issue, prior to June 3, 2006, shares of Common Stock (or securities convertible into Common Stock) at a price per share (or having a conversion price per share) less than $13.45 (subject to adjustment in the same manner as the Exercise Price is adjusted pursuant to Section 2(a) hereof) (treating the conversion price per share of the securities convertible into Common Stock as equal to (x) the sum of (i) the price for a unit of the security convertible into Common Stock and (ii) any additional consideration initially payable upon the conversion of such security into Common Stock divided by (y) the number of shares of Common Stock initially underlying such security), the Exercise Price in effect immediately prior thereto shall be adjusted so that the same shall equal the price determined by multiplying the Exercise Price in effect immediately prior to the date of such issuance by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on such date plus the number of shares which the aggregate issuance price of the total number of shares of Common Stock so issued (or the aggregate conversion price of the convertible securities so issued, which shall be determined by multiplying the number of shares of Common Stock issuable upon conversion of such convertible securities by the conversion price per share of Common Stock pursuant to the terms of such convertible securities) would purchase at $13.45 per share of Common Stock (subject to adjustment in the same manner as the Exercise Price is adjusted pursuant to Section 2(a) hereof), and of which the denominator shall be the number of shares of Common Stock outstanding on such date plus the number of additional shares of Common Stock issued (or into which the convertible securities so issued are convertible). Upon each such adjustment of the Exercise Price hereunder, the number of Warrant Shares shall be adjusted to the number of shares of Common Stock determined by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares acquirable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Exercise Price resulting from such adjustment. The adjustments contemplated by this Section 2(f) shall be made successively whenever any such Common Stock (or securities convertible into Common Stock) are issued and shall become effective immediately after issuance. If at the end of the period during which any such securities convertible into Common Stock are convertible not all such securities shall have been converted, the adjusted Exercise Price and adjusted number of Warrant Shares shall be immediately readjusted to what they would have been based upon the number of additional shares of Common Stock actually issued upon conversion of such convertible securities. Notwithstanding the foregoing provisions of this Section 2(f), (i) no adjustment to the Exercise Price shall be required to be made hereunder in respect of the first $25 million of Common Stock (or securities convertible into Common Stock) issued after the date hereof at a price per share (or having a conversion price per share) less than $13.45 (subject to adjustment in the same manner as the Exercise Price is adjusted pursuant to Section 2(a) hereof), and (ii) no adjustment to the Exercise Price shall be required to be made hereunder unless a similar adjustment to the conversion price of the Series B Preferred Stock is required to be made under Section 5(b)(iii) of the Certificate of Designations of the Series B Preferred Stock as in effect on the date hereof. The provisions of this Section 2(f) shall expire and be of no further force or effect on June 3, 2006. Until such time as the Company receives the Stockholder Approval, no adjustment shall be made pursuant to this Section 2(f) that shall cause the Exercise Price to be less than $13.4725 (subject to adjustment in the same manner as the Exercise Price is adjusted pursuant to Section 2(a) hereof) (the “Series B Limitation”); provided, however, upon receipt of the Stockholder Approval, any adjustment previously required to this Section 2(f) that was not made by reason of the Series B Limitation shall immediately take effect.

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(g) For the purpose of any computation under subsections (b), (c), (d) or (e) of this Section 2, the current market price (the “Current Market Price”) shall mean, with respect to any date of determination, the average of the Closing Sale Prices per share of Common Stock for the ten consecutive Trading Days ending on the date of determination. For purposes hereof, the term “ex” date, when used with respect to any dividend 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 Sale Price was obtained without the right to receive such dividend or distribution.

(h) In any case in which this Section 2 shall require that adjustments be made following a record date or Expiration Date, as the case may be, established for purposes of this Section 2, the Company may elect to defer (but only until five Business Days following the filing by the Company with the Trustee of the certificate described in Section 4.9 of the Indenture) issuing to the Holder of any Warrant exercised after such record date or Expiration Date the Common Stock and other capital stock of the Company issuable upon such exercise over and above the Common Stock and other capital stock of the Company issuable upon such exercise only on the basis of the Exercise Price and number of Warrant Shares prior to adjustment; and, in lieu of the shares the issuance of which is so deferred, the Company shall issue or cause its transfer agents to issue due bills or other appropriate evidence prepared by the Company of the right to receive such shares. If any distribution in respect of which an adjustment to the Exercise Price and number of Warrant Shares is required to be made as of the record date or Expiration Date therefor is not thereafter made or paid by the Company for any reason, the Exercise Price and number of Warrant Shares shall be readjusted to the Exercise Price and number of Warrant Shares which would then be in effect if such record date had not been fixed or such effective date or Expiration Date had not occurred.

(i) For purposes of this Section 2, “record date” shall mean, with respect to any dividend, distribution or other transaction or event in which the holders of Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged or converted into any combination of cash, securities or other property, the date fixed for determination of stockholders entitled to receive such cash, security or other property (whether or not such date is fixed by the Board of Directors or by statute, contract or otherwise).

(j) No Adjustment. No adjustment in the Exercise Price shall be required unless the adjustment would require an increase or decrease of at least 1% in the Exercise Price as last adjusted; provided, however, that any adjustments which by reason of this Section 2(j) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 2 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be. Except as otherwise provided herein, no adjustment need be made for issuances of Common Stock pursuant to a Company plan for reinvestment of dividends or interest or for a change in the par value or a change to no par value of the Common Stock. To the extent that the Warrant becomes exercisable into the right to receive cash, no adjustment need be made thereafter as to the cash. Interest will not accrue on the cash.

(k) Notice of Adjustments. Upon any adjustment of the Exercise Price or of the number or kind of securities into which this Warrant is exercisable pursuant to the terms

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of this Warrant, the Company shall give written notice thereof to the Holder, which notice shall state the Exercise Price or the number of Warrant Shares or other securities subject to this Warrant resulting from such adjustment, as the case may be, and shall set forth in reasonable detail the method of such calculation and the facts upon which such calculation is based.

(l) Reorganization or Reclassification. Any recapitalization, reorganization or reclassification, in each case which is effected in such a way that the holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as “Organic Change.” Prior to the consummation of any Organic Change, the Company shall make appropriate provision (in form and substance reasonably satisfactory to the Required Holders) to insure that each of the holders shall thereafter have the right to acquire and receive, in lieu of or addition to (as the case may be) the shares of Common Stock immediately theretofore acquirable and receivable upon the exercise of such holder’s SPA Warrant, such shares of stock, securities or assets as would have been issued or payable in such Organic Change (if such holder had exercised its SPA Warrant immediately prior to such Organic Change) with respect to or in exchange for the number of shares of Common Stock immediately theretofore acquirable and receivable upon exercise of such holder’s SPA Warrant had such Organic Change not taken place. In any such case, the Company shall make appropriate provision (in form and substance reasonably satisfactory to the Required Holders) with respect to such holders’ rights and interests to insure that the provisions of this Section 2 and Section 3 hereof shall thereafter be applicable to the SPA Warrants.

3. CHANGE OF CONTROL. The Company shall not enter into or be party to a Change of Control of the type referred to in clauses and (1) or (5) of the definition of such term in Section 14 unless the Successor Entity assumes in writing all of the obligations of the Company under this Warrant and the other Transaction Documents (as defined in the Securities Purchase Agreement) in accordance with the provisions of this Section 3 pursuant to written agreements in form and substance reasonably satisfactory to the Required Holders, including agreements to deliver to each holder of SPA Warrants in exchange for such SPA Warrants a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant exercisable for the Adjusted Warrant Consideration (as defined below). Upon the occurrence of any Change of Control, the Successor Entity, if other than the Company, shall succeed to, and be substituted for (so that from and after the date of such Change of Control, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of any Change of Control, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation of the Change of Control, in lieu of the Common Stock (or other securities, cash, assets or other property) purchasable upon the exercise of the Warrant prior to such Change of Control, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights) which the Holder would have been entitled to receive upon the happening of such Change of Control had this Warrant been converted immediately prior to such Change of Control, as adjusted in accordance with the provisions of this Warrant (provided that, if the type or amount of shares of stock, securities, cash, assets or any other property whatsoever receivable upon such Change of Control is more than a single type of consideration (determined

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based in part upon any form of stockholder election), then the type and amount of consideration will be deemed to be the weighted average of the kind and amounts of consideration received by the holders of the Company’s Common Stock that affirmatively make such an election) (the “Adjusted Warrant Consideration”). In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Change of Control pursuant to which holders of Common Stock are entitled to receive securities or other assets with respect to or in exchange for Common Stock (a “Corporate Event”), the Company shall make appropriate provision to ensure that the Holder will thereafter have the right to receive upon an exercise of this Warrant at any time after the consummation of the Change of Control but prior to the Warrant Expiration Date, in lieu of the Common Stock (or other securities, cash, assets or other property) purchasable upon the exercise of this Warrant prior to such Change of Control, the Adjusted Warrant Consideration. Provision made pursuant to the preceding sentence shall be in form and substance reasonably satisfactory to the Required Holders. In connection with any Change of Control in which all holders of Common Stock and securities convertible into, exercisable for and exchangeable for Common Stock are solely to receive in such Change of Control cash and/or securities of an entity that is not a publicly traded corporation whose capital stock is quoted on or listed on a securities exchange or quotation system in exchange for such securities, the Company shall have the right to require the Holder to sell, and the Holders shall have the option to require the Company to purchase, all or any portion of this Warrant for cash payable at consummation of such Change of Control in an amount equal to the greater of (i) the product of (a) the total number of shares for which this Warrant may be exercised and (b) the difference between the Exercise Price then in effect and the consideration per share received in such Change of Control or (ii) the product of (1) the remaining unexercised portion of this Warrant, on the date of such consummation which value shall be determined by use of the Black-Scholes Option Pricing Model reflecting (a) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of such date of request and (b) an expected volatility equal to the greater of 60% and, to the extent applicable, the 100 day volatility obtained from the historical price volatility function on Bloomberg and (2) the total number of shares for which this Warrant may be exercised. The provisions of this Section shall apply similarly and equally to successive Change of Control and Corporate Events and shall be applied without regard to any limitations on the exercise of this Warrant.

4. COVENANTS. (a) The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, Bylaws or through any reorganization, transfer of assets, consolidation, merger, amalgamation, scheme or plan of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the SPA Warrants are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the exercise of the SPA Warrants, the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the SPA Warrants then outstanding (without regard to any limitations on exercise).

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(b) The Company agrees to use its reasonable best efforts to seek and obtain affirmative approval in accordance with the Company’s Certificate of Incorporation and the rules of The Nasdaq Stock Market at the next special or annual meeting of its stockholders, which shall be held no later than May 31, 2006, for the issuance of a number of shares of Common Stock sufficient to fully provide for the conversion of the SPA Notes and the exercise of the SPA Warrants from time to time as such SPA Notes and SPA Warrants are presented for conversion or exercise, including without limitation the issuance of all such shares in excess of the Exercise Share Cap and Conversion Shares Cap (as defined in the SPA Notes) (such affirmative approval being referred to as the “Stockholder Approval”). If the Company shall not obtain the Stockholder Approval at its next meeting of stockholders, the Company shall use its reasonable best efforts to obtain such approval at each succeeding meeting of its stockholders until such time as it shall have obtained approval for the issuance of a number of shares of Common Stock sufficient to fully provide for the conversion of the SPA Notes and the exercise of the SPA Warrants. Upon receipt by the Company of the Stockholder Approval, the Company shall publish such information on the Company’s web site or through such other public medium as the Company may use at that time.

5. WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, amalgamation, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.

6. REISSUANCE OF WARRANTS.

(a) Transfer of Warrant. This Warrant may only be offered, sold or otherwise transferred (a) pursuant to an effective registration statement under the 1933 Act, (b) to the Company, (c) to an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the 1933 Act, (d) to a “qualified institutional buyer” in accordance with Rule 144A of the 1933 Act, (e) outside the United States in accordance with Rule 904 of Regulation S of the 1933 Act, (f) pursuant to the exemption from registration provided by Rule 144 under the 1933 Act (if available) or (g) pursuant to another available exception from the registration requirements of the Securities Act, subject to the Company’s right prior to any such offer, sale or transfer pursuant to clause (g) to require the delivery of an opinion of counsel, certification and/or other information reasonably satisfactory to it that such offer, sale or transfer does not require registration under the 1933 Act or applicable state securities laws, and the holder shall furnish to the Company an opinion to such effect from counsel of recognized standing reasonably satisfactory to the Company prior to such offer, sale or transfer. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the

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Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 6(d)), registered as the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less then the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 6(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred and the transferee shall agree to be bound by the terms hereof.

(b) Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in a customary form reasonably acceptable to the Company and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 6(d)) representing the right to purchase the Warrant Shares then underlying this Warrant.

(c) Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new Warrant or Warrants (in accordance with Section 6(d)) representing in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no Warrants for fractional shares of Common Stock shall be given.

(d) Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 6(a) or Section 6(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.

7. NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with Section 14 of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail a description of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice to the Holder (i) within ten (10) business days after any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment, (ii) at least fifteen days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of shares of Common Stock or (C) for determining rights to vote with respect to any Change of Control, dissolution or liquidation, provided, in each case, that such information shall be made known to

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the public prior to or in conjunction with such notice being provided to the Holder and (iii) at least 15 days prior to any Change of Control (other than pursuant to clause (3) of such definition, in which case within one (1) day of the Company’s knowledge of such transaction or proposed transaction).

8. AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Required Holders; provided, that no such action may increase the exercise price of any SPA Warrant or decrease the number of shares or class of stock obtainable upon exercise of any SPA Warrant without the written consent of the Holder. No such amendment shall be effective to the extent that it applies to less than all of the holders of the SPA Warrants then outstanding.

9. GOVERNING LAW; JURISDICTION; JURY TRIAL. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. Subject to Section 11, to the fullest extent permitted by applicable law, each party hereby irrevocably submits to the non-exclusive jurisdiction of any New York State court or Federal court sitting in the County of New York in respect of any suit, action or proceeding arising out of or relating to the provisions of this Warrant and irrevocably agree that all claims in respect of any such suit, action or proceeding may be heard and determined in any such court. The parties hereto hereby waive, to the fullest extent permitted by applicable law, any objection that they may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court, and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.

10. CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and all the Buyers and shall not be construed against any person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant.

11. DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s independent, outside accountant. The Company shall use reasonable best efforts to cause at its expense the investment bank or the accountant, as the case may be, to perform the

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determinations or calculations and notify the Company and the Holder of the results no later than ten Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

12. REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.

13. TRANSFER. Subject to Section 6 hereof, this Warrant may be offered for sale, sold, transferred or assigned without the consent of the Company.

14. CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:

(a) “Bloomberg” means Bloomberg Financial Markets.

(b) “Board of Directors” means the Board of Directors of the Company, or any committee thereof.

(c) “Business Day” means each day that is not a Legal Holiday.

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

(e) “Change in Control” shall be deemed to have occurred if any of the following occurs after the date hereof:

(1) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the Company’s assets to any person or group of related persons (other than to any of the Company’s wholly owned Subsidiaries);

(2) the approval by the holders of the Company’s Capital Stock of any plan or proposal for the liquidation or dissolution of the Company;

(3) if any person or group shall become the beneficial owner, directly or indirectly, of shares representing more than 50% of the aggregate ordinary voting power represented by issued and outstanding voting stock of the Company; or

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(4) at any time the following persons cease for any reason to constitute a majority of the Company’s Board of Directors: (i) individuals who on the date hereof constituted the Company’s Board of Directors; (ii) any new directors who are elected to the Company’s Board of Directors by the holders of the Series B Preferred Stock; and (iii) any other new directors whose appointment to the Company’s Board of Directors or whose nomination for election by the Company’s stockholders was approved by at least a majority of the directors of the Company then still in office either (A) who were directors of the Company on the date hereof, (B) were elected to the Company’s Board of Directors by the holders of the Series B Preferred Stock or (C) whose appointment or nomination for election was previously so approved; or

(5) any consolidation or merger by the Company where persons who are beneficial owners, directly or indirectly, of the Company’s shares of voting stock immediately prior to such transaction no longer beneficially own, directly or indirectly, at least a majority of the aggregate ordinary voting power represented by issued and outstanding voting stock of the continuing or surviving corporation or entity.

For purposes of the definition of Change in Control: (i) “person” or “group” have the meanings given to them for purposes of Sections 13(d) and 14(d) of the Exchange Act or any successor provisions, and the term “group” includes any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act (or any successor provision); (ii) a “beneficial owner” will be determined in accordance with Rule 13d-3 under the Exchange Act, as in effect on the date of this Warrant; (iii) “beneficially owned” and “beneficially own” have meanings correlative to that of beneficial owner; and (iv) “voting stock” means any class or classes of Capital Stock pursuant to which the holders of Capital Stock under ordinary circumstances have the power to vote in the election of the board of directors, managers or trustees of any person or other persons performing similar functions irrespective of whether or not, at the time, Capital Stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency.

(f) “Closing Sale Price” of the Common Stock means, as of any date of determination, the closing per share sale price (or, if no such closing sale price is reported on such day, the average of the bid and asked prices or, if more than one in either case, the average of the average bid and the average asked prices) at 4:00 p.m., New York time, as reported in composite transactions for the principal U.S. securities exchange on which the Common Stock is traded or, if the Common Stock is not listed on a U.S. national or regional securities exchange, as reported on the Nasdaq System or by the National Quotation Bureau Incorporated.

(g) “Common Stock” means (i) shares of the Company’s common stock, par value $0.00025 per share, and (ii) any share capital into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.

(h) “Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for Common Stock.

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(i) “Indenture” means that certain Indenture, dated as of November __, 2005, between the Company and the Trustee, as Trustee, pursuant to which the Company’s 5% Senior Convertible Notes due 2015 are being issued.

(j) “Legal Holiday” is a Saturday, Sunday or a day on which state or federally chartered banking institutions in New York, New York are not required to be open.

(k) “Options” means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.

(l) “Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on a Principal Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Change of Control.

(m) “Person” or “person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

(n) “Principal Market” means The New York Stock Exchange, Inc. or the Nasdaq National Market, as the case may be.

(o) “Registration Rights Agreement” means that certain registration rights agreement by and among the Company and the Buyers.

(p) “Required Holders” means the holders of the SPA Warrants representing at least a majority of Common Stock underlying the SPA Warrants then outstanding.

(q) “SPA Notes” means the notes issued pursuant to the Securities Purchase Agreement.

(r) “Successor Entity” means the Person (or, if so elected by the Required Holders, the Parent Entity) formed by, resulting from, continuing from or surviving any Change of Control or the Person (or, if so elected by the Required Holders, the Parent Entity) with which such Change of Control shall have been entered into.

(s) “Trading Day” means (i) if the Common Stock is quoted on the Nasdaq National Market or any other system of automated dissemination of quotations of securities prices, days on which trades may be effected through such system, (ii) if the Common Stock is listed or admitted for trading on any national or regional securities exchange, days on which such national or regional securities exchange is open for business, or (iii) if the Common Stock is not listed on a national or regional securities exchange or quoted on the Nasdaq National Market or any other system of automated dissemination of quotation of securities prices, days on which the Common Stock is traded regular way in the over-the-counter market and for which a closing bid and a closing asked price for the Common Stock are available; or (iv) if the Common Stock is not so listed, quoted or traded on any Business Day.

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(t) “Trustee” means the Trustee under, and as such term is defined in, the Indenture.

(u) “Volume Weighted Average Price” per share of Common Stock (or any security into which the Common Stock has been converted) on any Trading Day means the volume weighted average price on the principal exchange or over-the-counter market on which the Common Stock (or such other security) is then listed or traded, from 9:30 a.m. to 4:00 p.m. (New York City time) on that Trading Day as reported by Bloomberg or if such Volume Weighted Average Price is not available, the Board of Directors’ reasonable, good faith estimate of the volume weighted average price of the shares of Common Stock (or other security) on such Trading Day.

(v) “Warrant Expiration Date” means the date 120 months after the Issuance Date or, if such date falls on a day other than a Business Day or on which trading does not take place on the Principal Market, the next date that is not a Legal Holiday.

[signature page follows]

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IN WITNESS WHEREOF, the Company has caused this Warrant To Purchase Common Stock to be duly executed as of the Issuance Date set out above.

i2 TECHNOLOGIES, INC.
By:
	Name:
	Title:

EXHIBIT A

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

WARRANT TO PURCHASE COMMON STOCK

i2 TECHNOLOGIES, INC.

The undersigned holder hereby exercises the right to purchase _________________ of the shares of Common Stock (“Warrant Shares”) of i2 Technologies, Inc., a corporation incorporated under the laws of the state of Delaware (the “Company”), evidenced by the Warrant To Purchase Common Stock (the “Warrant”). Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.

1. Form of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as:

¨ a “Cash Exercise” with respect to ______________ Warrant Shares; and/or

¨ a “Cashless Exercise” with respect to _______________ Warrant Shares.

Notwithstanding anything to the contrary contained herein, this Exercise Notice shall constitute a representation by the holder of the Warrant submitting this Exercise Notice that (A) the representations and warranties of the holder set forth in Sections 4(a) and 4(d) of the Securities Purchase Agreement are true and correct as of the date hereof and (B) after giving effect to the exercise provided for in this Exercise Notice, such holder (together with its affiliates) will not have beneficial ownership (together with the beneficial ownership of such Person’s affiliates) of the number of shares of Common Stock which exceeds the Exercise Limitation of the total outstanding Common Stock as determined pursuant to the provisions of Section 1(f)(i) of the Warrant.

2. Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance with the terms of the Warrant.

3. Delivery of Warrant Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant. The Warrant Shares shall be registered in the name of [Insert Name or Name of Nominee] and be delivered to the following address [Insert Address]. The social security number or tax identification number of the holder is [Insert Appropriate Information].

Date: _______________ __, ______

Name of Registered Holder

By:

Name:

Title:

ACKNOWLEDGMENT

The Company hereby acknowledges this Exercise Notice and hereby directs Mellon Investor Services to issue the above indicated the number of shares of Common Stock to [Insert Name of Holder] in accordance with the Transfer Agent Instructions dated _________, from the Company and acknowledged and agreed to by Mellon Investor Services.

i2 TECHNOLOGIES, INC.

By:   

Name:

Title:

EX-10.1

Exhibit 10.1

PURCHASE AGREEMENT

THIS PURCHASE AGREEMENT (this “Agreement”) is made as of November 21, 2005 by and among i2 Technologies, Inc., a Delaware corporation (the “Company”), and the purchasers set forth on Schedule I hereto (each a “Purchaser” and collectively, the “Purchasers”).

RECITALS

WHEREAS, the Company has authorized the issuance and sale of up to $86.25 million in aggregate principal amount of its 5% Senior Convertible Notes due 2015 (the “Notes”);

WHEREAS, the Company proposes, subject to the terms and conditions stated herein, to issue and sell on the Closing Date (as defined below) (i) $75,000,000 in aggregate principal amount of the Notes to the Purchasers in the respective amounts set forth opposite each Purchaser’s name in column (1) on Schedule I hereto (the “Firm Notes”) and (ii) warrants, in substantially the form attached hereto as Exhibit A (the “Warrants”) to acquire up to that number of additional shares of Common Stock of the Company, par value $0.00025 per share (the “Common Stock”) set forth opposite each Purchaser’s name in column (3) on Schedule I hereto (as exercised, collectively, the “Warrant Shares”);

WHEREAS, the Company also proposes to issue and sell to the Purchasers up to an additional $11,250,000 in aggregate principal amount of the Notes (the “Additional Notes”) in the respective principal amounts set forth opposite each Purchaser’s name in column (2) on Schedule I hereto, if and to the extent that the Purchasers shall have determined to exercise the right to purchase such Additional Notes granted to the Purchasers in Section 1(b) below;

WHEREAS, the Firm Notes and the Additional Notes will be issued pursuant to an indenture substantially in the form attached as Exhibit B hereto (the “Indenture”) to be dated as of the Closing Date by and between the Company and JPMorgan Chase Bank, National Association, a national banking association organized and existing under the laws of the United States, as Trustee (the “Trustee”), and the Notes will be convertible into shares (the “Underlying Securities”) of Common Stock on the terms, and subject to the conditions, set forth in the Indenture;

WHEREAS, the Firm Notes, the Additional Notes, the Underlying Securities, the Warrants and the Warrant Shares, collectively, are referred to herein as the “Securities.”

WHEREAS, the offer and sale of the Securities will not be registered under the Securities Act of 1933, as amended (together with the rules and regulations promulgated thereunder, the “Securities Act”), in reliance on an exemption therefrom; and

WHEREAS, the Purchasers will be entitled to the benefits of a Registration Rights Agreement substantially in the form attached as Exhibit C hereto covering the Underlying Securities and the Warrant Shares to be dated as of the Closing Date by and among the Company and the Purchasers (the “Registration Rights Agreement” and, together with this Agreement, the Indenture, the Firm Notes, the Additional Notes and the Warrants, the “Transaction Documents”).

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing premises, the mutual promises and covenants set forth herein and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Agreement to Sell and Purchase.

(a) Firm Notes and Warrants. On the basis of the representations and warranties contained in this Agreement, and subject to the terms and conditions of this Agreement, the Company agrees to issue and sell to each Purchaser (i) the respective principal amounts of Firm Notes set forth opposite such Purchaser’s name in column (1) on Schedule I hereto and (ii) Warrants to acquire up to that number of Warrant Shares as is set forth opposite such Purchaser’s name in column (3) on Schedule I hereto, and each Purchaser, upon the basis of the representations and warranties herein contained, but subject to the conditions hereinafter stated, severally and not jointly agrees to purchase from the Company such respective principal amount of the Firm Notes and the Warrants at a purchase price of one hundred percent (100%) of the principal amount of the Firm Notes to be purchased by such Purchasers hereunder (the “Purchase Price”).

(b) Additional Notes. On the basis of the representations and warranties contained in this Agreement, and subject to the terms and conditions of this Agreement, the Company agrees to sell to each Purchaser, and each Purchaser shall have the right to purchase, up to the principal amount of the Additional Notes set forth opposite such Purchaser’s name in column (2) on Schedule I hereto, with respect to each Purchaser (the “Option”). If purchased by a Purchaser, the Additional Notes shall be sold at the Purchase Price plus accrued interest, if any, from the Closing Date to the date of payment and delivery. To exercise the Option, a Purchaser must so notify the Company in writing (the “Option Exercise Notice”) on or before the sixtieth (60^th) day after the Closing Date (the “Option Expiration Date”) which Option Exercise Notice shall specify the principal amount of the Additional Notes such Purchaser is purchasing pursuant to the Option and the date on which the Additional Notes are to be purchased. Such date may be the same as the Closing Date but not earlier than the Closing Date. If such date is not the Closing Date, such date may not be earlier than three (3) business days following the date of receipt by the Company of such Option Exercise Notice nor later than five (5) business days following the date of receipt by the Company of such Option Exercise Notice.

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2. Closing.

(a) Firm Notes and Warrants. Payment for the Firm Notes and the Warrants shall be made severally by the Purchasers to the Company to an account specified in writing by the Company to the Purchasers on or prior to the date hereof in United States dollars in cash or other funds immediately available in New York City against delivery to each Purchaser of the Firm Notes and the Warrants purchased by such Purchaser at 10:00 a.m., New York City time, on November 23, 2005, or at such other time on the same or such other date as shall be mutually agreed upon by the Company and the Purchasers purchasing more than fifty percent (50%) of the aggregate principal amount of the Firm Notes to be purchased hereunder. The time and date of such payment and delivery are hereinafter referred to as the “Closing Date.”

(b) Additional Notes. Payment for the Additional Notes to be purchased pursuant to any exercise of the Option shall be made by the Purchaser(s) purchasing the Additional Notes to the Company by wire transfer of United States dollars in cash or other funds immediately available in New York City, to an account previously specified in writing by the Company to such Purchaser(s) at least one (1) Business Day prior to the Option Closing Date (as defined below), against delivery of such Additional Notes in the form specified by the applicable Purchaser(s) in the applicable Option Exercise Notice at 10:00 a.m., New York City time, on the date set forth in the Option Exercise Notice, or at such other time on the same or on such other date, as may be mutually agreed upon by the Company and such Purchaser(s). The time and date of each such payment and delivery are hereinafter referred to as an “Option Closing Date.”

3. Representations and Warranties. The Company represents and warrants to the Purchasers as of the Closing Date and each Option Closing Date, the following:

(a) Exchange Act Documents. The documents filed by the Company with the Securities and Exchange Commission (the “SEC”) pursuant to the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder (collectively, the “Exchange Act”) since January 1, 2004 (as amended or supplemented from time to time prior to the date hereof, including the exhibits thereto, the “Exchange Act Documents”), when taken together, do not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(b) Financial Statements. Except as disclosed in the Exchange Act Documents, (i) the financial statements included in the Exchange Act Documents present fairly, in all material respects, the consolidated financial position of the Company and its consolidated subsidiaries as of the dates indicated and the results of their operations and the changes in their consolidated cash flows for the periods specified therein and (ii) said financial statements have been prepared in conformity with generally accepted accounting principles and practices (“GAAP”) applied on a consistent basis, except as indicated in the notes thereto or, in the case of unaudited statements, as permitted by Rule 10-01 of Regulation S-X promulgated by the SEC.

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(c) Absence of Material Adverse Effect. Since the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 9, 2005 (the “Latest 10-Q”), there has not been any Material Adverse Change affecting the Company and its consolidated subsidiaries considered as a single enterprise. As used in this Agreement, “Material Adverse Change” or “Material Adverse Effect” means any change or effect that would be materially adverse to the business, properties, condition (financial or otherwise) or results of operations of the Company and its consolidated subsidiaries considered as a single enterprise, or to the ability or authority of the Company to consummate the transactions contemplated hereby and by the other Transaction Documents on the terms set forth herein or therein, provided, that any reduction in the market price or trading volume of the Company’s publicly traded common stock shall not, in any event, be deemed to constitute a Material Adverse Change or a Material Adverse Effect (it being understood that the foregoing shall not prevent a person from asserting that any underlying cause of such reduction independently constitutes such a Material Adverse Change or Material Adverse Effect).

(d) Absence of Certain Changes. Since the Latest 10-Q, there has not been any (i) material change in the capital stock or long-term debt of the Company or (ii) issuance of any options or warrants for the purchase of capital stock of the Company, securities convertible into or exercisable or exchangeable for capital stock of the Company or rights to purchase capital stock of the Company, except for changes or issuances occurring in the ordinary course of business and changes in outstanding Common Stock resulting from transactions relating to employee benefit plans or dividend reinvestment, stock option, stock award and stock purchase plans. Except as disclosed in the Current Report on Form 8-K filed by the Company on November 18, 2005 (the “Recent Report”), since the Latest 10-Q, the Company has not entered into any transaction or agreement that has or would be reasonably likely to have a Material Adverse Effect on the Company and its subsidiaries, taken as a whole. Since the Latest 10-Q, the Company has not declared or paid any dividends or made any distribution of any kind with respect to its capital stock. The Company has not taken any steps to seek protection pursuant to any bankruptcy law nor does the Company have knowledge that its creditors intend to initiate involuntary bankruptcy proceedings or knowledge of any fact which would reasonably lead a creditor to do so. The Company is not as of the date hereof, and after giving effect to the transactions contemplated hereby will not be, Insolvent (as defined below). For purposes of this Section 3(d), “Insolvent” means (i) the present fair saleable value of the Company’s assets is less than the amount required to pay the Company’s known liabilities and identified contingent liabilities, (ii) the Company is unable to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured or (iii) the Company has unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted.

(e) Organization and Qualification. The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with corporate power and authority to own or lease its properties and conduct its business as described in the Exchange Act Documents, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other

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jurisdiction in which it owns or leases properties, or conducts its business in a manner or to an extent that would require such qualification, other than such failures to be so qualified or in good standing as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

(f) Subsidiaries. Each “significant subsidiary” (as such term is defined in Rule 1-02 of Regulation S-X) of the Company has been duly organized and is validly existing as a corporation in good standing under the laws of the jurisdiction in which it is chartered or organized with full power and authority to own or lease, as the case may be, and to operate its properties and conduct its business as currently operated and conducted, and is duly qualified to do business as a foreign corporation and is in good standing under the laws of each jurisdiction which requires such qualification, except where the failure so to qualify or to be in good standing would not, individually or in the aggregate, result in a Material Adverse Effect; all the issued and outstanding shares of capital stock of each such subsidiary have been duly authorized and validly issued, are fully paid and non-assessable and are owned, directly or indirectly, by the Company.

(g) Authorization; Enforcement; Validity. The Company has full corporate power and authority to enter into the Transaction Documents to which it is a party and to perform and discharge its obligations thereunder, including, without limitation, issuance of the Firm Notes, the Additional Notes and the Warrants and the reservation for issuance and the issuance of the Underlying Securities and the Warrant Shares; each Transaction Document to which it is a party has been duly authorized by the Company’s Board of Directors, and no further consent or authorization is required by the Company, its board of directors or its stockholders, other than (i) such consents or authorizations as have been obtained prior to the execution of this Agreement and (ii) the Stockholder Approval (as such term is defined in the Indenture); each Transaction Document to which it is a party has been duly executed and delivered by or on behalf of the Company and constitutes the legal, valid and binding obligations of the Company, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance or transfer, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and to general principles of equity, including principles of materiality, commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) and except that rights to indemnification and contribution thereunder may be limited by federal or state securities laws or public policy relating thereto that have not been previously waived.

(h) Capitalization. The authorized, issued and outstanding capital stock of the Company is as set forth in the Latest 10-Q except for changes in outstanding Common Stock resulting from transactions relating to employee benefit plans or dividend reinvestment, stock option, stock award and stock purchase plans. Except for this Agreement and the Registration Rights Agreement or stock purchase plans, there are no contracts, commitments, agreements, arrangements, understandings or undertakings of any kind to which the Company is a party, or by which it is bound, granting to any person the right to require the Company to file a registration statement under the Securities Act with respect to the Common

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Stock or requiring the Company to include any Common Stock with the Underlying Securities and the Warrant Shares registered pursuant to any registration statement that have not been previously waived. The shares of Common Stock outstanding on the date hereof have been duly authorized and are validly issued, fully paid and non-assessable.

(i) Issuance of Firm Notes, Additional Notes and Warrants. The Firm Notes, the Additional Notes and the Warrants have been duly authorized by the Company, and when duly executed, authenticated, issued and delivered as provided in the Indenture and the other Transaction Documents (assuming due authentication of the Firm Notes and the Additional Notes by the Trustee) and paid for as provided herein and therein will be free from all taxes, liens and charges with respect to the issuance thereof and will constitute legal, valid and binding obligations of the Company, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance or transfer, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and to general principles of equity, including principles of materiality, commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

(j) Issuance of Underlying Securities and Warrant Shares. Upon issuance and delivery of the Firm Notes, the Additional Notes and the Warrants in accordance with this Agreement and the Indenture, the Firm Notes and the Additional Notes will be convertible at the option of the holder thereof into the Underlying Securities in accordance with the terms of the Indenture and the Warrants will be exercisable at the option of the holder thereof into Warrant Shares in accordance with the terms of the Warrants; the Underlying Securities initially issuable upon conversion of the Notes and the Warrant Shares initially issuable upon exercise of the Warrants have been duly authorized and reserved for issuance and, when issued upon conversion or exercise, as the case may be, of the Notes and the Warrants, as applicable, in accordance with the terms of the Indenture and the Warrants, as applicable, will be validly issued, fully paid and non assessable, and the issuance of the Underlying Securities and the Warrant Shares will not be subject to any preemptive or similar rights and will be free from all taxes, liens or charges with respect to the issuance thereof.

(k) No Conflicts. The issuance and sale of the Firm Notes, the Additional Notes and the Warrants and the issuance by the Company of the Underlying Securities upon conversion of the Securities and the issuance of the Warrant Shares upon exercise of the Warrants, the execution and delivery by the Company of the Transaction Documents and the performance by the Company of all its obligations and the consummation of the transactions herein and therein contemplated, will not (i) result in a breach of any of the terms or provisions of, constitute a default (with or without the giving of notice or the passage of time or otherwise) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company is a party or by which the Company is bound or to which any of the property or assets of the Company is subject except, in each case, for such conflicts, breaches, defaults, liens, charges or encumbrances which

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would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) result in any violation of the provisions of the Certificate of Incorporation or the Bylaws of the Company, or (iii) result in any violation of any material applicable law or statute or any order, rule or regulation of any court or governmental agency or of any self-regulatory agency or body having jurisdiction over the Company or any of its properties; and no consent, approval, authorization, order, license, registration or qualification of or with any such court or governmental agency or of any self-regulatory agency or body is required for the issuance and sale of the Securities or the consummation by the Company of the transactions contemplated by any of the Transaction Documents, except such consents, approvals, authorizations, orders, licenses, registrations or qualifications as may be required under state securities or Blue Sky Laws in connection with the purchase of and any distribution of the Securities by the Purchasers or under the Securities Act with respect to the registration of the Underlying Securities and the Warrant Shares pursuant to the terms of the Registration Rights Agreement.

(l) Absence of Litigation. Except as disclosed in the Exchange Act Documents, there are no legal or governmental investigations, actions, suits or proceedings pending or, to the Company’s knowledge, threatened against or affecting the Company or any of its properties or to which the Company is or may be a party or to which any property of the Company is or may be the subject that, if determined adversely to the Company, would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(m) No Integrated Offering. Neither the Company, nor any affiliate (as defined in Rule 501(b) of Regulation D under the Securities Act) of the Company or any person acting on its or their behalf, has directly, or through any agent, sold, offered for sale, solicited offers to buy, or otherwise approached or negotiated with, any person in respect of, any security (as defined in the Securities Act) that is or will be integrated with the sale of the Securities in a manner that would require (i) the registration under the Securities Act of the issuance of any of the Securities contemplated hereby or (ii) the approval of the stockholders of the Company in accordance with the rules and regulations of the Nasdaq National Market (the “Principal Market”).

(n) No General Solicitation. None of the Company, any affiliate of the Company or any person acting on its or their behalf has offered or sold any of the Securities by means of any general solicitation or general advertising within the meaning of Rule 502(c) under the Securities Act, including (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio, or (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising in the United States.

(o) Securities Act and Trust Indenture Act. Assuming the accuracy of the representations and warranties of the Purchasers contained in Section 4 hereof and the Purchasers’ compliance with the agreements set forth therein, it is not necessary in connection with the offer, issuance, sale and delivery of the Securities in the manner contemplated by this Agreement and the other Transaction Documents to register the offer or sale of any of the

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Securities under the Securities Act or to qualify the Indenture under the Trust Indenture Act of 1939, as amended.

(p) Placement Agent. Except for its engagement letter with J.P. Morgan Securities Inc. dated October 6, 2005, neither the Company nor its subsidiaries is a party to any contract, agreement or understanding with any person that would reasonably be expected to give rise to a valid claim against the Company or the Purchasers for a brokerage commission, finder’s fee or like payment in connection with the offering and sale of the Securities.

(q) Manipulation of Price. Neither the Company, nor any of its subsidiaries nor any of their officers or directors or any of their affiliates has taken or will take, directly or indirectly, any action designed or intended to stabilize or manipulate the price of any security of the Company, or that caused or resulted in, or that might in the future reasonably be expected to cause or result in, stabilization or manipulation of the price of any security of the Company in violation of the Securities Act, the Exchange Act or any other applicable securities laws.

(r) Listing. The Common Stock is registered pursuant to Section 12(g) of the Exchange Act and is listed on the Principal Market, and the Company has not taken any action designed to or reasonably likely to result in the termination of the registration of the Common Stock under the Exchange Act or delisting of the Common Stock from the Principal Market. Since July 21, 2005, (i) the Common Stock has been designated for quotation on the Principal Market, (ii) trading in the Common Stock has not been suspended by the SEC or the Principal Market, other than temporary trading halts effected by the Principal Market following the Company’s public release of material news and (iii) no executive officer of the Company has received any communication, written or oral, from the SEC or the Principal Market threatening the suspension or delisting of the Common Stock from the Principal Market.

(s) Tax Status. The Company and each of its subsidiaries (i) has filed all material federal, state, local and foreign tax returns, reports and declarations required by any jurisdiction to which it is subject and (ii) has paid all taxes that are material in amount shown or determined to be due in the returns, reports and declarations filed by them and all assessments received by them or any of them to the extent that such taxes have become due and are not being contested in good faith and for which adequate reserves have been provided; and there is no tax deficiency in any material amount which has been or, to the Company’s knowledge, might reasonably be expected to be asserted or threatened against the Company and the Company is not aware of any reasonable basis for any such claim.

(t) Labor Relations. (i) Except as disclosed in the Exchange Act Documents, no labor disputes exist with employees of the Company except for such disputes as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect and the Company is not aware that any key employee or significant group of employees of the Company plans to terminate employment with the Company and (ii) the Company and its subsidiaries are in compliance with all federal, state, local and foreign laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions of

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employment and wages and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company, and neither the Company nor any of its subsidiaries is a party to a collective bargaining agreement; provided, however, that, notwithstanding the foregoing, the employees of the Company’s German subsidiaries have formed a workers counsel.

(u) Environmental Laws. Except as disclosed in the Exchange Act Documents, to the Company’s knowledge, the Company is in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health or the environment or imposing liability or standards of conduct concerning any Hazardous Material (collectively, “Environmental Laws”), except where such non-compliance with Environmental Laws would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The term “Hazardous Material” means (1) any “hazardous substance” as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, (2) any “hazardous waste” as defined by the Resource Conservation and Recovery Act, as amended, (3) any petroleum or petroleum product, (4) any polychlorinated biphenyl, and (5) any pollutant or contaminant or hazardous, dangerous, or toxic chemical, material, waste or substance regulated under or within the meaning of any other Environmental Law.

(v) Intellectual Property. (i) The Company or its subsidiaries own or possess the right to use the patents, patent licenses, trademarks, service marks, trade names, copyrights and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) (collectively, the “Intellectual Property”) reasonably necessary to carry on the business conducted by the Company and its subsidiaries, taken as a whole, as described in the Exchange Act Documents, except to the extent that the failure to own or possess the right to use such Intellectual Property would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) all of such patents, registered trademarks and registered copyrights owned by the Company or its subsidiaries have been duly registered in, filed in or issued by the United States Patent and Trademark Office, the United States Registrar of Copyrights or the corresponding offices of other jurisdictions, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect, (iii) all material licenses or other material agreements under which (1) the Company or any of its subsidiaries is granted rights in Intellectual Property, other than Intellectual Property generally available on commercial terms from other sources, and (2) the Company or any of its subsidiaries has granted rights to others in Intellectual Property owned or licensed by the Company, are in full force and effect and there is no default by the Company or its subsidiaries or, to the Company’s knowledge, the other parties thereto, except for such failures to be in full force and effect and such defaults as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (iv) the Company has not received any notice of infringement of or conflict with asserted rights of others with respect to any Intellectual Property, except for notices the content of which if accurate would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect and

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(v) the Company and its subsidiaries do not have and, to the Company’s knowledge, none of its and their employees have any agreements or arrangements with any persons other than the Company or its subsidiaries related to confidential information or trade secrets of such persons other than such agreements that would not restrict the Company and its subsidiaries from conducting their business as described in the Exchange Act Documents to an extent that would reasonably be expected to result in a Material Adverse Effect.

(w) Permits. The Company and each of its subsidiaries, taken together, have (i) made all filings, applications and submissions required by, and possesses all approvals, licenses, certificates, clearances, consents, exemptions, orders, permits and other authorizations required to be issued by, the appropriate federal, state or foreign regulatory authorities (collectively, “Permits”) in order for the Company and its subsidiaries to conduct their business, except for such Permits for which the failure to obtain would not reasonably be expected to have a Material Adverse Effect, and are in compliance in all material respects with the terms and conditions of all such Permits; all such Permits held by the Company and its subsidiaries are valid and in full force and effect; there is no pending or, to the Company’s knowledge, threatened action, suit, claim or proceeding that may cause any such Permit to be limited, revoked, cancelled, suspended, modified or not renewed and neither the Company nor its subsidiaries has received any notice of proceedings relating to the limitation, revocation, cancellation, suspension, modification or non-renewal of any such Permit that, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding would reasonably be expected to have a Material Adverse Effect and (ii) such licenses, franchises, permits, authorizations, approvals and orders of and from governmental and regulatory officials and bodies as are, to the Company’s knowledge, reasonably necessary to own or lease and operate the properties and conduct the business of the Company and its subsidiaries, taken as a whole, on the date hereof.

(x) Title. (i) The Company has good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by it that is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects, except such as do not materially affect the value of such property, do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries or would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and (ii) any real property and buildings held under lease by the Company and its subsidiaries are held by it under valid, subsisting and enforceable leases with such exceptions as do not interfere with the use made and proposed to be made of such property and buildings by the Company or as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(y) ERISA. (i) The Company is in compliance with all presently applicable provisions of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder (“ERISA”), except where the failure to be in such compliance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (ii) no “reportable event” (as defined in ERISA) has

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occurred with respect to any “pension plan” (as defined in ERISA) for which the Company is required to provide notice under Section 4043 of ERISA and would have any liability, except where such liability would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (iii) except for matters that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (a) with respect to any “pension plan” (other than a “multiemployer plan” (as defined in ERISA)), the Company has not incurred and does not expect to incur liability under Title IV of ERISA with respect to termination of, or withdrawal from, such “pension plan,” or under Section 412 or 4971 of the Internal Revenue Code of 1986, as amended, including the regulations and published interpretations thereunder (the “Code”), and (b) with respect to any “pension plan” that is a “multiemployer plan,” the Company has not received notice that the Company has incurred liability under Title IV of ERISA with respect to termination of, or withdrawal from, such “pension plan,” or under Section 412 or 4971 of the Code; (iv) except where the failure to be in such compliance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, each “pension plan” (other than a “multiemployer plan”) for which the Company would have any liability that is intended to be qualified under Section 401(a) of the Code is so qualified in all material respects and nothing has occurred, whether by action or by failure to act, which would reasonably be expected cause the loss of such qualification; and (v) except where the failure to be in such compliance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, no non-exempt “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) or “accumulated funding deficiency” (as defined in section 302 of ERISA) has occurred with respect to any “pension plan” (other than a “multiemployer plan”) for which the Company would have any liability.

(z) OSHA. Other than as disclosed in the Exchange Act Documents, to the Company’s knowledge, the Company and each of its subsidiaries is in compliance with any and all applicable Occupational Safety and Health Administration standards and requirements (the “OSHA Laws”), except where such non-compliance with OSHA Laws would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(aa) Investment Company. Neither the Company nor any of its subsidiaries is, and, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof, will not be, required to register as an “investment company” or an entity controlled by an investment company as such term is defined in the Investment Company Act of 1940, as amended.

(bb) Regulation U. The Company does not own, and has no present intention to acquire, and the proceeds of the sale of the Securities will not be used to buy or carry, any margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 207).

(cc) Independent Accountants. Deloitte & Touche LLP, who have certified the consolidated financial statements of the Company as of December 31, 2004, is an independent registered public accounting firm within the meaning of the Securities Act.

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(dd) Internal Controls. The Company and each of its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; and (D) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences, and the Company maintains a system of “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act).

(ee) Sarbanes-Oxley Act. The Company and its executive officers and directors, in their capacities as such, are in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act of 2002, including Section 402 related to loans and Sections 302 and 906 related to certifications.

(ff) Ranking of Firm Notes and Additional Notes. None of the existing indebtedness of the Company for borrowed money is or will rank senior to the Firm Notes or the Additional Notes in right of payment, whether in respect of payment of interest or upon liquidation or dissolution or otherwise, except to the extent that the Securities will be effectively junior to the obligations of the Company owing pursuant to that certain revolving letter of credit line from JPMorgan Chase Bank, National Association, effective from April 28, 2005 to May 1, 2006, as the same may be amended and/or extended from time to time, but only to the extent of the value of the assets securing such obligations.

(gg) Form S-3 Eligibility. The Company is eligible to register the Underlying Securities and the Warrant Shares for resale by the Purchasers using Form S-3 promulgated under the Securities Act.

(hh) Rule 144A. The Notes satisfy the requirements set forth in Rule 144A(d)(3) under the Securities Act.

(ii) Rights Agreement. Except for that certain Rights Agreement, dated as of January 17, 2002 and amended on April 27 and April 28, 2004, between the Company and Mellon Investor Services LLC, the Company has not adopted a stockholder rights plan or similar arrangement relating to accumulations of beneficial ownership of Common Stock or a change in control of the Company.

(jj) Insurance. The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its subsidiaries are engaged, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect. Neither the Company nor any such subsidiary believes that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be

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necessary to continue its business at a cost that would not reasonably be expected to have a Material Adverse Effect.

(kk) Foreign Corrupt Practices Act. Neither the Company, nor any of its subsidiaries, nor any director, officer, agent, employee or other Person acting on behalf of the Company or any of its subsidiaries has, in the course of its actions for, or on behalf of, the Company (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

Each Purchaser acknowledges and agrees that the Company has not made and does not make any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in this Section 3.

4. Representations and Warranties of the Purchasers. Each Purchaser severally represents and warrants to the Company only as to itself, as of the Closing Date and each Option Closing Date for such Purchasers, the following:

(a) Accredited Investor Status. Such Purchaser is knowledgeable, sophisticated and experienced in business and financial matters and qualifies as an “accredited investor” as defined in Rule 501(a) of Regulation D and as a “qualified institutional buyer” under Regulation 144A. Such Purchaser is experienced in evaluating investments in companies such as the Company.

(b) Information. Such Purchaser has been afforded access to information about the Company and the financial condition, results of operations, business, property and management of the Company sufficient to enable it to evaluate its investment in the Securities; such Purchaser and its advisors, if any, have been afforded the opportunity to ask questions of the Company; such Purchaser has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Securities. Neither such inquiries nor any other due diligence investigations conducted by such Purchaser, its advisors or representatives, if any, shall modify, amend or affect such Purchaser’s right to rely on the Company’s representations and warranties contained herein.

(c) Investment Risk. Such Purchaser understands that its investment in the Securities involves a high degree of risk. Such Purchaser is able to bear the economic risk of its investment in the Securities for an indefinite period of time, and is presently able to afford the complete loss of such investment.

(d) No Public Sale or Distribution. Such Purchaser is acquiring the Securities in the ordinary course of business solely for its own account and not as a nominee or agent for any other person and not with a view to any distribution thereof that violates the

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Securities Act or the securities laws of any State of the United States or any applicable jurisdiction; provided, however, that by making the representations herein, such Purchaser does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the Securities Act. Such Purchaser does not presently have any intention, or any agreement or understanding, directly or indirectly, with any person, to distribute any of the Securities.

(e) Validity; Enforcement. Such Purchaser was duly organized or formed and is a validly existing organization in good standing under the laws of its jurisdiction of organization, with power and authority to execute and deliver this Agreement and the Registration Rights Agreement and perform its obligations hereunder and thereunder; and this Agreement and the Registration Rights Agreement and the transactions contemplated hereby and thereby have been duly authorized by such Purchaser. Assuming due authorization, execution and delivery by the Company, each of this Agreement and the Registration Rights Agreement constitutes a legally valid and binding agreement of such Purchaser, enforceable against the Purchaser in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance or transfer, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and to general principles of equity, including principles of materiality, commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

(f) Residency. Such Purchaser is a resident of that jurisdiction specified in its address for notices set forth below the signature of the Purchaser where it appears on the signature page of this Agreement. Such Purchaser was not formed for the specific purpose of acquiring the Securities.

(g) Source of Funds. Such Purchaser is not acquiring the Securities with assets of any “employee benefit plan” (within the meaning of Section 3(3) of ERISA) that is subject to Title I of ERISA or Section 4975 of the Code.

(h) Beneficial Ownership. Assuming the capitalization of the Company set forth in its most recent Exchange Act Document, such Purchaser, together with its “affiliates” (as defined in Rule 13d-3 promulgated under the Securities Act), is the beneficial owner (as defined in Rule 13d-3 promulgated under the Exchange Act) of not more than 4.99% of the outstanding shares of Common Stock immediately after the purchase of the Securities hereunder.

(i) Broker/Dealer Status. Such Purchaser is not a registered broker-dealer under Section 15 of the Exchange Act.

(j) Independent Evaluation. Such Purchaser has independently evaluated the merits of its decision to purchase the Securities pursuant to the Transaction Documents, and the Purchaser confirms that it has not relied on the advice of any other Purchaser’s business and/or legal counsel in making such decision.

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(k) No Short Sales. Such Purchaser has not purchased any shares of Common Stock, engaged in any short selling of the Company’s securities, or established or increased any “put equivalent position” as defined in Rule 16(a)-1(h) under the Exchange Act, with respect to the Common Stock (collectively, a “Short Sale”), since the date and time that it was contacted by J.P. Morgan Securities Inc. with respect to the transactions contemplated by this Agreement. Such Purchaser agrees that it will not effect any Short Sale until the 8-K Filing (as defined below) has been made; provided, however, that, with respect to Deutsche Bank AG London, for the purposes of this Section 4(k), a “security-based swap agreement,” as defined in Section 206B of the Gramm-Leach-Bliley Act, shall not be considered a short sale or “put equivalent position.”

(l) Financing. Such Purchaser has, and will have at Closing, immediately available funds in U.S. dollars (through cash or cash equivalents and existing committed credit arrangements) sufficient to pay the Purchase Price for the Firm Notes to be purchased by such Purchaser and any other amounts payable pursuant to this Agreement and to consummate the transactions contemplated by, and otherwise satisfy the obligations of such Purchaser under, this Agreement.

(m) Certain Exemptions. Such Purchaser understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration requirements of the Securities Act and state securities and Blue Sky laws and that the Company is relying upon the truth and accuracy of, and such Purchaser’s compliance with, the representations, warranties, agreements, acknowledgements and understandings of such Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of such Purchaser to acquire the Securities.

(n) Legends. Such Purchaser understands that the certificates or other instruments representing the Notes and the Warrants and, until such time as the resale of the Underlying Securities and the Warrant Shares have been registered under the Securities Act as contemplated by the Registration Rights Agreement, the stock certificates representing the Underlying Securities and the Warrant Shares, except as set forth below, shall bear any legend as required by the “blue sky” laws of any state and a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such stock certificates, certificates or other instruments):

THIS SECURITY [AND THE SHARES OF COMMON STOCK ISSUABLE UPON [EXERCISE/CONVERSION] OF THIS SECURITY [HAVE/HAS] NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY[, THE SHARES OF COMMON STOCK ISSUABLE UPON [EXERCISE/CONVERSION] OF THIS SECURITY] NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION

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OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH i2 TECHNOLOGIES, INC. OR ANY AFFILIATE OF i2 TECHNOLOGIES, INC. WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO i2 TECHNOLOGIES, INC. OR ANY PARENT OR SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO i2 TECHNOLOGIES, INC.’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION REASONABLY SATISFACTORY TO IT. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.

The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of the Securities upon which it is stamped, unless otherwise required by state securities laws, (i) while a registration statement covering the

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resale of such Securities under the Securities Act is effective, (ii) in connection with a sale, assignment or other transfer, provided such holder provides the Company with an opinion of counsel, reasonably acceptable to the Company, the form and substance of which shall be reasonably satisfactory to the Company, to the effect that such sale, assignment or transfer of the Securities may be made without registration under the applicable requirements of the Securities Act , (iii) if such holder provides the Company with reasonable assurance that the Securities can be sold, assigned or transferred pursuant to paragraph (k) of Rule 144 or (iv) following any sale of such Securities pursuant to Rule 144.

(o) No Brokers. Such Purchaser is not a party to any contract, agreement or understanding with any person that would reasonably be expected to give rise to a valid claim against the Company or the Purchasers for a brokerage commission, finder’s fee or like payment in connection with the offering and sale of the Securities.

The Company acknowledges and agrees that the Purchasers have not made, and do not make, any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in this Section 4.

5. Covenants of the Company. The Company covenants and agrees with the Purchasers as follows:

(a) Listing. The Company shall promptly secure the listing of all of the Underlying Securities and the Warrant Shares upon each national securities exchange and automated quotation system, if any, upon which the Common Stock is then listed (subject to official notice of issuance) and shall maintain such listing of all Underlying Securities and the Warrant Shares from time to time issuable under the terms of the Transaction Documents. The Company shall use reasonable best efforts to maintain the Common Stock’s authorization for quotation on the Principal Market. Neither the Company nor any of its subsidiaries shall take any action which would be reasonably expected to result in the delisting or suspension of the Common Stock on the Principal Market.

(b) Blue Sky. The Company shall qualify the Securities for offering and sale under the applicable securities laws of such states as any Purchaser may reasonably designate and will continue such qualifications in effect so long as required for the resale of the Securities; provided that the Company will not be required to qualify as a foreign corporation or file a general consent to service of process in any such state.

(c) Fees and Expenses. Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company shall pay or cause to be paid all fees, costs and expenses incident to the performance of its obligations hereunder, including without limiting the generality of the foregoing, all fees, costs and expenses (i) incident to the preparation, issuance, execution, authentication and delivery of the Securities, including any expenses of the Trustee, (ii) payable to rating agencies in connection with any rating of the Notes, (iii) incurred in connection with the qualification of the Securities for sale

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under state securities laws, (iv) in connection with the approval of the Underlying Securities and the Warrant Shares for listing on the Principal Market, (v) in connection with the admission for trading of the Notes on any securities exchange or inter-dealer quotation system (as well as in connection with the admission of the Notes for trading in the Private Offering, Resales and Trading through Automatic Linkages (“PORTAL”) system of the National Association of Securities Dealers, Inc. (“NASD”) or any appropriate market system), (vi) related to any filing with the Principal Market and (vii) in connection with satisfying its obligations under Section 5(a). In addition to the foregoing (and without duplication), the Company agrees to pay each Purchaser their reasonable and documented out-of-pocket expenses incurred in connection with the negotiation, due diligence and documentation of the Transaction Documents and the transactions contemplated thereby (“Transaction Expenses”); provided, that the maximum amount of Transaction Expenses that the Company shall be obligated to pay to Highbridge International LLC shall not exceed $200,000 (the “Highbridge Expense Cap”) and the maximum amount of Transaction Expenses that the Company shall be obligated to pay to the other Purchasers shall not exceed $100,000 in the aggregate (the “Transaction Expense Cap”), which Transaction Expense Cap shall be allocated pro rata among the Purchasers (other than Highbridge International LLC) based upon the principal amount of the Securities purchased by each such other Purchaser relative to the principal amount of all Securities purchased by the Purchasers (other than Highbridge International LLC) in the aggregate (the “Purchaser’s Pro Rata Amount”); provided further, that if the aggregate Transaction Expenses incurred by the Purchasers exceeds the collective amount of the Highbridge Expense Cap and the Transaction Expense Cap, the Company shall be obligated to pay to Highbridge International LLC the full amount of its Transaction Expenses (up to and subject to the Highbridge Expense Cap) and to pay each such other Purchaser such Purchaser’s Pro Rata Amount of the Transaction Expense Cap. Except as expressly set forth in this Section 5(c) and in Sections 8 and 11, the Company shall have no obligation to pay any costs and expenses of the Purchasers (except as set forth in the Registration Rights Agreement).

(d) Regulation M. The Company shall not take any action prohibited by Regulation M under the Exchange Act in connection with the issuance of the Securities contemplated hereby.

(e) General Solicitation. None of the Company, any of its affiliates (as defined in Rule 501(b) under the Securities Act) or any person acting on behalf of the Company or such affiliate will solicit any offer to buy or offer or sell the Securities by means of any form of general solicitation or general advertising within the meaning of Regulation D, including: (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio; and (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising.

(f) Integration. None of the Company, any of its affiliates (as defined in Rule 501(b) under the Securities Act) or any person acting on behalf of the Company or such affiliate will sell, offer for sale or solicit offers to buy, or otherwise approach or negotiate with,

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any person in respect of any security (as defined in the Securities Act) which will be integrated with the sale of the Securities in a manner which would require the registration under the Securities Act of the Securities or require stockholder approval under the rules and regulations of the Principal Market, and the Company will take all action that is appropriate or necessary to assure that its offerings of other securities will not be integrated for purposes of the Securities Act or the rules and regulations of the Principal Market with the issuance of Securities contemplated hereby.

(g) Reservation of Shares. The Company shall reserve and keep available at all times, free of pre-emptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the Company to satisfy all obligations to issue the Underlying Securities and the Warrant Shares upon conversion or exercise of the Firm Notes, the Additional Notes or the Warrants, as applicable.

(h) Use of Proceeds. The Company shall use the proceeds from the sale of the Securities for working capital purposes, including the repayment of outstanding indebtedness of the Company. No part of the proceeds from the sale of the Securities hereunder will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 207), or for the purpose of buying or carrying or trading in any securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220). As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.

(i) Disclosure of Transactions and Other Material Information. The Company shall file a current report on Form 8-K (the “8-K Filing”) on or before 8:30 a.m., New York City time, on the first business day following the date hereof, in the form required by the Exchange Act, relating to the transactions contemplated by the Transaction Documents and attaching the material Transaction Documents, or forms thereof, as exhibits to such filing. At the time of the 8-K Filing, the Company shall not have provided any Purchaser with any material, nonpublic information that is not disclosed in the 8-K Filing.

(j) Material Non Public Information. Other than as set forth in the 8-K Filing, the Company covenants and agrees that neither it nor any other person or entity acting on its behalf has provided or will provide any Purchaser or its agents or counsel with any information that constitutes material non-public information, unless prior thereto such Purchaser shall have executed a written agreement regarding the confidentiality and use of such information. The Company understands and confirms that the Purchasers shall be relying on the foregoing representations in effecting transactions in securities of the Company.

(k) Listing. The Company agrees that (i) if the Company applies to have the Common Stock traded on any other national or regional securities exchange other than the Principal Market (a “Trading Market”), it will include in such application the Underlying Securities and the Warrant Shares and will take such other action as is necessary or desirable to

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cause the Underlying Securities and the Warrant Shares to be listed on such other Trading Market as promptly as possible, and (ii) it will take all action reasonably necessary to continue the listing and trading of its Common Stock on a Trading Market and will comply in all material respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market.

(l) PORTAL. The Company will cause the Notes to be eligible for trading on PORTAL.

(m) Series B Preferred Rights. The Company agrees that it will not (i) amend the antidilution provisions of its Certificate of Designations of 2.5% Series B Convertible Preferred Stock, including, without limitation, Sections 5(b)(iii) and 5(b)(iv) thererof or (ii) grant any additional antidilution or similar rights to the holders of the 2.5% Series B Convertible Preferred Stock for any reason without the consent of the Purchasers of more than fifty percent (50%) of the aggregate principal amount of the Notes at the time outstanding (the “Majority Holders”).

6. Conditions to the Purchasers’ Obligations. The obligation of each Purchaser hereunder to purchase the Firm Notes and the Warrants on the Closing Date is subject to the performance by the Company of its obligations hereunder and to the following additional conditions:

(a) the representations and warranties of the Company set forth in Section 3 above are true and correct in all material respects (except for those representations and warranties already qualified by materiality, which such representations and warranties shall be true and correct in all respects) on and as of the Closing Date as if made on and as of the Closing Date and the Company shall have complied in all material respects with all agreements and all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date;

(b) the Purchasers shall have received on and as of the Closing Date a certificate of an executive officer of the Company, with specific knowledge about the Company’s financial matters, reasonably satisfactory to the Purchasers, to the effect set forth in Section 6(a) above and to the further effect that except as disclosed in the Exchange Act Documents filed as of the date hereof, there has not occurred any Material Adverse Change since the date of the Latest 10-Q;

(c) Dechert LLP, special counsel for the Company, shall have furnished to the Purchasers their written opinion, dated the Closing Date, in substantially the form attached hereto as Exhibit D;

(d) subsequent to the execution and delivery of this Agreement and prior to the Closing Date, there shall not have occurred any downgrading, nor shall any public notice have been given of (i) any intended downgrading or (ii) any review or possible change that does not indicate an improvement in the rating accorded any securities of or guaranteed by

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the Company by any “nationally recognized statistical rating organization,” as such term is defined for purposes of Rule 436(g)(2) under the Securities Act;

(e) subsequent to the execution and delivery of this Agreement and prior to the Closing Date, there shall have been no suspension or material limitation of trading in the Common Stock on the Principal Market;

(f) the Company shall have duly executed each of the other Transaction Documents;

(g) the Company shall have delivered to the Purchasers a certificate evidencing the incorporation and good standing of the Company in the State of Delaware issued by the Secretary of State of the State of Delaware as of a date within ten (10) business days of the Closing Date;

(h) the Company shall have delivered to the Purchasers a certificate evidencing the Company’s qualification as a foreign corporation and good standing issued by the State of Texas as of a date within ten (10) business days of the Closing Date;

(i) the Notes shall have been approved for trading on PORTAL, subject only to notice of issuance at or prior to the time of purchase;

(j) the Company shall have obtained all governmental, regulatory or third-party consents and approvals, if any, necessary to be obtained prior to the Closing Date for the sale of the Securities;

(k) the Company shall have delivered to the Purchaser such other documents relating to the transactions contemplated by this Agreement as the Purchaser or its counsel may reasonably request;

(l) each other Purchaser shall have purchased from the Company the Firm Notes in the aggregate principal amounts and the Warrants for the number of Warrant Shares set forth opposite each such Purchaser’s name in column (1) and column (3), respectively, on Schedule I hereto; and

(m) the Company shall have delivered to such Purchasers a certificate, executed by the Secretary of the Company dated as of the Closing Date, as to (i) the resolutions consistent with Section 3(g) as adopted by the Company’s Board of Directors in a form reasonably acceptable to such Purchaser, (ii) the Certificate of Incorporation, as in effect at the Closing, and (iii) the Bylaws, as in effect at the Closing.

If it elects to exercise the Option, the obligation of a Purchaser to purchase the Additional Notes hereunder on an Option Closing Date is subject to the same conditions as are set forth above in clauses (a)-(m) with respect to the Firm Notes and the Warrants, provided that each reference to

21

the Closing Date in this Section 6 shall, with respect to the closing of the sale of any of the Additional Notes, be deemed to be a reference to the applicable Option Closing Date.

7. Conditions to the Company’s Obligations. The obligations of the Company hereunder to issue and sell the Firm Notes and the Warrants to each Purchaser on the Closing Date, or the Additional Notes to any Purchaser on its Option Closing Date, as applicable, are subject to the performance by the Purchasers of all of their obligations hereunder, the accuracy in all material respects of the representations and warranties of the Purchasers contained herein on and as of the Closing Date, or such Option Closing Date, as applicable, as if made on and as of the Closing Date, or the Option Closing Date, as applicable, and the due execution by the Purchasers of all other Transaction Documents to which the Purchasers are parties.

8. Indemnity and Contribution. The Company agrees to indemnify and hold harmless each Purchaser and each of their respective directors, officers, employees, members, representatives and agents and each person, if any, who controls each Purchaser within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (each, an “Indemnified Person”), from and against any and all losses, claims, damages, penalties, fees and liabilities (collectively, “Losses”), as incurred, including, without limitation, the reasonable legal fees and other reasonable expenses of one counsel (in addition to any local counsel) incurred (irrespective of whether any such Indemnified Person is a party to the action for which indemnification hereunder is sought) in connection with any suit, action or proceeding or any claim, as incurred, as a result of, or arising out of or relating to (a) any misrepresentation or breach of any representation or warranty made by the Company in the Transaction Documents, (b) any breach of any covenant, agreement or obligation of the Company contained in the Transaction Documents or (c) any cause of action, suit or claim brought or made against such Indemnified Person by a third party (including for these purposes a derivative action brought on behalf of the Company) and arising out of or resulting from the execution, delivery or performance by the Company of the Transaction Documents or any other certificate, instrument or document contemplated hereby or thereby; provided that the Company shall not be required to indemnify any of the Indemnified Persons to the extent Losses arise or result from a material misrepresentation or material breach of any representation or warranty made by such Purchaser or Indemnified Person contained in the Transaction Documents, or a material breach of any covenant, agreement or obligation by such Purchaser or Indemnified Person contained in the Transaction Documents.

If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any Indemnified Person, such Indemnified Person shall promptly notify the person against whom such indemnity may be sought (the “Indemnifying Person”) in writing, and the Indemnifying Person, upon request of the Indemnified Person, shall retain one counsel (in addition to any local counsel) reasonably satisfactory to the Indemnified Person to represent the Indemnified Person and any others the Indemnifying Person may designate in such proceeding and shall pay the reasonable fees and expenses of such counsel related to such proceeding; provided, however, that failure to so notify

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the Indemnifying Person shall not relieve such Indemnifying Person from any liability hereunder except to the extent the Indemnifying Person is prejudiced as a result thereof. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary, (ii) the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person or (iii) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person, the Indemnifying Person proposes to have the same counsel represent it and the Indemnified Person, and representation of both parties by the same counsel would, in the opinion of counsel, be inappropriate due to actual or potential differing interests between them. In no event shall the Indemnifying Person be liable for the fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. It is understood that the Indemnifying Person shall reimburse all such reasonable fees and expenses actually incurred upon delivery to the Indemnifying Person of reasonable documentation therefor setting forth such expenses in reasonable detail unless a bona fide dispute exists with respect to such expenses. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final, non-appealable judgment for the plaintiff, the Indemnifying Person agrees to indemnify any Indemnified Person from and against any Losses by reason of such settlement or judgment. No Indemnifying Person shall, without the prior written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is a party, unless such settlement includes an unconditional release of such Indemnified Person from all liability on claims that are the subject matter of such proceeding and no admission of fault on the part of the Indemnified Party.

Payments made by any Indemnifying Person under this Section 8 shall be limited to the amount of any liability or damage that remains after deducting therefrom any insurance proceeds and any indemnity, contribution or other similar payment recovered by the Indemnified Person from any third party with respect thereto.

Notwithstanding anything to the contrary set forth herein, no Indemnified Person shall be entitled to be indemnified pursuant to this Section 8 for any Loss to the extent such Loss arises as a result of the Indemnified Person’s gross negligence or willful misconduct; provided, however, that the Indemnifying Person shall pay the expenses incurred by any such Indemnified Person hereunder, as such expenses are incurred, in connection with any proceeding in advance of the final disposition, so long as the Indemnifying Person receives an undertaking by such Indemnified Person to repay the full amount advanced if there is a final determination that such Indemnified Person failed the standards set forth above or that such Indemnified Person is not entitled to indemnification as provided herein for other reasons; and provided, further, that the termination of any action, suit or proceeding by judgment, order, settlement, conviction, or a plea

23

of nolo contendere or its equivalent, shall not, of itself, create a presumption that such Indemnified Person was either grossly negligent or engaged in willful misconduct.

The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any Indemnified Person at law or in equity.

In circumstances in which the indemnity agreement provided for in the preceding paragraphs of this Section 8 is unavailable to, or insufficient to hold harmless, an Indemnified Party in respect of any Losses, each Indemnifying Party, in order to provide for just and equitable contribution, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, including reasonable legal or other expenses incurred, as incurred, in such proportion as is appropriate to reflect (i) the relative benefits received by the Indemnifying Party on the one hand and the Indemnified Party on the other from the offering of the Securities or (ii) if the allocation provided by the foregoing clause (i) is not permitted by applicable law, not only such relative benefits but also the relative fault of the Indemnifying Party on the one hand and the Indemnified Party on the other in connection with the breach that resulted in such losses, claims, damages or liabilities (or actions in respect thereof). The relative fault of the parties shall be determined by reference to, among other things, any equitable considerations appropriate in the circumstances. The Company and the Purchasers agree that it would not be equitable if the amount of such contribution were determined by pro rata or per capita allocation or by any other method of allocation that does not take into account the equitable considerations referred to in the first sentence of this paragraph. For purposes of this paragraph, each person, if any, who controls any of the Purchasers within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as such Purchaser. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

The indemnity agreements and contribution provisions contained in this Section 8 and the representations and warranties of the Company, and the Purchasers set forth in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Purchaser or any person controlling any Purchaser or by or on behalf of the Company, its officers or directors or any other person controlling the Company and (iii) acceptance of and payment for any of the Securities.

9. Purchaser Participation Right.

(a) Right. In the event that, prior to June 4, 2007, the Company proposes to issue equity securities or other securities directly or indirectly exercisable for or convertible into equity securities (other than Excluded Issuances set forth in Section 9(c) below), the Company shall offer each Purchaser the opportunity to purchase, on the same terms and conditions as those offered to all other purchasers and pursuant to documentation reasonably satisfactory to the Company and the Purchasers, a percentage of such securities that is equal to

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the percentage of the Company’s Common Stock owned by each Purchaser immediately prior to such transaction, counting as Common Stock (on an as-converted-to-Common Stock basis, without regard for limitations on conversion or exercise contained in the Transaction Documents) for the purposes of determining such percentage all issued and outstanding securities of the Company that are exchangeable or exercisable for, or convertible into, Common Stock (“Pro Rata Portion”).

(b) Procedure for Exercise.

(i) The Company shall deliver to each Purchaser a written notice (the “Offer Notice”) of any proposed or intended issuance or sale or exchange (the “Offer”) of the securities being offered (the “Offered Securities”) pursuant to Section 9(a) above at least fifteen (15) days prior to any such issuance or sale or exchange, which Offer Notice shall (x) identify and describe the Offered Securities, (y) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged and (z) offer to issue and sell to or exchange with such Purchasers a Pro Rata Portion of the Offered Securities allocated among such Purchasers based on such Purchaser’s pro rata portion of the aggregate principal amount of Securities purchased hereunder (the “Basic Amount”).

(ii) To accept an Offer, in whole or in part, such Purchaser must deliver, subject to clause (iv) below, an irrevocable written notice to the Company prior to the end of the fifteenth (15^th) day after such Purchaser’s receipt of the Offer Notice (the “Offer Period”), setting forth the portion of such Purchaser’s Basic Amount, if any, that such Purchaser elects to purchase (the “Notice of Acceptance”).

(iii) The Company shall have twenty (20) business days from the expiration of the Offer Period above to offer, issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the “Refused Securities”), only at a price and upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer Notice.

(iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 9(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that such Purchaser elected to purchase pursuant to Section 9(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to purchasers pursuant to Section 9(b)(iii) above) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until

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such securities have again been offered to the Purchasers in accordance with Section 9(b)(i) above.

(v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 9(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers and their respective counsel.

(vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 9(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement.

(c) Excluded Issuances. The participation rights set forth in this Section 9 shall not apply to the following issuances (the “Excluded Issuances”): (i) the sale or issuance of the Securities under the Transaction Documents; (ii) the grant by the Company of equity issuances under its equity incentive and stock option plans, including any such plans approved by the Company’s Board of Directors and stockholders in the future and any equity issuances in exchange for any existing employee stock options for the purpose of repricing such employee stock options; (iii) the grant or issuance by the Company of Common Stock options or warrants as full or partial payment of a customary advisory fee payable to a nationally recognized bank or investment bank in connection with a strategic transaction or financing; (iv) the issuance by the Company of any shares of Common Stock upon the exercise of an option or warrant or the conversion of a security (including, for the avoidance of doubt, the Company’s 2.5% Series B Convertible Preferred Stock, par value $.001 per share) outstanding on the date hereof (provided that the terms of such options or warrants or securities are not amended or modified in any manner after the date hereof) or an option or warrant issued or granted in compliance with this paragraph; (v) shares issued pursuant to the Company’s employee stock purchase plans, including any such plans approved by the Company’s Board of Directors and stockholders in the future; (vi) shares of Common Stock issued in connection with any stock split or subdivision, stock dividend or recapitalization of the Company; (vii) shares of Common Stock or warrants issued in connection with acquisitions by or of the Company, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise, occurring after the Closing Date, the primary purpose of which is not to raise equity capital; (viii) shares of Common Stock or warrants issued in connection with a joint venture, strategic alliance or other commercial relationship, the primary purpose of which is not to raise equity capital; (ix) shares of Common Stock pursuant to a bona fide firm commitment underwritten public offering with gross proceeds to the Company of at least $25 million with a nationally recognized underwriter (it being understood, however, that the Company shall use its reasonable best efforts to cause the underwriter of any such public offering completed on or before June 4, 2007 to allocate five percent (5%) of the Common Stock to be issued pursuant to such public offering for purchase by

26

the Purchasers collectively as a group, such allocation to be distributed pro rata among such Purchasers); and (x) issuances of equity securities, including without limitation pursuant to Section 3(a)(9) of the Securities Act, in exchange for the Company’s existing outstanding indebtedness, including without limitation issuances of Common Stock in exchange for the Company’s 5.25% Convertible Subordinated Debentures due 2006.

10. Lock-Up. The Company hereby agrees that, without the prior written consent of the Majority Holders, it will not, (x) during the period ending forty five (45) days after the Closing Date, (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise, and (y) during the period ending on the later of the date sixty (60) days after the Closing Date and the date the Initial Shelf Registration Statement (as defined in and required under the Registration Rights Agreement) is initially filed, file with the SEC a registration statement under the Securities Act relating to any additional shares of its Common Stock or securities convertible into, or exchangeable or exercisable for, any shares of its Common Stock. The foregoing sentence shall not apply to Excluded Issuances except for Excluded Issuances of the type described in Section 9(c)(ix).

In addition, the Company agrees to use its best efforts during the period ending ninety (90) days after the Closing Date to prevent its executive officers and directors, in the aggregate, from taking any of the actions set forth in clauses (i) and (ii) in the immediately preceding paragraph with respect to in excess of 250,000 shares of Common Stock in the aggregate for all executive officers and directors without the prior written consent of the Majority Holders; provided, however, that the foregoing covenant shall not apply to (i) any bona fide gift and (ii) sales of shares by such persons of Common Stock purchased under the Company’s employee stock purchase plans approved by the Company’s Board of Directors and stockholders now or in the future.

11. Termination. The Purchasers may terminate this Agreement by notice given to the Company executed by the Purchasers purchasing more than fifty percent (50%) of the aggregate principal amount of the Firm Notes hereunder as set forth on Schedule I hereto, (except in the case of clauses (i) and (v), which termination right may be exercised by each Purchaser as to itself but not the other Purchasers), if prior to the Closing Date (i) in the sole judgment of a Purchaser a Material Adverse Effect shall have occurred between the date hereof and the Closing Date, (ii) trading in any securities of or guaranteed by the Company or securities generally on the New York Stock Exchange, Inc., the American Stock Exchange or the Principal Market shall have been suspended or materially limited, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by United States or New

27

York State authorities, (v) there shall have been (A) an outbreak or escalation of hostilities between the United States and any foreign power, or (B) an outbreak or escalation of any other insurrection or armed conflict involving the United States or any other national or international calamity or emergency, or (C) any material change in the financial markets of the United States which, in the case of (A), (B) or (C) above and in the sole judgment of a Purchaser, makes it impracticable or inadvisable to proceed with the transactions contemplated by this Agreement or (vi) the failure of the Company to satisfy the conditions set forth in Section 6 of this Agreement on or before the date that is ten (10) calendar days after the date of this Agreement; provided, in each case, that the party seeking to terminate this Agreement is not then in material breach of this Agreement.

12. Effectiveness. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

13. Parties. This Agreement shall inure to the benefit of and be binding upon the Company and the Purchasers, any controlling persons referred to herein and their respective successors and, with respect to the Purchasers, their Permitted Assigns. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. No purchaser of Securities from the Purchasers shall be deemed to be a successor by reason merely of such purchase, and rights under this Agreement may be assigned by the Purchasers only to Permitted Assigns. For purposes of this Section 13, “Permitted Assigns” shall mean: (i) an “affiliate” (as defined in Rule 501(b) of Regulation D) of the Purchaser to whom Securities are assigned and (ii) a pledgee (or a transferee of such pledgee) that succeeds to the Securities in connection with a bona fide margin account or other loan or financing arrangement secured by the Securities.

14. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed by registered or certified mail, postage prepaid, return receipt requested, or otherwise delivered by hand or by messenger.

Notices to the Purchasers shall be given at the address as set forth on Schedule I hereto, with a copy to (solely for informational purposes):

Schulte Roth & Zabel LLP

919 Third Avenue

New York, New York 10022

Telephone: (212) 756-2000

Facsimile: (212) 593-5955

Attention: Eleazer Klein, Esq.

Notices to the Company shall be given to the Company at:

11701 Luna Road

Dallas, Texas 75234

Attention: General Counsel

Telephone: (469) 357-1000

Facsimile: (469) 357-6566

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with a copy to (solely for informational purposes):

Dechert LLP

30 Rockefeller Plaza

New York, New York

Telephone: (212) 698-3500

Facsimile: (212) 698-3599

Attention: Bruce B. Wood, Esq.

15. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. To the fullest extent permitted by applicable law, the Company hereby irrevocably submits to the non-exclusive jurisdiction of any New York State court or Federal court sitting in the County of New York in respect of any suit, action or proceeding arising out of or relating to the provisions of this Agreement and irrevocably agree that all claims in respect of any such suit, action or proceeding may be heard and determined in any such court. The parties hereto hereby waive, to the fullest extent permitted by applicable law, any objection that they may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court, and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

16. Counterparts. This Agreement may be signed in counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument; provided that a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile signature.

17. Severability. If any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, portions of such provision, or such provision in its entirety, to the extent necessary, shall be severed from this Agreement and the balance of this Agreement shall be enforceable in accordance with its terms.

18. Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

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19. Amendments and Waivers. Any term of this Agreement may be amended, modified or supplemented only with the written consent of the Company and the holders of more than fifty percent (50%) of (x) the then-outstanding aggregate principal amount of the Notes with respect to amendments, modifications and supplements relating to the Notes and (y) the then outstanding number of Warrants with respect to amendments, modifications and supplements relating to the Warrants. Neither this Agreement nor any term hereof may be waived, discharged or terminated (either generally or in a particular instance and either retroactively or prospectively) other than by a written instrument signed by the party against whom enforcement of any such waiver, discharge or termination is sought.

20. Entire Agreement. This Agreement and the documents referenced herein constitutes the full and entire understanding and agreement among the parties with regard to the subject matters hereof.

21. Survival. The respective representations, warranties, covenants and agreements of the Company and the Purchasers set forth in or made pursuant to this Agreement will remain in full force and effect and will survive delivery of and payment for the Securities sold hereunder and any termination of this Agreement.

22. Independence of Purchasers. The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document, and no action taken by the Purchasers pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents, and the Company acknowledges that the Purchasers are not acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. The Purchasers represent and warrant that they are not acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents and confirm that they have or legal counsel has on their behalf independently participated in the negotiation of the transaction contemplated hereby. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Agreement or out of any other Transaction Documents, and it shall not be necessary for any Purchaser to be joined as an additional party in any proceeding for such purpose.

23. Transfers. Each Purchaser agrees to offer, sell or otherwise transfer the Securities, prior to the date which is two (2) years after the original issue date of the Securities, only (a) to the Company or any parent or subsidiary thereof, (b) for so long as the Securities are eligible for resale pursuant to Rule 144A, to a person it reasonably believes is a “Qualified Institutional Buyer” (as defined in Rule 144A) that purchases for its own account or for the account of a Qualified Institutional Buyer to which notice is given that the transfer is being made

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in reliance on Rule 144A, (c) pursuant to a registration statement which has been declared effective under the Securities Act or (d) pursuant to another available exemption from the registration requirements of the Securities Act, subject to the Company’s and the Trustee’s right prior to any such offer, sale or transfer pursuant to clause (d) to require the delivery of an opinion of counsel, certification and/or other information reasonably satisfactory to each of them, and in each of the foregoing cases, a certificate of transfer in the form specified in the Indenture and the Notes is completed and delivered by the transferor to the Trustee.

[signature page follows]

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If the foregoing is in accordance with your understanding, please sign and return four counterparts hereof.

Very truly yours,
i2 TECHNOLOGIES, INC.
By:	/s/ Michael Berry
	Name:	Michael Berry
	Title:	EVP, CFO

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

PURCHASERS:
HIGHBRIDGE INTERNATIONAL LLC
By:   HIGHBRIDGE CAPITAL MANAGEMENT, LLC
By:	/s/ Adam Chill
	Name:	Adam J. Chill
	Title:	Managing Director

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

PURCHASERS:
MARATHON GLOBAL CONVERTIBLE MASTER FUND LTD.
By:	/s/ Jamie Raboy
	Name:	Jamie Raboy
	Title:	Authorized Signatory

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

PURCHASERS:

LEONARDO, L.P.

By:   LEONARDO CAPITAL MANAGEMENT, INC.,
its General Partner

By:   ANGELO, GORDON & CO., L.P.,
its Director

By:	/s/ Michael Gordon
	Name:	Michael L. Gordon
	Title:	Chief Operating Officer

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

PURCHASERS:

AMATIS LIMITED

By:   AMARANTH ADVISORS L.L.C.

By:	/s/ Karl Wachter
	Name:	Karl Wachter
	Title:	Authorized Signatory

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

PURCHASERS:
DEUTSCHE BANK AG LONDON
By:	/s/ Andrea Leung
	Name:	Andrea Leung
	Title:	Attorney-in-Fact

[SIGNATURE PAGE TO PURCHASE AGREEMENT]

EX-10.2

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) made and entered into as of November 23, 2005 by and among i2 Technologies, Inc., a Delaware corporation (the “Company”), and the parties set forth on Schedule I hereto (each, a “Purchaser” and collectively, the “Purchasers”).

RECITALS

WHEREAS, in order to induce each of the Purchasers to enter into that certain Purchase Agreement dated November 21, 2005 by and among the Company and the Purchasers (the “Purchase Agreement”), the Company has agreed to provide the registration rights set forth in this Agreement; and

WHEREAS, the execution and delivery of this Agreement is a condition to the closing under the Purchase Agreement.

AGREEMENT

NOW, THEREFORE, the Company agrees with the Purchasers (i) for their benefit as the Purchasers and (ii) for the benefit of the beneficial owners (including the Purchasers) from time to time of the Notes (as defined herein), the Warrants (as defined in the Purchase Agreement), the Underlying Common Stock (as defined herein) and the Warrant Shares (as defined in the Purchase Agreement) (each of the foregoing a “Holder” and together the “Holders”), as follows:

Section 1. Definitions. Capitalized terms used herein without definition shall have their respective meanings set forth in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings:

“Affiliate” means with respect to any specified person, an “affiliate,” as defined in Rule 144, of such person.

“Amendment Effectiveness Deadline Date” has the meaning set forth in Section 2(d) hereof.

“Applicable Conversion Price” means, as of any date of determination, the Conversion Price of the Notes then in effect as determined in accordance with the terms of the Indenture or, if no Notes are then outstanding, the Conversion Rate that would be in effect were Notes then outstanding.

“Business Day” has the meaning assigned to such term in the Indenture.

“Common Stock” has the meaning assigned to such term in the Indenture.

“Company Indemnified Party” has the meaning set forth in Section 6(b) hereof.

“Conversion Price” has the meaning assigned to such term in the Indenture.

“EDGAR” means the Electronic Data Gathering, Analysis, and Retrieval system by which companies file forms with the SEC.

“Effectiveness Deadline Date” has the meaning set forth in Section 2(a) hereof.

“Effectiveness Period” means a period that will terminate upon the earliest of (1) the date on which all Registrable Securities held by non-Affiliates are eligible to be sold to the public pursuant to Rule 144(k) under the Securities Act or any successor provision thereof, (2) the date when each of the Registrable Securities covered by the Shelf Registration Statement has been effectively registered under the Securities Act and disposed of in accordance with the Shelf Registration Statement, (3) the date on which all Registrable Securities have been resold pursuant to Rule 144 under the Securities Act, (4) the date on which all the Notes, the Warrants and the Registrable Securities cease to be outstanding and (5) the date that is the three-year anniversary of the Issue Date.

“Event” has the meaning set forth in Section 2(e) hereof.

“Event Date” has the meaning set forth in Section 2(e) hereof.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

“Exercise Price” has the meaning assigned such term in the Warrant.

“Filing Deadline Date” has the meaning set forth in Section 2(a) hereof.

“Holder” has the meaning set forth in the first paragraph of this Agreement.

“Holder Indemnified Party” has the meaning set forth in Section 6(a) hereof.

“Indemnified Party” has the meaning assigned to such term in Section 6(c) hereof.

“Indemnifying Party” has the meaning set forth in Section 6(c) hereof.

“Indenture” means the Indenture, dated as of November 23, 2005, between the Company and the Trustee, as Trustee, pursuant to which the Notes are being issued.

“Initial Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.

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“Issue Date” means the first date of original issuance of the Notes and the Warrants.

“Liquidated Damages Accrual Period” has the meaning set forth in Section 2(e) hereof.

“Liquidated Damages” has the meaning set forth in Section 2(e) hereof.

“Liquidated Damages Payment Date” means each interest payment date under the Indenture in the case of Notes, and each May 1 and November 1 in the case of the Underlying Common Stock and the Warrant Shares.

“Make-Whole Premium” has the meaning assigned to such term in the Indenture.

“Material Event” has the meaning set forth in Section 3(i) hereof.

“Notes” means the Firm Notes and the Additional Notes (as such terms are defined in the Purchase Agreement).

“Notice and Questionnaire” means a written notice and questionnaire delivered to the Company containing the information called for by the Selling Securityholder Notice and Questionnaire attached as Annex A hereto.

“Notice Holder” means, on any date, any Holder that has delivered a Notice and Questionnaire to the Company on or prior to such date, so long as all of their Registrable Securities that have been registered for resale pursuant to a Notice and Questionnaire have not been sold in accordance with a Shelf Registration Statement.

“Purchase Agreement” has the meaning set forth in the recitals to this Agreement.

“Proceeding” has the meaning set forth in Section 6(c) hereof.

“Prospectus” means the prospectus included in any Shelf Registration Statement (including, without limitation, a prospectus that discloses information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 415 promulgated under the Securities Act), as amended or supplemented by any amendment or prospectus supplement, including post-effective amendments, and all materials incorporated by reference or explicitly deemed to be incorporated by reference in such Prospectus.

“Purchaser” and “Purchasers” have the meaning set forth in the preamble of this Agreement.

“Record Holder” means (i) with respect to any Liquidated Damages Payment Date relating to any Notes as to which any Liquidated Damages has accrued, the holder of record of such Note on the record date with respect to the interest payment date under the Indenture on

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which such Liquidated Damages Payment Date shall occur and (ii) with respect to any Liquidated Damages Payment Date relating to the Underlying Common Stock, Warrants or Warrant Shares as to which any Liquidated Damages has accrued, the registered holder of such Underlying Common Stock, Warrants or Warrant Shares 15 days prior to such Liquidated Damages Payment Date.

“Registrable Securities” means the Underlying Common Stock and the Warrant Shares and any securities into or for which such Underlying Common Stock and/or Warrant Shares have been converted and any security issued with respect thereto upon any stock dividend, split or similar event until, in the case of any such security, the expiration of the Effectiveness Period.

“Registration Expenses” has the meaning set forth in Section 5 hereof.

“Rule 144” means Rule 144 under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC.

“Rule 144A” means Rule 144A under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated by the SEC thereunder.

“Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.

“Subsequent Shelf Registration Statement” has the meaning set forth in Section 2(b) hereof.

“Suspension Notice” has the meaning set forth in Section 3(i) hereof.

“Suspension Period” has the meaning set forth in Section 3(i) hereof.

“Trustee” means JPMorgan Chase Bank, National Association, a national banking association organized and existing under the laws of the United States, the Trustee under the Indenture.

“Underlying Common Stock” means the Common Stock issued or issuable upon conversion or repurchase of the Notes, including any Common Stock issued or issuable in connection with a Make-Whole Premium to be paid in accordance with Article 5 of the Indenture.

“Warrants” has the meaning assigned such term in the Purchase Agreement.

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“Warrant Shares” has the meaning assigned such term in the Purchase Agreement.

Section 2. Shelf Registration.

(a) The Company shall prepare and file or cause to be prepared and filed with the SEC, as soon as practicable but in any event by the date (the “Filing Deadline Date”) that is 120 days after the Issue Date, a registration statement for an offering to be made on a delayed or continuous basis pursuant to Rule 415 of the Securities Act (a “Shelf Registration Statement”) registering the resale from time to time by Holders thereof of all of the Registrable Securities (the “Initial Shelf Registration Statement”). The Initial Shelf Registration Statement shall be on Form S-3 or another appropriate form permitting registration of such Registrable Securities for resale by such Holders in accordance with the reasonable methods of distribution elected by the Holders, reasonably approved by the Company, and set forth in the Initial Shelf Registration Statement. The Company shall not permit any securities other than the Registrable Securities to be included in any Shelf Registration Statement registering the resale from time to time by Holders thereof of all of the Registrable Securities. The Company shall use its reasonable best efforts to cause the Initial Shelf Registration Statement to be declared effective under the Securities Act as promptly as is practicable but in any event by the date (the “Effectiveness Deadline Date”) that is 270 days after the Issue Date, and to keep the Initial Shelf Registration Statement (or any Subsequent Shelf Registration Statement) continuously effective under the Securities Act until the expiration of the Effectiveness Period. At the time the Initial Shelf Registration Statement is declared effective, each Holder that became a Notice Holder on or prior to the date that is five Business Days prior to such time of effectiveness shall be named as a selling securityholder in the Initial Shelf Registration Statement and the related Prospectus in such a manner as to permit such Holder to deliver such Prospectus to purchasers of Registrable Securities in accordance with applicable law.

(b) If the Initial Shelf Registration Statement or any Subsequent Shelf Registration Statement ceases to be effective for any reason at any time during the Effectiveness Period, the Company shall use its reasonable best efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof, and in any event shall within ten Business Days of such cessation of effectiveness amend the Shelf Registration Statement in a manner reasonably expected to obtain the withdrawal of the order suspending the effectiveness thereof, or file an additional Shelf Registration Statement covering all of the securities that as of the date of such filing are Registrable Securities (a “Subsequent Shelf Registration Statement”). If a Subsequent Shelf Registration Statement is filed, the Company shall use its reasonable best efforts to cause the Subsequent Shelf Registration Statement to become effective as promptly as is practicable after such filing and to keep such Shelf Registration Statement (or Subsequent Shelf Registration Statement) continuously effective until the end of the Effectiveness Period.

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(c) The Company shall supplement and amend the Shelf Registration Statement if required by the rules, regulations or instructions applicable to the registration form used by the Company for such Shelf Registration Statement, if required by the Securities Act or as reasonably requested by the Purchasers or by the Trustee on behalf of the Holders covered by such Shelf Registration Statement.

(d) Each Holder agrees that if such Holder wishes to sell Registrable Securities pursuant to a Shelf Registration Statement and related Prospectus, it will do so only in accordance with this Section 2(d) and Section 3(i). Each Holder wishing to sell Registrable Securities pursuant to a Shelf Registration Statement and related Prospectus agrees to deliver a completed and executed Notice and Questionnaire to the Company at least three Business Days prior to any attempted or actual distribution of Registrable Securities under the Shelf Registration Statement; provided that (A) the Company shall send the Notice and Questionnaire to each Holder as soon as practicable, but not later than 30 Business Days prior to the Filing Deadline Date and (B) Holders shall have at least 20 Business Days from the date on which the Notice and Questionnaire is first sent to such Holders by the Company to complete and return the Notice and Questionnaire to the Company in order to be named in the Shelf Registration Statement at the time of its initial effectiveness. From and after the date the Initial Shelf Registration Statement is declared effective, the Company shall, as promptly as practicable after the date a Notice and Questionnaire is delivered, and in any event within five Business Days after such date (subject to the proviso below), (i) if required by applicable law, file with the SEC a post-effective amendment to the Shelf Registration Statement or, if required by applicable law, prepare and file a supplement to the related Prospectus or a supplement or amendment to any document incorporated therein by reference or file any other required document so that the Holder delivering such Notice and Questionnaire is named as a selling securityholder in the Shelf Registration Statement and the related Prospectus in such a manner as to permit such Holder to deliver such Prospectus to purchasers of the Registrable Securities in accordance with applicable law and, if the Company shall file a post-effective amendment to the Shelf Registration Statement, use its reasonable best efforts to cause such post-effective amendment to be declared effective under the Securities Act as promptly as is practicable, but in any event by the date (the “Amendment Effectiveness Deadline Date”) that is 45 days after the date such post-effective amendment is required by this clause to be filed; (ii) provide such Holder a reasonable number of copies of any documents filed pursuant to Section 2(d)(i); and (iii) notify such Holder as promptly as practicable after the effectiveness under the Securities Act of any post-effective amendment filed pursuant to Section 2(d)(i); provided, that if such Notice and Questionnaire is delivered during a Suspension Period, or a Suspension Period is put into effect within five Business Days after such delivery date, the Company shall so inform the Holder delivering such Notice and Questionnaire and shall take the actions set forth in clauses (i), (ii) and (iii) above within ten Business Days after expiration of the Suspension Period in accordance with Section 3(i); provided, further, that in no event will the Company be required to file with the SEC (x) a supplement to the Prospectus more than once in any 20-day period or (y) a post-effective amendment to the Shelf Registration Statement more than once in any 60-day period, in each case solely for the purpose of naming any Holder, who is not included in the Shelf Registration Statement, as a selling securityholder in the Shelf Registration Statement and

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the related Prospectus. Notwithstanding anything contained herein to the contrary, the Company shall be under no obligation to name any Holder that is not a Notice Holder as a selling securityholder in any Shelf Registration Statement or related Prospectus; provided, however, that any Holder that becomes a Notice Holder pursuant to the provisions of this Section 2(d) (whether or not such Holder was a Notice Holder at the time the Shelf Registration Statement was declared effective) shall be named as a selling securityholder in the Shelf Registration Statement or related Prospectus in accordance with the requirements of this Section 2(d).

(e) The parties hereto agree that the Holders of Registrable Securities will suffer damages, and that it would not be feasible to ascertain the extent of such damages with precision, if (i) the Initial Shelf Registration Statement has not been declared effective under the Securities Act on or prior to the Effectiveness Deadline Date or (ii) the Initial Shelf Registration Statement is declared effective but shall thereafter cease to be effective (without being succeeded immediately by an additional registration statement filed and declared effective) or usable for the offer and sale of Registrable Securities for a period of time (including any Suspension Period) which shall exceed (A) 30 consecutive days in any one time, (B) 45 days in the aggregate in any three-month period or (C) 90 days in the aggregate in any 12-month period (each of the events of a type described in any of the foregoing clauses (i) and (ii) are individually referred to herein as an “Event,” and the Effectiveness Deadline Date in the case of clause (i), and the date on which the duration of the ineffectiveness or unusability of the Initial Shelf Registration Statement in any period exceeds the number of days permitted by clause (ii) hereof in the case of clause (ii), being referred to herein as an “Event Date”). Events shall be deemed to continue until the following dates with respect to the respective types of Events: the date the Initial Shelf Registration Statement is declared effective under the Securities Act in the case of an Event of the type described in clause (i) and the date the Initial Shelf Registration Statement becomes effective or usable again in the case of an Event of the type described in clause (ii).

Accordingly, commencing on (and including) any Event Date and ending on (but excluding) the next date on which there are no Events that have occurred and are continuing (a “Liquidated Damages Accrual Period”), the Company agrees to pay, as liquidated damages and not as a penalty, liquidated damages (“Liquidated Damages”) at the rate described below, payable periodically on each Liquidated Damages Payment Date to Record Holders of Notes and Warrants that are convertible into Underlying Common Stock or exercisable for Warrant Shares, as applicable, that are Registrable Securities and of shares of Underlying Common Stock issued upon conversion of Notes and Warrant Shares issued upon the exercise of the Warrants that are Registrable Securities, as the case may be, to the extent of, for each such Liquidated Damages Payment Date, accrued and unpaid Liquidated Damages to (but excluding) such Liquidated Damages Payment Date (or, if the Liquidated Damages Accrual Period shall have ended prior to such Liquidated Damages Payment Date, to the date of the end of the Liquidated Damages Accrual Period); provided that any Liquidated Damages accrued with respect to any Underlying Common Stock issuable upon conversion of any Note or portion thereof called for redemption on a redemption date or converted into Underlying Common Stock

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on a conversion date or any Warrant or portion thereof exercised into Warrant Shares on an exercise date prior to the Liquidated Damages Payment Date, shall, in any such event, be paid instead to the Holder who submitted such Note or Warrant or portion thereof for redemption, conversion or exercise, as applicable, on the applicable redemption date, conversion date or exercise date, as the case may be, on such date (or promptly following the conversion date or exercise date, in the case of conversion or exercise, as the case may be). Liquidated Damages shall accrue at a rate per annum equal to (1) 0.50% for the first 90-day period from the Event Date and (2) 1.00% thereafter of (i) the aggregate principal amount of such Notes and the aggregate Exercise Price of such Warrants or, without duplication, (ii) in the case of Notes that have been converted into Underlying Common Stock, the Applicable Conversion Price of such shares of Underlying Common Stock, and in the case of Warrants that have been exercised, the Exercise Price of such Warrants, as the case may be, in each case determined as of the Business Day immediately preceding the next Liquidated Damages Payment Date. Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any Registrable Security from and after the earlier of (x) the date such security is no longer a Registrable Security and (y) expiration of the Effectiveness Period. The rate of accrual of Liquidated Damages with respect to any period shall not exceed the rate provided for in this paragraph notwithstanding the occurrence of multiple concurrent Events. Following the cure of all Events requiring the payment by the Company of Liquidated Damages to the Holders of Registrable Securities pursuant to this Section, the accrual of Liquidated Damages shall cease (without in any way limiting the effect of any subsequent Event requiring the payment of Liquidated Damages by the Company). Notwithstanding anything in this Agreement to the contrary, Liquidated Damages shall only be payable to Notice Holders.

The Trustee, on behalf of Holders of Notes, and the Holders of Warrants, shall be entitled to seek any available remedy for the enforcement of this Agreement, including specific performance or equitable relief with respect to this Agreement. Notwithstanding the foregoing, the parties agree that the sole monetary damages payable for a violation of the terms of this Agreement with respect to which Liquidated Damages are expressly provided shall be such Liquidated Damages.

All of the Company’s obligations set forth in this Section 2(e) that are outstanding with respect to any Registrable Security at the time such security ceases to be a Registrable Security shall survive until such time as all such obligations with respect to such security have been satisfied in full (notwithstanding termination of this Agreement pursuant to Section 8(k)).

The parties hereto agree that the liquidated damages provided for in this Section 2(e) constitute a reasonable estimate of the damages that may be incurred by Holders of Registrable Securities by reason of the failure of the Shelf Registration Statement to be filed or declared effective or available for effecting resales of Registrable Securities in accordance with the provisions hereof.

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Section 3. Registration Procedures. In connection with the registration obligations of the Company under Section 2 hereof, the Company shall:

(a) Prepare and file with the SEC a Shelf Registration Statement or Shelf Registration Statements on Form S-3 or any other appropriate form under the Securities Act available for the sale of the Registrable Securities by the Holders thereof in accordance with the intended method or methods of distribution thereof, and use its reasonable best efforts to cause each such Shelf Registration Statement to become effective and remain effective as provided herein; provided, that before filing any Shelf Registration Statement or Prospectus or any amendments or supplements thereto with the SEC, the Company shall furnish to the Holders and counsel for the Holders copies of all such documents proposed to be filed and such documents (other than a prospectus supplement filed solely to update the selling securityholder information (of a selling securityholder other than such Holder) in the Prospectus) will be subject to the review of such counsel for a period of no less than ten Business Days for the initial filing of the Shelf Registration Statement or any post-effective amendment thereto or no less than three Business Days prior to the filing of a pre-effective amendment to the Shelf Registration Statement, and with respect to the initial filing of the Shelf Registration Statement or any post-effective amendment thereto, the Company shall not file such documents to which such counsel shall reasonably object within ten Business Days of the delivery of such copies to the Holders and such counsel and with respect to the pre-effective amendment to the Shelf Registration Statement, the Company shall not file such documents to which such counsel shall reasonably object within three Business Days of the delivery of such copies to the Holders and such counsel.

(b) Prepare and file with the SEC such amendments and post-effective amendments to each Shelf Registration Statement as may be necessary to keep such Shelf Registration Statement continuously effective until the expiration of the Effectiveness Period; cause the related Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) under the Securities Act; and use its reasonable best efforts to comply with the provisions of the Securities Act applicable to it with respect to the disposition of all securities covered by such Shelf Registration Statement during the Effectiveness Period in accordance with the intended methods of disposition by the sellers thereof set forth in such Shelf Registration Statement as so amended or such Prospectus as so supplemented.

(c) As promptly as practicable give notice to the Notice Holders, the Purchasers and counsel to the Holders (i) when any Prospectus, Prospectus supplement, Shelf Registration Statement or post-effective amendment to a Shelf Registration Statement has been filed with the SEC and, with respect to a Shelf Registration Statement or any post-effective amendment, when the same has been declared effective, (ii) of any request, following the effectiveness of the Initial Shelf Registration Statement under the Securities Act, by the SEC or any other federal or state governmental authority for amendments or supplements to any Shelf Registration Statement or related Prospectus or for additional information, (iii) of the issuance by the SEC or any other federal or state governmental authority of any stop order suspending

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the effectiveness of any Shelf Registration Statement or the initiation or threatening of any proceedings for that purpose, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, (v) after the effective date of any Shelf Registration Statement filed pursuant to this Agreement of the occurrence of (but not the nature of or details concerning) a Material Event and (vi) of the determination by the Company that a post-effective amendment to a Shelf Registration Statement will be filed with the SEC, which notice may, at the discretion of the Company (or as required pursuant to Section 3(i)), state that it constitutes a Suspension Notice, in which event the provisions of Section 3(i) shall apply.

(d) Use its reasonable best efforts to prevent the issuance of, and, if issued, to obtain the withdrawal of any order suspending the effectiveness of a Shelf Registration Statement or the lifting of any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction in which they have been qualified for sale, in either case at the earliest possible moment, and provide prompt notice to each Notice Holder and the Purchasers of the withdrawal of any such order.

(e) If requested by the Purchasers or any Notice Holder, as promptly as practicable incorporate in a Prospectus supplement or post-effective amendment to a Shelf Registration Statement such information as the Purchasers or such Notice Holder shall, on advice from counsel, determine to be required to be included therein by applicable law and make any required filings of such Prospectus supplement or such post-effective amendment; provided, that the Company shall not be required to take any actions under this Section 3(e) that, on advice from counsel for the Company, the Company determines would not be in compliance with applicable law.

(f) As promptly as practicable furnish to each Notice Holder, the Purchasers and counsel for the Holders, without charge, at least one conformed copy of the Shelf Registration Statement and any amendment thereto, including financial statements but excluding schedules, all documents incorporated or deemed to be incorporated therein by reference and all exhibits, which obligation shall be deemed satisfied if such information is available through EDGAR or on or through the Company’s website.

(g) During the Effectiveness Period, deliver to each Notice Holder, the Purchasers and counsel for the Holders, in connection with any sale of Registrable Securities pursuant to a Shelf Registration Statement, without charge, as many copies of the Prospectus or Prospectuses relating to such Registrable Securities (including each preliminary prospectus) and any amendment or supplement thereto as such Notice Holder and the Purchasers may reasonably request; and the Company hereby consents (except during such periods that a Suspension Notice is outstanding and has not been revoked) to the use of such Prospectus or each amendment or supplement thereto by each Notice Holder, in connection with any offering and sale of the Registrable Securities covered by such Prospectus or any amendment or supplement thereto in the manner set forth therein.

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(h) Prior to any public offering of the Registrable Securities pursuant to the Shelf Registration Statement, use its reasonable best efforts to register or qualify or cooperate with the Notice Holders in connection with the registration or qualification (or exemption from such registration or qualification) of such Registrable Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United States as any Notice Holder reasonably requests in writing (which request may be included in the Notice and Questionnaire); and prior to any public offering of the Registrable Securities pursuant to the Shelf Registration Statement, use its reasonable best efforts to keep each such registration or qualification (or exemption therefrom) effective during the Effectiveness Period in connection with such Notice Holder’s offer and sale of Registrable Securities pursuant to such registration or qualification (or exemption therefrom) and at all times do any and all other acts or things reasonably necessary or advisable to enable the disposition in such jurisdictions of such Registrable Securities in the manner set forth in the relevant Shelf Registration Statement and the related Prospectus; provided, that the Company will not be required to (i) qualify as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this Agreement or (ii) take any action that would subject it to general service of process in suits or to taxation in any such jurisdiction where it is not then so subject.

(i) Upon (A) the issuance by the SEC of a stop order suspending the effectiveness of the Shelf Registration Statement or the initiation of proceedings with respect to the Shelf Registration Statement under Section 8(d) or 8(e) of the Securities Act, (B) the occurrence of any event or the existence of any fact as a result of which any Shelf Registration Statement shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or any Prospectus shall contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (C) the occurrence or existence of any pending corporate development (a “Material Event”) that, in the reasonable discretion of the Company, makes it appropriate to suspend the availability of the Shelf Registration Statement and the related Prospectus, the Company shall (i) in the case of clause (B) above, subject to the next sentence, as promptly as practicable, prepare and file, if necessary pursuant to applicable law, a post-effective amendment to such Shelf Registration Statement or a supplement to the related Prospectus or any document incorporated therein by reference or file any other required document that would be incorporated by reference into such Shelf Registration Statement and Prospectus so that such Shelf Registration Statement does not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and such Prospectus does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (it being understood that the Company may rely on information provided by each Notice Holder with respect to such Notice Holder), as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, and, in the case of a post-effective amendment to a Shelf Registration Statement, subject to the next sentence, use its reasonable best efforts to

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cause it to be declared effective as promptly as is practicable, and (ii) give notice to the Notice Holders, the Purchasers and counsel for the Holders (or, if applicable, separate counsel for the Holders) that the availability of the Shelf Registration Statement is suspended (a “Suspension Notice”) and, upon receipt of any Suspension Notice, each Notice Holder agrees not to sell any Registrable Securities pursuant to such Shelf Registration Statement until such Notice Holder’s receipt of copies of the supplemented or amended Prospectus provided for in clause (i) above, or until it is advised in writing by the Company that the Prospectus may be used, and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in such Prospectus. The Company will use its reasonable best efforts to ensure that the use of the Prospectus may be resumed (x) in the case of clause (A) above, as promptly as is practicable, (y) in the case of clause (B) above, as soon as, in the reasonable judgment of the Company, the Shelf Registration Statement does not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading and the Prospectus does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and (z) in the case of clause (C) above, as soon as, in the reasonable discretion of the Company, such suspension is no longer appropriate. The period during which the availability of the Shelf Registration Statement and any Prospectus may be suspended (the “Suspension Period”) without the Company incurring any obligation to pay liquidated damages pursuant to Section 2(e) shall not exceed (i) 30 consecutive days in any one time, (ii) 45 days in any three-month period and (iii) 90 days in any 12-month period, provided however, that the first day of any Suspension Period must be at least two (2) Business Days after the last day of any prior Suspension Period.

(j) Make available for inspection during normal business hours by representatives for the Notice Holders of such Registrable Securities, and any investment banks, attorneys and accountants retained by such Notice Holders, all relevant financial and other records and pertinent corporate documents and properties of the Company and its subsidiaries, and cause the appropriate officers, directors and employees of the Company and its subsidiaries to make available for inspection during normal business hours all relevant information reasonably requested by such representatives for the Notice Holders, or any such investment banks, attorneys or accountants in connection with such disposition, in each case as is customary for similar “due diligence” examinations; provided, however, that such persons shall, at the Company’s request, first agree in writing with the Company that any information that is reasonably and in good faith designated by the Company in writing as confidential at the time of delivery of such information shall be kept confidential by such persons and shall be used solely for the purposes of exercising rights under this Agreement, unless (i) disclosure of such information is required by court or administrative order or is necessary to respond to inquiries of regulatory authorities, (ii) disclosure of such information is required by law (including any disclosure requirements pursuant to federal securities laws in connection with the filing of any Shelf Registration Statement or the use of any Prospectus referred to in this Agreement), (iii) such information becomes generally available to the public other than as a result of a disclosure or failure to safeguard by any such person or (iv) such information becomes available to any

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such person from a source other than the Company and such source is not bound by a confidentiality agreement or is not otherwise under a duty of trust to the Company, and provided that the foregoing inspection and information gathering shall, to the greatest extent possible, be coordinated on behalf of all the Notice Holders and the other parties entitled thereto.

(k) Comply with all applicable rules and regulations of the SEC and make generally available to its securityholders earning statements (which need not be audited) satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) commencing on the first day of the first fiscal quarter of the Company commencing after the effective date of a Registration Statement, which statements shall cover said 12-month periods.

(l) Cooperate with each Notice Holder to facilitate the timely preparation and delivery of certificates representing Registrable Securities sold pursuant to a Shelf Registration Statement, which certificates shall not bear any restrictive legends, and cause such Registrable Securities to be registered in such names as such Notice Holder may request in writing at least three Business Days prior to any sale of such Registrable Securities.

(m) Provide the Trustee and the transfer agent for the Common Stock with certificates for the Registrable Securities that are in a form eligible for deposit with The Depository Trust Company.

(n) Upon (i) the filing of the Initial Shelf Registration Statement and (ii) the effectiveness of the Initial Shelf Registration Statement, announce the same, in each case by press release to a nationally recognized wire service.

(o) Provide a CUSIP number for all Registrable Securities covered by each Registration Statement not later than the effective date of such Registration Statement and provide the Trustee and the transfer agent for the Common Stock with printed certificates for the Registrable Securities that are in a form eligible for deposit with The Depository Trust Company.

(p) Enter into such customary agreements and take all such other necessary actions in connection therewith (including those requested by the holders of a majority of the Registrable Securities being sold) in order to expedite or facilitate the disposition of such Registrable Securities.

(q) The Company shall promptly furnish to legal counsel for the Holders copies of any correspondence from the SEC or the staff of the SEC to the Company or its representatives relating to any Shelf Registration Statement; provided, that such correspondence shall not be furnished to legal counsel for any Holder, or to any Holder directly, unless such Holder agrees to keep confidential any information regarding such correspondence.

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Section 4. Holder’s Obligations. Each Holder agrees, by acquisition of the Registrable Securities, that no Holder shall be entitled to sell any of such Registrable Securities pursuant to a Shelf Registration Statement or to receive a Prospectus relating thereto, unless such Holder has furnished the Company with a Notice and Questionnaire as required pursuant to Section 2(d) hereof (including the information required to be included in such Notice and Questionnaire) and the information set forth in the next sentence. Each Notice Holder agrees promptly to furnish to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Notice Holder not misleading and any other information regarding such Notice Holder and the distribution of such Registrable Securities as the Company may from time to time reasonably request. Any sale of any Registrable Securities by any Holder shall constitute a representation and warranty by such Holder that the information relating to such Holder and its plan of distribution is as set forth in the Prospectus delivered by such Holder in connection with such disposition, that such Prospectus does not as of the time of such sale contain any untrue statement of a material fact relating to or provided by such Holder or its plan of distribution and that such Prospectus does not as of the time of such sale omit to state any material fact relating to or provided by such Holder or its plan of distribution necessary in order to make the statements in such Prospectus, in the light of the circumstances under which they were made, not misleading. Each Holder covenants and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it in connection with sales of Registrable Securities pursuant to any Shelf Registration Statement, if any.

Section 5. Registration Expenses. The Company shall bear all fees and expenses incurred in connection with the performance by the Company of its obligations under Sections 2 and 3 of this Agreement whether or not any of the Shelf Registration Statements are declared effective. Such fees and expenses (“Registration Expenses”) shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses (x) with respect to filings required to be made with the National Association of Securities Dealers, Inc., and (y) of compliance with federal and state securities or Blue Sky laws, (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities in a form eligible for deposit with The Depository Trust Company), (iii) duplication and mailing expenses relating to copies of any Shelf Registration Statement or Prospectus delivered to any Holders hereunder, (iv) fees and disbursements of counsel for the Company and the fees and disbursements of one counsel chosen by the Holders of a majority of the then outstanding Underlying Common Stock and Warrant Shares constituting Registrable Securities (with Holders of Notes deemed to be the Holders, for purposes of this Section, of the number of outstanding shares of Underlying Common Stock into which such Notes are or would be convertible, not including, for this purpose only, any shares of Common Stock payable as a Make-Whole Premium upon conversion of any Note and Holders of Warrants deemed to be Holders, for purposes of this Section, of the number of outstanding Warrant Shares into which such Warrants are or would be exercisable) in connection with the Shelf Registration Statement, and (v) fees and disbursements of the registrar and transfer agent for the Common Stock. In addition, the Company shall pay the internal expenses of the Company (including, without limitation, all salaries and expenses of officers and employees performing legal or accounting

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duties), the expense of any annual audit, the fees and expenses incurred in connection with the listing by the Company of the Registrable Securities on any securities exchange on which similar securities of the Company are then listed and the fees and expenses of any person, including special experts, retained by the Company.

Section 6. Indemnification; Contribution.

(a) The Company agrees to indemnify and hold harmless each Holder and its directors, officers, employees, members, representatives and agents and each person, if any, who controls any Holder within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (each, a “Holder Indemnified Party”), from and against any loss, damage, expense, liability or claim (including the reasonable cost of investigation) which such Holder Indemnified Party may incur under the Securities Act, Exchange Act, or any other law, including any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to a Registration Statement, or otherwise, as incurred, insofar as such loss, damage, expense, liability or claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in the Shelf Registration Statement, or in any Prospectus, or any amendment thereof or supplement thereto, or arises out of or is based upon the omission or alleged omission to state therein a material fact necessary to make the statements therein (in the case of any Prospectus or in any amendment or supplement thereto or in any preliminary prospectus, in the light of the circumstances under which they were made) not misleading; provided, however, that: (i) the Company shall not be liable in any such case to the extent that any such loss, damage, expense, liability or claim arises out of or is based upon any untrue statement or omission or alleged untrue statement or omission of a material fact contained in, or omitted from, and in conformity with information required to be used in any Shelf Registration Statement, related prospectus or any amendments or supplements thereto pursuant to the Securities Act furnished in writing by or on behalf of the applicable Holder Indemnified Party to the Company expressly for use in a Shelf Registration Statement or Prospectus or any amendment thereof or supplement thereto; and (ii) with respect to any untrue statement or omission of material fact made in the Shelf Registration Statement, or in any Prospectus, the indemnity agreement contained in this Section 6(a) shall not inure to the benefit of a Holder Indemnified Party if the untrue statement or omission of material fact was corrected in amendments or supplements to the Prospectus, as then amended or supplemented, if such corrected Prospectus was timely made available by the Company pursuant to Section 3(g) hereof, and the Holder Indemnified Party was promptly advised in writing not to use the incorrect prospectus prior to the use giving rise to any such loss, damage, expense, liability or claim and such Holder Indemnified Party, notwithstanding such advice, used it. This indemnity agreement will be in addition to any liability that the Company may otherwise have. This indemnity agreement will not apply to any loss, damage, expense, liability or claim arising from an offer or sale, occurring during a Suspension Period, of Registrable Securities by a Notice Holder who has previously received notice from the Company of the commencement of the Suspension Period pursuant to Section 3(i).

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(b) Each Holder, severally and not jointly, agrees to indemnify and hold harmless the Company and its directors, officers, employees, members, representatives and agents and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (each, a “Company Indemnified Party”) from and against any loss, damage, expense, liability or claim (including the reasonable cost of investigation) which such Company Indemnified Party may incur under the Securities Act or otherwise, insofar as such loss, damage, expense, liability or claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in information furnished in writing by or on behalf of such Holder to the Company required to be included in any Shelf Registration Statement, or in any Prospectus, or any amendment thereof or supplement thereto, or arises out of or is based upon any omission or alleged omission to state a material fact required to be stated in any Shelf Registration Statement or in any amendment or supplement thereto or necessary to make the statements therein not misleading, or arises out of or is based upon any omission or alleged omission to state a material fact necessary in order to make the statements in any Prospectus or in any amendment or supplement thereto or in any preliminary prospectus, in the light of the circumstances under which they were made, not misleading, in connection with such information; provided, however, that no such Holder shall be liable for any claims hereunder in excess of the amount of net proceeds received by such Holder from the sale of Registrable Securities pursuant to such Shelf Registration Statement.

(c) If any action, suit or proceeding (each, a “Proceeding”) is brought against any person in respect of which indemnity may be sought pursuant to either subsection (a) or (b) of this Section 6, such person (the “Indemnified Party”) shall promptly notify the person against whom such indemnity may be sought (the “Indemnifying Party”) in writing of the institution of such Proceeding and the Indemnifying Party shall assume the defense of such Proceeding with one counsel (in addition to any local counsel) reasonably satisfactory to the Indemnified Party and shall pay the fees and expenses of such counsel related to such Proceeding; provided, however, that failure to so notify the Indemnifying Party shall not relieve such Indemnifying Party from any liability hereunder except to the extent it is materially prejudiced as a result thereof, but in no event shall such Indemnifying Party be relieved from any liability which it may otherwise have separate from these indemnification provisions. Such Indemnified Party shall have the right to employ its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless (i) the Indemnified Party is a Holder of Notes representing not less than 33% of the aggregate principal amount of the then outstanding Notes, (ii) the Indemnifying Party and the Indemnified Party shall have mutually agreed to the contrary, (iii) the Indemnifying Party has failed within a reasonable time after receipt of notice to assume defense of a Proceeding to retain counsel reasonably satisfactory to the Indemnified Party or (iv) the named parties in any such Proceeding (including any impleaded parties) include both the Indemnifying Party and the Indemnified Party, the Indemnifying Party proposes to have the same counsel represent it and the Indemnified Party, and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the Indemnifying Party may be liable for the fees and expenses of more than one counsel (in

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addition to any local counsel) separate from their own counsel for all Indemnified Parties in accordance with the foregoing sentence, and that all such fees and expenses actually incurred shall be promptly reimbursed as incurred upon delivery to the Indemnifying Party of reasonable documentation therefor setting forth such expenses in reasonable detail. The Indemnifying Party shall not be liable for any settlement of any Proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Party agrees to indemnify and hold harmless any Indemnified Party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified Party shall have requested the Indemnifying Party to reimburse the Indemnified Party as contemplated by this paragraph, the Indemnifying Party agrees that it shall be liable for any settlement of any Proceeding effected without its consent if (i) such settlement is entered into more than 60 Business Days after receipt by the Indemnifying Party of the aforesaid request, (ii) such Indemnifying Party shall not have reimbursed the Indemnified Party in accordance with such request prior to the date of such settlement and (iii) such Indemnified Party shall have given such Indemnifying Party at least 30 days’ prior notice of its intention to settle. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending or threatened Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding and without admission of fault by the Indemnified Party.

(d) If the indemnification provided for in this Section 6 is unavailable to an Indemnified Party under subsections (a) and (b) of this Section 6 in respect of any losses, damages, expenses, liabilities or claims referred to therein, then each applicable Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such losses, damages, expenses, liabilities or claims, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Holders on the other hand from the offering of the Registrable Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and of the Holders on the other in connection with the statements or omissions which resulted in such losses, damages, expenses, liabilities or claims, as well as any other relevant equitable considerations. Notwithstanding the provisions of this Section 6, neither any of the Purchasers nor any Holder shall be required to indemnify or contribute any amount in excess of the amount by which the total price at which the Registrable Securities sold by such Holder or Purchaser, as the case may be, exceeds the amount of any damages that such Holder or Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. The relative fault of the Company on the one hand and of the Holders on the other shall be determined by reference to, among other things, whether the untrue statement or alleged untrue statement of a material fact or omission or alleged omission relates to information supplied by the Company or by the Holders and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses,

17

damages, expenses, liabilities and claims referred to above shall be deemed to include any reasonable legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any Proceeding.

(e) The Company and the Holders agree that it would not be just and equitable if contribution pursuant to this Section 6 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in subsection (d) above. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Holders’ respective obligations to contribute pursuant to this Section 6 are several in proportion to the respective amount of Registrable Securities they have sold pursuant to a Shelf Registration Statement, and not joint. The remedies provided for in this Section 6 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Party at law or in equity,

(f) The indemnity and contribution provisions contained in this Section 6 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Holder or any person controlling any Holder, the Company or the Company’s officers or directors or any person controlling the Company and (iii) the sale of any Registrable Security by any Holder.

(g) Section 6 of this Agreement may not be amended except by an instrument in writing signed by the Indemnified Party affected thereby.

Section 7. Information Requirements.

(a) The Company covenants that, if at any time before the end of the Effectiveness Period it is not subject to the reporting requirements of the Exchange Act, it will cooperate with any Holder and take such further action as any Holder may reasonably request in writing, all to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144, Rule 144A, Regulation S and Regulation D under the Securities Act and customarily taken in connection with sales pursuant to such exemptions. Upon the written request of any Holder, the Company shall deliver to such Holder a written statement as to whether it has complied with such filing requirements, unless such a statement has been included in the Company’s most recent report filed with the SEC pursuant to Section 13 or Section 15(d) of Exchange Act. Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to require the Company to register any of its securities (other than the Common Stock) under any section of the Exchange Act.

(b) The Company shall file the reports required to be filed by it under the Exchange Act and shall comply with all other requirements set forth in the instructions to Form S-1 or Form S-3, as the case may be, in order to allow the Company to be eligible to file registration statements on Form S-1 or Form S-3.

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Section 8. Miscellaneous.

(a) No Contrary Agreements. The Company is not, as of the date hereof, a party to, nor shall it, on or after the date of this Agreement, enter into, any agreement with respect to its securities that violates the rights granted to the Holders of Registrable Securities in this Agreement. The Company represents and warrants that the rights granted to the Holders of Registrable Securities hereunder do not in any way violate the rights granted to the holders of such Company’s securities under any other agreements. Notwithstanding the foregoing, the Holders acknowledge that the Company is obligated, and may obligate itself from time to time in the future, to register its securities for other holders.

(b) Amendments and Waivers. Except as otherwise provided in Section 6(g), and except with respect to the Company’s obligations to pay Liquidated Damages (as to which the consent of each holder affected by any amendment, modification or supplement thereto shall be required to consent), the provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the Company has obtained the written consent of Holders of (x) a majority of the then outstanding Underlying Common Stock constituting Registrable Securities (with Holders of Notes deemed to be the Holders, for purposes of this Section, of the number of outstanding shares of Underlying Common Stock into which such Notes are or would be convertible as of the date on which such consent is requested excluding, for this purpose only, any shares of Common Stock payable as a Make-Whole Premium upon conversion of any Note) with respect to any amendment, modification or supplement related to the Underlying Common Stock, and (y) a majority of the then outstanding Warrant Shares constituting Registrable Securities (with Holders of Warrants deemed to be the Holders, for purposes of this Section, of the number of outstanding Warrant Shares into which such Warrants are or would be exercisable as of the date on which such consent is requested) with respect to any amendment, modification or supplement related to the Warrant Shares. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders of Registrable Securities whose securities are being sold pursuant to a Shelf Registration Statement and that does not directly or indirectly affect the rights of other Holders of Registrable Securities may be given by Holders of at least a majority of the Registrable Securities being sold by such Holders pursuant to such Shelf Registration Statement; provided that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the provisions of the immediately preceding sentence. Each Holder at the time of any such amendment, modification, supplement, waiver or consent or thereafter shall be bound by any such amendment, modification, supplement, waiver or consent effected pursuant to this Section 8(b), whether or not any notice, writing or marking indicating such amendment, modification, supplement, waiver or consent appears on the Registrable Securities or is delivered to such Holder.

(c) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand delivery, by telecopier, by courier

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guaranteeing overnight delivery or by first-class mail, return receipt requested, and shall be deemed given (i) when made, if made by hand delivery, (ii) upon confirmation, if made by telecopier, (iii) one Business Day after being deposited with such courier, if made by overnight courier, or (iv) on the date indicated on the notice of receipt, if made by first-class mail, to the parties as follows:

(i) if to a Holder, at the most current address given by such Holder to the Company in the Purchase Agreement or upon any transfer of the Notes or Warrants;

with a copy (for informational purposes only) to:

Schulte Roth & Zabel LLP

919 Third Avenue

New York, New York 10022

Telephone: (212) 756-2000

Facsimile: (212) 593-5955

Attention:    Eleazer Klein, Esq.

(ii) if to the Company, to:

i2 Technologies, Inc

11701 Luna Road

Dallas, Texas 75234

Telephone: (469) 357-1000

Facsimile: (469) 357-6566

Attention:    General Counsel

with a copy (for informational purposes only) to:

Dechert LLP

30 Rockefeller Plaza

New York, New York 10112

Telephone: (212) 698.3500

Facsimile: (212) 698-3599

Attention:    Bruce B. Wood, Esq.

or to such other address as such person may have furnished to the other persons identified in this Section 8(c) in writing in accordance herewith.

(d) Approval of Holders. Whenever the consent or approval of Holders is required hereunder, Notes and Warrants held by the Company or its affiliates (as such term is defined in Rule 405 under the Securities Act) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage.

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(e) Successors and Assigns. Any person who purchases any Notes, Warrants or Registrable Securities from the Purchasers or any Holder shall be deemed, for purposes of this Agreement, to be an assignee of the Purchasers or such Holder, as the case may be. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties and shall inure to the benefit of and be binding upon each Holder. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided by this Agreement.

(f) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be original and all of which taken together shall constitute one and the same agreement; provided that a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile signature.

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

(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. To the fullest extent permitted by applicable law, the Company hereby irrevocably submits to the non-exclusive jurisdiction of any New York State court or Federal court sitting in the County of New York in respect of any suit, action or proceeding arising out of or relating to the provisions of this Agreement and irrevocably agrees that all claims in respect of any such suit, action or proceeding may be heard and determined in any such court. The parties hereto hereby waive, to the fullest extent permitted by applicable law, any objection that they may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court, and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

(i) Severability. If any term, provision, covenant or restriction of this Agreement is held to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby.

(j) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained

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herein and the registration rights granted by the Company with respect to the Registrable Securities. Except as provided in the Purchase Agreement, there are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein, with respect to the registration rights granted by the Company with respect to the Registrable Securities. This Agreement supersedes all prior agreements and undertakings among the parties with respect to such registration rights.

(k) Termination. This Agreement and the obligations of the parties hereunder shall terminate upon the end of the Effectiveness Period, except for any liabilities or obligations under Section 4, 5 or 6 hereof and the obligations to make payments of and provide for liquidated damages under Section 2(e) hereof to the extent such liquidated damages accrue prior to the end of the Effectiveness Period, each of which shall remain in effect in accordance with its terms.

[signature page follows]

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IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first written above.

COMPANY:
i2 TECHNOLOGIES, INC.
By:	/s/    MICHAEL BERRY
	Name:	Michael Berry
	Title:	EVP, CFO

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

PURCHASERS:
HIGHBRIDGE INTERNATIONAL LLC
By:   HIGHBRIDGE CAPITAL MANAGEMENT, LLC
By:	/s/    ADAM CHILL
	Name:	Adam J. Chill
	Title:	Managing Director

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

PURCHASERS:
MARATHON GLOBAL CONVERTIBLE MASTER FUND LTD.
By:	/s/    JAMIE RABOY
	Name:	Jamie Raboy
	Title:	Authorized Signatory

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

PURCHASERS:

LEONARDO, L.P.

By:   LEONARDO CAPITAL MANAGEMENT, INC.,
its General Partner

By:   ANGELO, GORDON & CO., L.P.,
its Director

By:	/s/    MICHAEL GORDON
	Name:	Michael Gordon
	Title:	Chief Operating Officer

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

PURCHASERS:

AMATIS LIMITED

By:   AMARANTH ADVISORS L.L.C.

By:	/s/    KARL WACHTER
	Name:	Karl J. Wachter
	Title:	Authorized Signatory

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

PURCHASERS:

DEUTSCHE BANK AG LONDON

By:	/s/    ANDREA LEUNG
	Name:	Andrea Leung
	Title:	Attorney in Fact

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

ANNEX A

i2 TECHNOLOGIES, INC.

FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

To be named as a selling securityholder in the prospectus, beneficial owners shall complete and deliver this Notice and Questionnaire within 20 business days after the date of the written request therefor by i2 Technologies, Inc. (the “Company” or “Registrant”). Beneficial owners that do not complete this Notice and Questionnaire and deliver it to the Company within such 20 business day period will not be eligible to be named as selling securityholders in the prospectus and therefore will not be permitted to sell any Registrable Securities (as defined below) pursuant to the Shelf Registration Statement (as defined below).

The undersigned beneficial owner of 5% Senior Convertible Notes due 2015 (the “Notes”) of the Company, Warrants of the Company or common stock of the Company, par value $0.00025 per share (the “common stock” or the “Registrable Securities”), understands that the Registrant has filed or intends to file with the Securities and Exchange Commission a registration statement on Form S-1 or Form S-3 (the “Shelf Registration Statement”) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of the Registrable Securities, in accordance with the terms of the Registration Rights Agreement, dated as of November 23, 2005 (the “Registration Rights Agreement”), between the Company and the purchasers named therein. A copy of the Registration Rights Agreement is available from the Company upon request at the address set forth below. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement.

Each beneficial owner of Registrable Securities is entitled to the benefits of the Registration Rights Agreement. In order to sell or otherwise dispose of any Registrable Securities pursuant to the Shelf Registration Statement, a beneficial owner of Registrable Securities generally will be required to be named as a selling securityholder in the related prospectus, deliver a prospectus to purchasers of Registrable Securities and be bound by those provisions of the Registration Rights Agreement applicable to such beneficial owner (including certain indemnification provisions, as described below). Beneficial owners that do not complete this Notice and Questionnaire and deliver it to the Company within the 20 business day period described in the first paragraph of this Notice and Questionnaire will not be named as selling securityholders in the prospectus at the time of effectiveness of the Shelf Registration Statement and therefore will not be permitted to sell any Registrable Securities pursuant to the Shelf Registration Statement until they are later named as selling securityholders in accordance with the provisions of the Registration Rights Agreement. Beneficial owners are encouraged to complete and timely deliver this Notice and Questionnaire so that such beneficial owners may be named as selling securityholders in the related prospectus at the time of effectiveness. Certain legal consequences arise from being named as a selling securityholder in the Shelf Registration Statement and the related prospectus. Accordingly, holders and beneficial owners of Registrable Securities are advised to consult their

own securities law counsel regarding the consequences of being named or not being named as a selling securityholder in the Shelf Registration Statement and the related prospectus.

NOTICE

The undersigned beneficial owner (the “Selling Securityholder”) of Registrable Securities hereby gives notice to the Company of its intention to sell or otherwise dispose of Registrable Securities beneficially owned by it and listed below in Item 3 (unless otherwise specified under such Item 3) pursuant to the Shelf Registration Statement. The undersigned, by signing and returning this Notice and Questionnaire, understands that it will be bound by the terms and conditions of this Notice and Questionnaire and the Registration Rights Agreement.

Pursuant to the Registration Rights Agreement, the undersigned has agreed to indemnify and hold harmless the Company’s directors and officers and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), from and against certain losses arising in connection with statements concerning the undersigned made in the Shelf Registration Statement or the related prospectus in reliance upon the information provided in this Notice and Questionnaire.

If the Selling Securityholder transfers all or any portion of the Registrable Securities listed in Item 3 below after the date on which such information is provided to the Company, the Selling Securityholder agrees to notify the transferee(s) at the time of the transfer of its rights and obligations under this Notice and Questionnaire and the Registration Rights Agreement. The undersigned hereby provides the following information to the Company and represents and warrants that such information is accurate and complete:

A-2

QUESTIONNAIRE

1.	(a)	Full Legal Name of Selling Securityholder:
	(b)	Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities Listed in Item 3 below are held:
	(c)	Full Legal Name of DTC participant (if applicable and if not the same as (b) above) through which Registrable Securities listed in Item 3 below are held:
2.		Address for Notices to Selling Securityholder:

Telephone:

Fax:

Contact Person:

3.		Beneficial Ownership of Registrable Securities:
	(a)	Number of Shares of Registrable Securities beneficially owned:
	(b)	CUSIP No(s). of such Registrable Securities beneficially owned:
4.		Beneficial Ownership of Other Securities of the Company Owned by the Selling Securityholder.
		Except as set forth below in this Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the Registrable Securities listed above in Item 3.

A-3

	(a)	Type and Amount of Other Securities beneficially owned by the Selling Securityholder:
	(b)	CUSIP No(s). of such Other Securities beneficially owned:
5.		Relationships with the Company:
		Except as set forth below, neither the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years. State any exceptions here:
6.		Broker-Dealers and their Affiliates
	(a)	Is the Selling Securityholder a broker-dealer or an affiliate of a broker-dealer:
		Yes ¨     No ¨
		If so, please answer the remaining question in this section.
		(i)     Please advise whether the notes and/or warrants were received by the Selling Securityholder as compensation for investment banking services or as investment shares, and if so please describe the circumstances.
		Note that in general we may be required to identify any registered broker-dealer as an underwriter in the prospectus.
		(ii)    Except as set forth below, if the Selling Securityholder is a registered broker-dealer, the Selling Securityholder does not plan to make a market in the Registrable Securities. If the Selling Securityholder plans to make a market in the Registrable Securities, please indicate whether the Selling Securityholder plans to use the prospectus relating to the Registrable Securities as a market-making prospectus.

A-4

(b)	Affiliation with Broker-Dealers
	Is the Selling Securityholder an affiliate1 of a registered broker-dealer?
	Yes ¨     No ¨
	If so, please answer the remaining question in this section.
	(i)     Please describe the affiliation between the Selling Securityholder and any registered broker-dealer.
	(ii)    If the notes and/or warrants were purchased by the Selling Securityholder other than in the ordinary course of business, please describe the circumstances.
	(iii)  Please advise whether the notes and/or warrants were received by the Selling Securityholder as compensation for investment banking services or as investment shares, and if so please describe the circumstances.
	(iv)   If the Selling Securityholder, at the time of its purchase of Registrable Securities, had any agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities, please describe such agreements or undertakings.
	Note that if the Selling Securityholder is an affiliate of a broker-dealer and did not purchase its notes and/or warrants in the ordinary course of business or at the time of the purchase had any agreements or understandings, directly or indirectly, to distribute the securities, we may be required to identify the Selling Securityholder as an underwriter in the prospectus.
(c)	Beneficial Ownership by Natural Persons:
	If the Selling Securityholder is an entity, does any natural person have voting or investing power over the Registrable Securities held by the Selling Securityholder?2

¹ An “affiliate” of a specified person or entity means a person or entity that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the person or entity specified.

² Please answer “Yes” if any natural person, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (a) voting power which includes the power to vote, or to direct the voting of, such security; and/or, (b) investment power which includes the power to dispose, or to direct the disposition of, the Registrable Securities held by the Selling Securityholder.

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	If so, please state the person’s or persons’ name(s):
7.	Beneficial Ownership by Natural Persons or by a Board or Committee Is the Selling Securityholder a reporting entity with the Securities and Exchange Commission?
	Yes ¨     No ¨
	If the Selling Securityholder is a majority owned subsidiary of a reporting entity, identify the majority stockholder that is a reporting entity.
	If No, please answer the remaining questions in this section.
	(i)     Please name the natural person or person(s) having voting and/or investment control over the Selling Securityholder.3
	(ii)    If the voting and/or investment control over the Selling Securityholder is held by board or committee, please state the name of the natural person or person(s) on such board or committee.
8.	Plan of Distribution:
	Except as set forth below, the undersigned (including its donees or pledgees) intends to distribute the Registrable Securities listed above in Item 3 pursuant to the Shelf Registration Statement only as follows (if at all): Such Registrable Securities may be sold from time to time directly by the undersigned or, alternatively, through underwriters, broker dealers or agents. If the Registrable Securities are sold through underwriters, broker dealers or agents, the Selling Securityholder will be responsible for underwriting discounts or commissions or agents’ commissions. Such Registrable Securities may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined at the time of sale or at negotiated prices. Such sales may be effected in transactions (which may involve block transactions) (i) on any national securities exchange or quotation service on which the Registrable Securities may be listed or quoted at the time of sale, (ii) in the over the counter market, (iii) in transactions otherwise than on such exchanges or services or in the over the counter market, (iv) through the writing of options, whether such options are listed on an options exchange or otherwise, (v) in ordinary

³ Please include any natural person that, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (a) voting power which includes the power to vote, or to direct the voting of, such security; and/or, (b) investment power which includes the power to dispose, or to direct the disposition of, the Registrable Securities held by the Selling Securityholder.

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brokerage transactions and transactions in which the broker-dealer solicits purchaser, (vi) in block trades in which the broker-dealer
will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction, (vii)
in purchases by a broker-dealer as principal and resale by the broker-dealer for its account, (viii) in an exchange distribution in
accordance with the rules of the applicable exchange, (ix) in privately negotiated transactions, (x) in short sales (xi) in sales pursuant
to Rule 144, (xii) in which broker-dealers may agree with the selling securityholders to sell a specified number of such shares at a
stipulated price per share, (xiii) in a combination of any such methods of sale, and (xiv) in any other method permitted pursuant to
applicable law.

State any exceptions here:

Note: In no event will such method(s) of distribution take the form of an underwritten offering of the Registrable Securities without the prior written agreement of the Company.

The undersigned acknowledges its obligation to comply with the provisions of the Exchange Act and the rules thereunder relating to stock manipulation, particularly Regulation M thereunder (or any successor rules or regulations), in connection with any offering of Registrable Securities pursuant to the Registration Rights Agreement. The undersigned agrees that neither it nor any person acting on its behalf will engage in any transaction in violation of such provisions.

The Selling Securityholder hereby acknowledges its obligations under the Registration Rights Agreement to indemnify and hold harmless certain persons as set forth therein.

In accordance with the undersigned’s obligation under the Registration Rights Agreement to provide such information as may be required by law for inclusion in the Shelf Registration Statement, the undersigned agrees to promptly notify the Company of any inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof at any time while the Shelf Registration Statement remains effective.

All notices hereunder and pursuant to the Registration Rights Agreement shall be made in writing by hand delivery, first class mail or air courier guaranteeing overnight delivery to the address set forth below.

By signing below, the undersigned consents to the disclosure of the information contained herein in its answers to Items 1 through 8 and the inclusion of such information in the Shelf Registration Statement and the related prospectus. The undersigned understands that such information will be relied upon by the Company in connection with the preparation or amendment of the Shelf Registration Statement and the related prospectus.

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Once this Notice and Questionnaire is executed by the Selling Securityholder and received by the Company, the terms of this Notice and Questionnaire, and the representations and warranties of the Selling Securityholder contained herein, shall be binding on the Selling Securityholder and shall inure to the benefit of and shall be enforceable by the respective successors, heirs, personal representatives and assigns of the Company with respect to the Registrable Securities beneficially owned by such Selling Securityholder and listed in Item (3) above. This Agreement shall be governed in all respects by the laws of the State of New York.

IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized agent.

Dated:	________________________	Beneficial Owner:
		By:
		Name:
		Title:

PLEASE RETURN THE COMPLETED AND EXECUTED

NOTICE AND QUESTIONNAIRE

TO:

i2 Technologies, Inc.

11701 Luna Road

Dallas, Texas 75234

Attention: General Counsel

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SCHEDULE I

PURCHASERS

HIGHBRIDGE INTERNATIONAL LLC

MARATHON GLOBAL CONVERTIBLE MASTER FUND LTD.

LEONARDO, L.P.

AMATIS LIMITED

DEUTSCHE BANK AG LONDON