<SUBMISSION>
<ACCESSION-NUMBER>0001047469-08-000323
<TYPE>S-3ASR
<PUBLIC-DOCUMENT-COUNT>11
<FILING-DATE>20080115
<DATE-OF-FILING-DATE-CHANGE>20080115
<EFFECTIVENESS-DATE>20080115
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>THERAVANCE INC
<CIK>0001080014
<ASSIGNED-SIC>2834
<IRS-NUMBER>943265960
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>S-3ASR
<ACT>33
<FILE-NUMBER>333-148677
<FILM-NUMBER>08531354
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>901 GATEWAY BLVD
<CITY>SOUTH SAN FRANCISCO
<STATE>CA
<ZIP>94080
<PHONE>6508086000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>901 GATEWAY BLVD
<CITY>S. SAN FRANCISCO
<STATE>CA
<ZIP>94080
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>ADVANCED MEDICINE INC
<DATE-CHANGED>20000302
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>S-3ASR
<SEQUENCE>1
<FILENAME>a2181932zs-3asr.htm
<DESCRIPTION>S-3ASR
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#08ZAA77601_1">QuickLinks</A></FONT>
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<P ALIGN="CENTER"><FONT SIZE=2><B>As filed with the Securities and Exchange Commission on January&nbsp;15, 2008  </B></FONT></P>

<P ALIGN="RIGHT"><FONT SIZE=2><B> Registration No.&nbsp;333-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></FONT></P>

<P><FONT SIZE=2><B> <hr noshade width=100% align=left size=4>
<hr noshade width=100% align=left size=1>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>  </B></FONT><FONT SIZE=2><B>Washington, D.C. 20549  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=4><B>FORM S-3<BR>  </B></FONT><FONT SIZE=2><B>REGISTRATION STATEMENT<BR>
UNDER<BR>
THE SECURITIES ACT OF 1933  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=4><B>THERAVANCE,&nbsp;INC.<BR>  </B></FONT><FONT SIZE=2>(Exact Name of Registrant as Specified in Its Charter) </FONT></P>

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<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>Delaware<BR> </B></FONT><FONT SIZE=2>(State or Other Jurisdiction<BR>
of Incorporation or Organization)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>94-3265960<BR> </B></FONT><FONT SIZE=2>(I.R.S. Employer<BR>
Identification Number)</FONT></TD>
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<P ALIGN="CENTER"><FONT SIZE=2><B>901 Gateway Boulevard<BR>
South San Francisco, CA 94080<BR>
(650)&nbsp;808-6000<BR>  </B></FONT><FONT SIZE=2>(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>Rick E Winningham<BR>
Chief Executive Officer<BR>
Theravance,&nbsp;Inc.<BR>
901 Gateway Boulevard<BR>
South San Francisco, CA 94080<BR>
(650)&nbsp;808-6000<BR>  </B></FONT><FONT SIZE=2>(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B><I>The Commission is requested to send copies of all communications to:  </I></B></FONT></P>

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<TD WIDTH="33%" ALIGN="CENTER"><FONT SIZE=2><B>Mark K. Hyland<BR>
Shearman &amp; Sterling LLP<BR>
525 Market Street<BR>
San Francisco, California 94105<BR>
(415) 616-1100</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="33%" ALIGN="CENTER"><FONT SIZE=2><B>David T. Young<BR>
John F. Dietz<BR>
Gunderson Dettmer Stough<BR>
Villeneuve Franklin &amp; Hachigian, LLP<BR>
155 Constitution Drive<BR>
Menlo Park, California 94025<BR>
(650) 321-2400</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="33%" ALIGN="CENTER"><FONT SIZE=2><B>Alan F. Denenberg<BR>
Martin A. Wellington<BR>
Davis Polk &amp; Wardwell<BR>
1600 El Camino Real<BR>
Menlo Park, California 94025<BR>
(650) 752-2000<BR> </B></FONT></TD>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>Approximate date of commencement of proposed sale to the public: </B></FONT><FONT SIZE=2>From time to time
after the
effective date of this Registration Statement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following
box.&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT> </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule&nbsp;415
under the Securities Act of
1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.&nbsp;<FONT FACE="WINGDINGS">&#253;</FONT> </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If this Form is filed to register additional securities for an offering pursuant to Rule&nbsp;462(b) under the Securities Act,
please check the following box
and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT> </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If this Form is a post-effective amendment filed pursuant to Rule&nbsp;462(c) under the Securities Act, check the following box and
list the
Securities Act registration statement number of the earlier effective registration statement for the same offering.&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT> </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If this Form is a registration statement pursuant to General Instruction&nbsp;I.D. or a post-effective amendment thereto that shall
become effective
upon filing with the Commission pursuant to Rule&nbsp;462(e) under the Securities Act, check the following box.&nbsp;<FONT FACE="WINGDINGS">&#253;</FONT> </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional
securities or additional classes of securities pursuant to Rule&nbsp;413(b) under the Securities Act, check the following box.&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>CALCULATION OF REGISTRATION FEE  </B></FONT></P>

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<TH WIDTH="24%" ALIGN="CENTER"><FONT SIZE=1><B>Title of each class of Securities to be<BR>
Registered</B></FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Amount<BR>
to be<BR>
Registered(1)</B></FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="17%" ALIGN="CENTER"><FONT SIZE=1><B>Proposed Maximum<BR>
Offering Price per<BR>
Security</B></FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Proposed Maximum<BR>
Aggregate<BR>
Offering Price(1)</B></FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Amount of<BR>
Registration Fee(1)</B></FONT><BR></TH>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=12><HR NOSHADE></TD>
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<TR VALIGN="BOTTOM">
<TD WIDTH="24%"><FONT SIZE=2>Convertible Subordinated Notes due 2015</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;&#151;</FONT></TD>
</TR>
<TR VALIGN="TOP">
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<TD WIDTH="24%"><FONT SIZE=2>Common Stock, par value $0.01 per share(2)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=12><HR NOSHADE></TD>
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<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>An
indeterminate amount of securities to be offered at indeterminate prices is being registered pursuant to this registration statement. The registrant is deferring payment of the
registration fee pursuant to Rule&nbsp;456(b) and is omitting this information in reliance on Rule&nbsp;456(b) and Rule&nbsp;457(r).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>The
common stock being registered hereby includes associated rights to acquire Series&nbsp;A junior participating preferred stock of Theravance, Inc., pursuant to the Rights
Agreement described in the prospectus contained in this registration statement. </FONT></DD></DL>
<BR><BR>

<P><FONT SIZE=2><hr
noshade width=100% align=left size=1>
<hr noshade width=100% align=left size=4> </FONT></P>

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<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=1,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=589737,FOLIO='blank',FILE='DISK133:[08ZAA1.08ZAA77601]BA77601A.;11',USER='GMEDINA',CD='14-JAN-2008;23:34' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->

<P><FONT COLOR="#FF4040" SIZE=2><B>The information in this prospectus is not complete and may be changed. This prospectus is not an offer to sell these securities and it is not
soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. </B></FONT></P>

<P ALIGN="CENTER"><FONT COLOR="#FF4040" SIZE=2><B>Subject to Completion<BR>
Preliminary Prospectus Dated January&nbsp;15, 2008</B></FONT></P>

<P><FONT SIZE=2><B> <U>P&nbsp;R&nbsp;O&nbsp;S&nbsp;P&nbsp;E&nbsp;C&nbsp;T&nbsp;U&nbsp;S</U>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>$150,000,000  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>
<IMG SRC="g984214.jpg" ALT="LOGO" WIDTH="396" HEIGHT="145">
  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B>&nbsp;&nbsp;&nbsp;&nbsp;% Convertible Subordinated Notes due 2015  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>The Offering:  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes will bear interest at the rate of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% per year, payable semiannually on January&nbsp;15 and
July&nbsp;15 of each year, beginning
July&nbsp;15, 2008. The notes will mature on January&nbsp;15, 2015. The notes will be our unsecured subordinated obligations and will be subordinated in right of payment to all of our existing and
future senior indebtedness and effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing that indebtedness and to all existing
and future indebtedness and other liabilities of our subsidiaries. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Convertibility of the Notes:  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders may convert their notes into shares of our common stock at an initial conversion rate
of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares for each $1,000 in notes
(equivalent to an initial conversion price of approximately $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share), subject to adjustment, at any time prior to the close of business on the business day immediately
preceding the stated maturity date. Our common stock is listed on the Nasdaq Global Market under the symbol "THRX". On January&nbsp;14, 2008, the last reported sale price of our common stock was
$22.21&nbsp;per share. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Fundamental Changes:  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If we experience a "fundamental change," as defined herein, each holder may require us to purchase for cash all or a portion of such
holders' notes at a
redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to but excluding the repurchase date. In addition, we will in some circumstances
increase the conversion rate of the notes with a make-whole premium for conversions in connection with certain fundamental changes. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Redemption of the Notes:  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may not redeem the notes prior to January&nbsp;15, 2012. On or after January&nbsp;15, 2012 and prior to the maturity date, we may
redeem for cash all or
part of the notes if the last reported sale price of our common stock has been greater than or equal to 130% of the conversion price then in effect for at least 20 trading days during any 30
consecutive trading day period prior to the date on which we provide notice of redemption. The redemption price will equal 100% of the principal amount of the notes to be redeemed, plus accrued and
unpaid interest to but excluding the redemption date. We will make at least eight semiannual interest payments (including the interest payments on July&nbsp;15, 2008, and January&nbsp;15, 2012) in
the full amount required by the indenture before we can redeem the notes at our option. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=3><B>Investing in the notes involves risks. See "Risk Factors" beginning on page&nbsp;14.</B></FONT></P>

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<TH WIDTH="64%" ALIGN="LEFT"><FONT SIZE=3>&nbsp;</FONT><BR></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="8%" ALIGN="CENTER"><FONT SIZE=1><B>Per Note</B></FONT><HR NOSHADE></TH>
<TH WIDTH="13%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="12%" ALIGN="CENTER"><FONT SIZE=1><B>Total</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="64%"><FONT SIZE=2>Public offering price</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="CENTER"><FONT SIZE=2>%</FONT></TD>
<TD WIDTH="13%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="CENTER"><FONT SIZE=2>$</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="64%"><FONT SIZE=2>Underwriting discount</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="CENTER"><FONT SIZE=2>%</FONT></TD>
<TD WIDTH="13%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="CENTER"><FONT SIZE=2>$</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="64%"><FONT SIZE=2>Proceeds, before expenses, to us</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="CENTER"><FONT SIZE=2>%</FONT></TD>
<TD WIDTH="13%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="12%" ALIGN="CENTER"><FONT SIZE=2>$</FONT></TD>
</TR>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
underwriters may also purchase up to an additional $22,500,000 principal amount of notes within 30&nbsp;days from the date of this prospectus to cover overallotments, if any. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal offense. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
notes will be ready for delivery in book entry form only through the facilities of The Depository Trust Company on or about January&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2008. </FONT></P>

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<TD WIDTH="34%"><FONT SIZE=5><B>Merrill Lynch &amp; Co.</B></FONT></TD>
<TD WIDTH="66%" ALIGN="RIGHT"><FONT SIZE=5><B>Goldman, Sachs &amp; Co.</B></FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>The
date of this prospectus is January&nbsp;&nbsp;&nbsp;&nbsp;, 2008. </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=2,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=445556,FOLIO='blank',FILE='DISK133:[08ZAA1.08ZAA77601]BC77601A.;20',USER='DNICHOL',CD='15-JAN-2008;13:14' -->
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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bg77601_table_of_contents"> </A>
<A NAME="toc_bg77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>TABLE OF CONTENTS    <BR>    </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Prospectus  </B></FONT></P>

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<TH WIDTH="92%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="5%" ALIGN="CENTER"><FONT SIZE=1><B>Page</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2>About this Prospectus</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2>1</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Note Regarding Forward-Looking Statements</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
1</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Where You Can Find More Information</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
1</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Incorporation by Reference</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
1</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Prospectus Summary</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
3</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
The Offering</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
9</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Risk Factors</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
14</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Ratio of Earnings to Fixed Charges</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
32</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Use of Proceeds</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
32</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Price Range of Common Stock</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
33</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Dividend Policy</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
33</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Capitalization</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
34</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Description of the Notes</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
35</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Description of Capital Stock</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
54</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Certain U.S. Federal Income Tax Considerations</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
66</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Underwriting</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
72</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Legal Matters</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
77</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="92%"><FONT SIZE=2><BR>
Experts</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2><BR>
77</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>You should rely only on the information contained or incorporated by reference in this prospectus. We have not, and the underwriters have not,
authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not, and the underwriters are not,
making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the documents
incorporated by reference in this prospectus is accurate only as of the date on those respective documents. Our business, financial condition, results of operations and prospects may have changed
since those dates. You should read this prospectus, including the documents incorporated by reference in this prospectus, when making your investment decision. You should also read and consider the
information in the documents we have referred you to in the sections of the prospectus entitled "Where You Can Find More Information."  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is
made to
the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Some of the documents referred to herein have been filed as exhibits to the
registration statement of which this prospectus is a part, while others are incorporated by reference from our previously filed periodic reports or our Registration Statement on
Form&nbsp;8-A (Commission File No.&nbsp;000-30319), filed on September&nbsp;27, 2004, and amendments thereto, including their exhibits, and you may obtain copies of these
documents as described below under "Where You Can Find More Information."  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>General information about us can be found on our website at "</B></FONT><FONT
SIZE=2><B><I>http://www.theravance.com</I></B></FONT><FONT SIZE=2><B>".
The information on our website is for information only and should not be relied on for investment purposes. The information on our website is not incorporated by reference into this prospectus and
should not be considered part of this or any other report filed with the Securities and Exchange Commission.  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bi77601_about_this_prospectus"> </A>
<A NAME="toc_bi77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>ABOUT THIS PROSPECTUS    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (SEC), utilizing a "shelf" registration
process.
This prospectus provides you with the specific details regarding this offering, including the principal amount, conversion rate and ranking of our notes, and the risks of investing in our notes. To
the extent information in this prospectus is inconsistent with any of the documents incorporated by reference into this prospectus, you should rely on this prospectus. You should read and consider the
information in this prospectus together with the additional information described under the headings "Where You Can Find More Information" and "Information Incorporated by Reference." </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bi77601_note_regarding_forward-looking_statements"> </A>
<A NAME="toc_bi77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>NOTE REGARDING FORWARD-LOOKING STATEMENTS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The information in this prospectus contains forward-looking statements within the meaning of Section&nbsp;27A of the Securities Act of 1933, as
amended
(Securities Act), and Section&nbsp;21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks and uncertainties. Any statements
contained herein that are not of historical fact, including, without limitation, statements regarding our strategy, future operations, future financial position, future revenues, projected costs,
prospects, plans, goals and objectives, may be forward-looking statements. The words "anticipates," "believes," "designed," "estimates," "expects," "goal," "intends," "may," "plans," "projects,"
"pursuing," "will," "would" and similar expressions (including the negatives thereof) are intended to identify forward-looking statements, although not all forward-looking statements contain these
identifying words. We may not actually achieve the plans, intentions, expectations or objectives disclosed in our forward-looking statements and the assumptions underlying our forward-looking
statements may prove incorrect. Therefore, you should not place undue reliance on our forward-looking statements. Actual results or events may differ significantly from the results discussed in the
forward-looking statements we make. Factors that might cause such a discrepancy include, but are not limited to those discussed below in "Risk Factors." All forward-looking statements in this document
are based on information available to us as of the date hereof and we assume no obligation to update any such forward-looking statements. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bi77601_where_you_can_find_more_information"> </A>
<A NAME="toc_bi77601_3"> </A>
<BR></FONT><FONT SIZE=2><B>WHERE YOU CAN FIND MORE INFORMATION    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have filed with the SEC a registration statement on Form&nbsp;S-3 under the Securities Act relating to the notes and the common stock issuable
upon conversion thereof offered by this prospectus. This prospectus is a part of that registration statement, which includes additional information not contained in this prospectus. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file with the SEC (including exhibits to such
documents) at the SEC's Public Reference Room at 100 F&nbsp;Street, N.E., Room&nbsp;1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for
further information on the Public Reference Room. Our SEC filings are also available to the public at the SEC's website at </FONT><FONT SIZE=2><I>www.sec.gov</I></FONT><FONT SIZE=2>. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bi77601_incorporation_by_reference"> </A>
<A NAME="toc_bi77601_4"> </A>
<BR></FONT><FONT SIZE=2><B>INCORPORATION BY REFERENCE    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The SEC allows us to "incorporate by reference" the information we file with them, which means that we can disclose important information to you by
referring you
to those documents. The information incorporated by reference is considered to be part of this prospectus, and information that we file later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below (except the information contained in such documents to the extent "furnished" and not "filed") and any future filings we make with
the SEC under Section&nbsp;13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>Annual
Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2006, filed on March&nbsp;1, 2007. </FONT></DD></DL>
</UL>
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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>All
information in our proxy statement filed with the SEC on March&nbsp;12, 2007 to the extent incorporated by reference in our Annual Report on Form&nbsp;10-K for the
year ended December&nbsp;31, 2006.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>Quarterly
Report on Form&nbsp;10-Q for the quarter ended March&nbsp;31, 2007, filed on May&nbsp;8, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.</FONT></DT><DD><FONT SIZE=2>Quarterly
Reports on Form&nbsp;10-Q and 10-Q/A for the quarter ended June&nbsp;30, 2007, filed on August&nbsp;8, 2007 and August&nbsp;15, 2007,
respectively.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>5.</FONT></DT><DD><FONT SIZE=2>Quarterly
Report on Form&nbsp;10-Q for the quarter ended September&nbsp;30, 2007, filed on November&nbsp;7, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on February&nbsp;20, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>7.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on February&nbsp;21, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on April&nbsp;30, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>9.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on June&nbsp;29, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>10.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on July&nbsp;3, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>11.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on July&nbsp;11, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>12.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on July&nbsp;20, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on July&nbsp;31, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>14.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on September&nbsp;13, 2007.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>15.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on January&nbsp;7, 2008.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>16.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on January&nbsp;11, 2008.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>17.</FONT></DT><DD><FONT SIZE=2>Report
on Form&nbsp;8-K filed on January&nbsp;15, 2008.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>18</FONT></DT><DD><FONT SIZE=2>.&nbsp;&nbsp;The
 description of our common stock and preferred stock purchase rights contained in the Registration Statement on Form&nbsp;8-A filed with the SEC on September&nbsp;27, 2004. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
may request, and we will provide you with, a copy of these filings, at no cost, by calling us at (650)&nbsp;808-6000 or by writing to us at the following address: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>Theravance,&nbsp;Inc.<BR>
901 Gateway Boulevard<BR>
South San Francisco, CA 94080<BR>
Attn: Investor Relations </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ca77601_prospectus_summary"> </A>
<A NAME="toc_ca77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>PROSPECTUS SUMMARY    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>This summary highlights selected information contained elsewhere or incorporated by reference in this prospectus. This summary
may not
contain all the information that you should consider before investing in our notes. You should read the entire prospectus carefully, including "Risk Factors" and the financial statements incorporated
by reference in this prospectus, before making an investment decision. Unless the context otherwise requires, any reference to "Theravance," "we," "our" and "us" in this prospectus refers to
Theravance,&nbsp;Inc., a Delaware corporation, and its subsidiaries.</I></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Theravance,&nbsp;Inc.  </B></FONT></P>


<P><FONT SIZE=2><B>Overview  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are a biopharmaceutical company with a pipeline of internally discovered product candidates. We are focused on the discovery, development and
commercialization of small molecule medicines across a number of therapeutic areas including respiratory disease, bacterial infections and gastrointestinal motility dysfunction. Of our six programs in
development, four are in late stage&#151;our telavancin program focusing on treating serious Gram-positive bacterial infections with Astellas Pharma&nbsp;Inc. (Astellas), our
Horizon program (formerly referred to as Beyond Advair) with GlaxoSmithKline plc (GSK), our Gastrointestinal Motility Dysfunction program and TD-1792, our investigational antibiotic for
the treatment of serious Gram-positive bacterial infections. By leveraging our proprietary insight of multivalency to drug discovery focused on validated targets, we are pursuing a next
generation strategy designed to discover superior medicines in areas of significant unmet medical need. None of our product candidates have been approved for marketing and sale to patients and we have
not received any product revenue to date. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
strategy focuses on the discovery, development and commercialization of medicines with superior efficacy, convenience, tolerability and/or safety. By primarily focusing on
biological targets that have been clinically validated either by existing medicines or by potential medicines in late-stage clinical studies, we can leverage years of available knowledge
regarding a
target's activity and the animal models used to test potential medicines against such targets. We move a product candidate into development after it demonstrates the potential to be superior to
existing medicines or drug candidates in animal models that we believe correlate to human clinical experience. This strategy of developing the next generation of existing medicines or potential
medicines is designed to reduce technical risk and increase productivity. We believe that we can enhance the probability of successfully developing and commercializing medicines by identifying at
least two structurally different product candidates, whenever practicable, in each therapeutic program. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P><FONT SIZE=2><B>Our Programs  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table summarizes the status of our product candidates for internal development or co-development. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>
<IMG SRC="g415286.jpg" ALT="CHART" WIDTH="682" HEIGHT="342">
  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the table above: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Phase
1 indicates initial clinical safety testing in healthy volunteers, or studies directed toward understanding the mechanisms of action of the drug.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Phase
2 indicates further clinical safety testing and preliminary efficacy testing in a limited patient population.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Phase
3 indicates evaluation of clinical efficacy and safety within an expanded patient population.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>NDA
indicates that a new drug application has been submitted to and accepted for filing by the U.S. Food and Drug Administration (FDA).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>We
consider programs in which at least one compound has successfully completed a Phase&nbsp;2a study showing efficacy and tolerability as having achieved Proof of Concept.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Development
Status indicates the most advanced stage of development that has been completed or is in process. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B><U>Bacterial Infections Programs</U>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our bacterial infections program has been dedicated to finding new antibiotics for serious infections due to Gram-positive bacteria, including
methicillin-resistant </FONT><FONT SIZE=2><I>Staphylococcus aureus</I></FONT><FONT SIZE=2> (MRSA). This program has resulted in the discovery of telavancin and a unique heterodimer antibiotic,
TD-1792. </FONT></P>

<P><FONT SIZE=2><B><I>Telavancin  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Telavancin, the lead product candidate in our bacterial infections program targeting resistant Gram-positive pathogens, is a bactericidal,
once-daily injectable antibiotic with a multifunctional </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>mechanism
of action. Our goal is for telavancin to become first-line therapy in treating serious Gram-positive complicated skin and skin structure infections (cSSSI) and
hospital-acquired pneumonia (HAP) bacterial infections. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Telavancin Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based on results from ATLAS 1 and ATLAS 2, our large, multi-center, multinational, double-blind, randomized Phase 3 clinical studies in which 1,867
patients were
enrolled and treated, 719 of whom were infected with MRSA, in December&nbsp;2006 we submitted our first new drug application (NDA) to the FDA for telavancin for the treatment of cSSSI caused by
Gram-positive bacteria. In October 2007, the FDA issued an approvable letter for our NDA filing. The FDA letter indicated that the telavancin application is approvable, subject to:
resolution of current good manufacturing practices (cGMP) compliance issues not specifically related to telavancin at a third-party manufacturer; and submission of revised labeling or
re-analyses of clinical data or additional clinical data. We are preparing a complete response to the approvable letter and believe that no additional clinical studies will need to be
initiated to respond. On January&nbsp;11, 2008, we announced that the Anti-Infective Drugs Advisory Committee to the FDA is scheduled to meet to review our telavancin NDA for the
proposed indication to treat cSSSI on February&nbsp;27, 2008. Telavancin is also under review for its safety and efficacy by regulatory authorities in the European Union for the treatment of
complicated skin and soft tissue infections and in Canada for the treatment of cSSSI. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
December 2007 we announced results from ATTAIN 1 and ATTAIN 2, our large, multi-center, multinational, double-blind, randomized Phase 3 clinical studies in HAP in which 1,503
patients were enrolled and treated, 464 of whom were infected with MRSA. In each study, telavancin achieved its objective of non-inferiority in the all-treated and clinically
evaluable patient populations. Currently, we plan to submit an NDA for the HAP indication to the FDA in 2008. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Our Relationship with Astellas  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In November 2005, we entered into a collaboration arrangement with Astellas for the development and commercialization of telavancin. In July&nbsp;2006,
 Japan
was added to our telavancin collaboration, thereby giving Astellas worldwide rights to this potential medicine. Through September&nbsp;30, 2007, we have received $158.0&nbsp;million in upfront,
milestone and other fees from Astellas and we are eligible to receive up to an additional $60.0&nbsp;million in remaining milestone payments if regulatory filings and approvals in various regions of
the world are achieved. If telavancin is commercialized we will be entitled to receive royalties on global sales of telavancin that, on a percentage basis, range from the high teens to the upper
twenties depending on sales volume. Under this arrangement, we will be responsible for substantially all costs to develop and obtain U.S. regulatory approval for telavancin for cSSSI and HAP, and
Astellas will be responsible for substantially all costs associated with commercialization and further development of telavancin. </FONT></P>


<P><FONT SIZE=2><B><I>TD-1792  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TD-1792 is an investigational heterodimer antibiotic that combines the antibacterial activities of a glycopeptide and a beta-lactam in
one molecule. The goal of our program with TD-1792 is to develop a next-generation antibiotic for the treatment of serious infections caused by Gram-positive
bacterial infections. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> TD-1792 Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July 2007 we announced results from an approximately 200-patient study in cSSSI with TD-1792. In September&nbsp;2007, we announced
that we retained full ownership rights of TD-1792 as a result of Astellas' decision not to exercise its right to license the compound under our telavancin </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P><FONT SIZE=2>collaboration
arrangement. We are currently conducting further studies with TD-1792 to evaluate the potential of this compound in more serious infections such as bacteremia. </FONT></P>

<P><FONT SIZE=2><B><U>Respiratory Programs</U>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have three development programs directed toward asthma and/or chronic obstructive pulmonary disease (COPD): our Horizon program (formerly referred
to as
Beyond Advair) with GSK, and our muscarinic antagonist&#151;Beta<SUB>2</SUB> Agonist (MABA) and our Long-Acting Muscarinic Antagonist (LAMA) programs. GSK has licensed both our
MABA and LAMA programs, pursuant to the terms of our 2004 strategic alliance. </FONT></P>

<P><FONT SIZE=2><B><I>Horizon Program with GlaxoSmithKline  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In November 2002, we entered into our Horizon collaboration with GSK to develop and commercialize a long-acting beta<SUB>2</SUB>agonist (LABA)
product candidate for the treatment of asthma and COPD. This product candidate is intended to be administered via inhalation once daily both as a single agent new medicine and as part of a new
combination medicine with an inhaled corticosteroid (ICS).
The collaboration intends to develop a new generation product to replace Advair&reg;, which had sales of approximately $6.1&nbsp;billion in 2006 as reported by GSK in early 2007. Each
company contributed four LABA product candidates to the program. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Through
September&nbsp;30, 2007, we received $60.0&nbsp;million in upfront and milestone payments related to the clinical progress of our product candidates. In addition, we are
entitled to receive the same royalties on product sales of medicines from the Horizon program, regardless of whether the product candidate originated with us or with GSK. The royalty structure is
downward tiering and would result in an average percentage royalty rate in the low- to mid-teens at annual net sales of up to approximately $4.0&nbsp;billion and the average
royalty rate would decline to single digits at annual net sales of more than $6.0&nbsp;billion. Sales of single agent LABA medicines and combination LABA/ICS medicines would be combined for the
purposes of this royalty calculation. In the event that a LABA product candidate discovered by GSK is successfully developed and commercially launched in multiple regions in the world, we will be
obligated to make payments to GSK of up to $220.0&nbsp;million. Based on available information, we do not estimate that a significant portion of these potential milestone payments to GSK are likely
to be made in the next three years. The current lead LABA candidate, GW642444 (`444), is a GSK-discovered compound. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Horizon Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In April&nbsp;2007 the collaboration reported results from the Phase&nbsp;2b clinical program, in which two LABA product candidates, dosed once daily,
achieved clinically significant increases in bronchodilation at least equivalent to that of salmeterol dosed twice daily. Based on these results, in late December&nbsp;2007 the lead LABA compound in
development, '444, progressed into a 28-day Phase&nbsp;2b study designed to enroll 600&nbsp;patients with asthma and is planned to progress into Phase&nbsp;2b studies in COPD in the first half
of 2008. In addition, in a recent 8-week, 650-patient Phase&nbsp;2 study of the lead ICS, GW685698 ('698), both doses studied (200&nbsp;mcg and 400&nbsp;mcg) showed improved lung function dosed
once daily compared to placebo, with no adverse effect on cortisol excretion. Based on these results, three 8-week studies with '698 comprising a Phase&nbsp;2b program designed to enroll a total of
1,800 patients with mild, moderate and severe asthma, began enrolling patients in late December&nbsp;2007. In parallel, combination studies to enable Phase&nbsp;3 studies with both '444 and '698
are scheduled to initiate in 2008. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2><B><I>Bifunctional Muscarinic Antagonist-Beta<SUB>2</SUB> Agonist (MABA)  </I></B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In our MABA program, we are developing with GSK a long-acting inhaled bronchodilator that is bifunctional, meaning that one small molecule functions
both as a muscarinic
antagonist and as a beta<SUB>2</SUB> receptor agonist. By combining bifunctional activity and high lung selectivity, we intend to develop a medicine with greater efficacy than single mechanism
bronchodilators (such as tiotropium or salmeterol) and with equal or better tolerability. This bifunctional bronchodilator could potentially then serve as a basis for improved "triple therapy" through
co-formulation with another inhaled respiratory compound into a single product that could potentially deliver three complementary therapeutic effects for patients with respiratory disease.
GSK licensed our MABA program in 2005 pursuant to the terms of our strategic alliance described below. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> MABA Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The first compound in the MABA program, GSK961081, successfully completed single- and multiple-dose Phase&nbsp;1 studies in healthy volunteers and
commenced a Phase&nbsp;2 study in late October 2007. We expect to complete and report results from this study in late 2008. </FONT></P>

<P><FONT SIZE=2><B><I>Long-Acting Muscarinic Antagonist (LAMA)  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inhaled muscarinic antagonists are frequently used as bronchodilators for COPD. Inhaled muscarinic antagonists work by inhibiting muscarinic receptors
on the
bronchial airways, which leads to muscle relaxation and improved lung function. Pursuant to our strategic alliance with GSK, we are developing with GSK an inhaled LAMA designed to produce a prolonged
blockade of the relevant receptor sub-types while also being highly lung-selective, which means that lower concentrations of drug should get into the systemic circulation.
Higher lung selectivity should result in improved tolerability. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> LAMA Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The investigational, inhaled bronchodilator GSK1160724 commenced a Phase&nbsp;1 study in December 2007. We expect to complete and report results from
this
study in 2008. GSK currently has a competing LAMA product candidate that is further advanced in development than our LAMA product candidate, which is the second LAMA compound we delivered to GSK under
this program. </FONT></P>

<P><FONT SIZE=2><B><U>Gastrointestinal (GI) Motility Dysfunction Program</U>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Gastrointestinal (GI) Motility Dysfunction program is dedicated to finding new medicines for GI motility disorders such as chronic idiopathic
constipation
(CIC), constipation predominant irritable bowel syndrome (C-IBS), functional dyspepsia and delayed gastric emptying. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
lead compound in this area is TD-5108, a highly selective 5-HT4 receptor agonist. We believe that the high degree of selectivity of TD-5108
provides the potential for it to become a next-generation medicine for the treatment of severe constipation and possibly constipation-predominant irritable bowel syndrome. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> TD-5108 Development Status  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In June 2007 we announced results from our approximately 400-patient ACCORD Phase&nbsp;2 clinical study in chronic constipation with
TD-5108. In September 2007, we announced that we retained full ownership rights of our GI Motility Dysfunction program as a result of GSK's decision not to exercise its right to license
the program under the strategic alliance. At our end-of-Phase 2 meeting with the FDA for TD-5108 in late 2007, the FDA confirmed that the TD-5108 data
package from the ACCORD study was adequate to progress TD-5108 into Phase&nbsp;3 efficacy and safety studies in patients with CIC. The FDA also indicated that the size of the clinical
program should be consistent with the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>International
Conference on Harmonisation (ICH) guidelines for the development of drugs for chronic use. We recently completed enrollment in a Phase&nbsp;1 thorough QTc study on this compound. Our
preliminary review of the electrocardiogram data from the study suggests that such data is unreliable due to problems with the conduct of the study, not with the intrinsic properties of TD-5108. We
believe that lack of assay sensitivity in the active control arm of the study (moxifloxacin) renders the results uninterpretable, and that the study will need to be repeated in order to generate
scientifically valid results. We currently intend to initiate a repeat of the study later this year. </FONT></P>

<P><FONT SIZE=2><B>2004 GSK Strategic Alliance  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In March 2004, we entered into our strategic alliance with GSK. Under this alliance, GSK received an option to license exclusive development and
commercialization rights to product candidates from all of
our drug discovery programs initiated prior to September&nbsp;1, 2007, on pre-determined terms and on an exclusive, worldwide basis. Upon its decision to license a program, GSK is
responsible for funding all future development, manufacturing and commercialization activities for product candidates in that program. If these programs are successfully advanced through development
by GSK, we are entitled to receive clinical, regulatory and commercial milestone payments and royalties on any sales of medicines developed from these programs. For product candidates licensed to date
under this agreement, the royalty structure for a product containing one of our compounds as a single active ingredient would result in an average percentage royalty rate in the low double digits. If
a product is successfully commercialized, in addition to any royalty revenue that we receive, the total upfront and milestone payments that we could receive in any given program that GSK licenses
range from $130.0&nbsp;million to $162.0&nbsp;million for programs with single-agent medicines and up to $252.0&nbsp;million for programs with both a single-agent and a combination medicine. If
GSK chooses not to license a program, we retain all rights to the program and may continue the program alone or with a third party. To date, GSK has licensed our two COPD programs: our
Long-Acting Muscarinic Antagonist (LAMA) program and our Bifunctional Muscarinic Antagonist-Beta<SUB>2</SUB> Agonist (MABA) program. Under the terms of the strategic alliance
agreement, GSK still has an option to license our peripheral Opioid-Induced Bowel Dysfunction (PUMA) program, our AT1 Receptor&#151;Neprilysin Inhibitor hypertension (ARNI) program and our
MonoAmine Reuptake Inhibitor chronic pain (MARIN) program. </FONT></P>

<P><FONT SIZE=2><B>Financial Update  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;While we are still in the process of determining final results for the fourth quarter of 2007, as of November&nbsp;30, 2007, we had cash, cash
equivalents and
marketable securities totaling $143&nbsp;million. We expect that our cash, cash equivalents and marketable securities, together with the proceeds of this offering, will be sufficient to meet our
capital needs for at least the next 12&nbsp;months. </FONT></P>

<P><FONT SIZE=2><B>Corporate Information  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We were incorporated on November&nbsp;19, 1996 under the name Advanced Medicine,&nbsp;Inc. In April&nbsp;2002, we changed our name to
Theravance,&nbsp;Inc. Our principal executive offices are located at 901&nbsp;Gateway Boulevard, South San Francisco, California 94080, and our telephone number is
(650)&nbsp;808-6000. Theravance and the Theravance logo are registered trademarks of Theravance,&nbsp;Inc. Trademarks, tradenames or service marks of other companies appearing in this
prospectus are the property of their respective owner. Our web site is </FONT><FONT SIZE=2><I>www.theravance.com</I></FONT><FONT SIZE=2>. Information contained on our web site does not constitute a
part of this prospectus. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<BR></FONT><FONT SIZE=2><B>THE OFFERING    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a brief summary of the terms of this offering. In the following summary, any reference to "Theravance," "we," "our," and "us" refers
only to
Theravance,&nbsp;Inc. and not any of its current or future subsidiaries. For a more complete description of the notes, see "Description of the Notes" in this prospectus. </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2>Issuer</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2>Theravance,&nbsp;Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Notes Offered</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
$150,000,000 aggregate principal amount of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% Convertible Subordinated Notes due 2015 ($172,500,000 aggregate principal amount if the underwriters exercise in full their over-allotment option to purchase
additional notes).</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Issue Price</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
100% of the principal amount plus interest, if any.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Maturity Date</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
January&nbsp;15, 2015.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Interest and Payment Dates</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% per year, payable semi-annually in arrears in cash on January&nbsp;15 and July&nbsp;15 of each year, beginning July&nbsp;15, 2008.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Conversion Rights</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
The notes are convertible, at the option of the holder, at any time prior to the close of business on the business day immediately preceding the stated maturity date, into shares of our common stock at a conversion rate
of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares per $1,000 principal amount of notes, which is equivalent to a conversion price of approximately $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share. The conversion rate is subject to adjustment. See
"Description of the Notes&#151;Conversion Rights."</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Fundamental Change</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
If a fundamental change occurs, holders will have the right to require us to repurchase for cash all or any portion of their notes. The fundamental change repurchase price will be 100% of the principal amount of the notes to be repurchased plus
accrued and unpaid interest, if any, up to, but excluding, the repurchase date. See "Description of the Notes&#151;Fundamental Change Permits Holders to Require Us to Purchase Notes."</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
If certain fundamental change events occur, we will in some circumstances adjust the conversion rate of the notes with a make-whole premium in connection with such fundamental change. The amount of the make-whole premium, if any, will be based on our
common stock price and the effective date of such fundamental change. A description of how the make-whole premium will be determined and an illustrative table showing the estimated make-whole premium that would apply at various common stock prices
and fundamental change effective dates are set forth under "Description of the Notes&#151;Make-Whole Premium Upon Certain Fundamental Changes."</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="57%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<BR>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<TD WIDTH="36%"><FONT SIZE=2><BR>
Redemption at Our Option</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
We may not redeem the notes prior to January&nbsp;15, 2012. On or after January&nbsp;15, 2012 and prior to the maturity date, we may redeem for cash all or part of the notes if the last reported sale price of our common stock has been greater than or
equal to 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period prior to the date on which we provide notice of redemption. The redemption price will equal 100% of the principal amount of
the notes to be redeemed, plus accrued and unpaid interest to but excluding the redemption date. We will make at least eight semiannual interest payments (including the interest payments on July&nbsp;15, 2008, and January&nbsp;15, 2012) in the full
amount required by the indenture before we can redeem the notes at our option. We will give notice of redemption not less than 30 nor more than 60&nbsp;days before the redemption date by mail to the trustee, the paying agent and each holder of
notes.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Ranking</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
The notes will be our general unsecured obligations and will be:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="57%"><FONT SIZE=2><BR>
subordinated in right of payment to all of our existing and future senior indebtedness;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="57%"><FONT SIZE=2><BR>
equal in right of payment to all of our existing and future subordinated indebtedness;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="57%"><FONT SIZE=2><BR>
effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing that indebtedness; and</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="57%"><FONT SIZE=2><BR>
effectively subordinated to all existing and future indebtedness and other liabilities of our subsidiaries.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
As of September&nbsp;30, 2007, we had no outstanding senior indebtedness as defined in the indenture, nor any secured indebtedness or subordinated indebtedness.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
In addition, as of September&nbsp;30, 2007, our subsidiaries had no indebtedness outstanding (excluding intercompany indebtedness).</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Use of Proceeds</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
We currently intend to use the net proceeds from this offering for general corporate purposes, which may include clinical and preclinical development of existing product candidates, drug research activities and manufacture of pre-clinical, clinical
and commercial drug supplies, capital expenditures and working capital.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Form and Denomination</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
The notes will be issued in minimum denominations of $1,000 and any integral multiple of $1,000.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Nasdaq Symbol for Common Stock</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
Our common stock is listed on the Nasdaq Global Market under the symbol "THRX."</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="57%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<TD WIDTH="36%"><FONT SIZE=2><BR>
Certain U.S. Federal Income Tax Considerations</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
See "Certain U.S. Federal Income Tax Considerations" for a discussion of the U.S. tax considerations applicable to the purchase, ownership and conversion of the notes.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="36%"><FONT SIZE=2><BR>
Risk Factors</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3 VALIGN="BOTTOM"><FONT SIZE=2><BR>
You should carefully consider the information set forth in the section entitled "Risk Factors" beginning on page&nbsp;14 of this prospectus and all other information provided to you and incorporated by reference in the prospectus before deciding to
invest in the notes.</FONT></TD>
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<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<!-- ZEQ.=3,SEQ=14,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=341542,FOLIO='11',FILE='DISK133:[08ZAA1.08ZAA77601]CC77601A.;10',USER='GMEDINA',CD='14-JAN-2008;23:38' -->
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NAME="page_ce77601_1_12"> </A> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ce77601_summary_consolidated_financial_data"> </A>
<A NAME="toc_ce77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>SUMMARY CONSOLIDATED FINANCIAL DATA    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following tables present our summary consolidated statements of operations data for 2004 through 2006 and the nine months ended September&nbsp;30,
2006 and
2007, and our summary consolidated balance sheet data as of September&nbsp;30, 2007. You should read this information in conjunction with our consolidated financial statements, including the related
notes, and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form&nbsp;10-K for 2006 and our Quarterly Report on
Form&nbsp;10-Q for the quarter ended September&nbsp;30, 2007. The summary consolidated balance sheet data is presented on an actual basis and as adjusted to reflect the issuance and
sale of $150,000,000 aggregate principal amount of notes in this offering, after deducting the estimated underwriting discount and offering expenses payable by us. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=8 ALIGN="CENTER"><FONT SIZE=1><B>Year Ended December&nbsp;31,</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>Nine Months Ended<BR>
September&nbsp;30,</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2004</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2005</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2007</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=14 ALIGN="CENTER"><FONT SIZE=1><B>(in thousands, except per share data)<BR> </B></FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>(unaudited)<BR> </B></FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2><B>Consolidated Statement of Operations Data:</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Revenue</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>8,940</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>12,054</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>19,587</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>14,657</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>16,372</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Operating expenses:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2>Research and development(1)</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>91,627</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>137,936</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>166,564</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>128,562</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>124,319</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2>General and administrative(1)</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>23,708</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>23,674</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>32,193</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>24,041</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>26,772</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Total operating expenses</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>115,335</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>161,610</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>198,757</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>152,603</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>151,091</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Loss from operations</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(106,395</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(149,556</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(179,170</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(137,946</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(134,719</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Interest and other income</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>4,564</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>6,969</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>13,649</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>10,234</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>8,059</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Interest expense</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(823</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(577</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(523</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(495</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(279</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Net loss</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(102,654</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(143,164</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(166,044</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(128,207</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(126,939</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Basic and diluted net loss per common share</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(3.08</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(2.69</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(2.81</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(2.18</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(2.10</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Shares used in computing net loss per common share(2)(3)(4)(5)</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>33,283</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>53,270</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>59,013</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>58,702</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>60,384</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<HR NOSHADE ALIGN="LEFT" WIDTH="48">
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>Stock-based
compensation, consisting of stock-based compensation expense under SFAS&nbsp;123(R), the amortization of deferred stock-based compensation and the value of options
issued to non-employees for services rendered, is allocated as follows (in thousands): </FONT></DD></DL>
<BR>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="84%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="42%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=8 ALIGN="CENTER"><FONT SIZE=1><B>Year Ended December&nbsp;31,</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>Nine Months Ended<BR>
September&nbsp;30,</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="42%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2004</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2005</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2007</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="42%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>(unaudited)<BR> </B></FONT><BR></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="42%"><FONT SIZE=2>Research and development</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>4,631</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>3,259</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>12,635</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>9,378</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>10,078</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="42%"><FONT SIZE=2>General and administrative</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>3,890</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,364</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>9,196</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>7,106</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>7,089</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="42%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="42%"><FONT SIZE=2>Total stock-based compensation</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>8,521</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>5,623</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>21,831</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>16,484</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>17,167</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="42%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>In
May&nbsp;2004, all shares of convertible preferred stock were converted into common stock.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>In
May&nbsp;2004, GSK, through an affiliate, purchased 6,387,096 shares of Class&nbsp;A common stock for $108.9&nbsp;million.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>On
October&nbsp;5, 2004, the Company completed its initial public offering with the sale of 7,072,500 shares of common stock. Net proceeds, after underwriters' commissions and
offering expenses, totaled $102.1&nbsp;million. Contemporaneously with the closing of its initial public offering, the </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ce77601_1_13"> </A>
<UL>

<P><FONT SIZE=2>Company
sold 433,757 shares of its Class&nbsp;A common stock to an affiliate of GSK in a private transaction for total proceeds of $6.9&nbsp;million. </FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(5)</FONT></DT><DD><FONT SIZE=2>In
February&nbsp;2006, the Company completed its follow-on offering with the sale of 5,200,000 shares of common stock. Net proceeds, after underwriters' commission and
offering expenses, totaled $139.9&nbsp;million. </FONT></DD></DL>
<BR>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="68%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>As of<BR>
September&nbsp;30, 2007</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="68%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Actual</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>As<BR>
Adjusted</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="68%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>(in thousands)<BR>
(unaudited)<BR> </B></FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2><B>Consolidated Balance Sheet Data:</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Cash, cash equivalents and marketable securities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>166,521</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>311,421</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Working capital</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>87,300</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>232,200</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Total assets</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>198,623</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>348,523</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Long-term liabilities(6)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>182,372</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>332,372</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Accumulated deficit</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(904,751</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(904,751</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="68%"><FONT SIZE=2>Total net capital deficiency</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(40,885</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(40,885</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<HR NOSHADE ALIGN="LEFT" WIDTH="48">
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(6)</FONT></DT><DD><FONT SIZE=2>Long-term
liabilities includes the long-term portion of deferred revenue of $171.5&nbsp;million as of September&nbsp;30, 2007. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>13</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_da77601_1_14"> </A> </FONT></P>

<!-- TOC_END -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="da77601_risk_factors"> </A>
<A NAME="toc_da77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>RISK FACTORS    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><I>An investment in our notes involves a high degree of risk. We operate in a dynamic and rapidly changing industry that involves
numerous
risks and uncertainties. You should carefully consider the following risk factors, together with all of the other information contained in this prospectus or incorporated by reference into this
prospectus. The risks and uncertainties described below are not the only ones we face. Other risks and uncertainties, including those that we do not currently consider material, may impair our
business. If any of the adverse developments discussed below actually occur, our business, financial condition, operating results or cash flows could be materially and adversely affected. This could
cause the value of our notes to decline, and you may lose all or part of your investment.</I></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="da77601_risks_related_to_our_business"> </A>
<A NAME="toc_da77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>Risks Related to our Business    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>If telavancin is not approved by regulatory agencies, including the U.S. Food and Drug Administration, our business will be adversely affected and the price of our notes and
common stock will decline.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Telavancin is the first product candidate for which we submitted a new drug application (NDA) to the U.S. Food and Drug Administration (FDA). On
October&nbsp;19, 2007 we received an approvable letter from the FDA indicating that our telavancin NDA is approvable, subject to: resolution of current good manufacturing practices (cGMP) compliance
issues not specifically related to telavancin at our third-party manufacturer; and submission of revised labeling or re-analyses of clinical data or additional clinical data. Although we
are working diligently to respond to the FDA and we believe that no additional clinical studies will need to be initiated to respond to the approvable letter, there can be no assurance that we will be
able to respond fully or adequately to the FDA's requests using currently existing clinical data, that our third-party manufacturer will successfully resolve the cGMP issues that the FDA noted, or
that the FDA will approve the current telavancin NDA on the basis of existing preclinical and clinical data or at all. If we are required to undertake additional clinical trials or to identify and
qualify a new contract manufacturer for televancin, we would incur significant additional cost and regulatory action on our NDA would be materially delayed. On January&nbsp;11, 2008, we announced
that the Anti-Infective Drugs Advisory Committee (AIDAC) to the FDA is scheduled to meet to review our telavancin NDA for the proposed indication to treat complicated skin and skin
structure infections (cSSSI) on February&nbsp;27, 2008. It is impossible to predict the outcome of
the AIDAC meeting, and the decision of the AIDAC is not binding on FDA. Any adverse developments or results or perceived adverse developments or results with respect to the AIDAC meeting could
adversely affect the prospects of telavancin and cause the price of our notes and common stock to fall. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Telavancin
is also under review by European Union and Canadian regulatory agencies. If the regulatory authorities require additional clinical data, or the labeling for telavancin that
is ultimately approved by regulatory authorities materially limits the targeted patient population, our business will be harmed and the price of our notes and common stock will fall. Furthermore, if
our third party manufacturer's cGMP issues are not satisfactorily resolved or regulatory action on telavancin is otherwise delayed for a lengthy period, or if a regulatory authority does not approve
telavancin, our business will be harmed and the price of our notes and common stock will fall. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, in 2008 we plan to submit an NDA to the FDA for the additional indication of hospital-acquired pneumonia (HAP) for telavancin. Regulatory action with respect to this
application could take a significant amount of time and could require that we undertake additional studies. Any adverse developments or results or perceived adverse developments or results with
respect to our efforts to obtain approval of telavancin for this indication will cause the price of our notes and common stock to fall. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>14</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_da77601_1_15"> </A>
<BR>

<P><FONT SIZE=2><B>If our product candidates, in particular telavancin, are determined to be unsafe or ineffective in humans, our business will be adversely affected and our stock price will
decline.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have never commercialized any of our product candidates. We are uncertain whether any of our compounds or product candidates will prove effective
and safe in
humans or meet applicable regulatory standards. In addition, our approach to applying our expertise in multivalency to drug discovery is unproven and may not result in the creation of successful
medicines. The risk of failure for our compounds and product candidates is high. For example, in late 2005 we discontinued our overactive bladder program based upon the results of our Phase 1 studies
with compound TD-6301, and GSK discontinued development of TD-5742, the first LAMA compound licensed from us, based on the results of Phase 1 studies. To date, the data
supporting our drug discovery and development programs is derived solely from laboratory experiments, preclinical studies and clinical studies. A number of other compounds remain in the lead
identification, lead optimization, preclinical testing or early clinical testing stages. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Several
recent, well-publicized safety-related product withdrawals, suspensions, post-approval labeling revisions to include black-box warnings and
changes in approved indications, as well as growing public and governmental scrutiny of safety issues,
have created an increasingly conservative regulatory environment. Therefore, there is a risk that the FDA may implement new standards or change their interpretation of existing requirements for
demonstrating that a product candidate is safe and effective, which could cause non-approval or delays in its approval of product candidates, including telavancin. It is impossible to
predict when or if any of our product candidates will prove effective or safe in humans or will receive regulatory approval. If we are unable to discover and develop medicines that are effective and
safe in humans, our business will fail. </FONT></P>

<P><FONT SIZE=2><B>Any failure of a product candidate in clinical studies or any delay in commencing or completing clinical studies for our product candidates would harm our business and cause
our stock price to decline.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of our product candidates must undergo extensive preclinical and clinical studies as a condition to regulatory approval. Preclinical and clinical
studies
are expensive and take many years to complete. The commencement and completion of clinical studies for our product candidates may be delayed by many factors, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>poor
effectiveness of product candidates during clinical studies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>adverse
events, safety issues or side effects relating to the product candidates or their formulation into medicines;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
inability or the inability of our collaborators or licensees to manufacture or obtain from third parties materials sufficient for use in preclinical and clinical
studies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>governmental
or regulatory delays and changes in regulatory requirements, policy and guidelines;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>failure
of our partners to advance our product candidates through clinical development;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>unreliable
results from clinical studies, which we recently experienced with our Phase&nbsp;1 thorough QTc study on TD-5108;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>inability
to raise additional capital in sufficient amounts to continue our development programs, which are very expensive;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>inability
to enter into corporate partnering arrangements relating to the development and commercialization of our later-stage programs; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>15</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>delays
in patient enrollment, which we experienced in our Phase 3 HAP program for telavancin, and variability in the number and types of patients available for clinical
studies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>difficulty
in maintaining contact with patients after treatment, resulting in incomplete data;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
regional disturbance where we are enrolling patients in our clinical trials, such as a pandemic, terrorist activities or war, or a natural disaster; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>varying
interpretation of data by the FDA and similar foreign regulatory agencies. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>If
our product candidates fail to demonstrate safety and effectiveness in clinical trials, or if our clinical trials are materially delayed, our business and financial condition will be adversely
affected. </FONT></P>

<P><FONT SIZE=2><B>If our product candidates that we develop on our own or through collaborative partners are not approved by regulatory agencies, including the FDA, we will be unable to
commercialize them.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The FDA must approve any new medicine before it can be marketed and sold in the United States. We must provide the FDA and similar foreign regulatory
authorities
with data from preclinical and clinical studies that demonstrate that our product candidates are safe and effective for a defined indication before they can be approved for commercial distribution. We
will not obtain this approval for a product candidate unless and until the FDA approves a NDA. In order to market our medicines in the European Union and other foreign jurisdictions, we must obtain
separate regulatory approvals in each country. The approval procedure varies among countries and can involve additional testing, and the time required to obtain approval may differ from that required
to obtain FDA approval. Approval by the FDA does not ensure approval by regulatory authorities in other countries, and approval by one foreign regulatory authority does not ensure approval by
regulatory authorities in other foreign countries or by the FDA. Conversely, failure to obtain approval in one or more jurisdictions may make approval in other jurisdictions more difficult. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Clinical
studies involving our product candidates may reveal that those candidates are ineffective, inferior to existing approved medicines, unacceptably toxic or have other
unacceptable side effects. In addition, the results of preclinical studies do not necessarily predict clinical success, and larger and later-stage clinical studies may not produce the same results as
earlier-stage clinical studies. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Frequently,
product candidates that have shown promising results in early preclinical or clinical studies have subsequently suffered significant setbacks or failed in later clinical
studies. In addition, clinical studies of potential products often reveal that it is not possible or practical to continue development efforts for these product candidates. If our clinical studies are
substantially delayed or fail to prove the safety and effectiveness of our product candidates, we may not receive regulatory approval of any of our product candidates and our business and financial
condition will be materially harmed. </FONT></P>

<P><FONT SIZE=2><B>We rely on a number of manufacturers for our product candidates and we rely on a single manufacturer for supply of telavancin, and our business will be seriously harmed if
these manufacturers are not able to satisfy our demand and alternative sources are not available.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have limited in-house production capabilities and depend entirely on a number of third-party active pharmaceutical ingredient (API) and drug
product manufacturers. We may not have long-term agreements with these third parties and our agreements with these parties may be terminable at will by either party at any time. If, for
any reason, these third parties are unable or unwilling to perform, we may not be able to locate alternative manufacturers or enter into favorable agreements with them. Any inability to acquire
sufficient quantities of API and drug product in a timely manner from these third parties could delay clinical studies, prevent us from developing our product candidates in a
cost-effective manner or on a timely basis, and adversely affect the commercial introduction of any approved products. In addition, manufacturers of our API and drug product are subject to
the FDA's </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>16</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>cGMP
regulations and similar foreign standards and we do not have control over compliance with these regulations by our manufacturers. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are in the process of having telavancin API and drug product manufactured for us in order to meet our obligations to Astellas in connection with commercial launch in the event
telavancin is approved for sale by regulatory authorities. We have a single source of supply of telavancin API and a single source of supply of telavancin drug product. If we are unable to have
telavancin manufactured in a timely manner, or if Astellas is unable to arrange for the expanded commercial manufacture of telavancin, the commercial introduction of telavancin, if approved, would be
adversely affected. During a mid-2007 audit of our supplier for telavancin drug product, a district office of the FDA noted deficiencies, not specifically related to the manufacture of
telavancin drug product, with the supplier's quality and laboratory systems at the plant where telavancin is manufactured. Although the supplier reported to us that it had responded to all noted
deficiencies and had obtained verbal acknowledgment from the FDA's district office that it was in compliance, on November&nbsp;16, 2007 the supplier received a warning letter from the FDA related to
these issues and, to date, the supplier has been unable to reach formal resolution of these issues with the FDA. On October&nbsp;19, 2007 we received an approvable letter from the FDA indicating
that the telavancin NDA is approvable subject to, among other things, resolution of these cGMP compliance issues at our supplier. It is impossible to predict the amount of time it will take for the
supplier and the FDA to resolve these compliance issues, and any material delay will harm our business and cause the price of our notes and common stock to fall. In addition, if this manufacturer is
unable to resolve its issues with the FDA, we might be required to identify and qualify an alternative manufacturer for televancin, which would involve significant costs and material delays. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
manufacturing strategy presents the following additional risks: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>because
of the complex nature of our compounds, our manufacturers may not be able to successfully manufacture our APIs and/or drug products in a cost effective and/or timely
manner and changing manufacturers for our APIs or drug products could involve lengthy technology transfer and validation activities for the new manufacturer;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
processes required to manufacture certain of our APIs and drug products are specialized and available only from a limited number of third-party manufacturers;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>some
of the manufacturing processes for our APIs and drug products have not been scaled to quantities needed for continued clinical studies or commercial sales, and delays
in scale-up to commercial quantities could delay clinical studies, regulatory submissions and commercialization of our product candidates; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>because
some of the third-party manufacturers are located outside of the U.S., there may be difficulties in importing our APIs and drug products or their components into the
U.S. as a result of, among other things, FDA import inspections, incomplete or inaccurate import documentation or defective packaging. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, we are using a single source for the supply of our APIs and a single source for the supply of drug product for TD-1792, our investigational heterodimer
antibiotic, as well as for TD-5108 in our GI Motility Dysfunction program. If any supplier fails to continue to produce supplies for our development activities for these compounds in
acceptable quantity and/or quality, our clinical studies could be delayed. </FONT></P>

<P><FONT SIZE=2><B>If approved, telavancin may not be accepted by physicians, patients, third party payors, or the medical community in general.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If approved by the relevant regulatory agencies, the commercial success of telavancin will depend upon its acceptance by physicians, patients, third
party payors
and the medical community in </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>17</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>general.
We cannot be sure that telavancin will be accepted by these parties even if it is approved by the relevant regulatory authorities. If approved, telavancin will compete with vancomycin, a
relatively inexpensive generic drug that is manufactured by a variety of companies, a number of existing anti-infectives manufactured and marketed by major pharmaceutical companies and
others, and potentially against new anti-infectives that are not yet on the market. Even if the medical community accepts that telavancin is safe and efficacious for its approved
indications, physicians may choose to restrict the use of telavancin. If we and our partner, Astellas, are unable to demonstrate to physicians that, based on experience, clinical data,
side-effect profiles and other factors, telavancin is preferable to vancomycin and other existing or subsequently-developed anti-infective drugs, we may never generate
meaningful revenue from telavancin. The degree of market acceptance of telavancin, if approved by the relevant regulatory agencies, will depend on a number of factors, including, but not limited to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
demonstration of the clinical efficacy and safety of telavancin;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
labeling for telavancin that ultimately is approved by regulatory authorities;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
advantages and disadvantages of telavancin compared to alternative therapies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
and Astellas' ability to educate the medical community about the safety and effectiveness of telavancin;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
reimbursement policies of government and third party payors; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
market price of telavancin relative to competing therapies. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Even if our product candidates receive regulatory approval, commercialization of such products may be adversely affected by regulatory actions.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Even if we receive regulatory approval, this approval may include limitations on the indicated uses for which we can market our medicines or the
patient
population that may utilize our medicines, which may limit the market for our medicines or put us at a competitive disadvantage relative to alternative therapies. Further, if we obtain regulatory
approval, a marketed medicine and its manufacturer are subject to continual review, including review and approval of the manufacturing facilities. Discovery of previously unknown problems with a
medicine may result in restrictions on its permissible uses, or on the manufacturer, including withdrawal of the medicine from the market. The FDA and similar foreign regulatory authorities may also
implement new standards, or change their interpretation and enforcement of existing standards and requirements for the manufacture, packaging or testing of products at any time. If we are unable to
comply, we may be subject to regulatory or civil actions or penalties that could significantly and adversely affect our business. Any failure to maintain regulatory approval will limit our ability to
commercialize our product candidates, which would materially and adversely affect our business and financial condition. </FONT></P>

<P><FONT SIZE=2><B>We have incurred operating losses in each year since our inception and expect to continue to incur substantial losses for the foreseeable future.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have been engaged in discovering and developing compounds and product candidates since mid-1997. We have not generated any product revenue to
date. We may never generate revenue from selling medicines or achieve profitability. As of September&nbsp;30, 2007, we had an accumulated deficit of approximately $904.8&nbsp;million. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
expect to incur substantial expenses as we continue our drug discovery and development efforts, particularly to the extent we advance our product candidates into and through clinical
studies, which are very expensive. As a result, we expect to continue to incur substantial losses for the foreseeable future. We are uncertain when or if we will be able to achieve or sustain
profitability. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>18</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>

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<P><FONT SIZE=2>Failure
to become and remain profitable would adversely affect the price of our notes and common stock and our ability to raise capital and continue operations. </FONT></P>

<P><FONT SIZE=2><B>If we fail to obtain the capital necessary to fund our operations, we may be unable to develop our product candidates and we could be forced to share our rights to
commercialize our product candidates with third parties on terms that may not be favorable to us.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We need large amounts of capital to support our research and development efforts. If we are unable to secure capital to fund our operations we will
not be able
to continue our discovery and development efforts and we might have to enter into strategic collaborations that could require us to share commercial rights to our medicines to a greater extent than we
currently intend. Based on our current operating plans, we believe that our cash and cash equivalents and marketable securities together with the proceeds of this offering will be sufficient to meet
our anticipated operating needs for at least the next twelve months. We are likely to require additional capital to fund operating needs thereafter. In addition, in the event that a LABA product
candidate discovered by GSK is successfully developed and commercially launched in multiple regions in the world, we are obligated to pay GSK milestone payments of up to an aggregate of
$220.0&nbsp;million under our Horizon program (formerly referred to as Beyond Advair). The current lead LABA candidate, GW642444, is a GSK-discovered compound. If this
GSK-discovered compound is advanced through regulatory approval, we would not be entitled to any further milestone payments from GSK with regard to the Horizon program. We cannot guarantee
that future financing will be available in sufficient amounts or on terms acceptable to us, if at all. If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us,
we will be prevented from continuing our discovery and development efforts and exploiting other corporate opportunities. This could harm our business, prospects and financial condition and cause the
price of our notes and common stock to fall. </FONT></P>

<P><FONT SIZE=2><B>If our partners do not satisfy their obligations under our agreements with them, we will be unable to develop our partnered product candidates as planned.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We entered into our Horizon collaboration agreement with GSK in November&nbsp;2002, our strategic alliance agreement with GSK in March&nbsp;2004, and
our
telavancin development and commercialization agreement with Astellas in November&nbsp;2005. In connection with these agreements, we have granted to these parties certain rights regarding the use of
our patents and technology with respect to compounds in our development programs, including development and marketing rights. Under our GSK agreements, GSK has full responsibility for development and
commercialization of any product candidates in the programs that it has in-licensed, including Horizon, LAMA and MABA. Any future milestone payments or royalties to us from these programs
will depend on the extent to which GSK advances the product candidate through development and commercial launch. In connection with our Astellas telavancin agreement, Astellas is responsible for the
commercialization of telavancin and any royalties to us from this program will depend upon Astellas' ability to launch and sell the medicine if it is approved. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
partners might not fulfill all of their obligations under these agreements. In that event, we may be unable to assume the development and commercialization of the product candidates
covered by the agreements or enter into alternative arrangements with a third party to develop and commercialize such product candidates. In addition, with the exception of product candidates in our
Horizon program, our partners generally are not restricted from developing and commercializing their own products and product candidates that compete with those licensed from us. For example, GSK
currently has a competing LAMA product candidate that is further advanced in development than our LAMA product candidate which they licensed from us. If a partner elected to promote its own products
and product candidates in preference to those licensed from us, future payments to us could be reduced and our business and financial condition would be materially and adversely affected. Accordingly,
our ability to </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>19</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>receive
any revenue from the product candidates covered by these agreements is dependent on the efforts of the partner. We could also become involved in disputes with a partner, which could lead to
delays in or termination of our development and commercialization programs and time-consuming and expensive litigation or arbitration. If a partner terminates or breaches its agreements
with us, or otherwise fails to complete its obligations in a timely manner, the chances of successfully developing or commercializing our product candidates would be materially and adversely affected. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, while our strategic alliance with GSK sets forth pre-agreed upfront payments, development obligations, milestone payments and royalty rates under which GSK may
obtain exclusive rights to develop and commercialize our product candidates, GSK may in the future seek to negotiate more favorable terms on a project-by-project basis. To
date, GSK has licensed our LAMA program and our MABA program under the terms of the strategic alliance agreement and has chosen not to license our bacterial infections program, our anesthesia program
and our GI Motility Dysfunction program. There can be no assurance that GSK will license any other development program under the terms of the strategic alliance agreement, or at all. GSK's failure to
license our development programs could adversely affect the perceived prospects of the product candidates that are the subject of these development programs, which could negatively affect both our
ability to enter into collaborations for these product candidates with third parties and the price of our notes and common stock. </FONT></P>

<P><FONT SIZE=2><B>Our relationship with GSK may have a negative effect on our ability to enter into relationships with third parties.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of November&nbsp;30, 2007, GSK beneficially owned approximately 15.4% of our outstanding capital stock. Pursuant to our strategic alliance with GSK,
 GSK has
the right to license exclusive development and commercialization rights to our product candidates arising from (i)&nbsp;our peripheral Opioid-Induced Bowel Dysfunction (PUMA) program,
(ii)&nbsp;our AT1 Receptor&#151;Neprilysin Inhibitor hypertension (ARNI) program and (iii)&nbsp;our MonoAmine Reuptake Inhibitor chronic pain (MARIN) program. Because GSK may license these
three development programs at any time prior to successful completion of a Phase 2 proof-of-concept study, we may be unable to
collaborate with other partners with respect to these programs until we have expended substantial resources to advance them through clinical studies. We may not have sufficient funds to pursue such
programs in the event GSK does not license them at an early stage. Pharmaceutical companies other than GSK that may be interested in developing products with us may be less inclined to do so because
of our relationship with GSK, or because of the perception that development programs that GSK does not license pursuant to our strategic alliance agreement are not promising programs. If our ability
to work with present or future strategic partners or collaborators is adversely affected as a result of our strategic alliance with GSK, our business prospects may be limited and our financial
condition may be adversely affected. </FONT></P>

<P><FONT SIZE=2><B>If we are unable to enter into future collaboration arrangements or if any such collaborations with third parties are unsuccessful, our profitability may be delayed or reduced.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To date, we have entered into collaborations with GSK for the Horizon, LAMA and MABA programs and with Astellas for telavancin, and we have licensed
our
anesthesia compound to AstraZeneca AB (AstraZeneca). Each of TD-5108 and TD-1792 has successfully completed a Phase 2 proof-of-concept study and we
currently intend to pursue collaboration arrangements for the development and commercialization of these compounds. Collaborations with third parties regarding these programs or our other programs may
require us to relinquish material rights, including revenue from commercialization of our medicines, on terms that are less attractive than our current arrangements. These collaboration arrangements
are complex and time-consuming to negotiate, and if we are unable to reach agreements with third-party collaborators, we may fail to meet our business objectives and our financial
condition may be adversely affected. We face significant competition in seeking third-party collaborators and may be unable to find third parties to pursue product </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>20</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>collaborations
on a timely basis or on acceptable terms. Furthermore, for any collaboration, we may not be able to control the amount of time and resources that our partners devote to our product
candidates and our partners may choose to pursue alternative products. Our inability to successfully collaborate with third parties would increase our development costs and could limit the likelihood
of successful commercialization of our product candidates. </FONT></P>

<P><FONT SIZE=2><B>We depend on third parties in the conduct of our clinical studies for our product candidates.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We depend on independent clinical investigators, contract research organizations and other third party service providers in the conduct of our
preclinical and
clinical studies for our product candidates. We rely heavily on these parties for execution of our preclinical and clinical studies, and control only certain aspects of their activities. Nevertheless,
we are responsible for ensuring that our clinical studies are conducted in accordance with good clinical practices (GCPs) and other regulations as required by the FDA and foreign regulatory agencies,
and the applicable protocol. Failure by these parties to
comply with applicable regulations, GCPs and protocols in conducting studies of our product candidates can delay our development programs. For example, we recently completed enrollment in our Phase 1
thorough QTc study on TD-5108, the lead compound in our GI Motility Dysfunction program. Our preliminary review of the electrocardiogram data from the study suggests that such data is unreliable due
to problems with the conduct of the study, not with the intrinsic properties of TD-5108. We believe that lack of assay sensitivity in the active control arm of the study (moxifloxacin) renders the
results uninterpretable, and that the study will need to be repeated in order to generate scientifically valid results. We currently intend to initiate a repeat of the study later this year. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
FDA enforces good clinical practices and other regulations through periodic inspections of trial sponsors, clinical research organizations (CROs), principal investigators and trial
sites. For example, in connection with the FDA's review of our telavancin NDA for the treatment of cSSSI, the FDA conducted inspections of Theravance and certain of our study sites and clinical
investigators and a CRO. If we or any of the third parties on which we have relied to conduct our clinical studies are determined to have failed to comply with GCPs, the study protocol or applicable
regulations, the clinical data generated in our studies may be deemed unreliable and we or the FDA may decide to conduct additional audits or require additional clinical studies, which could delay our
development programs. </FONT></P>

<P><FONT SIZE=2><B>We face substantial competition from companies with more resources and experience than we have, which may result in others discovering, developing, receiving approval for or
commercializing products before or more successfully than we do.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our ability to succeed in the future depends on our ability to demonstrate and maintain a competitive advantage with respect to our approach to the
discovery and
development of medicines. Our objective is to discover, develop and commercialize new small molecule medicines with superior efficacy, convenience, tolerability and/or safety. Because our strategy is
to develop new product candidates for biological targets that have been validated by existing medicines or potential medicines in late stage clinical studies, to the extent that we are able to develop
medicines, they are likely to compete with existing drugs that have long histories of effective and safe use. We expect that any medicines that we commercialize with our collaborative partners or on
our own will compete with existing or future market-leading medicines. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Many
of our potential competitors have substantially greater financial, technical and personnel resources than we have. In addition, many of these competitors have significantly greater
commercial infrastructures than we have. Our ability to compete successfully will depend largely on our ability to leverage our experience in drug discovery and development to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>discover
and develop medicines that are superior to other products in the market;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>attract
qualified scientific, product development and commercial personnel; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>21</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>obtain
patent and/or other proprietary protection for our medicines and technologies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>obtain
required regulatory approvals; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>successfully
collaborate with pharmaceutical companies in the discovery, development and commercialization of new medicines. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Established
pharmaceutical companies may invest heavily to quickly discover and develop or in-license novel compounds that could make our product candidates obsolete.
Accordingly, our competitors may succeed in obtaining patent protection, receiving FDA approval or discovering, developing and commercializing medicines before we do. We are also aware of other
companies that are engaged in the discovery of medicines that would compete with the product candidates that we are developing. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
new medicine that competes with a generic market leading medicine must demonstrate compelling advantages in efficacy, convenience, tolerability and/or safety in order to overcome
severe price competition and be commercially successful. If approved, telavancin must demonstrate these advantages, as it will compete with vancomycin, a relatively inexpensive generic drug that is
manufactured by a number of companies, and a number of existing anti-infectives marketed by major pharmaceutical companies. If we are not able to compete effectively against our current
and future competitors, our business will not grow and our financial condition and operations will suffer. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
the principles of multivalency become more widely known, we expect to face increasing competition from companies and other organizations that pursue the same or similar approaches.
Novel therapies, such as gene therapy or effective vaccines for infectious diseases, may emerge that will make both conventional and multivalent medicine discovery efforts obsolete or less
competitive. </FONT></P>

<P><FONT SIZE=2><B>We have no experience selling or distributing products and no internal capability to do so.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Generally, our strategy is to engage pharmaceutical or other healthcare companies with an existing sales and marketing organization and distribution
system to
market, sell and distribute our products. We may not be able to establish these sales and distribution relationships on acceptable terms, or at all. If we receive regulatory approval to commence
commercial sales of any of our product candidates that are not covered by our current agreements with GSK, Astellas or AstraZeneca, we will have to establish a sales and marketing organization with
appropriate technical expertise and supporting distribution capability. At present, we have no sales personnel and a limited number of marketing personnel. Factors that may inhibit our efforts to
commercialize our products without strategic partners or licensees include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
inability to recruit and retain adequate numbers of effective sales and marketing personnel;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
inability of sales personnel to obtain access to or persuade adequate numbers of physicians to prescribe our products;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines;
and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>unforeseen
costs and expenses associated with creating an independent sales and marketing organization. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
we are not able to partner with a third party and are not successful in recruiting sales and marketing personnel or in building a sales and marketing infrastructure, we will have
difficulty commercializing our product candidates, which would adversely affect our business and financial condition. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>22</FONT></P>

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<P><FONT SIZE=2><B>If we lose key scientists or management personnel, or if we fail to recruit additional highly skilled personnel, it will impair our ability to discover, develop and
commercialize product candidates.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are highly dependent on principal members of our management team and scientific staff, including our Chairman of the board of directors, P. Roy
Vagelos, our
Chief Executive Officer, Rick E Winningham, and our Senior Vice President of Development, Michael Kitt. These executives each have significant pharmaceutical industry experience. The unexpected loss
of Dr.&nbsp;Vagelos, Mr.&nbsp;Winningham or Dr.&nbsp;Kitt could impair our ability to discover, develop and market new medicines. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
scientific team has expertise in many different aspects of drug discovery and development. Our company is located in northern California, which is headquarters to many other
biopharmaceutical companies and many academic and research institutions. There is currently a shortage of experienced scientists, which is likely to continue, and competition for skilled personnel in
our market is very intense. Competition for experienced scientists may limit our ability to hire and retain highly qualified personnel on acceptable terms. In addition, none of our employees have
employment commitments for any fixed period of time and could leave our employment at will. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
we fail to identify, attract and retain qualified personnel, we may be unable to continue our development and commercialization activities. </FONT></P>

<P><FONT SIZE=2><B>Our principal facility is located near known earthquake fault zones, and the occurrence of an earthquake, extremist attack or other catastrophic disaster could cause damage to
our facilities and equipment, which could require us to cease or curtail operations.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our principal facility is located in the San Francisco Bay Area near known earthquake fault zones and therefore is vulnerable to damage from
earthquakes. In
October&nbsp;1989, a major earthquake struck this area and caused significant property damage and a number of fatalities. We are also vulnerable to damage from other types of disasters, including
power loss, attacks from extremist organizations, fire, floods, communications failures and similar events. If any disaster were to occur, our ability to operate our business could be seriously
impaired. In addition, the unique nature of our research activities and of much of our equipment could make it difficult for us to recover from this type of disaster. We currently may not have
adequate insurance to cover our losses resulting from disasters or other similar significant business interruptions and we do not plan to purchase additional insurance to cover such
losses due to the cost of obtaining such coverage. Any significant losses that are not recoverable under our insurance policies could seriously impair our business and financial condition. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dc77601_risks_related_to_our_alliance_with_gsk"> </A>
<A NAME="toc_dc77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>Risks Related to our Alliance with GSK    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>GSK's ownership of a significant percentage of our stock and its right to membership on our board of directors may create conflicts of interest, and may inhibit our
management's ability to continue to operate our business in the manner in which it is currently being operated.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of November&nbsp;30, 2007, GSK beneficially owned approximately 15.4% of our outstanding capital stock, and GSK has the right to maintain its
percentage
ownership of our capital stock. In addition, GSK currently has the right to designate one member to our board of directors. There are currently no GSK designated directors on our board of directors.
Further, pursuant to our certificate of incorporation, we renounce our interest in and waive any claim that a corporate or business opportunity taken by GSK constituted a corporate opportunity of ours
unless such corporate or business opportunity is expressly offered to one of our directors who is a director, officer or employee of GSK, primarily in his or her capacity as one of our directors. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>23</FONT></P>

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<P><FONT SIZE=2><B>GSK's rights under the strategic alliance and governance agreements may deter or prevent efforts by other companies to acquire us, which could prevent our stockholders from
realizing a control premium.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our governance agreement with GSK requires us to exempt GSK from our stockholder rights plan, affords GSK certain rights to offer to acquire us in the
event
third parties seek to acquire our stock and contains other provisions that could deter or prevent another company from seeking to acquire us. For example, GSK may offer to acquire 100% of our
outstanding stock from stockholders in certain circumstances, such as if we are faced with a hostile acquisition offer or if our board of directors acts in a manner to facilitate a change in control
of us with a party other than GSK. In addition, pursuant to our strategic alliance agreement with GSK, GSK has the right to license (i)&nbsp;our PUMA program, (ii)&nbsp;our ARNI program and
(iii)&nbsp;our MARIN program. As a result of these rights, other companies may be less inclined to pursue an acquisition of us and therefore we may not have the opportunity to be acquired in a
transaction that stockholders might otherwise deem favorable, including transactions in which our stockholders might realize a substantial premium for their shares. </FONT></P>


<P><FONT SIZE=2><B>After September 2008, GSK could sell or transfer a substantial number of shares of our common stock, which could depress the price of our notes and common stock or result in a
change in control of our company.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beginning in September 2008, GSK may sell or transfer our common stock either pursuant to a public offering registered under the Securities Act of
1933, as
amended (the "1933 Act"), or pursuant to Rule&nbsp;144 of the 1933 Act. In addition, beginning in September 2012, GSK will have no restrictions on its ability to sell or transfer our common stock on
the open market, in privately negotiated transactions or otherwise, and these sales or transfers could create substantial declines in the price of our notes and common stock or, if these sales or
transfers were made to a single buyer or group of buyers, could contribute to a transfer of control of our company to a third party. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dc77601_risks_related_to_legal_and_regulatory_uncertainty"> </A>
<A NAME="toc_dc77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>Risks Related to Legal and Regulatory Uncertainty    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>If our efforts to protect the proprietary nature of the intellectual property related to our technologies are not adequate, we may not be able to compete effectively in our
market.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We rely upon a combination of patents, patent applications, trade secret protection and confidentiality agreements to protect the intellectual
property related
to our technologies. Any involuntary disclosure to or misappropriation by third parties of this proprietary information could enable competitors to quickly duplicate or surpass our technological
achievements, thus eroding our competitive position in our market. The status of patents in the biotechnology and pharmaceutical field involves complex legal and scientific questions and is very
uncertain. As of September&nbsp;30, 2007, we owned 108 issued United States patents and 364 granted foreign patents, as well as additional pending United States and foreign patent applications. Our
patent applications may be challenged or fail to result in issued patents and our existing or future patents may be invalidated or be too narrow to prevent third parties from developing or designing
around these patents. If the sufficiency of the breadth or strength of protection provided by our patents with respect to a product candidate is threatened, it could dissuade companies from
collaborating with us to develop, and threaten our ability to commercialize, the product candidate. Further, if we encounter delays in our clinical trials or in obtaining regulatory approval of our
product candidates, the patent lives of the related product candidates would be reduced. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable, for processes for which patents are
difficult to enforce and for any other elements of our drug discovery and development processes that involve proprietary know-how, information and technology that is not covered by patent
applications. Although we require </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>24</FONT></P>

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<P><FONT SIZE=2>all
of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information and technology to enter into confidentiality agreements, we
cannot be certain that this know-how, information and technology will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop
substantially equivalent information and techniques. Further, the laws of some foreign countries do not protect proprietary rights to the same extent as the laws of the United States. As a result, we
may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable to prevent material disclosure of the intellectual
property related to our technologies to third parties, we will not be able to establish or, if established, maintain a competitive advantage in our market, which could materially adversely affect our
business, financial condition and results of operations. </FONT></P>

<P><FONT SIZE=2><B>Litigation or third-party claims of intellectual property infringement would require us to divert resources and may prevent or delay our drug discovery and development efforts.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our commercial success depends in part on our not infringing the patents and proprietary rights of third parties. Third parties may assert that we are
employing
their proprietary technology without authorization. There are third party patents that may cover materials or methods for treatment related to our product candidates. At present we are not aware of
any patent claims with merit that would adversely and materially affect our ability to develop our product candidates, but nevertheless the possibility of third party allegations cannot be ruled out.
In addition, third parties may obtain patents in the future and claim that use of our technologies infringes upon these patents. Furthermore, parties making claims against us may obtain injunctive or
other equitable relief, which could effectively block our ability to further develop and commercialize one or more of our product candidates. Defense of these claims, regardless of their merit, would
involve substantial litigation expense and would be a substantial diversion of employee resources from our business. In the event of a successful claim of infringement against us, we may have to pay
substantial damages, obtain one or more licenses from third parties or pay royalties. In addition, even in the absence of litigation, we may need to obtain licenses from third parties to advance our
research or allow commercialization of our product candidates, and we have done so from time to time. We may fail to obtain any of these licenses at a reasonable cost or on reasonable terms, if at
all. In that event, we would be unable to further develop and commercialize one or more of our product candidates, which could harm our business significantly. In addition, in the future we could be
required to initiate litigation to enforce our proprietary rights against infringement by third parties. Prosecution of these claims to enforce our rights against others would involve substantial
litigation expenses and divert substantial employee resources from our business. If we fail to effectively enforce our proprietary rights against others, our business will be harmed. </FONT></P>

<P><FONT SIZE=2><B>Product liability lawsuits could divert our resources, result in substantial liabilities and reduce the commercial potential of our medicines.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The risk that we may be sued on product liability claims is inherent in the development of pharmaceutical products. These lawsuits may divert our
management from
pursuing our business strategy and may be costly to defend. In addition, if we are held liable in any of these lawsuits, we may incur substantial liabilities and may be forced to limit or forgo
further commercialization of those products. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
we maintain general liability and product liability insurance, this insurance may not fully cover potential liabilities. In addition, inability to obtain or maintain sufficient
insurance coverage at an acceptable cost or to otherwise protect against potential product liability claims could prevent or inhibit the commercial production and sale of our products, which could
adversely affect our business. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>25</FONT></P>

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<P><FONT SIZE=2><B>Government restrictions on pricing and reimbursement, as well as other healthcare payor cost-containment initiatives, may negatively impact our ability to generate
revenues.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The continuing efforts of the government, insurance companies, managed care organizations and other payors of health care costs to contain or reduce
costs of
health care may adversely affect one or more of the following: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
ability to set a price we believe is fair for our potential medicines;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
ability to generate revenues and achieve profitability; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
availability of capital. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the United States, the Medicare Prescription Drug Improvement and Modernization Act of 2003 (the MMA) will likely result in decreased reimbursement for prescription drugs, which may
intensify industry-wide pressure to reduce prescription drug prices. This could harm our ability to market our potential medicines and generate revenues. The MMA, associated cost
containment measures that health care payors and providers are instituting and the effect of probable further health care reform could significantly reduce potential revenues from the sale of any
product candidates approved in the future. In addition, in certain foreign markets, the pricing of prescription drugs is subject to government control and reimbursement may in some cases be
unavailable. We believe that pricing pressures at the state and federal level, as well as internationally, will continue and may increase, which may make it difficult for us to sell our potential
medicines that may be approved in the future at a price acceptable to us or our collaborators. </FONT></P>

<P><FONT SIZE=2><B>If we use hazardous and biological materials in a manner that causes injury or violates applicable law, we may be liable for damages.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our research and development activities involve the controlled use of potentially hazardous substances, including chemical, biological and radioactive
materials.
In addition, our operations produce hazardous waste products. Federal, state and local laws and regulations govern the use, manufacture, storage, handling and disposal of hazardous materials. We may
incur significant additional costs to comply with these and other applicable laws in the future. Also, even if we are in compliance with applicable laws, we cannot completely eliminate the risk of
contamination or injury resulting from hazardous materials and we may incur liability as a result of any such contamination or injury. In the event of an accident, we could be held liable for damages
or penalized with fines, and the liability could exceed our resources. We do not have any insurance for liabilities arising from hazardous materials. Compliance with applicable environmental laws and
regulations is expensive, and current or future environmental regulations may impair our research, development and production efforts, which could harm our business. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dc77601_general_company_related_risks"> </A>
<A NAME="toc_dc77601_3"> </A>
<BR></FONT><FONT SIZE=2><B>General Company Related Risks    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Our stock price may be extremely volatile and purchasers of our common stock could incur substantial losses.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our stock price may be extremely volatile. The stock market in general and the market for biopharmaceutical companies in particular have experienced
extreme
volatility that has often been unrelated to the operating performance of particular companies. The following factors, in addition to
the other risk factors described in this section, may also have a significant impact on the market price of our common stock: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
adverse development or perceived adverse development with respect to our telavancin NDA, our meeting with the Anti-Infective Drugs Advisory Committee to the
FDA, or our response to the FDA's approvable letter received October&nbsp;19, 2007; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>26</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
delay in the commercial distribution of telavancin if our NDA is approved by the FDA;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
delay in filing our telavancin NDA for the HAP indication with the FDA and any adverse development or perceived adverse development with respect to the FDA's review of
the NDA, including without limitation the FDA's issuance of a "refusal to file" letter or a request for additional information;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
adverse developments or results or perceived adverse developments or results with respect to the Horizon program;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
extent to which GSK advances (or does not advance) our product candidates through development into commercialization;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
adverse developments or results or perceived adverse developments or results with respect to our GI Motility Dysfunction program or TD-1792;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>announcements
regarding GSK's decisions whether or not to license any of our development programs;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>announcements
regarding GSK or Astellas generally;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>announcements
of patent issuances or denials, technological innovations or new commercial products by us or our competitors;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>developments
concerning any collaboration we may undertake with companies other than GSK or Astellas;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>publicity
regarding actual or potential testing or study results or the outcome of regulatory review relating to products under development by us, our partners or our
competitors;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>regulatory
developments in the United States and foreign countries;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>economic
and other external factors beyond our control; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>sales
of stock by us or by our stockholders, including sales by certain of our executive officers and directors pursuant to written pre-determined selling plans
under Rule&nbsp;10b5-1 of the Securities Exchange Act of 1934, some of which plans are currently in effect and others of which may be entered into. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2><B>Concentration of ownership will limit your ability to influence corporate matters.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of November&nbsp;30, 2007, GSK beneficially owned approximately 15.4% of our outstanding capital stock and our directors, executive officers and
investors
affiliated with these individuals beneficially owned approximately 14.0% of our outstanding capital stock. These stockholders could substantially control the outcome of actions taken by us that
require stockholder approval. In addition, pursuant to our governance agreement with GSK, GSK currently has the right to nominate one member of our board of directors. For these reasons, GSK could
have substantial influence in the election of our directors, delay or prevent a transaction in which stockholders might receive a premium over the prevailing market price for their shares and have
significant control over changes in our business. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>27</FONT></P>

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<P><FONT SIZE=2><B>Anti-takeover provisions in our charter and bylaws, in our rights agreement and in Delaware law could prevent or delay a change in control of our company.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provisions of our certificate of incorporation and bylaws may discourage, delay or prevent a merger or acquisition that stockholders may consider
favorable,
including transactions in which you might otherwise receive a premium for your shares. These provisions include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>requiring
supermajority stockholder voting to effect certain amendments to our certificate of incorporation and bylaws;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>restricting
the ability of stockholders to call special meetings of stockholders;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>prohibiting
stockholder action by written consent; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>establishing
advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on by stockholders at stockholder
meetings. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>In
addition, our board of directors has adopted a rights agreement that may prevent or delay a change in control of us. Further, some provisions of Delaware law may also discourage, delay or prevent
someone from acquiring us or merging with us. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dc77601_risks_related_to_the_notes"> </A>
<A NAME="toc_dc77601_4"> </A>
<BR></FONT><FONT SIZE=2><B>Risks Related to the Notes    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>The notes will be subordinated to any future senior indebtedness.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes are unsecured and contractually subordinated in right of payment to any of our future senior indebtedness. In the event of bankruptcy,
liquidation or
reorganization or upon acceleration of the notes due to an event of default and in specific other events, our assets will be available to pay obligations on the notes only after all senior
indebtedness has been paid in full in cash or other payment satisfactory to the holders of senior indebtedness has been made. There may not be sufficient assets remaining to pay amounts due on any or
all of the notes then outstanding. As a result of these payments, our general creditors may recover less, ratably, than the holders of our senior indebtedness and such general creditors may recover
more, ratably, than the holders of our notes or our other subordinated indebtedness. The indenture does not limit the creation of senior indebtedness (or any other indebtedness). Any significant
additional indebtedness incurred may also materially adversely impact our ability to service our debt, including the notes. In addition, the holders of our senior indebtedness may, under certain
circumstances, restrict or prohibit us from making payments on the notes. We anticipate that from time to time we may incur additional indebtedness, including senior indebtedness. </FONT></P>


<P><FONT SIZE=2><B>The notes are effectively subordinated to the indebtedness and liabilities of our existing and future subsidiaries and to all of our existing and future secured indebtedness.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes are not guaranteed by our existing subsidiaries or any future subsidiaries and, accordingly, the notes are effectively subordinated to the
existing and
future indebtedness and other liabilities of our subsidiaries. These liabilities may include indebtedness, trade payables, guarantees, lease obligations and letter of credit obligations. Therefore,
our rights and the rights of our creditors, including the holders of the notes, to participate in the assets of any subsidiary upon that subsidiary's liquidation or reorganization will be subject to
the prior claims of the subsidiary's creditors, except to the extent that we may ourselves be a creditor with recognized claims against the subsidiaries. However, even if we are a creditor of one of
our subsidiaries, our claims would still be effectively subordinated to any security interests in, or mortgages or other liens on, the assets of that subsidiary and would be subordinate to any
indebtedness of the subsidiary senior to that held by us. As of September&nbsp;30, 2007, our subsidiaries had no indebtedness outstanding (excluding intercompany indebtedness). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>28</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, the notes will not be secured by any of our assets or those of our subsidiaries. As a result, the notes will be effectively subordinated to any secured debt we may incur.
In any liquidation, dissolution, bankruptcy or other similar proceeding, holders of our secured debt may assert rights against any assets securing such debt in order to receive full payment of their
debt before those assets may be used to pay the holders of the notes. In such an event, we may not have sufficient assets remaining to pay amounts due on any or all of the notes. As of
September&nbsp;30, 2007, we had no secured indebtedness outstanding. </FONT></P>

<P><FONT SIZE=2><B>There are no restrictive covenants in the indenture for the notes relating to our ability to incur future indebtedness or complete other transactions.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The indenture governing the notes does not contain any financial or operating covenants that would protect you from several kinds of transactions that
may
adversely affect you. In particular, the indenture does not contain restrictions on the payment of dividends, the incurrence of indebtedness, transactions with affiliates, incurrence of liens or the
issuance or repurchase of securities by us or any of our subsidiaries. We therefore may incur additional debt, including senior indebtedness, secured indebtedness or indebtedness at the subsidiary
level to which the notes would be contractually or structurally subordinated. We may not be able to generate sufficient cash flow to pay the interest on our debt, including the notes and any
indebtedness that is senior in right of payment to the notes. Further, there can be no assurances that future working capital, any borrowings or equity financing will be available to pay or refinance
any such debt. </FONT></P>

<P><FONT SIZE=2><B>The make-whole premium that may be payable upon conversion in connection with certain fundamental change events may not adequately compensate you for the lost
option time value of your notes as a result of such fundamental change and also may not be enforceable.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you convert notes in connection with certain fundamental changes, we may be required to pay a make-whole premium by issuing additional shares. The
make-whole payment is described under "Description of the Notes&#151;Make-Whole Premium Upon Certain Fundamental Changes." While the make-whole premium is
designed to compensate you for the lost option time value of your notes as a result of such fundamental changes, the make-whole amount is only an approximation of such lost value and may
not adequately compensate you for such loss. In addition, our obligation to increase the conversion rate as described above could be considered a penalty, in which case its enforceability would be
subject to general principles of reasonableness of economic remedies. In addition, we will not increase the conversion rate to an amount, subject to adjustment, that exceeds&nbsp;&nbsp;&nbsp;&nbsp;shares per
$1,000 in principal amount of notes. </FONT></P>

<P><FONT SIZE=2><B>We may not have the ability to repurchase the notes in cash upon the occurrence of a fundamental change as required by the indenture.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders of the notes will have the right to require us to repurchase the notes upon the occurrence of a fundamental change as described under
"Description of the
Notes&#151;Fundamental Change Permits Holders to Require Us to Purchase Notes." We may not have sufficient funds to repurchase the notes in cash or have the ability to arrange necessary
financing on acceptable terms. Our ability to repurchase the notes may also be limited by law or the terms of other agreements relating to our senior indebtedness. A fundamental change may also
constitute an event of default or prepayment under, or result in the acceleration of the maturity of, our then-existing indebtedness. Our failure to repurchase the notes when required
would result in an event of default with respect to the notes. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>29</FONT></P>

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<P><FONT SIZE=2><B>The definition of a fundamental change requiring us to repurchase the notes is limited and, therefore, the market price of the notes may decline if we enter into a transaction
that is not a fundamental change under the indenture.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The term "fundamental change" requiring us to repurchase the notes at your option is limited to specified corporate transactions and may not include
other events
that might adversely affect our financial condition. In addition, the requirement that we offer to repurchase the notes upon a
fundamental change may not protect holders in the event of a highly leveraged transaction, reorganization, merger or similar transaction involving us. </FONT></P>


<P><FONT SIZE=2><B>If you hold notes, you are not entitled to any rights with respect to our common stock, but you are subject to all changes made with respect to our common stock.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you hold notes, you are not entitled to any rights with respect to our common stock (including, without limitation, voting rights and rights to
receive any
dividends or other distributions on our common stock), but you are subject to all changes affecting the common stock. You will only be entitled to rights on the common stock if and when we deliver
shares of common stock to you upon conversion of your notes. For example, in the event that an amendment is proposed to our certificate of incorporation or bylaws requiring stockholder approval and
the record date for determining the stockholders of record entitled to vote on the amendment occurs prior to delivery of the common stock, you will not be entitled to vote on the amendment, although
you will nevertheless be subject to any changes in the powers, preferences or special rights of our common stock. </FONT></P>

<P><FONT SIZE=2><B>Fluctuations in the price of our common stock may impact the price of the notes and make them more difficult to resell.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Because the notes are convertible into shares of our common stock, volatility or depressed prices for our common stock could have a similar effect on
the trading
price of the notes. Holders who receive common stock upon conversion of the notes will also be subject to the risk of volatility and depressed prices of our common stock. </FONT></P>

<P><FONT SIZE=2><B>Future issuances of common stock and hedging activities may depress the trading price of our common stock and the notes.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any issuance of equity securities after this offering, including the issuance of shares upon conversion of the notes, could dilute the interests of
our existing
stockholders, including holders who have received shares upon conversion of their notes, and could substantially decrease the trading price of our common stock and the notes. We may issue equity
securities in the future for a number of reasons, such as to finance our operations and business strategy (including in connection with acquisitions, strategic collaborations or other transactions),
to adjust our ratio of debt to equity, to satisfy our obligations upon the exercise of outstanding warrants or options or for other reasons. In addition, the price of our common stock could also be
affected by possible sales of our common stock by investors who view the notes as a more attractive means of equity participation in our company and by hedging or arbitrage trading activity that we
expect to develop involving our common stock. The hedging or arbitrage could, in turn, affect the trading price of the notes, or any common stock that holders receive upon conversion of the notes. </FONT></P>

<P><FONT SIZE=2><B>The conversion rate of the notes may not be adjusted for all dilutive events that may occur.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As described under "Description of the Notes&#151;Conversion Rights," we will adjust the conversion rate of the notes for certain events, including,
among
others, the issuance of stock or cash dividends on our common stock; the issuance of certain rights or warrants; certain subdivisions and combinations of our capital stock; the distribution of capital
stock, indebtedness or assets; and certain </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>30</FONT></P>

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<P><FONT SIZE=2>tender
or exchange offers. We will not adjust the conversion rate for other events, such as an issuance of common stock for cash or in connection with an acquisition, that may adversely affect the
trading price of the notes or our common stock. If we engage in any of these types of transactions, the value of the common stock into which your notes are convertible may be diluted. An event that
adversely affects the value of the notes, but does not result in an adjustment to the conversion rate, may occur. </FONT></P>

<P><FONT SIZE=2><B>If we pay a cash dividend on our common stock, you may be deemed to have received a taxable dividend without the receipt of any cash.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If we pay a cash dividend on our common stock, an adjustment to the conversion rate will result, and you may be deemed to have received a taxable
dividend
subject to U.S. federal income tax without having received any cash. If you are a non-U.S. holder (as defined in "Certain U.S. Federal Income Tax Considerations"), such deemed dividend may
be subject to U.S. federal withholding tax at a 30% rate or such lower rate as may be specified by an applicable treaty. If you are a non-U.S. holder, it is possible that U.S. federal tax
on the deemed dividend would be withheld from interest paid to you on the notes. See "Certain U.S. Federal Income Tax Considerations." </FONT></P>

<P><FONT SIZE=2><B>An active trading market for the notes may not develop.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes are a new issue of securities for which there is currently no public market, and no active or liquid trading market might ever develop. If
the notes
are traded after their initial issuance, they may trade at a discount from their initial offering price, depending on prevailing interest rates, the market for similar securities, the price, and
volatility in the price, of our shares of common stock, our performance and other factors. In addition, we do not know whether an active trading market will develop for the notes. To the extent that
an active trading market does not develop, the liquidity and trading prices for the notes may be harmed. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have no plans to list the notes on a securities exchange. The liquidity of any market for the notes will depend upon the number of holders of the notes, our results of operations and
financial condition, the market for similar securities, the interest of securities dealers in making a market in the notes and other factors </FONT></P>

<P><FONT SIZE=2><B>Provisions of the notes could discourage an acquisition of us by a third party.  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain provisions of the notes could make it more difficult or more expensive for a third party to acquire us. Upon the occurrence of certain
transactions
constituting a fundamental change, holders of the notes will have the right, at their option, to require us to repurchase all of their notes or any portion of the principal amount of such notes in
integral multiples of $1,000. We may also be required to issue additional shares upon conversion or provide for conversion into the acquirer's capital stock in the event of certain fundamental
changes. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>31</FONT></P>

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NAME="de77601_ratio_of_earnings_to_fixed_charges"> </A>
<A NAME="toc_de77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>RATIO OF EARNINGS TO FIXED CHARGES    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth our ratio of earnings to fixed charges on a historical basis for the periods indicated. The ratios are calculated by
dividing
earnings by the fixed charges. </FONT></P>

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<TR VALIGN="BOTTOM">
<TH WIDTH="46%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%" ROWSPAN=2><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=9 ROWSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Year Ended December&nbsp;31,</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="46%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%" ROWSPAN=2><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ROWSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Nine Months Ended<BR>
September&nbsp;30, 2007</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="46%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>2002</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>2003</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>2004</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>2005</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="46%"><FONT SIZE=2>Ratio of earnings to fixed charges(1)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
</TR>
</TABLE>
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<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>For
the purposes of computing ratio of earnings to fixed charges, earnings consist of loss before income taxes plus fixed charges. Fixed charges consist of interest charges and that
portion of rental payments under operating leases we believe to be representative of interest. Earnings for 2002, 2003, 2004, 2005, 2006 and the nine months ended September&nbsp;30, 2007 were
insufficient to cover fixed charges by $79.2&nbsp;million, $70.6&nbsp;million, $102.7&nbsp;million, $143.2&nbsp;million, $166.0&nbsp;million and $126.9&nbsp;million, respectively. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="de77601_use_of_proceeds"> </A>
<A NAME="toc_de77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>USE OF PROCEEDS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We expect to receive approximately $144.9 million from the sale of our notes in this offering, or $166.7&nbsp;million if the underwriters exercise
their
overallotment option in full, after deducting the estimated underwriting discount and offering expenses that we are to pay. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
currently intend to use the net proceeds from the sale of the notes that we may offer with this prospectus for general corporate purposes. General corporate purposes may include
funding clinical and preclinical development of existing product candidates, drug research activities, manufacture of pre-clinical, clinical and commercial drug supplies, capital
expenditures and working capital, repayment of debt and other general corporate purposes. We have not determined the amounts we plan to spend on any of the areas listed above or the timing of these
expenditures. As a result, our management will have broad discretion to allocate the net proceeds of this offering. Pending the application of the net proceeds for these purposes, we intend to invest
the net proceeds in short-term, interest-bearing, investment-grade securities. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>32</FONT></P>

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<BR></FONT><FONT SIZE=2><B>PRICE RANGE OF COMMON STOCK    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock is listed on the Nasdaq Global Market under the symbol "THRX." The following table sets forth, for the periods indicated, the range
of high and
low closing sale prices of our common stock as reported on the Nasdaq Global Market. </FONT></P>

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<TR VALIGN="BOTTOM">
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>High</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Low</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2><B>Year Ended December&nbsp;31, 2004</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Fourth Quarter (from October&nbsp;5, 2004)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
18.46</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
15.40</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><BR><FONT SIZE=2><B>Year Ended December&nbsp;31, 2005</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> First Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
18.86</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
16.53</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Second Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
18.31</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
16.55</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Third Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
21.57</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
16.98</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Fourth Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
20.86</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=2><BR><FONT SIZE=2><B>Year Ended December&nbsp;31, 2006</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> First Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
29.88</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
20.43</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Second Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
29.90</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
22.06</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Third Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
28.02</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
22.40</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Fourth Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
32.66</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
27.38</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><BR><FONT SIZE=2><B>Year Ended December&nbsp;31, 2007</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> First Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
36.74</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
29.22</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Second Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
36.81</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
28.74</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Third Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
33.13</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
24.44</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> Fourth Quarter</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
27.99</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
19.33</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=2><BR><FONT SIZE=2><B>Year Ending December&nbsp;31, 2008</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="74%"><BR><FONT SIZE=2> First Quarter (through January&nbsp;14, 2008)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
22.21</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2><BR>
19.45</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
last reported sale price of our common stock on January&nbsp;14, 2008 was $22.21 per share. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of November&nbsp;30, 2007, there were approximately 274 holders of record of our common stock. Because many of these shares are held by brokers and other institutions on behalf of
stockholders, we are unable to estimate the total number of stockholders represented by these record holders. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="de77601_dividend_policy"> </A>
<A NAME="toc_de77601_4"> </A>
<BR></FONT><FONT SIZE=2><B>DIVIDEND POLICY    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We currently intend to retain any future earnings to finance our research and development efforts. We have never declared or paid cash dividends and
do not
intend to declare or pay cash dividends on our common stock in the foreseeable future. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>33</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=2,SEQ=36,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=922867,FOLIO='33',FILE='DISK133:[08ZAA1.08ZAA77601]DE77601A.;11',USER='DNICHOL',CD='15-JAN-2008;13:14' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_dg77601_1_34"> </A> </FONT></P>

<!-- TOC_END -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dg77601_capitalization"> </A>
<A NAME="toc_dg77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>CAPITALIZATION    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table shows: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
actual capitalization as of September&nbsp;30, 2007; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
capitalization as adjusted to give effect to the issuance and sale of $150,000,000 aggregate principal amount of notes in this offering, after deducting the underwriting
discount and estimated offering expenses payable by us. </FONT></DD></DL>
</UL>
<BR>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="85%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH COLSPAN=3 ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>As of September 30, 2007</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN=3 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Actual</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>As&nbsp;Adjusted</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH COLSPAN=3 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>(in thousands, except for<BR>
share and per share data)<BR>
(unaudited)<BR> </B></FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=3><FONT SIZE=2>Cash, cash equivalents and marketable securities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>166,521</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>311,421</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=3><FONT SIZE=2><BR>
Long Term Debt:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=3><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;% convertible subordinated notes due 2015 offered hereby</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>150,000</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=3><FONT SIZE=2><BR>
Other Long-Term Obligations</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
182,372</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
182,372</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=3><FONT SIZE=2><BR>
Stockholders' equity (Net capital deficiency):</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Preferred stock, $0.01 par value, 230,000 shares authorized, no shares issued and outstanding</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>&#151;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Common stock, $0.01 par value; 200,000,000 shares authorized; 51,460,691 shares issued and outstanding</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>514</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>514</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Class A Common Stock, $0.01 par value, 30,000,000 shares authorized, 9,401,499 issued and outstanding</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>94</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>94</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Additional paid-in capital</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>863,177</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>863,177</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Accumulated other comprehensive income</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>81</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>81</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Accumulated deficit</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(904,751</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>(904,751</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><BR><FONT SIZE=2><B>Total stockholders' equity (net capital deficiency)</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
(40,885</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
(40,885</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="64%"><BR><FONT SIZE=2><B>Total Capitalization</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><BR><FONT SIZE=2><B>$</B></FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><B><BR>
141,487</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><B><BR>&nbsp;</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><B><BR>$</B></FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><B><BR>
291,387</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><B><BR>&nbsp;</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
number of shares in the table above excludes: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>an
aggregate of 13,449,227 shares of common stock subject to outstanding options and restricted stock unit awards under our 2004 Equity Incentive Plan, 1997 Stock Plan and
the Long-term Stock Option Plan, at a weighted average price of $18.85;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>an
additional 1,029,041 shares of common stock reserved for future stock option grants or purchases as of September&nbsp;30, 2007 under our 2004 Equity Incentive Plan and
Amended and Restated 2004 Employee Stock Purchase Plan; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>18,064
shares of common stock issuable upon exercise of outstanding warrants with a weighted average exercise price of $1.94 per share. The outstanding warrant was not
exercised as of its expiration date of October&nbsp;5, 2007 and therefore no stock was or will be issued under the warrant. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>34</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=37,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=709008,FOLIO='34',FILE='DISK133:[08ZAA1.08ZAA77601]DG77601A.;10',USER='GMEDINA',CD='15-JAN-2008;00:41' -->
<A NAME="page_dg77601_1_35"> </A>
<UL>
<UL>
</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dg77601_description_of_the_notes"> </A>
<A NAME="toc_dg77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>DESCRIPTION OF THE NOTES    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will issue the notes under the indenture, to be dated as of January&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2008, between Theravance,&nbsp;Inc., as issuer,
and The Bank of
New York Trust Company, N.A., as trustee. As used in this description of the notes, the words "our company," "we," "us," "our" or "Theravance" refer only to Theravance,&nbsp;Inc. and do not include
any of our current or future subsidiaries. We have summarized the material provisions of the notes below. The following description is not complete and is subject to, and qualified by reference to,
all of the provisions of the indenture and the notes, which we urge you to read because they define your rights as a holder. A copy of the indenture, including a form of the notes, is available as
described under "Where You Can Find More Information." </FONT></P>

<P><FONT SIZE=2><B>General  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes will be general unsecured subordinated obligations of Theravance. The notes are limited to $150,000,000 aggregate principal amount
($172,500,000
aggregate principal amount if the underwriters exercise their overallotment option in full). The notes will mature on January&nbsp;15, 2015. The notes will be issued in denominations of $1,000 or in
integral multiples of $1,000. The notes will be payable at the principal corporate trust office of the paying agent, which initially will be an office or agency of the trustee. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
notes bear cash interest at the rate of&nbsp;&nbsp;&nbsp;&nbsp;% per year on the principal amount from the issue date, or from the most recent date to which interest has been paid or
provided for. Interest will be payable semiannually in arrears on January&nbsp;15 and July&nbsp;15 of each year, beginning on July&nbsp;15, 2008, to holders of record at the close of business on
the January&nbsp;1 or the July&nbsp;1 immediately preceding such interest payment date. Each payment of cash interest on the notes will include interest accrued for the period commencing on and
including the immediately preceding interest payment date, provided that the first interest payment on July&nbsp;15, 2008, will include interest from January&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2008 through the
day before the applicable interest payment date (or purchase date, as the case may be). Any payment required to be
made on any day that is not a business day will be made on the next succeeding business day. Interest will be calculated using a 360-day year composed of twelve 30-day months.
A "business day" is any weekday that is not a day on which banking institutions in New York, New York are authorized or obligated to close. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest
will cease to accrue on a note upon its maturity, conversion, redemption or purchase by us at the option of a holder. We may not reissue a note that has matured or been
converted, has been redeemed by us at our option or purchased by us at your option or otherwise cancelled, except for registration of transfer, exchange or replacement of such note. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes
may be presented for conversion at the office of the conversion agent and for exchange or registration of transfer at the office of the registrar. The conversion agent and the
registrar shall initially be the trustee. No service charge will be made for any registration of transfer or exchange of notes. However, we may require the holder to pay any tax, assessment or other
governmental charge payable as a result of such transfer or exchange. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
indenture does not contain any financial covenants or any restrictions on the payment of dividends, the incurrence of senior indebtedness (as defined below) or other indebtedness or
the issuance or repurchase of securities by us. The indenture does not contain any covenants or other provisions to protect holders of the notes in the event of a highly leveraged transaction or a
change of control, except to the extent described under "&#151;Fundamental Change Permits Holders to Require Us to Purchase Notes" and "&#151;Make-Whole Premium Upon Certain
Fundamental Changes" below. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>35</FONT></P>

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<P><FONT SIZE=2><B>Subordination of Notes  </B></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Ranking  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes will be our general unsecured obligations and will be: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>subordinated
in right of payment, as provided in the indenture, to the prior payment in full of all of our existing and future senior indebtedness,
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>equal
in right of payment with all of our existing and future subordinated indebtedness,
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effectively
subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing that indebtedness, and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effectively
subordinated to all existing and future indebtedness and other liabilities of our subsidiaries. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
payment of the principal of, premium, if any, and any interest amount on the notes is subordinated to the prior payment in full, in cash or other payment satisfactory to the holders
of senior indebtedness, of all existing and future senior indebtedness. If we dissolve, wind-up, liquidate or reorganize, or if we are the subject of any bankruptcy, insolvency,
receivership or similar proceedings, we will pay the holders of senior indebtedness in full in cash or other payment satisfactory to the holders of senior indebtedness before we pay the holders of the
notes. If the notes are accelerated because of an event of default under the indenture we must pay the holders of senior indebtedness in full all amounts due and owing thereunder before we pay the
note holders. The indenture will require that we must promptly notify holders of senior indebtedness if payment of the notes is accelerated because of an event of default under the indenture. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may not make any payment on the notes or purchase or otherwise acquire the notes if: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
default in the payment of any senior indebtedness occurs and is continuing beyond any applicable period of grace; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
other default of designated senior indebtedness occurs and is continuing that permits holders of the designated senior indebtedness to accelerate its maturity and the
trustee receives a payment blockage notice from the Company or other person permitted to give such notice under the indenture. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are required to resume payments on the notes: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
case of a payment default of senior indebtedness, upon the date on which such default is cured or waived or ceases to exist; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
case of a nonpayment default of designated senior indebtedness, the earlier of the date on which such nonpayment default is cured or waived or ceases to exist or
179&nbsp;days after the date on which the payment blockage notice is received. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
new period of payment blockage may be commenced for a default unless: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>at
least 365&nbsp;days have elapsed since our receipt of the prior payment blockage notice; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>all
scheduled payments on the notes that have come due have been paid in full in cash. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
nonpayment default that existed or was continuing on the date of delivery of any payment blockage notice shall be the basis for a subsequent payment blockage notice. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a result of these subordination provisions, in the event of our bankruptcy, dissolution or reorganization, holders of senior indebtedness may receive more, ratably, and holders of
the notes may receive less, ratably, than our other creditors. These subordination provisions will not prevent the occurrence of any event of default under the indenture. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>36</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
either the trustee or any holder of notes receives any payment or distribution of our assets in contravention of these subordination provisions before all senior indebtedness is paid
in full, then such
payment or distribution will be held by the recipient in trust for the benefit of holders of senior indebtedness to the extent necessary to make payment in full of all senior indebtedness remaining
unpaid. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
notes are exclusively obligations of Theravance. Our subsidiaries are separate and distinct legal entities. Our existing subsidiaries and any future subsidiaries will not guarantee
the notes or have any obligation to pay any amounts due on the notes or to provide us with funds for our payment obligations, whether by dividends, distributions, loans or other payments. In addition,
any payment of dividends, distributions, loans or advances by our subsidiaries to us could be subject to statutory or contractual restrictions. Payments to us by our subsidiaries will also be
contingent upon our subsidiaries' earnings and business considerations. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
right to receive any assets of our existing subsidiaries and any future subsidiaries upon their liquidation or reorganization, and therefore, our right to participate in those
assets, will be structurally subordinated to the claims of our subsidiaries' creditors, including trade creditors. In addition, even if we were a creditor of any of our subsidiaries, our rights as a
creditor would be subordinate to any security interest in the assets of our subsidiaries and any indebtedness of our subsidiaries senior to that held by us. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of September&nbsp;30, 2007, we had no outstanding senior indebtedness as defined in the indenture, nor any secured indebtedness or subordinated indebtedness. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, as of September&nbsp;30, 2007, our subsidiaries had no indebtedness outstanding (excluding intercompany indebtedness). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
we nor our subsidiaries are limited from incurring senior indebtedness or additional debt under the indenture. If we incur additional debt, our ability to pay our obligations on
the notes could be affected. We expect from time to time to incur additional indebtedness and other liabilities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are obligated to pay reasonable compensation to the trustee. We will indemnify the trustee against any losses, liabilities or expenses incurred by it in connection with its duties.
The trustee's claims for such payments will be senior to the claims of the note holders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>designated senior indebtedness</I></FONT><FONT SIZE=2>" means our obligations under any particular senior indebtedness in which the instrument creating or
evidencing the same or the assumption or guarantee thereof (or any related agreements or documents to which we are a party) expressly provides that such indebtedness is "designated senior
indebtedness" for purposes of the indenture (provided that such instrument, agreement or other document may place limitations and conditions on the right of such senior indebtedness to exercise the
rights of designated senior indebtedness). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>indebtedness</I></FONT><FONT SIZE=2>" means, without duplication: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>all
of our indebtedness, obligations and other liabilities (contingent or otherwise) for borrowed money (including obligations in respect of overdrafts, foreign exchange contracts,
currency exchange agreements, interest rate protection agreements and any loans or advances from banks, whether or not evidenced by notes or similar instruments) or evidenced by credit or loan
agreements, bonds, debentures, notes or similar instruments (whether or not the recourse of the lender is to the whole of our assets or to only a portion thereof), other than any trade accounts
payable or other accrued current expense incurred in the ordinary course of business in connection with the obtaining of materials or services;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>all
of our reimbursement obligations and other liabilities (contingent or otherwise) with respect to letters of credit, bank guarantees or bankers' acceptances; </FONT></DD></DL>
</UL>
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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>all
of our obligations and liabilities (contingent or otherwise):
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>in
respect of leases required, in conformity with generally accepted accounting principles, to be accounted for as capitalized lease obligations on our balance sheet,
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>as
lessee under other leases for facilities equipment (and related assets leased together therewith), whether or not capitalized, entered into or leased for financing purposes (as
determined by us), or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>under
any lease or related document (including a purchase agreement) in connection with the lease of real property or improvements (or any personal property included as part of any
such lease) that provides that we are contractually obligated to purchase or cause a third party to purchase the leased property and thereby guarantee a minimum residual value of the leased property
to the lessor and all of our obligations under such lease or related document to purchase or to cause a third party to purchase such leased property (whether or not such lease transaction is
characterized as an operating lease or a capitalized lease in accordance with generally accepted accounting principles);
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>all
of our obligations (contingent or otherwise) with respect to an interest rate, currency or other swap, cap, floor or collar agreement, hedge agreement, forward contract, or other
similar instrument or foreign currency hedge, exchange, purchase or similar instrument or agreement;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(5)</FONT></DT><DD><FONT SIZE=2>all
of our direct or indirect guarantees, agreements to be jointly liable or similar agreements in respect of, and obligations or liabilities (contingent or otherwise) to purchase or
otherwise acquire or otherwise assure a creditor against loss in respect of, indebtedness, obligations or liabilities of another person of the kind described in clauses&nbsp;(1) through (4);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(6)</FONT></DT><DD><FONT SIZE=2>any
indebtedness or other obligations described in clauses (1)&nbsp;through (5)&nbsp;secured by any mortgage, pledge, lien or other encumbrance existing on property which is owned
or held by us, regardless of whether the indebtedness or other obligation secured thereby shall be assumed by us; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(7)</FONT></DT><DD><FONT SIZE=2>any
and all deferrals, renewals, extensions and refundings of, or amendments, modifications or supplements to, any indebtedness, obligation or liability of the kind described in
clauses&nbsp;(1) through (6). </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>senior indebtedness</I></FONT><FONT SIZE=2>" means the principal of, premium, if any, interest (including all interest accruing subsequent to the commencement
of any bankruptcy or similar proceeding, whether or not a claim for postpetition interest is allowable as a claim in any such proceeding) and rent payable on or in connection with, and all fees,
costs, expenses and other amounts accrued or due on or in connection with, indebtedness of Theravance, whether secured or unsecured, absolute or contingent, due or to become due, outstanding on the
date of the indenture or thereafter created, incurred, assumed, guaranteed or in effect guaranteed by Theravance, including all deferrals, renewals, extensions or refundings of, or amendments,
modifications or supplements to, the foregoing, unless in the case of any particular indebtedness the instrument creating or evidencing the same or the assumption or guarantee thereof expressly
provides that such indebtedness shall not be senior in right of payment to the notes or </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>38</FONT></P>

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<P><FONT SIZE=2>expressly
provides that such indebtedness is on the same basis or junior to the notes. Senior indebtedness does not include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>indebtedness
that expressly provides that such indebtedness shall not be senior in right of payment to the notes or expressly provides that such indebtedness is on the same basis or
junior in right of payment to the notes;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>indebtedness
that is expressly subordinated to any senior indebtedness;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>indebtedness
subordinated by operation of law;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>our
trade payables and accrued expenses (including, without limitation, accrued compensation and accrued restructuring charges) or deferred purchase price for goods, services or
materials purchased or provided in the ordinary course of business;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(5)</FONT></DT><DD><FONT SIZE=2>lease
obligations other than those described in clause&nbsp;(3) under the definition of "indebtedness" above;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(6)</FONT></DT><DD><FONT SIZE=2>any
indebtedness of Theravance to or among any of its subsidiaries; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(7)</FONT></DT><DD><FONT SIZE=2>any
obligation for federal, state, local or other taxes. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Optional Redemption  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No sinking fund is provided for the notes. Prior to January&nbsp;15, 2012, the notes will not be redeemable. On or after January&nbsp;15, 2012 and
prior to
the maturity date, we may redeem for cash all or part of the notes if the last reported sale price of our common stock has been greater than or equal to 130% of the conversion price then in effect for
at least 20 trading days during any 30 consecutive trading day period prior to the date on which we provide notice of redemption. The redemption price will equal 100% of the principal amount of the
notes being redeemed, plus accrued and unpaid interest to but excluding the redemption date, except as described below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
"last reported sale price" of our common stock on any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and ask prices or,
if more than one in either case, the average of the average bid and the average asked prices) on that date as reported in composite transactions for the principal U.S. national or regional securities
exchange on which our common stock is listed for trading. If our common stock is not listed for trading on a U.S. national or regional securities exchange on the relevant date, the "last reported sale
price" will be the last quoted bid price for our common stock in the over-the-counter market on the relevant date as reported by the National Quotation Bureau or similar
organization. If our common stock is not so quoted, the "last reported sale price" will be the average of the mid-point of the last bid and ask prices for our common stock on the relevant
date from each of at least three nationally recognized independent investment banking firms selected by us for this purpose. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will give notice of redemption not less than 30 nor more than 60&nbsp;days before the redemption date by mail to the trustee, the paying agent and each holder of notes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the redemption date falls after a record date and on or prior to the corresponding interest payment date, we will pay, on the regular interest payment date, the full amount of
accrued and unpaid interest payable, if any, due on such interest payment date to the holder of record at the close of business on the corresponding record date, and not to a holder submitting the
notes for redemption. We will make at least eight semiannual interest payments (including the interest payments on July&nbsp;15, 2008, and January&nbsp;15, 2012) in the full amount required by the
indenture before we can redeem the notes at our option. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may not redeem any notes unless all accrued and unpaid interest thereon has been or is simultaneously paid for all semiannual periods or portions thereof terminating prior to the
redemption date. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>39</FONT></P>

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<P><FONT SIZE=2><A
NAME="page_di77601_1_40"> </A> </FONT> <FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If we decide to redeem fewer than all of the outstanding notes, the trustee will select the notes to be redeemed (in principal amounts of $1,000 or integral multiples
thereof) by lot,
or on a pro rata basis or by another method the trustee considers fair and appropriate. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the trustee selects a portion of your notes for partial redemption and you convert a portion of your notes, the converted portion will be deemed to be from the portion selected for
redemption. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With
respect to any notes we have called for redemption, we will not be required to issue, register the transfer of or convert any notes after the close of business on the business day
immediately preceding the redemption date, unless we default in the payment of the redemption price. </FONT></P>


<P><FONT SIZE=2><B>Conversion Rights  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders may convert their notes into shares of our common stock prior to the close of business on the business day immediately preceding the stated
maturity date
based on an initial conversion rate of&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share). The
conversion rate will be subject to adjustment as described below. If a holder has already delivered a fundamental change purchase notice as described under "&#151;Fundamental Change Permits
Holders to Require Us to Purchase Notes" with respect to a note, however, the holder may not surrender that note for conversion until the holder has withdrawn the purchase notice in accordance with
the indenture. A holder may convert fewer than all of such holder's notes so long as the notes converted are an integral multiple of $1,000 principal amount. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
holder of a note otherwise entitled to a fractional share will receive cash equal to the applicable portion of the closing price of our common stock for the trading day immediately
preceding the conversion date. As used in this Description of the Notes, all references to our common stock are to our common stock, par value $0.01. See "Description of Capital Stock" below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
ability to surrender notes for conversion will expire at the close of business on the business day immediately preceding the stated maturity date. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
convert interests in a global note, the holder must deliver to DTC the appropriate instruction form for conversion pursuant to DTC's then applicable conversion program procedures. To
convert a certificated note, a holder must: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complete
and manually sign a conversion notice, a form of which is on the back of the note, and deliver the conversion notice to the conversion agent;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>surrender
the note to the conversion agent;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
required by the conversion agent, furnish appropriate endorsements and transfer documents; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
required, pay all transfer or similar taxes. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
conversion of a note, a holder will not receive, except as described below, any cash payment representing any accrued interest. Instead, accrued interest will be deemed paid by the
shares of common stock (or any cash in lieu thereof) received by the holder on conversion. Delivery to the holder of the full number of shares of common stock into which the note is convertible,
together with any cash payment of such holder's fractional shares, will thus be deemed: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
satisfy our obligation to pay the principal amount of a note; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
satisfy our obligation to pay accrued and unpaid interest. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>We
will deliver the shares (and cash in lieu of fractional shares) due upon conversion no later than three business days after the conversion date. Delivery of shares of common stock will be
accomplished by delivery to the conversion agent of certificates for the required number of shares, other than in the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>40</FONT></P>

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<P><FONT SIZE=2>case
of holders of notes in book entry form with DTC, which shares shall be delivered in accordance with DTC's customary practices. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a result, accrued interest is deemed paid in full rather than cancelled, extinguished or forfeited. If a holder surrenders a note for conversion during the period from the close of
business on any regular record date next preceding any interest payment date to the opening of business on such interest payment date, then, despite the conversion, we will, on the interest payment
date, pay the semiannual interest payable on such note to the person who was the record holder of the note at the close of business on the record date. Such notes, upon surrender to us for conversion,
must be accompanied by funds equal to the amount of interest payable on the notes so converted, provided that no such payment need be made: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
connection with any conversion following the regular record date immediately preceding the final interest payment date;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
we have specified a fundamental change purchase date that is after a record date and on or prior to the business day following the corresponding interest payment date;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
connection with any conversion of notes that have been called by us for redemption and in respect of which we have specified a redemption date that is after a record date
but on or prior to the corresponding interest payment date; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
the extent of any overdue interest, if any overdue interest exists at the time of conversion with respect to such note. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
conversion rate will not be adjusted for accrued interest. For a discussion of the U.S. federal income tax treatment of a holder receiving shares of our common stock, upon
surrendering notes for conversion, see "Certain U.S. Federal Income Tax Considerations." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will adjust the conversion rate for certain events, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>the
issuance of our common stock as a dividend or distribution on our common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>certain
subdivisions and combinations of our common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>the
issuance to all or substantially all holders of our common stock of certain rights or warrants entitling them for a period expiring within 45&nbsp;days of such issuance to
purchase our common stock, or securities convertible into our common stock, at less than, or having a conversion price per share less than, the then current market price of our common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>the
dividend or other distribution to all or substantially all holders of our common stock of shares of our capital stock, other than common stock, or evidences of our indebtedness or
our assets, including securities, but excluding those rights and warrants referred to above and dividends and distributions in connection with a reclassification, consolidation, merger, combination,
sale or conveyance resulting in a change in the conversion consideration, or pursuant to any stockholder rights plan or dividends or distributions paid exclusively in cash;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(5)</FONT></DT><DD><FONT SIZE=2>dividends
or other distributions consisting exclusively of cash to all or substantially all holders of our common stock, in which case the conversion rate will be adjusted by
multiplying the conversion rate by a fraction, (i)&nbsp;the numerator of which will be the average of the last reported sale prices of our common stock for the ten trading days prior to the date on
which "ex-dividend trading" commences for such dividend or distribution, and (ii)&nbsp;the denominator of which will be the difference between (A)&nbsp;such average price of our common
stock and (B)&nbsp;the amount in cash per share of such distribution; and </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>41</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(6)</FONT></DT><DD><FONT SIZE=2>payments
to holders in respect of a tender offer or exchange offer for our common stock by us or any of our subsidiaries to the extent that the cash and fair market value of any other
consideration included in the payment per share exceeds the closing price of our common stock on the trading day following the last date on which tenders or exchanges may be made pursuant to such
tender offer or exchange offer. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event that we pay a dividend or make a distribution on our common stock consisting of capital stock of, or similar equity interests in, a subsidiary or other business unit of
ours, the conversion rate will be adjusted, unless we make an equivalent distribution to holders of notes, based on the market value of the securities so distributed relative to the market value of
our common stock, in each case based on the average closing prices of those securities for the 10 trading days commencing on the date on which "ex-dividend trading" commences for such
dividend or distribution on the Nasdaq Global Market or such other national or regional exchange or market on which the securities are then listed or quoted. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, the indenture will provide that upon conversion of the notes, holders will receive the rights related to such common stock pursuant to our stockholder rights plan, whether
or not such rights have separated from the common stock at the time of such conversion to the extent such rights remain in place at such time. However, in the case of our existing stockholder rights
plan and any future rights plan that so provides, there will not be any adjustment to the conversion privilege or conversion rate as a result of: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
issuance of such rights;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
distribution of separate certificates representing such rights;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
exercise or redemption of such rights in accordance with any rights agreement; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
termination or invalidation of such rights. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, if a holder of notes exercising its right of conversion after the distribution of rights pursuant to any such rights plan in effect at the time of such
conversion is not entitled to receive the rights that would otherwise be attributable (but for the date of conversion) to
the shares of common stock to be received upon such conversion, if any, the conversion rate will be adjusted as though the rights were being distributed to holders of common stock on the date the
rights become separable from such stock. If such an adjustment is made and such rights are later redeemed, repurchased, invalidated or terminated, then a corresponding reversing adjustment will be
made to the conversion rate on an equitable basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the case of the following events (each, a "business combination"): </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
recapitalization, reclassification or change of our common stock, other than changes resulting from a subdivision or combination;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
consolidation, merger or combination involving us;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
sale, conveyance or lease to another corporation of all or substantially all of our property and assets, other than to one or more of our subsidiaries; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
statutory share exchange, </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>in
each case as a result of which holders of our common stock are entitled to receive stock, other securities, other property or assets (including cash or any combination thereof) with respect to or
in exchange for our common stock, the holders of the notes then outstanding will be entitled thereafter to convert those notes into the kind and amount of shares of stock, other securities or other
property or assets (including cash or any combination thereof) which they would have owned or been entitled to receive upon such business combination had such notes been converted into our common
stock </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>42</FONT></P>

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<P><FONT SIZE=2>immediately
prior to such business combination, except that such holders will not receive a make-whole premium if such holder does not convert its notes "in connection with" the relevant
fundamental change. In the event holders of our common stock have the opportunity to elect the form of consideration to be received in such business combination, the notes will be convertible into the
weighted average of the kind and amount of consideration received by the holders of our common stock that affirmatively make such an election. We may not become a party to any such transaction unless
its terms are consistent with the preceding. None of the foregoing provisions shall affect the right of a holder of notes to convert its notes into shares of our common stock prior to the effective
date of the business combination. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
indenture permits us to increase the conversion rate, to the extent permitted by law, for any period of at least 20&nbsp;days. In that case we will give at least 15&nbsp;days'
notice of such increase. We may also make such increase in the conversion rate, in addition to those set forth above, as our board of directors deems advisable to avoid or diminish any income tax to
holders of our common stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
U.S. federal income tax purposes, adjustments to the conversion rate (or failures to make such adjustments) that have the effect of increasing the holders' proportionate interests
in our assets or earnings may in some circumstances result in a taxable deemed distribution to the holders. See "Certain U.S. Federal Income Tax Considerations." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will not be required to adjust the conversion rate unless the adjustment would result in a change of at least 1% of the conversion rate. However, we will carry forward any
adjustments that are less than 1% of the conversion rate and take them into account when determining subsequent adjustments. We will also adjust for any carry forward amount upon conversion regardless
of the 1% threshold. We will not make any adjustments if holders of notes are permitted, by virtue of their ownership of the notes, to participate in the transactions described above in clauses
(1)&nbsp;through (6)&nbsp;that would otherwise require adjustment of the conversion rate. Except as stated above, the conversion rate will not be adjusted for the issuance of our common stock or
any securities convertible into or exchangeable for our common stock or carrying the right to purchase our common stock or any such security. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, in no event shall the conversion rate as adjusted in accordance with the foregoing exceed&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares per $1,000 principal amount of notes,
other than on account of adjustments to the conversion rate in the manner set forth in clauses (1)&nbsp;through (6)&nbsp;above. </FONT></P>

<P><FONT SIZE=2><B>Fundamental Change Permits Holders to Require Us to Purchase Notes  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a fundamental change occurs, each holder of notes will have the right to require us to repurchase all or any portion of that holder's notes that is
equal to
$1,000 or an integral multiple of $1,000, on the date fixed by us, which we refer to as the fundamental change purchase date, that is not less than 30 nor more than 45&nbsp;days after the date we
give notice of the fundamental change, at a fundamental change purchase price equal to 100% of the principal amount of the notes to be repurchased, together with interest accrued and unpaid to, but
excluding, the fundamental change purchase date. If such purchase date is after a record date but on or prior to an interest payment date, however, then the interest payable on such date will be paid
to the holder of record of the notes on the relevant record date. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
least 20 days prior to the anticipated effective date of a fundamental change, if practicable, but in any case as promptly as practicable, we are required to give notice to all
holders of notes, as provided in the indenture, of the occurrence of the fundamental change and of their resulting repurchase right. We must also deliver a copy of our notice to the trustee. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>43</FONT></P>

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<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to exercise the repurchase right upon a fundamental change, a holder must deliver prior to the purchase date a fundamental change purchase notice stating among other things: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
certificated notes have been issued, the certificate numbers of the notes to be delivered for purchase;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
portion of the principal amount of notes to be purchased, in integral multiples of $1,000; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the notes are to be purchased by us pursuant to the applicable provisions of the notes and the indenture. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the notes are not in certificated form, a holder's fundamental change purchase notice must comply with appropriate DTC procedures. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
holder may withdraw any fundamental change purchase notice by a written notice of withdrawal delivered to the paying agent prior to the close of business on the business day prior to
the fundamental change purchase date. The notice of withdrawal must state: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
principal amount of the withdrawn notes;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
certificated notes have been issued, the certificate numbers of the withdrawn notes; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
principal amount, if any, of the notes which remains subject to the fundamental change purchase notice. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with any purchase offer in the event of a fundamental change, we will, if required: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>comply
with the provisions of Rule&nbsp;13e-4, Rule&nbsp;14e-1, and any other tender offer rules under the Securities Exchange Act of 1934, or
the Exchange Act, which may then be applicable; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>file&nbsp;a
Schedule TO or any other required schedule under the Exchange Act. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment
of the fundamental change purchase price for a note for which a fundamental change purchase notice has been delivered and not validly withdrawn is conditioned upon delivery of
the note,
together with necessary endorsements, to the paying agent at any time after delivery of such fundamental change purchase notice. Payment of the fundamental change purchase price for the note will be
made promptly following the later of the fundamental change purchase date or the time of delivery of the note. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the paying agent holds money or securities sufficient to pay the fundamental change purchase price of the note in accordance with the terms of the indenture, then, on the business
day following the fundamental change purchase date, the note will cease to be outstanding and interest on such note will cease to accrue, whether or not the note is delivered to the paying agent.
Thereafter, all other rights of the holder will terminate, other than the right to receive the fundamental change purchase price upon delivery of the note. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
"fundamental change" will be deemed to have occurred upon a change of control or a termination of trading, each as defined below, after the original issuance of the notes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
"change of control" will be deemed to have occurred at such time after the original issuance of the notes when the following has occurred: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>the
acquisition by any person of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of transactions of shares of our
capital stock entitling that person to exercise 50% or more of the total voting power of all </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>44</FONT></P>

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<UL>
<UL>

<P><FONT SIZE=2>shares
of our capital stock entitled to vote generally in elections of directors, other than any acquisition by us, any of our subsidiaries or any of our employee benefit plans; or </FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>our
consolidation or merger with or into any other person, any merger of another person into us, any reclassification or recapitalization, or any conveyance, transfer, sale, lease or
other disposition of all or substantially all of our properties and assets to another person other than to one or more of our wholly owned subsidiaries, other than:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
transaction:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of our capital stock, and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>pursuant
to which holders of our capital stock immediately prior to the transaction have the entitlement to exercise, directly or indirectly, 50% or more of the total voting
power of all shares of our capital stock entitled to vote generally in the election of directors of the continuing or surviving person immediately after the transaction; or
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>any
merger solely for the purpose of changing our jurisdiction of incorporation and resulting in a reclassification, conversion or exchange of outstanding shares of common
stock solely into shares of common stock of the surviving entity; or
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>during
any consecutive two-year period, individuals who at the beginning of that two-year period constituted our board of directors, together with any new
directors whose election to our board of directors, or whose nomination for election by our stockholders, was approved by a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of our board of directors then in
office; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>our
stockholders pass a resolution approving a plan of liquidation or dissolution. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, it will not constitute a change of control if at least 90% of the consideration for the common stock (excluding cash payments for fractional shares and
cash payments made in respect of dissenters' appraisal rights) in the transaction or transactions constituting the change of control consists of common stock or American Depositary Shares representing
shares of common stock traded on a U.S. national securities exchange, or which will be so traded or quoted when issued or exchanged in connection with the change of control, and as a result of such
transaction or transactions the notes become convertible solely into such consideration; provided that, with respect to an entity organized under the laws of a jurisdiction outside the United States,
such entity has a worldwide total market capitalization (calculated in U.S. dollars) of its equity securities of at least two times the market capitalization of us before giving effect to the
consolidation or merger. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
"termination of trading" means the termination (but not the temporary suspension) of trading of our common stock, which will be deemed to have occurred if our common stock or other
common stock into which the notes are convertible is neither listed for trading on a United States national securities exchange nor approved for listing on any United States system of automated
dissemination of quotations of securities prices, or traded in over-the-counter securities
markets, and no American Depositary Shares or similar instruments for such common stock are so listed or approved for listing in the United States. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of the foregoing, beneficial ownership shall be determined in accordance with Rule&nbsp;13d-3 promulgated by the SEC under the Exchange Act. The term "person"
includes any syndicate or group which would be deemed to be a "person" under Section&nbsp;13(d)(3) of the Exchange Act. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>45</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rule&nbsp;13e-4
under the Exchange Act requires the dissemination of certain information to security holders if an issuer tender offer occurs and may apply if the
repurchase option becomes available to holders of the notes. We will comply with this rule to the extent applicable at that time. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
may, to the extent permitted by applicable law, at any time purchase the notes in the open market or by tender at any price or by private agreement. Any note so purchased by us may,
to the extent permitted by applicable law, be reissued or resold or may be surrendered to the trustee for cancellation. Any notes surrendered to the trustee may not be reissued or resold and will be
canceled promptly. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
notes may be purchased by us at the option of holders upon the occurrence of a fundamental change if there has occurred and is continuing an event of default with respect to the
notes, other than a default in the payment of the fundamental change purchase price with respect to the notes. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
preceding provisions would not necessarily protect holders of the notes if highly leveraged or other transactions involving us occur that may adversely affect holders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
ability to repurchase notes upon the occurrence of a fundamental change is subject to important limitations. The occurrence of a fundamental change could cause an event of default
under, or be prohibited or limited by, the terms of future debt. Further, we may not have the financial resources, or be able to arrange financing, to pay the repurchase price for all the notes that
might be delivered by holders of notes seeking to exercise the repurchase right. Any failure by us to repurchase the notes when required following a fundamental change would result in an event of
default under the indenture. Any such default may, in turn, cause a default under future debt. </FONT></P>

<P><FONT SIZE=2><B>Make-Whole Premium Upon Certain Fundamental Changes  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you convert your notes in connection with a change of control event defined in clauses (1)&nbsp;or (2)&nbsp;of such definition, we will pay, to the
extent
described below, a make-whole premium by issuing additional shares of common stock upon conversion of the notes if and as required below. A conversion of the notes by a holder will be
deemed for these purposes to be "in connection with" a fundamental change if the conversion notice is received by the conversion agent on or subsequent to the date ten trading days prior to the date
announced by us as the anticipated effective date of the fundamental change but before the close of business on the business day immediately preceding the related fundamental change purchase date or
ten trading days after the actual effective date of the fundamental change, if later. Any make-whole premium will be in addition to, and not in substitution for, any securities, cash or
other assets otherwise due to holders of notes upon conversion. Any make-whole premium will be determined by reference to the table below and is based on the date on which the fundamental
change becomes effective, which we refer to as the "effective date," and the price, which we refer to as the "stock price," paid, or deemed to be paid, per share of our common stock in the transaction
constituting the fundamental change, subject to adjustment as described below. If holders of our common stock receive only cash in the fundamental change, the stock price shall be the cash amount paid
per share of our common stock. In all other cases, the stock price shall be the average of the closing prices of our common stock for each of the ten trading days immediately prior to but not
including the effective date. The following table shows what the make-whole premium would be for each hypothetical stock price and effective date set forth below, expressed as additional
shares of common stock per $1,000 principal amount of notes. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>46</FONT></P>

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<P style='page-break-before:always'></p>
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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_dk77601_1_47"> </A> </FONT> <FONT SIZE=2><B>Make-Whole Premium Upon Certain Fundamental Changes (Number of Additional Shares)  </B></FONT></P>

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<TH COLSPAN=14 ALIGN="CENTER"><FONT SIZE=1><B>Effective Date</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="12%" ALIGN="LEFT"><FONT SIZE=1><B>Stock Price on Effective Date<BR> </B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="14%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,<BR>
2008</B></FONT><HR NOSHADE></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2009</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2010</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2011</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2012</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2013</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2014</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>January&nbsp;15,<BR>
2015</B></FONT><HR NOSHADE></TH>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
hypothetical stock prices and additional shares set forth above are based on certain assumptions and are for illustrative purposes only. The final applicable stock prices and
additional shares will be set forth in the final prospectus and may differ from those set forth above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
actual stock price and effective date may not be set forth on the table, in which case: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
the actual stock price on the effective date is between two stock prices on the table or the actual effective date is between two effective dates on the table, the
make-whole premium will be determined by a straight-line interpolation between the make-whole premiums set forth for the two stock prices and the two effective
dates on the table based on a 365-day year, as applicable;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
the stock price on the effective date exceeds $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share, subject to adjustment as described below, no make-whole premium will be paid; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
the stock price on the effective date is less than $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share, subject to adjustment as described below, no make-whole premium will be paid. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
stock prices set forth in the first column of the table above will be adjusted as of any date on which the conversion rate of the notes is adjusted. The adjusted stock prices will
equal the stock prices applicable immediately prior to such adjustment multiplied by a fraction, the numerator of which is the conversion rate immediately prior to the adjustment giving rise to the
stock price adjustment and the denominator of which is the conversion rate as so adjusted. The number of additional shares set forth in the table above will be adjusted in the same manner as the
conversion rate as set forth above under "&#151;Conversion Rights," other than by operation of an adjustment to the conversion rate by adding the make-whole premium as described
above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, in no event will the conversion rate exceed&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per $1,000 principal amount of notes, subject to adjustments in the same manner as the
conversion rate. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>47</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
additional shares delivered to satisfy our obligations to holders that convert their notes in connection with a fundamental change will be delivered upon the later of the settlement
date for the conversion and promptly following the effective date of the fundamental change transaction. </FONT></P>

<P><FONT SIZE=2><B>Reporting Obligations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will deliver to the trustee all reports and other information and documents which we are required to file with the SEC pursuant to Section&nbsp;13
or 15(d)
of the Exchange Act, including our Annual Report on Form&nbsp;10-K and our Quarterly Reports on Form&nbsp;10-Q within 15&nbsp;days after we file such reports with the
SEC. In the event we are at any time no longer subject to the reporting requirements of Section&nbsp;13 or 15(d) of the Exchange Act, we shall continue to provide the trustee with reports containing
substantially the same information as would have been required to be filed with the SEC had we continued to have been subject to such reporting requirements. In such event, such reports will be
provided at the times we would have been required to provide reports had we continued to have been subject to such reporting requirements. We will comply with the other provisions of
Section&nbsp;314(a) of the Trust Indenture Act. Furthermore, within 90&nbsp;days after the end of each fiscal year, we will deliver to the trustee an officer's certificate stating whether the
signatory knows of any default or event of default under the indenture, and describe any default or event of default and the efforts to remedy the same. </FONT></P>

<P><FONT SIZE=2><B>Events of Default and Acceleration  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following are events of default under the indenture: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>default
in the payment of any principal amount, redemption price, or fundamental change purchase price due with respect to the notes, when the same becomes due and payable,
whether or not such payment is prohibited by the subordination provisions of the indenture;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>default
in payment of any interest under the notes, which default continues for 30&nbsp;days, whether or not such payment is prohibited by the subordination provisions of
the indenture;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>default
in the delivery when due of shares of common stock, including any make-whole premium, and any cash payable upon conversion with respect to the notes,
which default continues for ten&nbsp;days;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
failure to comply with any of our other agreements in the notes or the indenture upon our receipt of notice of such default from the trustee or from holders of not less
than 25% in aggregate principal amount of the notes, and the failure to cure (or obtain a waiver of) such default within 75&nbsp;days after receipt of such notice;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>default
in the payment of principal by the end of any applicable grace period or resulting in acceleration of other indebtedness of Theravance for borrowed money where the
aggregate principal amount with respect to which the default or acceleration has occurred exceeds $15&nbsp;million, provided that if any such default is cured, waived, rescinded or annulled, then
the event of default by reason thereof would be deemed not to have occurred; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>certain
events of bankruptcy, insolvency or reorganization affecting us or our significant subsidiaries. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
an event of default shall have happened and be continuing, either the trustee or the holders of not less than 25% in aggregate principal amount of the notes then outstanding may
declare the principal of the notes and any accrued and unpaid interest through the date of such declaration immediately due and payable; provided, however, that so long as any designated senior
indebtedness will be outstanding, such acceleration of the notes will not be effective until the earlier of (1)&nbsp;an acceleration of such designated senior indebtedness; or (2)&nbsp;five
business days after receipt by the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>48</FONT></P>

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<P><FONT SIZE=2>trustee
of written notice of such acceleration. In the case of certain events of bankruptcy or insolvency with respect to us, the principal amount of the notes together with any accrued interest
through the occurrence of such event shall automatically become and be immediately due and payable. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, the indenture will provide that, to the extent elected by us, the sole remedy for an event of default relating to the failure to comply with the reporting
obligations in the indenture with respect to SEC filings that are described above under the caption above "Reporting Obligations," and for any failure to comply with the requirements of
Section&nbsp;314(a)(1) of the Trust Indenture Act, will for the first 180&nbsp;days after the occurrence of such an event of default consist exclusively of the right to receive special interest on
the notes at an annual rate equal to 1.0% of the outstanding principal amount of the notes. This special interest will be paid semi-annually in arrears, with the first
semi-annual payment due on the first interest payment date following the date on which the special interest began to accrue on any notes. The special interest will accrue on all
outstanding notes from and including the date on which an event of default relating to a failure to comply with the reporting obligations in the indenture first occurs to but not including the 180th
day (or earlier, if the event of default relating to the reporting obligations is cured or waived prior to such 180th day), whereupon such special interest will cease to accrue and, if the event of
default relating to reporting obligations has not been cured or waived prior to such 180th day, the notes will be subject to acceleration as provided above. The provisions of the indenture described
in this paragraph will not affect the rights of holders in the event of the occurrence of any other event of default. In the event we do not elect to pay special interest upon an event of default in
accordance with this paragraph, the notes will be subject to acceleration as provided above. </FONT></P>

<P><FONT SIZE=2><B>Consolidation, Mergers or Sales of Assets  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The indenture provides that we may not consolidate with or merge into any person or convey, transfer or lease our properties and assets substantially
as an
entirety to another person, other than to one or more of our wholly owned subsidiaries, unless: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
resulting, surviving or transferee corporation, limited liability company, partnership, trust or other business entity is organized and existing under the laws of the
United States, any state thereof or the District of Columbia, and such corporation (if other than us) assumes all our obligations under the notes and the indenture;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>after
giving effect to the transaction, no event of default, and no event that, after notice or passage of time, would become an event of default, has occurred and is
continuing; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>other
conditions described in the indenture are met. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
the assumption of our obligations by such entity in such circumstances, except for a lease of our properties substantially as an entirety and, subject to certain other exceptions,
we shall be discharged from all obligations under the notes and the indenture. Although such transactions are permitted under the indenture, certain of the foregoing transactions occurring could
constitute a fundamental change of our company, permitting each holder to require us to purchase the notes of such holder as described above. An assumption of our obligations under the notes and the
indenture by such corporation might, depending on the facts and circumstances, be deemed for U.S. federal income tax purposes to be an exchange of the notes for new notes by the holders thereof,
resulting in recognition of gain or loss for such purposes and possibly other adverse tax consequences to the holders. Holders should consult their own tax advisors regarding the tax consequences of
such an assumption. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>49</FONT></P>

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<P><FONT SIZE=2><B>Modification  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The trustee and we may amend or supplement the indenture or the notes with the consent of the holders of not less than a majority in aggregate
principal amount
of the notes then outstanding. However, the consent of the holder of each outstanding note affected is required to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>alter
the manner of calculation or rate of accrual of interest on the note or change the time of payment;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>make
the note payable in money or securities other than that stated in the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>change
the stated maturity of the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>reduce
the principal amount or fundamental change purchase price with respect to the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>make
any change that adversely affects the right to require us to purchase the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>impair
the right to institute suit for the enforcement of any payment with respect to the note or with respect to conversion of the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>change
the currency of payment of principal of, or interest on, the note;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>except
as otherwise permitted or contemplated by provisions of the indenture concerning specified reclassification or corporation reorganizations, adversely affect the
conversion rights (including any make-whole premium payable) of the note; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>change
the provisions in the indenture that relate to modifying or amending the indenture. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Without
the consent of any holder of notes, the trustee and we may amend or supplement the indenture: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
evidence a successor to us and the assumption by that successor of our obligations under the indenture and the notes;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
add to our covenants for the benefit of the holders of the notes or to surrender any right or power conferred upon us;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
secure our obligations in respect of the notes;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
evidence and provide the acceptance of the appointment of a successor trustee under the indenture;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
comply with the requirements of the SEC in order to maintain qualification of the indenture under the Trust Indenture Act, as contemplated by the indenture or otherwise;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
conform the provisions of the indenture to the "Description of the Notes" section in this prospectus;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
cure any ambiguity, omission, defect or inconsistency in the indenture; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
make any change that does not adversely affect the rights of the holders of the notes in any material respect. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
holders of a majority in aggregate principal amount of the outstanding notes may, on behalf of all the holders of all notes: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>waive
compliance by us with restrictive provisions of the indenture, as detailed in the indenture; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>waive
any past default under the indenture and its consequences, except a default in the payment of any amount due, or in the obligation to deliver common stock upon
conversion, </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>50</FONT></P>

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<UL>
<UL>

<P><FONT SIZE=2>with
respect to any note or in respect of any provision which under the indenture cannot be modified or amended without the consent of the holder of each outstanding note affected. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2><B>Discharge of the Indenture  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We may satisfy and discharge our obligations under the indenture by delivering to the trustee for cancellation all outstanding notes or by depositing
with the
trustee, the paying agent or the conversion agent, if applicable, after the notes have become due and payable, whether at stated maturity, on any purchase date, on a fundamental change purchase date,
on a redemption date or upon conversion or otherwise, cash sufficient to pay all of the outstanding notes and paying all other sums payable under the indenture. </FONT></P>

<P><FONT SIZE=2><B>Calculations in Respect of Notes  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are responsible for making all calculations called for under the notes. These calculations include, but are not limited to, determination of the
current
market prices of our common stock. We will make all these calculations in good faith and, absent manifest error, our calculations are final and binding on holders of notes. We will provide a schedule
of our calculations to the trustee, and the trustee is entitled to conclusively rely upon the accuracy of our calculations without independent verification. </FONT></P>

<P><FONT SIZE=2><B>Governing Law  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The indenture and the notes are governed by, and construed in accordance with, the law of the State of New York. </FONT></P>

<P><FONT SIZE=2><B>Information Concerning the Trustee  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Bank of New York Trust Company, N.A., a national banking association duly organized and existing under the laws of the United States of America
will be the
trustee, registrar, paying agent and conversion agent under the indenture for the notes. </FONT></P>

<P><FONT SIZE=2><B>Global Notes; Book Entry; Form  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will initially issue the notes in the form of one or more global securities. Each global security will be deposited with the trustee as custodian
for DTC and
registered in the name of a nominee of DTC. Except as set forth below, each global security may be transferred, in whole and not in part, only to DTC or another nominee of DTC. You will hold your
beneficial interests in each global security directly through DTC if you have an account with DTC or indirectly through organizations that have accounts with DTC. Notes in definitive certificated form
(called "certificated securities") will be issued only in certain limited circumstances described below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DTC
has advised us that it is: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
limited purpose trust company organized under the laws of the State of New York;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
member of the Federal Reserve System;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
"clearing corporation" within the meaning of the New York Uniform Commercial Code; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
"clearing agency" registered pursuant to the provisions of Section&nbsp;17A of the Exchange Act. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DTC
was created to hold securities of institutions that have accounts with DTC (called "participants") and to facilitate the clearance and settlement of securities transactions among
its </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>51</FONT></P>

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<P><FONT SIZE=2>participants
in such securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. DTC's
participants include securities brokers and dealers, which may include the underwriters, banks, trust companies, clearing corporations and certain other organizations. Access to DTC's
book-entry system is also available to others such as banks, brokers, dealers and trust companies (called, the "indirect participants") that clear through or maintain a custodial
relationship with a participant, whether directly or indirectly. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
expect that pursuant to procedures established by DTC upon the deposit of each global security with DTC, DTC will credit on its book-entry registration and transfer
system the principal amount of notes represented by such global security to the accounts of participants. The accounts to be credited shall be designated by the underwriters. Ownership of beneficial
interests in the global security will be limited to participants or persons that may hold interests through participants. Ownership of beneficial interests in a global security will be shown on, and
the transfer of those beneficial interests will be effected only through, records maintained by DTC (with respect to participants' interests), the participants and the indirect participants. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
laws of some jurisdictions may require that certain purchasers of securities take physical delivery of such securities in definitive form. These limits and laws may impair the
ability to transfer or pledge beneficial interests in the global security. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Owners
of beneficial interests in global securities who desire to convert their interests into common stock should contact their brokers or other participants or indirect participants
through whom they hold such beneficial interests to obtain information on procedures, including proper forms and cut-off times, for submitting requests for conversion. So long as DTC, or
its nominee, is the registered owner or holder of a global security, DTC or its nominee, as the case may be, will be considered the sole owner or holder of the notes represented by the global security
for all purposes under the indenture and the notes. In addition, no owner of a beneficial interest in a global security will be able to transfer that interest except in accordance with the applicable
procedures of DTC. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
as set forth below, as an owner of a beneficial interest in the global security, you will not be entitled to have the notes represented by the global security registered in your
name, will not receive or be entitled to receive physical delivery of certificated securities and will not be considered to be the owner or holder of any notes under the global security. We understand
that under existing industry practice, if an owner of a beneficial interest in the global security desires to take any action that DTC, as the holder of the global security, is entitled to take, DTC
would authorize the participants to take such action. Additionally, in such case, the participants would authorize beneficial owners owning
through such participants to take such action or would otherwise act upon the instructions of beneficial owners owning through them. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
will make payments of principal of, premium, if any, and interest on the notes represented by the global security registered in the name of and held by DTC or its nominee to DTC or
its nominee, as the case may be, as the registered owner and holder of the global security. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
expect that DTC or its nominee, upon receipt of any payment of principal of, premium, if any, or interest on the global security, will credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the principal amount of the global security as shown on the records of DTC or its nominee. We also expect that payments by
participants or indirect participants to owners of beneficial interests in the global security held through such participants or indirect participants will be governed by standing instructions and
customary practices and will be the responsibility of such participants or indirect participants. We will not have any responsibility or liability for any aspect of the records relating to, or
payments made on account of, beneficial interests in the global security for any note or for maintaining, supervising or reviewing any records relating to such beneficial interests or for any other
aspect of the relationship between DTC and its participants or </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>52</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>indirect
participants or the relationship between such participants or indirect participants and the owners of beneficial interests in the global security owning through such participants. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Transfers
between participants in DTC will be effected in the ordinary way in accordance with DTC rules and will be settled in same-day funds. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DTC
has advised us that it will take any action permitted to be taken by a holder of notes only at the direction of one or more participants to whose account the DTC interests in the
global security is credited and only in respect of such portion of the aggregate principal amount of notes as to which such participant or participants has or have given such direction. However, if
DTC notifies us that it is unwilling to be a depositary for the global security or ceases to be a clearing agency or there is an event of default under the notes (and the holder so requests), DTC will
exchange the global security for certificated securities that it will distribute to its participants. Although DTC is expected to follow the foregoing procedures in order to facilitate transfers of
interests in the global security among participants of DTC, it is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. Neither we
nor the trustee will have any responsibility, or liability for the performance by DTC or the participants or indirect participants of their respective obligations under the rules and procedures
governing their respective operations. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>53</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dm77601_description_of_capital_stock"> </A>
<A NAME="toc_dm77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>DESCRIPTION OF CAPITAL STOCK    <BR>    </B></FONT></P>


<P><FONT SIZE=2><B>General  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a summary of the rights of our common stock and preferred stock and related provisions of our certificate of incorporation, bylaws
and
governance agreement with GSK. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
authorized capital stock consists of 230,230,000 shares, with a par value of $0.01 per share, of which: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>200,000,000
shares are designated as common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>30,000,000
shares are designated as Class&nbsp;A common stock; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>230,000
shares are designated as preferred stock. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
November&nbsp;30, 2007, we had outstanding 51,595,868 shares of common stock, 9,401,499 shares of Class&nbsp;A common stock and no shares of preferred stock. All of our
outstanding Class&nbsp;A common stock is held by GSK and its affiliates. In addition, as of November&nbsp;30, 2007, an aggregate of 13,558,461 shares of our common stock were subject to
outstanding options and restricted stock unit awards. At November&nbsp;30, 2007, 97,079 shares of our outstanding common stock held by our employees, consultants and directors were subject to a
lapsing right of repurchase in our favor, under which we may repurchase these shares upon the termination of the holder's employment or consulting relationship. </FONT></P>

<P><FONT SIZE=2><B>Common Stock  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock was subject to a call and put arrangement with GSK that expired on September&nbsp;12, 2007. </FONT></P>

<P><FONT SIZE=2><I>Voting Rights  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Generally  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless otherwise provided for in our certificate of incorporation or required by applicable law, on all matters submitted to our stockholders for vote,
 our
common stockholders and Class&nbsp;A common stockholders will be entitled to one vote per share, voting together as a single class. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Class&nbsp;A common stock  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Class&nbsp;A common stock, all of which is held by GSK, will have the right to elect a certain number of directors to our board of directors
depending on
the percentage of our outstanding voting stock owned by GSK at varying points in time. See "&#151;Voting Rights For the Election of Directors/Board of Directors Composition" and
"&#151;Governance Agreement" for a description of the rights of GSK as the holder of our Class&nbsp;A common stock with respect to board of directors composition. </FONT></P>

<P><FONT SIZE=2><I>Dividends  </I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of common stock and Class&nbsp;A common
stock shall
be entitled to share equally in any dividends that our board of directors may determine to pay from time to time. In the event a dividend is paid in the form of shares of common stock or rights to
acquire shares of common stock, the holders of common stock and Class&nbsp;A common stock shall receive common stock, or rights to acquire common stock, as the case may be. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>54</FONT></P>

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<P><FONT SIZE=2><I>Liquidation  </I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon our liquidation, dissolution or winding-up, the holders of common stock and Class&nbsp;A common stock shall be entitled to share equally all
assets remaining after the payment of any liabilities and the liquidation preferences on any outstanding preferred stock. </FONT></P>

<P><FONT SIZE=2><I>Optional Conversion of Class&nbsp;A Common Stock  </I></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All shares of our Class&nbsp;A common stock are held by GSK. GSK may convert each share of Class&nbsp;A common stock into one share of common stock at
any
time. All shares of Class&nbsp;A common stock so converted will be retired and cancelled. </FONT></P>

<P><FONT SIZE=2><I>Voting Rights for the Election of Directors/Board of Directors Composition  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Authorized Number of Directors  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our certificate of incorporation and bylaws provide that our board of directors may consist of any number of directors, greater than or equal to one,
provided
that at any time that GSK's percentage ownership of our voting stock is 50.1% or greater, the authorized number of directors on our board of directors will be no less than nine, or any greater number
that is divisible by three. We will increase or decrease the size of our board of directors and fill any newly created directorships as appropriate to achieve our board of directors composition
required by our governance agreement with GSK. We will have the right to decrease the size of our board of directors without GSK's consent (and, if desired, to increase it again without GSK's consent
to no more than 13 seats), so long as GSK does not lose its right to designate the directors or independent directors pursuant to the governance agreement. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
certificate of incorporation provides that holders of a majority of the shares of Class&nbsp;A common stock voting as a separate class, shall be entitled to elect members of our
board of directors as follows: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>For
so long as GSK continues to own at least 15% of our outstanding stock (or, if GSK sells any of our stock, at least 19% after any such sale), one director;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>For
so long as GSK holds 35.1-50.0% of our outstanding stock, one director plus that percentage of our independent directors most closely approximating the
percentage of stock GSK owns; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>For
so long as GSK holds 50.1% or more of our outstanding stock, one third of our board of directors, plus one half of our independent directors. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
these purposes, "independent directors" include all of our directors that qualify as independent under applicable exchange listing rules. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
other directors are elected by a plurality of holders of our common stock and Class&nbsp;A common stock, voting together as a single class. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Vacancies on Our Board of Directors  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK has the right to nominate any replacement for a director nominated by GSK at the end of that director's term or upon removal from office, subject
to the
approval of a majority of the directors (other than any director nominated by GSK) with respect to nominations pursuant to the governance agreement. The directors that were not nominated by GSK have
the right to nominate any replacement for a director that was not nominated by GSK. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>55</FONT></P>

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<P><FONT SIZE=2><B>Preferred Stock  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our certificate of incorporation authorizes 230,000 shares of Series&nbsp;A junior participating preferred stock that are purchasable upon exercise of
the
rights under our rights agreement. See "&#151;Rights Agreement". These shares are: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>not
redeemable;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>entitled,
when, as and if declared, to a minimum preferential quarterly dividend payment of the greater of (a)&nbsp;$1.00 per share, and (b)&nbsp;an amount equal to
1,000 times the dividend declared per share of our common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
the event of a liquidation, dissolution or winding up, entitled to a minimum preferential payment of the greater of (a)&nbsp;$10.00 per share (plus any declared but
unpaid dividends), and (b)&nbsp;an amount equal to 1,000 times the payment made per share of common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>entitled
to 1,000 votes, voting together with our common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>in
the event of a merger, consolidation or other transaction in which outstanding shares of our common stock are converted or exchanged, entitled to receive 1,000 times the
amount received per share of our common stock; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>entitled
to anti-dilution protections. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Corporate Opportunities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our certificate of incorporation acknowledges that we and GSK may generally pursue any business opportunities available to us, and have no obligation
to offer
any business opportunities to the other party. In addition, pursuant to our certificate of incorporation, as between us and GSK and its affiliates, we renounce our interest in and waive any claim that
a corporate or business opportunity constituted a corporate opportunity for us so long as the policy regarding treatment of corporate opportunities set forth in our certificate of incorporation is
followed. Pursuant to the policy set forth in our certificate of incorporation, a corporate or business opportunity offered to any person who is our director and who is also a director, officer or
employee of GSK, will belong to us only if the opportunity is expressly offered to such person primarily in his or her capacity as our director. Otherwise the opportunity will belong to GSK. Our
certificate of incorporation provides that these provisions may only be amended by the affirmative vote of at least 85% of the voting power of all shares of our voting stock then outstanding. </FONT></P>

<P><FONT SIZE=2><B>Governance Agreement  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following summary describes the material provisions of our governance agreement with GSK. The governance agreement contains agreements with GSK
relating to
our corporate governance and future acquisitions or dispositions of our securities by GSK and was put in place in connection with the addition of call and put features on our shares of common stock
that expired on September&nbsp;12, 2007. The rights and obligations of GSK vary based on the level of GSK's ownership of our voting stock as described below. As of November&nbsp;30, 2007, GSK held
15.4% of our outstanding capital stock. As described further below, the Governance Agreement imposes limitations and conditions on GSK's ability to increase its ownership of our outstanding capital
stock. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>56</FONT></P>

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<P><FONT SIZE=2><B><I>If GSK's Ownership of Our Voting Stock is Greater than 50.1%  </I></B></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Agreements Related to Our Board of Directors  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Composition of Our Board of Directors  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board of directors will include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
number of nominees designated by GSK equal to one-third of the aggregate number of directors comprising our board of directors at that time;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>two
of our officers nominated by the nominating committee of our board of directors; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
remaining members of our board of directors will be independent directors. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An
independent director is a director that complies with the independence requirements for directors with respect to us for companies listed on the Nasdaq Global Market and has business
or technical experience, stature and character as is commensurate with service on our board of directors of a publicly traded company. In addition, upon its request, GSK may designate nominees for
half of the total number of independent directors. These independent director nominees must be reasonably acceptable to the members of the board of directors not nominated by GSK and must meet the
qualifications of an independent director both with respect to us and with respect to GSK. An equal number of independent directors will be nominated by the directors of our board of directors
(excluding the directors nominated by GSK). If GSK's percentage ownership of our voting stock falls
below 50.1% (subject to certain limitations), then the term of each director nominated by GSK pursuant to this provision will automatically cease. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
committee of our board of directors must contain at least one director nominated by GSK except for: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
committee representing the interests of the holders of common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
committee of independent directors constituted for the purposes of making any determination that is to be made under the terms of the governance agreement or our
certificate of incorporation; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
committee in which membership of a director nominated by GSK would be prohibited by applicable law, regulation or stock exchange or trading system listing requirement. </FONT></DD></DL>
<UL>

<P><FONT SIZE=2><I> Approval by a Majority of GSK Nominated Directors of Certain Actions  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The approval of a majority of the directors nominated by GSK will be required to approve any of the following: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
acquisition of any business or assets that would constitute a substantial portion of our business or assets;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
sale, lease, license, transfer or other disposal of a substantial portion of our business or assets, tangible or intangible, other than dispositions of assets over which
GSK has no contractual rights pursuant to agreements with us or in the ordinary course of business; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
repurchase or redemption of any of our equity securities other than (A)&nbsp;redemptions required by the terms of our voting stock, (B)&nbsp;purchases made at fair
market value in connection with any deferred compensation plan that we maintain and (C)&nbsp;repurchases of unvested or restricted stock at or below cost pursuant to a compensation plan. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>57</FONT></P>

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<UL>
<UL>
</UL>
</UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Limitations and Exceptions to GSK's Rights to Acquire Our Securities  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Limitation on Acquisition of our Equity Securities by GSK  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as agreed to by us in writing following approval by a majority of our independent directors, GSK may not, directly or indirectly: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>acquire
any of our equity securities;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>make
or participate in any solicitation of proxies to vote from any holders of our equity securities;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>form
or participate in a "group" within the meaning of Section&nbsp;13(d)(3) of the Securities and Exchange Act of 1934, as amended, with any person not bound by the terms
of the governance agreement with respect to any of our voting stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>acquire
any of our assets or rights to purchase any of our assets except for assets offered for sale by us or the acquisition or purchase of our assets pursuant to the
existing agreements that we have in place with GSK;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>enter
into any arrangement or understanding with others to do any of the actions listed immediately above; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>act
together with others to offer to us or any of our stockholders any business combination, restructuring, recapitalization or similar transaction involving us or otherwise
seek together with others to control, change or influence the management, board of directors or our policies or nominate any person as a director who is not nominated by the then incumbent directors,
or propose any matter to be voted upon by our stockholders. </FONT></DD></DL>
</UL>
<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Permitted GSK Purchases of Our Equity Securities From Us  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK may acquire our equity securities from us in the following circumstances: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>if
we issue equity securities to a third party (other than pursuant to exercise of options issued as compensation to our directors, officers, employees or consultants), GSK
may purchase all or a portion of the number of equity securities that would bring GSK's percentage ownership of our voting stock to the same level that it was at immediately prior to the issuance of
equity securities to the third party at the same price at which the equity securities were sold to the third party;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
purchase, on a quarterly basis, of equity securities comparable to those that are issued as compensation to our directors, officers, employees or consultants during the
preceding quarter pursuant to option exercises or vesting of restricted stock, at the fair market value at the time of GSK's notification to us of its intention to purchase such equity securities that
would bring GSK's percentage ownership of our voting stock to the same level that it was at immediately prior to such issuances or vesting;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition of additional equity securities issued in connection with a stock split or recapitalization; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
purchase of equity securities for a pension plan or benefit plan for the benefit of GSK's employees.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>GSK
may purchase additional equity securities if we have determined to sell equity securities to pay all or any portion of the milestones that we may owe GSK pursuant to our
existing agreements with GSK. In this event, GSK has the first right to purchase the additional equity securities on the terms that we intend to sell the equity securities; provided that, the voting </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>58</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dm77601_1_59"> </A>
<UL>
<UL>

<P><FONT SIZE=2>stock
held by GSK at such time was acquired in accordance with the terms of the governance agreement and our certificate of incorporation. </FONT></P>

</UL>
</UL>
<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Permitted GSK Purchases of Equity Securities from Our Stockholders  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK may acquire our equity securities from our stockholders in the following circumstances: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition of securities of another biotechnology or pharmaceutical company that owns our equity securities (provided that those shares will be subject to the
provisions of the governance agreement on the same basis as GSK's shares of Class&nbsp;A common stock); or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
making of an offer to acquire equity securities if (a)&nbsp;a person or group (other than GSK) acquires 20% or more of our voting stock or (b)&nbsp;our board of
directors formally acts to facilitate a change in control of us (other than with GSK), subject to the following conditions:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer be an offer for 100% of our voting stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer include no condition as to financing; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes a condition that the holders of a majority of the shares of the voting stock not owned by GSK accept the offer by tendering their shares or voting
their shares in favor of the offer. </FONT></DD></DL>
</DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
term "change in control" is referred to as (i)&nbsp;an acquisition of us by a third party (ii)&nbsp;any transaction or series of related transactions (including mergers,
consolidations and other forms of business consolidations) after which our continuing stockholders hold less than 50% of the outstanding voting securities of either us or the entity that survives the
transaction (or the parent of the surviving entity) or (iii)&nbsp;the sale, lease, license, transfer or other disposal of all or substantially all of our business or assets (except that the sale,
license or transfer to another party of any of our assets in the ordinary course of business will not be considered a change in control of us if GSK has no contractual rights under our existing
agreements with GSK over our asset sold, licensed or transferred). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK
can make an offer to our stockholders to merge with us or otherwise acquire outstanding voting stock that would bring GSK's percentage ownership of our voting stock to 100%, subject
to the following conditions: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer occurs on or after September&nbsp;1, 2012;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes no conditions to financing;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer is approved by a majority of our independent directors; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes a condition that the holders of a majority of the shares of our voting stock not owned by GSK accept the offer by tendering their shares in the
offer. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK
can make an offer to our stockholders to acquire outstanding voting stock that would bring GSK's percentage ownership of our voting stock to 100%, subject to the following
conditions: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer occurs before September&nbsp;1, 2012;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes no condition as to financing;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer is approved by a majority of our independent directors;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes a condition that the holders of a majority of the shares of the voting stock not owned by GSK accept the offer by tendering their shares in the
offer; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer is for the greater of (a)&nbsp;the fair market value per share on the date immediately preceding the date of the first public announcement of the offer or
(b)&nbsp;$162.75 </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>59</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dm77601_1_60"> </A>
<UL>
<UL>

<P><FONT SIZE=2>per
share (as adjusted to take into account stock dividends, stock splits, recapitalizations and the like). </FONT></P>

</UL>
</UL>
<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Limitations on Disposition of Our Equity Securities by GSK  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If GSK's percentage ownership of our voting stock becomes 50.1% or greater before September&nbsp;1, 2012, then GSK may not sell or transfer any voting
stock
held by it until September&nbsp;1, 2012. GSK is permitted to sell or transfer its voting stock in connection with a change in control of us that is approved by a majority of our independent
directors. In the event that the prohibition on the disposition of voting stock by GSK expires on September&nbsp;1, 2012, if GSK disposes of any of our voting stock, GSK shall not be able to
purchase any of our voting stock for one year after such disposition without the prior approval of a majority of our independent directors. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Voting Arrangements  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Agreement to Vote  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK shall vote the voting stock held by it (at GSK's election) either (i)&nbsp;in accordance with the recommendation of our independent directors or
(ii)&nbsp;in proportion to the votes cast by the other holders of our voting stock. </FONT></P>

<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Exceptions to Agreement to Vote  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK can vote as it chooses on any proposal to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effect
a change in control of us;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effect
the acquisition by us of any business or assets that would constitute a substantial portion of our business or assets;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effect
the sale, license or transfer of all or a substantial portion of our business or assets unless GSK has no contractual rights over the business or assets in question
pursuant to our strategic alliance agreement with GSK, and such sale, license or transfer occurs in the ordinary course of business; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>issue
equity securities to one or more parties (other than in a public offering) that would result in that party or parties holding 20% or more of the voting stock. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
a person or group acting in concert acquires 20% or more of the voting stock, GSK may vote its voting stock without any restrictions. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Grant of Proxy  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK grants an irrevocable proxy coupled with an interest in all voting stock owned by GSK to our board of directors. This proxy will enable the
proxyholder to
vote or otherwise act with respect to all of GSK's voting stock in the manner required by the governance agreement. </FONT></P>


<P><FONT SIZE=2><B><I>If GSK's Ownership of Our Voting Stock is Less Than 50.1%  </I></B></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Agreements Related to Our Board of Directors  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Composition of Our Board of Directors  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK shall have the right to either: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>nominate
an individual to serve as a member of our board of directors (in which case the size of our board of directors will be increased by one); or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>designate
an individual to serve as an observer at our board of directors meetings. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>60</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<UL>
<UL>
</UL>
</UL>
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->

<P><FONT SIZE=2><A
NAME="page_do77601_1_61"> </A> </FONT> <FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK shall have this right until such time as GSK's percentage ownership of our outstanding securities having the right to vote generally in any election of our
directors, referred to in
this section "&#151;Governance Agreement" as our "voting stock," (a)&nbsp;has fallen below 15%, or (b)&nbsp;directly as a result of any sale or other disposition by GSK of voting stock, has
fallen below 19%. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Limitations and Exceptions to GSK's Rights to Acquire Our Securities  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Limitation on Acquisition of our Equity Securities by GSK  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as agreed to by us in writing following approval by a majority of our independent directors, GSK will have the same limitations on the
acquisition of our
equity securities as are described above in "&#151;Governance Agreement&#151;If GSK's Ownership of Our Voting Stock is Greater than 50.1%&#151;Limitations and Exceptions to GSK's
Rights to Acquire Our Securities." </FONT></P>

<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Permitted GSK Purchases of Our Equity Securities From Us  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK may acquire our equity securities from us under the same circumstances that it is allowed to acquire our equity securities as are described above
in
"&#151;Governance Agreement&#151;If GSK's Ownership of Our Voting Stock is Greater than 50.1%&#151;Limitations and Exceptions to GSK's Rights to Acquire Our Securities." </FONT></P>

<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Permitted GSK Purchases of Equity Securities from Our Stockholders  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK may acquire our equity securities from our stockholders under the same circumstances that it is allowed to acquire our equity securities from our
stockholders as are described above in "&#151;Governance Agreement&#151;If GSK's Ownership of Our Voting Stock is Greater than 50.1%&#151;Limitations and Exceptions to GSK's
Rights to Acquire Our Securities." In addition, GSK can make an offer to our stockholders to acquire outstanding voting stock that would bring GSK's percentage ownership of our voting stock to no
greater than 60%, subject to the following conditions: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer occurs on or after September&nbsp;1, 2008;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes no condition as to financing;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer is approved by a majority of our independent directors;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the offer includes a condition that the holders of a majority of the shares of the voting stock not owned by GSK accept the offer by tendering their shares in the
offer; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>that
the shares purchased will be subject to the provisions of the governance agreement on the same basis as the shares of GSK's Class&nbsp;A common stock. </FONT></DD></DL>
</UL>
<UL>
<UL>
<UL>
<UL>

<P><FONT SIZE=2><I> Limitation on Disposition of Our Equity Securities by GSK  </I></FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK may not sell or transfer any of our voting stock held by them without the prior approval of a majority our independent directors until
September&nbsp;1,
2008. GSK is permitted to sell or transfer its voting stock in connection with a change in control of us that is approved by a majority of our independent directors. In the event that the prohibition
on the disposition of voting stock by GSK
expires on September&nbsp;1, 2008 as set forth above, GSK shall only be able to dispose of our voting stock after such date and prior to September&nbsp;1, 2012 through either a public offering or
pursuant to Rule&nbsp;144 under the Securities Act of 1933, as amended. </FONT></P>

<P><FONT SIZE=2><I>Voting Arrangements  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Agreement to Vote  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK shall vote the voting stock held by it (at GSK's election) either (i)&nbsp;in accordance with the recommendation of our independent directors or
(ii)&nbsp;in proportion to the votes cast by the other holders of our voting stock. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>61</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_do77601_1_62"> </A>
<UL>
<UL>

<P><FONT SIZE=2><I> Exceptions to Agreement to Vote  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK can vote as it chooses on any proposal to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>issue
equity securities to one or more parties (other than in a public offering) that would result in that party or parties holding 20% or more of our voting stock; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>effect
a change in control of us. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
a person or group acting in concert acquires 20% or more of the voting stock, GSK may vote its voting stock without any restrictions. </FONT></P>

<UL>
<UL>


<P><FONT SIZE=2><I> Grant of Proxy  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GSK grants an irrevocable proxy coupled with an interest in all voting stock owned by GSK to our board of directors. This proxy will enable the
proxyholder to
vote or otherwise act with respect to all of GSK's voting stock in the manner required by the governance agreement. </FONT></P>

<P><FONT SIZE=2><I>Covenants  </I></FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Severance Arrangements  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We agree not to enter into or amend any existing contract with any of our directors, officers or employees that would provide for any payment, vesting
of common
stock, acceleration or other benefit or right contingent upon (i)&nbsp;GSK's purchase of shares of Class&nbsp;A common stock, (ii)&nbsp;the exercise by GSK of any of its rights under the
governance agreement to representation on our board of directors or (iii)&nbsp;GSK's purchase of any equity securities not prohibited by the governance agreement. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Amendments; Termination  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The governance agreement provides that its provisions may be amended only if the amendment is in writing and signed by GSK and us, and that no
amendment will be
effective without the approval of a majority of our independent directors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
provisions of the governance agreement will terminate at the earliest of (i)&nbsp;when GSK beneficially owns 100% of our outstanding voting stock, (ii)&nbsp;the effective time
of a change in control of us and (iii)&nbsp;September&nbsp;1, 2015. </FONT></P>

<P><FONT SIZE=2><B>Anti-Takeover Effects of Delaware Law, Our Certificate of Incorporation and Bylaw Provisions, Our Rights Agreement and our Governance Agreement with GSK  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provisions of Delaware law and our certificate of incorporation and bylaws, our rights agreement and our governance agreement with GSK could make an
acquisition
of us by a third party and the removal of our incumbent officers and directors more difficult. These provisions, summarized below, may discourage coercive takeover practices and inadequate takeover
bids and are intended to encourage persons seeking to acquire control of us to first negotiate with us. We believe that the benefits of increased protection of our ability to negotiate with the
proponent of an unfriendly or unsolicited acquisition proposal outweigh the disadvantages of discouraging such proposals because, among other things, negotiation could result in an improvement of
their terms. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are subject to Section&nbsp;203 of the Delaware General Corporation Law, which regulates corporate acquisitions. In general, Section&nbsp;203 prohibits a Delaware corporation
from engaging in a "business combination" with an "interested stockholder" for a period of three years following the date the person became an interested stockholder, unless: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
board of directors approved the transaction in which such stockholder became an interested stockholder prior to the date the interested stockholder attained such status; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>62</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_do77601_1_63"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>upon
consummation of the transaction that resulted in the stockholder's becoming an interested stockholder, such person owned at least 85% of our voting stock outstanding at
the time the transaction commenced, excluding shares owned by persons who are directors and officers; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>on
or subsequent to such date the business combination is approved by our board of directors and authorized at an annual or special meeting of stockholders. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
"business combination" generally includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. In general, an
"interested stockholder" is a person who, together with affiliates and associates, owns, or within three years prior to the determination of interested stockholder status, did own, 15% or more of a
corporation's voting stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the terms of our governance agreement with GSK, we have agreed that we will exempt GSK from the application of Section&nbsp;203 of the Delaware General Corporation Law.
Under the governance agreement, GSK is subject to certain limitations in its ability to acquire our shares of capital stock. See "&#151;Governance Agreement." </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
certificate of incorporation and bylaws do not provide for the right of stockholders to act by written consent without a meeting or for cumulative voting in the election of
directors. In addition, our bylaws provide that special meetings of the stockholders can only be called by the Chairman of our board of directors, the chief executive officer, our board of directors
or the request of stockholders holding at least 66<SUP>2</SUP>/<SMALL>3</SMALL>% of the outstanding common stock. These provisions, which require the vote of stockholders holding at least 66<SUP>2</SUP>/<SMALL>3</SMALL>%
of the outstanding common stock to amend, may have the effect of deterring hostile takeovers or delaying changes in our management. </FONT></P>

<P><FONT SIZE=2><B>Rights Agreement  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under our rights agreement, each share of our common stock and Class&nbsp;A common stock has associated with it one preferred stock purchase right.
Each of
these rights entitles its holder to purchase, at a price of $209.25 for each, one one-thousandth of a share of Series&nbsp;A junior participating preferred stock, (each subject to
adjustment) under circumstances provided for in the rights agreement. The purpose of our rights agreement is to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>give
our board of directors the opportunity to negotiate with any persons seeking to obtain control of us;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>deter
acquisitions of voting control of us without assurance of fair and equal treatment of all of our stockholders; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>prevent
a person from acquiring in the market a sufficient amount of voting power over us to be in a position to block an action sought to be taken by our stockholders. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
exercise of the rights under our rights agreement would cause substantial dilution to a person attempting to acquire us on terms not approved by our board of directors, and
therefore would significantly increase the price that such person would have to pay to complete the acquisition. Our rights agreement may deter a potential acquisition or tender offer. Until a
"distribution date" occurs, the rights will: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>not
be exercisable;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>be
represented by the same certificate that represents the shares with which the rights are associated; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>trade
together with those shares. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
rights will expire at the close of business on October&nbsp;8, 2014, unless earlier redeemed or exchanged by us. Following a "distribution date," the rights would become
exercisable and we would </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>63</FONT></P>

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<P><FONT SIZE=2>issue
separate certificates representing the rights, which would trade separately from the shares of our common stock. A "distribution date" would occur upon the earlier of: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>ten
business days after a public announcement that the person has become an "acquiring person;" or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>ten
business days after a person commences or announces its intention to commence a tender or exchange offer that, if successful, would result in the person becoming an
"acquiring person." </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
holder of rights will not, as such, have any rights as a stockholder, including the right to vote or receive dividends. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
our rights agreement, a person becomes an "acquiring person" if the person, alone or together with a group, acquires beneficial ownership of 15% or more of the outstanding shares
of our common stock. GSK is not an "acquiring person" because we have, pursuant to our governance agreement with GSK, exempted GSK from the application of our rights agreement. In addition, an
"acquiring person" shall not include us, any of our subsidiaries, or any of our employee benefit plans or any person or entity acting pursuant to such employee benefit plans. Our rights agreement also
contains provisions designed to prevent the inadvertent triggering of the rights by institutional or certain other stockholders. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any person becomes an acquiring person, each holder of a right, other than the acquiring person, will be entitled to purchase, at the purchase price, a number of our shares of common
stock having a market value of two times the purchase price. If, following a public announcement that a person has become an acquiring person: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>we
merge or enter into any similar business combination transaction and we are not the surviving corporation; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>50%
or more of our assets, cash flow or earning power is sold or transferred, </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>each
holder of a right, other than the acquiring person, will be entitled to purchase a number of shares of common stock of the surviving entity having a market value of two times the purchase price. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;After
a person becomes an acquiring person, but prior to such person acquiring 50% of our outstanding common stock, our board of directors may exchange each right, other than rights
owned by the acquiring person, for </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>one
share of common stock;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>one
one-thousandth of a share of our Series&nbsp;A junior preferred stock; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
fractional share of another series of preferred stock having equivalent value. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
any time until a person has become an acquiring person, our board of directors may redeem all of the rights at a redemption price of $0.01 per right. On the redemption date, the
rights will expire and the only entitlement of the holders of rights will be to receive the redemption price. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
so long as the rights are redeemable, our board of directors may amend any provisions in the rights agreement without stockholder consent. After the rights are no longer redeemable,
our board of directors may only amend the rights agreement without stockholder consent if such amendment would not change the amendment provisions, adversely affect the interests of the holders of
rights, or cause the rights to again become redeemable. Despite the foregoing, at no time may the redemption price of the rights be amended or changed. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
adoption of the rights agreement and the distribution of the rights should not be taxable to our stockholders or us. Our stockholders may recognize taxable income when the rights
become exercisable in accordance with the rights agreement. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>64</FONT></P>

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<P><FONT SIZE=2><B>Registration Rights  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain holders of our common stock and GSK are entitled to rights with respect to the registration of their shares under the Securities Act. These
registration
rights are contained in our amended and restated investors' rights agreement and are described below. The registration rights under the investors' rights agreement with respect to holders of our
common stock will expire October&nbsp;5, 2009, or, with respect to an individual holder holding two percent or less of our outstanding capital stock, when such holder is able to sell all of its
shares in a single transaction pursuant to Rule&nbsp;144 under the Securities Act. The registration rights under the investors' rights agreement with respect to holders of our Class&nbsp;A common
stock will expire on the earlier of September&nbsp;12, 2014, or, with respect to an individual holder of Class&nbsp;A common stock holding two percent or less of our outstanding capital stock,
when such holder is able to sell all of its shares in a single transaction pursuant to Rule&nbsp;144 under the Securities Act. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Demand Registration Rights  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The holders of shares of common stock having demand registration rights under the investors' rights agreement have the right to require that we
register their
common stock, provided such registration relates to not less than 50% in aggregate of our then outstanding shares of common stock having demand registration rights. We are only obligated to effect two
registrations in response to these demand registration rights. We may postpone the filing of a registration statement for up to 90&nbsp;days once in any 12-month period if our board of
directors determines in good faith that the filing would be seriously detrimental to our stockholders or us. The underwriters of any underwritten offering have the right to limit the number of shares
to be included in a registration statement filed in response to the exercise of these demand registration rights. We must pay all expenses, except for underwriters' discounts and commissions, incurred
in connection with these demand registration rights. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> Piggyback Registration Rights  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If we register any securities for public sale, the stockholders with piggyback registration rights under the investors' rights agreement have the
right to
include their shares in the registration, subject to specified exceptions. The underwriters of any underwritten offering have the right to limit the number of shares registered by these stockholders
due to marketing reasons. We must pay all expenses, except for underwriters' discounts and commissions, incurred in connection with these piggyback registration rights. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><B><I> S-3 Registration Rights  </I></B></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;While we are eligible to file&nbsp;a registration statement on Form&nbsp;S-3, the stockholders with S-3 registration rights under the
investors' rights agreement can request that we register their shares, provided that such registration relates to not less than 10% in aggregate of our then outstanding shares of common stock having
S-3 registration rights and the total price of the shares of common stock offered to the public is at least $1,000,000. The holders of S-3 registration rights may only require
us to file two Form&nbsp;S-3 registration statements in any 12-month period. We may postpone the filing of a Form&nbsp;S-3 registration statement for up to
90&nbsp;days once in any 12-month period if our board of directors determines in good faith that the filing would be seriously detrimental to our stockholders or us. We must pay all
expenses, except for underwriters' discounts and commissions, incurred in connection with these S-3 registration rights. </FONT></P>


<P><FONT SIZE=2><B>Transfer Agent and Registrar  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The transfer agent and registrar for our common stock and the rights is The Bank of New York Trust Company, N.A. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>65</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dq77601_certain_u.s._federal_income_tax_considerations"> </A>
<A NAME="toc_dq77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>Any discussion of tax issues set forth in this prospectus was written in connection with the promotion and marketing of the
transactions
described in this prospectus. Such discussion was not intended or written to be used, and it cannot be used, by any person for the purpose of avoiding any tax penalties that may be imposed on such
person. Each investor should seek advice based on its particular circumstances from an independent tax advisor.</B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following is a summary of certain U.S. federal income tax considerations relating to the purchase, ownership, and disposition of the notes and common stock into which the notes are
convertible. This summary is based upon the provisions of the Internal Revenue Code of 1986, as amended (the "Code"), Treasury Regulations promulgated thereunder, administrative rulings and judicial
decisions, all as of the date hereof. These authorities may be changed, possibly retroactively, so as to result in U.S. federal income tax consequences different from those set forth below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
summary is limited to holders who purchase notes upon their initial issuance at their initial issue price and who hold the notes and the common stock into which such notes are
convertible as capital assets. This summary does not address the tax considerations arising under the laws of any foreign, state, or local jurisdiction or any U.S. federal estate or gift tax rules. In
addition, this discussion does not address tax considerations applicable to a holder's particular circumstances or a holder that may be subject to special tax rules, including, without limitation: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>banks,
insurance companies, or other financial institutions;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>regulated
investment companies or real estate investment trusts;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>persons
subject to the alternative minimum tax;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>tax-exempt
organizations;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>dealers
in securities or currencies;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>traders
in securities that elect to use a mark-to-market method of accounting for their securities holdings;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>certain
former citizens or former long-term residents of the United States;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>U.S.
holders, as defined below, whose functional currency is not the U.S. dollar;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>persons
who hold the notes or common stock as a position in a hedging transaction, straddle, conversion transaction or other risk reduction transaction; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>persons
deemed to sell the notes or common stock under the constructive sale provisions of the Code. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>You are urged to consult your tax advisor with respect to the application of the U.S. federal income tax laws to your particular situation, as well as any tax
consequences of the purchase, ownership, and disposition of the notes and common stock arising under the U.S. federal estate or gift tax rules or under the laws of any state, local, foreign or other
taxing jurisdiction.</B></FONT></P>

<P><FONT SIZE=2><B>Consequences to U.S. Holders  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a summary of certain U.S. federal income tax consequences that will apply to you if you are a U.S. holder of the notes or the common
stock.
"U.S. holder" means a beneficial owner of our notes or our common stock that is: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>an
individual citizen or resident of the United States, as determined for U.S. federal income tax purposes; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>66</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
corporation or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in the United States or under the laws of the United
States, any state thereof, or the District of Columbia;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>an
estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
trust that (i)&nbsp;is subject to the primary supervision of a U.S. court and the control of one or more U.S. persons or (ii)&nbsp;has a valid election in effect under
applicable Treasury Regulations to be treated as a U.S. person. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
a partnership, or other entity treated as a partnership for U.S. federal income tax purposes, holds our notes or common stock, the tax treatment of a partner will generally depend
upon the status of the partner and the activities of the partnership. If you are a partner in a partnership holding the notes or common stock, you should consult your own tax advisor. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Interest  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You will be required to include interest paid on the notes as ordinary income at the time it is paid or accrued, depending upon your regular method of
accounting
for U.S. federal income tax purposes. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Sale, Exchange, Repurchase or Redemption of the Notes  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the sale, exchange, repurchase, or redemption of a note, you generally will recognize capital gain or loss equal to the difference between the
amount you
receive (including the amount of cash and the fair market value of any property) and your adjusted tax basis in the note. Your adjusted tax basis in a note will generally equal the cost of the note to
you, decreased by the amount of any principal payments that you have received. Any amount attributable to accrued but unpaid interest not previously included in income will be taxable to you as
interest, as described above. Any gain or loss that you recognize generally will be treated as long-term capital gain or loss if you held the notes for more than one year. Net
long-term capital gains of noncorporate U.S. holders, including individuals, are eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Conversion of the Notes  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You generally will not recognize gain or loss upon conversion of the notes into our common stock, except with respect to any cash received in lieu of
fractional
shares. The receipt of cash for fractional shares generally will result in the recognition of gain or loss equal to the difference between the amount of cash received and your adjusted tax basis in
the fractional share. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Your
tax basis in common stock received upon conversion of a note will generally equal your adjusted basis in the note at the time of the conversion, reduced by any basis allocable to a
fractional share. Your holding period for the common stock received will generally include the holding period for the note converted. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Constructive Dividends  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. holders of convertible debt instruments such as the notes may, in certain circumstances, be deemed to have received distributions of stock if the
conversion
price of such instruments is adjusted. However, adjustments to the conversion price made pursuant to a bona fide reasonable adjustment formula which has the effect of preventing the dilution of the
interest of the holders of the debt instruments will generally not be deemed to result in a constructive distribution of stock. Certain of the possible adjustments provided in the notes, including,
without limitation, adjustments in respect of taxable dividends to our stockholders, may not qualify as being pursuant to a bona fide reasonable </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>67</FONT></P>

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<P><FONT SIZE=2>adjustment
formula. If such adjustments are made, you will be deemed to have received constructive distributions includible in your income in the manner described under "&#151;Dividends" below
even though you have not received any cash or property as a result of such adjustments. In certain circumstances, the failure to provide for such an adjustment may also result in a constructive
distribution to you. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Dividends  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Distributions, if any, made on our common stock received upon conversion of the notes generally will be treated as dividends to the extent of our
current and
accumulated earnings and profits, as determined for U.S. federal income tax purposes. Dividends received by noncorporate U.S. holders, including individuals, in taxable years beginning before
January&nbsp;1, 2011 generally are taxed at the reduced rates provided certain holding period requirements are satisfied. Distributions in excess of our current and accumulated earnings and profits
will be treated as a return of capital to the extent of your adjusted tax basis in the common stock, and thereafter as capital gain. Dividends received by a corporate U.S. holder may be eligible for a
dividends received deduction, subject to applicable limitations. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Sale or Exchange of Common Stock  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the sale or exchange of our common stock received upon conversion of the notes, you generally will recognize capital gain or loss equal to the
difference
between (i)&nbsp;the amount of cash and the fair market value of any property received upon the sale or exchange and (ii)&nbsp;your adjusted tax basis in the common stock. Your adjusted tax basis
and holding period in common stock received in connection
with conversion of notes are determined as discussed above under "&#151;Conversion of the Notes." Any gain or loss that you recognize generally will be treated as long-term capital
gain or loss if you held the stock for more than one year. Net long-term capital gains of noncorporate U.S. holders, including individuals, are eligible for reduced rates of taxation. The
deductibility of capital losses is subject to limitations. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Backup Withholding and Information Reporting  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. holders may be subject to IRS information reporting and backup withholding (which is currently imposed at a 28% rate) on payments of interest on
the notes,
dividends on common stock, and proceeds from the sale or other disposition of the notes or common stock. A U.S. holder will be subject to backup withholding on these payments if the U.S. holder fails
to provide its taxpayer verification number ("TIN") to the paying agent and comply with certain certification procedures or otherwise establish an exemption from backup withholding. Backup withholding
may be imposed when a noncorporate U.S. holder is not otherwise exempt and the U.S. holder: (i)&nbsp;fails to furnish its TIN; (ii)&nbsp;furnishes an incorrect TIN; (iii)&nbsp;is notified by the
IRS that it has failed to properly report payments of interest or dividends; or (iv)&nbsp;under certain circumstances, fails to certify, under penalties of perjury, that it has furnished a correct
TIN and has not been notified by the IRS that it is subject to backup withholding. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
generally will be entitled to credit any amounts withheld under the backup withholding rules against your U.S. federal income tax provided that the required information is furnished
to the IRS in a timely manner. </FONT></P>


<P><FONT SIZE=2><B>Consequences to Non-U.S. Holders  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a summary of certain material U.S. federal income tax consequences that will apply to you if you are a non-U.S. holder of the notes
or the common stock. For purposes of this discussion, a "non-U.S. holder" means a beneficial owner of our notes or common stock that is not a </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>68</FONT></P>

<HR NOSHADE>
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<A NAME="page_dq77601_1_69"> </A>
<BR>

<P><FONT SIZE=2>U.S.
holder or a partnership or other entity treated as a partnership for U.S. federal income tax purposes. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Interest  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payments of interest made to you on the notes generally will be exempt from U.S. federal income and withholding tax, provided that: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>such
payments are not effectively connected with your conduct of a trade or business within the United States (or, in the case of an applicable tax treaty, are not
attributable to your permanent establishment in the United States);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>you
do not own, actually or constructively, 10% or more of the total combined voting power of all classes of our stock entitled to vote;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>you
are not a "controlled foreign corporation" that is related to us, directly or indirectly, through stock ownership within the meaning of the applicable sections of the
Code; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>you
provide your name and address, and certify, under penalties of perjury, that you are not a U.S. person for U.S. federal income tax purposes, which certification may be
made on an IRS Form&nbsp;W-8BEN, or that you hold your notes through certain intermediaries, and you and the intermediaries satisfy the certification requirements of applicable Treasury
Regulations. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you cannot satisfy the requirements described above, you will be subject to 30% U.S. federal withholding tax with respect to payments of interest on the notes, unless you provide us
with a properly executed (i)&nbsp;IRS Form&nbsp;W-8BEN claiming an exemption from or reduction in withholding under the benefit of an applicable income tax treaty or (ii)&nbsp;IRS
Form&nbsp;W-8ECI stating that interest paid on the notes is not subject to withholding tax because it is effectively connected with the conduct of a trade or business in the United
States. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you are engaged in a trade or business in the United States and interest on a note is effectively connected with your conduct of that trade or business, you generally will be subject
to U.S. federal income tax on that interest in the manner as if you were a U.S. person as defined under the Code. You will, however, be exempt from the 30% withholding tax, provided the certification
requirements described above are satisfied. In addition, if you are a foreign corporation, you may be subject to a branch profits tax equal to 30%, or such lower rate as may be prescribed under an
applicable income
tax treaty, of your earnings and profits for the taxable year, subject to adjustments, that are effectively connected with your conduct of a trade or business in the United States. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Conversion of the Notes  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Conversion of the notes into common stock generally will not be a taxable event to you, except with respect to any cash received in lieu of a
fractional share of
common stock. You will realize gain or loss upon the receipt of cash in lieu of a fractional share of common stock, measured by the difference between the amount of cash received and your tax basis
attributable to the fractional share. Such gain will treated as described under "&#151;Sale, Exchange, Repurchase or Redemption of the Notes or Sale or Exchange of Common Stock" below. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>69</FONT></P>

<HR NOSHADE>
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<A NAME="page_dq77601_1_70"> </A>
<UL>
<UL>

<P><FONT SIZE=2><I> Sale, Exchange, Repurchase or Redemption of the Notes or Sale or Exchange of Common Stock  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any gain that you realize upon the sale, exchange, repurchase, or redemption of our notes (except to the extent a portion is attributable to accrued
interest)
and any gain that you realize upon the sale or exchange of common stock generally will not be subject to U.S. federal income tax unless: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
gain is effectively connected with your conduct of a trade or business in the United States and, in the case of an applicable tax treaty, is attributable to your
permanent establishment in the United States;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>you
are an individual who is present in the United States for 183&nbsp;days or more in the taxable year of sale, exchange or other disposition and certain conditions are
met; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>we
are or have been a U.S. real property holding corporation for U.S. federal income tax purposes at any during the shorter of the five-year period ending on the
date of
disposition or your holding period for our notes or common stock. However, we believe that we are not currently, and do not anticipate becoming, a U.S. real property holding corporation. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
your gain is described in the first bullet point above, you generally will be subject to U.S. federal income tax on the net gain derived from the sale. If you are a corporation, then
any such effectively connected gain received by you may also, under certain circumstances, be subject to the branch profits tax at a 30% rate, or such lower rate as may be prescribed under an
applicable income tax treaty. If you are an individual described in the second bullet point above, you will be subject to a flat 30% U.S. federal income tax on the gain derived from the sale, which
may be offset by U.S.-source capital losses, even though you are not considered a resident of the United States. You are urged to consult your tax advisor regarding the tax consequences of the
acquisition, ownership, and disposition of the notes or the common stock. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Constructive Dividends  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under certain circumstances, you may be deemed to have received a constructive dividend. See "&#151;Consequences to U.S. Holders&#151;Constructive
Dividends" above. Any constructive dividend deemed paid to a non-U.S. holder will be subject to U.S. federal withholding tax at a 30% rate or such lower rate as may be specified by an
applicable income tax treaty. It is possible that U.S. federal tax on the constructive dividend would be withheld from interest paid to the non-U.S. holder of the notes. A
non-U.S. holder who is subject to withholding tax under such circumstances should consult its own tax advisor as to whether it can obtain a refund for all or a portion of the withholding
tax. </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2><I> Dividends  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In general, dividends, if any, received by a non-U.S. holder with respect to our common stock will be subject to U.S. federal withholding tax at a
30% rate, unless such rate is reduced by an applicable income tax treaty. Dividends that are effectively connected with your conduct of a trade or business in the United States and, in the case of an
applicable tax treaty, are attributable to your permanent establishment in the United States, are not subject to the withholding tax, but instead are subject to U.S. federal income tax on a net income
basis at applicable individual or corporate rates. As discussed above, certain certification and disclosure requirements must be complied with in order for effectively connected income to be exempt
from withholding. Any such effectively connected dividends received by a non-U.S. holder that is a corporation may also, under certain circumstances, be subject to the branch profits tax
at a 30% rate or such lower rate as may be prescribed under an applicable income tax treaty. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>70</FONT></P>

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<A NAME="page_dq77601_1_71"> </A>
<UL>
<UL>

<P><FONT SIZE=2><I> Backup Withholding and Information Reporting  </I></FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In general, you will not be subject to backup withholding with respect to payments that we make to you, provided that we do not have actual knowledge
or reason
to know that you are a U.S. person and you have given us an appropriate statement certifying, under penalties of perjury, that you are not a U.S. person. In addition, you will not be subject to backup
withholding with respect to the proceeds of the sale of a note or of common stock within the U.S. or conducted through certain U.S.-related financial intermediaries, if the payor receives the
statement described above and does not have actual knowledge or to know that you are a U.S. person or you otherwise establish an exemption. However, we may be required to report annually to the IRS
and to you the amount of, and the tax withheld with respect to, any dividends paid to you, regardless of whether any tax was actually withheld. Copies of these information returns may also be made
available under the provisions of a specific treaty or agreement to the tax authorities of the country in which you reside. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
generally will be entitled to credit any amounts withheld under the backup withholding rules against your U.S. federal income tax provided that the required information is furnished
to the IRS in a timely manner. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>71</FONT></P>

<HR NOSHADE>
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NAME="page_ds77601_1_72"> </A> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ds77601_underwriting"> </A>
<A NAME="toc_ds77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>UNDERWRITING    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith Incorporated and Goldman, Sachs&nbsp;&amp; Co. are the underwriters in connection with this offering.
Subject to the
terms and conditions described in the purchase agreement among us and the underwriters, we have agreed to sell to the underwriters, and the underwriters have agreed to purchase from us, the aggregate
principal amount of the debentures listed opposite their names below. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="68%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="83%" ALIGN="LEFT"><FONT SIZE=1><B>Underwriter<BR> </B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Principal<BR>
Amount</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="83%" VALIGN="TOP"><FONT SIZE=2>Merrill Lynch, Pierce, Fenner &amp; Smith<BR>
Incorporated</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="83%" VALIGN="TOP"><FONT SIZE=2>Goldman, Sachs &amp; Co.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="83%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="83%" VALIGN="TOP"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="83%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
underwriters have agreed to purchase all of the notes sold pursuant to the terms and conditions of the purchase agreement if any of these notes are purchased. If an underwriter
defaults, the purchase agreement provides that the purchase commitments of the non-defaulting underwriters may be increased or the purchase agreement may be terminated. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments the
underwriters may be required to make in respect of these liabilities. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
underwriters are offering the notes, subject to prior sale, when, as and if issued to and accepted by them, subject to approval of legal matters by their counsel, and other
conditions contained in the purchase agreement, such as the receipt by the underwriters of officers' certificates and legal opinions. The underwriters reserve the right to withdraw, cancel or modify
offers to the public and to reject orders in whole or in part. </FONT></P>

<P><FONT SIZE=2><B>Commissions and Discounts  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The underwriters have advised us that they propose initially to offer the notes to the public at the public offering price on the cover page of this
prospectus
and to dealers at that price less a concession not in excess of&nbsp;&nbsp;&nbsp;&nbsp;% of the principal amount of the notes. After the public offering, the public offering price, concession and discount may
be changed. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table shows the public offering price, underwriting discount and proceeds before expenses to us. The information assumes either no exercise or full exercise by the
underwriters of their overallotment option. </FONT></P>

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<DIV ALIGN="CENTER"><TABLE WIDTH="65%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="56%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Per&nbsp;Note</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Without Option</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>With Option</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="56%"><FONT SIZE=2>Public offering price</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="56%"><FONT SIZE=2>Underwriting discount</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="56%"><FONT SIZE=2>Proceeds, before expenses, to&nbsp;us</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="11%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
estimated expenses of this offering, not including the underwriting discount, payable by us, will be approximately $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;. </FONT></P>

<P><FONT SIZE=2><B>Overallotment Option  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have granted to the underwriters an option to purchase up to an additional $22,500,000 in aggregate principal amount of notes at the public
offering price
less the underwriting discount, solely to </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>72</FONT></P>

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<A NAME="page_ds77601_1_73"> </A>
<BR>

<P><FONT SIZE=2>cover
any overallotments. The purchase of these additional notes must close by the date that is 30&nbsp;days from, and including the date of closing of, the purchase of the initial notes. </FONT></P>

<P><FONT SIZE=2><B>No Sales of Similar Securities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We, our executive officers and directors, funds affiliated with our directors and GSK have agreed, with exceptions, not to sell or transfer any of our
common
stock for 90&nbsp;days after the date of this prospectus without first obtaining the written consent of Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith Incorporated and Goldman, Sachs&nbsp;&amp; Co.
Specifically, we and these individuals have agreed not to directly or indirectly: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>offer,
pledge, sell or contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale or
otherwise dispose of or transfer directly or indirectly any shares of our common stock or any securities convertible into or exercisable or exchangeable for common stock, except pursuant to any
preexisting 10b5-1 sales plans; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>enter
into any swap or other arrangement that transfers to another, in whole or in part, the economic consequences of ownership of any of our common stock </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>whether
any such swap or transaction is to be settled by delivery of shares or other securities, in case or otherwise. The restrictions described in the preceding paragraph do not apply to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
sale of the notes to the underwriters;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
issuance by us of shares of common stock upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus that is
described in this prospectus; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
issuance by us of shares or options to purchase shares of common stock pursuant to our stock incentive and employee stock purchase plans, provided that the recipient of
the shares agrees to be subject to the restrictions described in this paragraph. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
foregoing restrictions do not apply to 40,455 shares of common stock pledged prior to this offering by one of our officers to secure a loan. </FONT></P>


<P><FONT SIZE=2><B>New Issue of Notes  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The notes are a new issue of securities with no established trading market. We do not intend to apply for listing of the notes on any national
securities
exchange or for quotation of the notes on any automated dealer quotation system. The underwriters have advised us that they presently intend to make a market in the notes after completion of this
offering. However, the underwriters are under no obligation to do so and may discontinue any market-making activities at any time without any notice. We cannot assure the liquidity of the trading
market for the notes or that an active public market will develop. If an active public trading market for the notes does not develop, the market price and liquidity of the notes may be adversely
affected. If the notes are traded, they may trade at a discount from their initial offering price, depending on prevailing interest rates, the market for similar securities, our performance and other
factors. Our shares of common stock are listed on the Nasdaq Global Market under the symbol "THRX." </FONT></P>

<P><FONT SIZE=2><B>Price Stabilization and Short Positions  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the offering, the underwriters may engage in transactions that stabilize the market price of the notes and our shares of common
stock. Such
transactions may include bids or purchases to peg, fix or maintain the price of the notes or the shares of common stock. If the underwriters create a short position in the notes in connection with the
offering, i.e., if it sells more </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>73</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ds77601_1_74"> </A>
<BR>

<P><FONT SIZE=2>notes
than are listed in this prospectus, the underwriters may reduce that short position by purchasing notes in the open market. Purchases of a security to stabilize the price or to reduce a short
position could cause the price of the security to be higher than it might be in the absence of such purchases. The underwriters may also elect to reduce any short position by exercising all or a part
of the overallotment option described above. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the
representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
we nor the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the
notes or shares of our common stock. In addition, neither we nor the underwriters make any representation that the underwriters will engage in these transactions or that these transactions, once
commenced, will not be discontinued without notice. </FONT></P>

<P><FONT SIZE=2><B>Electronic Distribution  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A prospectus in electronic format may be made available on the websites maintained by the underwriters of this offering. Other than the electronic
prospectus,
the information on the website of the underwriters is not part of this prospectus. The underwriters may agree to allocate a number of notes to themselves for sale to their online brokerage account
holders. </FONT></P>


<P><FONT SIZE=2><B>Other Relationships  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain of the underwriters or their affiliates from time to time have provided, and may provide in the future, investment and commercial banking and
financial
advisory services to us and our affiliates in the ordinary course of business, for which they have received or will receive customary fees and commissions. </FONT></P>

<P><FONT SIZE=2><B>European Economic Area  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), each
underwriter
has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date) it has not
made and will not make an offer of shares to the public in that Relevant Member State prior to the publication of a prospectus in relation to the shares which has been approved by the competent
authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with
the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of shares to the public in that Relevant Member State at any time: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>to
legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in
securities;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>to
any legal entity which has two or more of (1)&nbsp;an average of at least 250 employees during the last financial year; (2)&nbsp;a total balance sheet of more than
&euro;43,000,000; and (3)&nbsp;an annual net turnover of more than &euro;50,000,000, as shown in its last annual or consolidated accounts;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>to
fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of the representatives for
any such offer; or </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>74</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ds77601_1_75"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(d)</FONT></DT><DD><FONT SIZE=2>in
any other circumstances which do not require the publication by the Issuer of a prospectus pursuant to Article&nbsp;3 of the Prospectus Directive. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the purposes of this provision, the expression an "offer of shares to the public" in relation to any shares in any Relevant Member State means the communication in any form and by
any means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe the shares, as the same may be varied in that
Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant
implementing measure in each Relevant Member State. </FONT></P>

<P><FONT SIZE=2><B>United Kingdom  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each underwriter has represented and agreed that: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>it
has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the
meaning of Section&nbsp;21 of the FSMA) received by it in connection with the issue or sale of the shares in circumstances in which Section&nbsp;21(1) of the FSMA would not, if the Issuer was not
an authorised person, apply to the Issuer; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>it
has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares in, from or otherwise involving the United
Kingdom. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Hong Kong  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The shares may not be offered or sold by means of any document other than (i)&nbsp;in circumstances which do not constitute an offer to the public
within the
meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), or (ii)&nbsp;to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and
any rules made thereunder, or (iii)&nbsp;in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong),
and no advertisement, invitation or document
relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which
are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of
only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder. </FONT></P>


<P><FONT SIZE=2><B>Singapore  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document
or material
in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of
an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i)&nbsp;to an institutional investor under Section&nbsp;274 of the Securities and
Futures Act, Chapter 289 of Singapore (the "SFA"), (ii)&nbsp;to a relevant person, or any person pursuant to Section&nbsp;275(1A), and in accordance with the conditions, specified in
Section&nbsp;275 of the SFA or (iii)&nbsp;otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>75</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ds77601_1_76"> </A>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Where
the shares are subscribed or purchased under Section&nbsp;275 by a relevant person which is: (a)&nbsp;a corporation (which is not an accredited investor) the sole business of
which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b)&nbsp;a trust (where the trustee is not an
accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the
beneficiaries' rights and interest in that trust shall not be transferable for 6&nbsp;months after that corporation or that trust has acquired the shares under Section&nbsp;275 except:
(1)&nbsp;to an institutional investor under Section&nbsp;274 of the SFA or to a relevant person, or any person pursuant to Section&nbsp;275(1A), and in accordance with the conditions, specified
in Section&nbsp;275 of the SFA; (2)&nbsp;where no consideration is given for the transfer; or (3)&nbsp;by operation of law. </FONT></P>


<P><FONT SIZE=2><B>Japan  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The securities have not been and will not be registered under the Securities and Exchange Law of Japan (the Securities and Exchange Law) and each
underwriter has
agreed that it will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in
Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or
indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Securities and Exchange Law and any other
applicable laws, regulations and ministerial guidelines of Japan. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>76</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ds77601_1_77"> </A>
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ds77601_legal_matters"> </A>
<A NAME="toc_ds77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>LEGAL MATTERS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain legal matters relating to the issuance of the notes offered by this prospectus will be passed upon for us by Gunderson Dettmer Stough
Villeneuve
Franklin&nbsp;&amp; Hachigian, LLP, Menlo Park, California and Shearman&nbsp;&amp; Sterling LLP, San Francisco, California. Davis Polk&nbsp;&amp; Wardwell, Menlo Park, California, is counsel to the
underwriters in connection with this offering. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ds77601_experts"> </A>
<A NAME="toc_ds77601_3"> </A>
<BR></FONT><FONT SIZE=2><B>EXPERTS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ernst&nbsp;&amp; Young LLP, independent registered public accounting firm, has audited our consolidated financial statements included in our Annual
Report on
Form&nbsp;10-K for the year ended December&nbsp;31, 2006, and management's assessment of the effectiveness of our internal control over financial reporting as of December&nbsp;31,
2006 as set forth in their reports, which are incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements and management's assessment are
incorporated by reference in reliance on Ernst&nbsp;&amp; Young LLP's reports, given on their authority as experts in accounting and auditing. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>77</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=6,SEQ=80,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=301755,FOLIO='77',FILE='DISK133:[08ZAA1.08ZAA77601]DS77601A.;18',USER='DNICHOL',CD='15-JAN-2008;13:14' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->

<P><FONT SIZE=6><B> <hr noshade width=100% align=left size=4>
<hr noshade width=100% align=left size=1>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B>$150,000,000  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B>
<IMG SRC="g2663.jpg" ALT="LOGO" WIDTH="399" HEIGHT="145">
  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B>&nbsp;&nbsp;&nbsp;&nbsp;% Convertible Subordinated Notes due 2015  </B></FONT></P>

<HR NOSHADE ALIGN="CENTER" WIDTH="90">
<P ALIGN="CENTER"><FONT SIZE=2><B> PROSPECTUS  </B></FONT></P>

<HR NOSHADE ALIGN="CENTER" WIDTH="90">
<P ALIGN="CENTER"><FONT SIZE=4><B>Merrill Lynch&nbsp;&amp; Co.  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=4><B> Goldman, Sachs&nbsp;&amp; Co.  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>January&nbsp;&nbsp;&nbsp;&nbsp;, 2008  </B></FONT></P>

<P><FONT SIZE=2><B> <hr noshade width=100% align=left size=1>
<hr noshade width=100% align=left size=4>  </B></FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=81,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=529670,FOLIO='blank',FILE='DISK133:[08ZAA1.08ZAA77601]HO77601A.;8',USER='GMEDINA',CD='14-JAN-2008;17:24' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_ja77601_1_1"> </A> </FONT></P>

<!-- TOC_END -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ja77601_part_ii_information_not_required_in_prospectus"> </A>
<A NAME="toc_ja77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>PART II    <BR>    <BR>    INFORMATION NOT REQUIRED IN PROSPECTUS    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Item 14. Other Expenses of Issuance and Distribution.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth all expenses, other than the underwriting discounts and commissions, payable by the Registrant in connection with the
sale of the
securities being registered. All the amounts shown are estimates except for the registration fee. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="68%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>Securities and Exchange Commission Registration Fee</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>5,296</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>Legal Fees and Expenses</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>350,000</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>Accounting Fees and Expenses</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>150,000</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>Printing and Engraving Expenses</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>40,000</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>Miscellaneous</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>54,704</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="3%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="79%"><FONT SIZE=2>Total</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="12%" ALIGN="RIGHT"><FONT SIZE=2>600,000</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
</TR>
</TABLE></DIV>
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<P><FONT SIZE=2><B>Item 15. Indemnification of Officers and Directors.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;145 of the Delaware General Corporation Law authorizes a court to award or a corporation's board of directors to grant indemnification to
directors and officers in terms sufficiently broad to permit such indemnification under certain circumstances for liabilities (including reimbursement for expenses incurred) arising under the
Securities Act of 1933, as amended (the "Act"). Article&nbsp;VI of the Registrant's Amended and Restated Bylaws provides for mandatory indemnification of its directors and officers and those serving
at the Registrant's request as directors, officers, employees or agents of other organizations to the maximum extent permitted by the Delaware General Corporation Law. The Registrant's Amended and
Restated Certificate of Incorporation provides that, pursuant to Delaware law, its directors shall not be liable for monetary damages for breach of the directors' fiduciary duty as directors to the
Registrant and its stockholders. This provision in the Amended and Restated Certificate of Incorporation does not eliminate the directors' fiduciary duty, and in appropriate circumstances equitable
remedies such as injunctive or other forms of non-monetary relief will remain available under Delaware law. In addition, each director will continue to be subject to liability for breach
of the director's duty of loyalty to the Registrant for acts or omissions not in good faith or involving intentional misconduct or knowing violations of law, for actions leading to improper personal
benefit to the director, and for payment of dividends or approval of stock repurchases or redemptions that are unlawful under Delaware law. The provision also does not affect a director's
responsibilities under any other law, such as the federal securities laws or state or federal environmental laws. The Registrant has entered into indemnification agreements with its officers and
directors. The indemnification agreements provide the Registrant's officers and directors with further indemnification to the maximum extent permitted by the Delaware General Corporation Law. The
Registrant maintains liability insurance for its directors and officers. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>II-1</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ja77601_1_2"> </A>
<BR>

<P><FONT SIZE=2><B>Item 16. Exhibits.  </B></FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="79%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="8%" ALIGN="CENTER"><FONT SIZE=1><B>Exhibit</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="89%" ALIGN="CENTER"><FONT SIZE=1><B>Exhibit Description</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
1.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Form of Purchase Agreement</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.4</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Form of Indenture for Convertible Subordinated Notes due 2015</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.5</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Form of Convertible Subordinated Note due 2015 (see Exhibit&nbsp;4.4)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Opinion of Shearman&nbsp;&amp; Sterling LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.2</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Opinion of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian, LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
12.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Computation of Ratio of Earnings to Fixed Charges</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Consent of Independent Registered Public Accounting Firm</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.2</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Consent of Shearman&nbsp;&amp; Sterling LLP (included in Exhibit&nbsp;5.1)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.3</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Consent of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian, LLP (included in Exhibit&nbsp;5.2)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
24.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Power of Attorney (included on signature page of Registration Statement)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="8%" ALIGN="RIGHT"><FONT SIZE=2><BR>
25.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="89%"><FONT SIZE=2><BR>
Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of New York Trust Company, N.A., as Trustee under the Indenture for the Convertible Subordinated Notes due 2015</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2><B>Item 17. Undertakings.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned Registrant hereby undertakes: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>To
include any prospectus required by section&nbsp;10(a)(3) of the Securities Act of 1933;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2>To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the Commission pursuant to Rule&nbsp;424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the
maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iii)</FONT></DT><DD><FONT SIZE=2>To
include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such
information in the registration statement.
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>That,
for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>II-2</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_ja77601_1_3"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.</FONT></DT><DD><FONT SIZE=2>That,
for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a
seller to the purchaser and will be considered to offer or sell such securities to such purchaser: </FONT></P>

<UL>
<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>Any
preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule&nbsp;424;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2>Any
free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iii)</FONT></DT><DD><FONT SIZE=2>The
portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided
by or on behalf of the undersigned registrant; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iv)</FONT></DT><DD><FONT SIZE=2>Any
other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
<BR><BR></FONT></DD></DL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>5.</FONT></DT><DD><FONT SIZE=2>That,
for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>Each
prospectus filed by the registrant pursuant to Rule&nbsp;424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus
was deemed part of and included in the registration statement; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2>Each
prospectus required to be filed pursuant to Rule&nbsp;424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule&nbsp;430B relating
to an offering made pursuant to Rule&nbsp;415(a)(1)(i), (vii), or (x)&nbsp;for the purpose of providing the information required by section&nbsp;10(a) of the Securities Act of 1933 shall be
deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in Rule&nbsp;430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be
deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or
made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any
such document immediately prior to such effective date.
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.</FONT></DT><DD><FONT SIZE=2>The
undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to
section&nbsp;13(a) or section&nbsp;15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>II-3</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=3,SEQ=84,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=779103,FOLIO='II-3',FILE='DISK133:[08ZAA1.08ZAA77601]JA77601A.;12',USER='CDUSTIN',CD='15-JAN-2008;04:05' -->
<A NAME="page_ja77601_1_4"> </A>
<UL>
<UL>

<P><FONT SIZE=2>section&nbsp;15(d)
of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. </FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>7.</FONT></DT><DD><FONT SIZE=2>Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.</FONT></DT><DD><FONT SIZE=2>The
undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a)&nbsp;of
section&nbsp;310 of the Trust Indenture Act ("Act") in accordance with the rules and regulations prescribed by the Commission under section&nbsp;305(b)2 of the Act. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>II-4</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<UL>
<UL>
</UL>
</UL>
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_jc77601_1_5"> </A> </FONT></P>

<!-- TOC_END -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="jc77601_signatures_#151;form_s-3"> </A>
<A NAME="toc_jc77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>SIGNATURES&#151;FORM S-3    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of
the
requirements for filing on Form&nbsp;S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of South
San Francisco, State of California, on this 15th day of January, 2008.</FONT></P>

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<TABLE WIDTH="78%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>THERAVANCE, INC.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%" ALIGN="RIGHT"><FONT SIZE=2>By:</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>RICK E WINNINGHAM</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2><B>Rick E Winningham</B></FONT><BR>
<FONT SIZE=2><B>Chief Executive Officer</B></FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>II-5</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=86,EFW="2181932",CP="THERAVANCE, INC.",DN="1",CHK=55597,FOLIO='II-5',FILE='DISK133:[08ZAA1.08ZAA77601]JC77601A.;11',USER='GMEDINA',CD='15-JAN-2008;01:06' -->
<A NAME="page_jc77601_1_6"> </A>
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="jc77601_power_of_attorney"> </A>
<A NAME="toc_jc77601_2"> </A>
<BR></FONT><FONT SIZE=2><B>POWER OF ATTORNEY    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;KNOW ALL PERSONS BY THESE PRESENTS, that each individual whose signature appears below constitutes and appoints Rick E Winningham and Michael W.
Aguiar, his true
and lawful
attorneys-in-fact and agents with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to sign any registration statement for the same offering covered by this Registration Statement that is to be effective on
filing pursuant to Rule&nbsp;462(b) promulgated under the Securities Act of 1933, and all post-effective amendments thereto, and to file the same, with all exhibits thereto and all
documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="37%" ALIGN="CENTER"><FONT SIZE=1><B>Signature</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="37%" ALIGN="CENTER"><FONT SIZE=1><B>Title</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="21%" ALIGN="CENTER"><FONT SIZE=1><B>Date</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="37%" ALIGN="CENTER" VALIGN="TOP"><BR><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2>/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>RICK E WINNINGHAM</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Rick E Winningham</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2>Chief Executive Officer and Director (principal executive officer)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2>January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>MICHAEL W. AGUIAR</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Michael W. Aguiar</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Senior Vice President, Finance and Chief Financial Officer (principal financial and accounting officer)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>JEFFREY M. DRAZAN</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Jeffrey M. Drazan</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT V. GUNDERSON, JR.</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Robert V. Gunderson, Jr.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ARNOLD J. LEVINE, PH.D.</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Arnold J. Levine, Ph.D.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>BURTON MALKIEL, PH.D.</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Burton Malkiel, Ph.D.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>P. ROY VAGELOS, M.D.</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> P. Roy Vagelos, M.D.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>WILLIAM H. WALTRIP</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> William H. Waltrip</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>GEORGE M. WHITESIDES, PH.D.</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> George M. Whitesides, Ph.D.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="37%" ALIGN="CENTER"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>WILLIAM D. YOUNG</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> William D. Young</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="37%"><FONT SIZE=2><BR>
Director</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="21%" ALIGN="CENTER"><FONT SIZE=2><BR>
January&nbsp;15, 2008</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>II-6</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<!-- TOC_END -->
<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ka77601_index_to_exhibits"> </A>
<A NAME="toc_ka77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>Index to Exhibits    <BR>    </B></FONT></P>

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<TABLE WIDTH="79%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="10%" ALIGN="CENTER"><FONT SIZE=1><B>Exhibit<BR>
Number</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="88%" ALIGN="CENTER"><FONT SIZE=1><B>Exhibit Description</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
1.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Form of Purchase Agreement</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.4</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Form of Indenture for Convertible Subordinated Notes due 2015</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
4.5</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Form of Convertible Subordinated Note due 2015 (see Exhibit&nbsp;4.4)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Opinion of Shearman&nbsp;&amp; Sterling LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
5.2</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Opinion of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian, LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
12.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Computation of Ratio of Earnings to Fixed Charges</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Consent of Independent Registered Public Accounting Firm</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.2</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Consent of Shearman&nbsp;&amp; Sterling LLP (included in Exhibit&nbsp;5.1)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
23.3</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Consent of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian, LLP (included in Exhibit&nbsp;5.2)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
24.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Power of Attorney (included on signature page of Registration Statement)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2><BR>
25.1</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="88%"><FONT SIZE=2><BR>
Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Bank of New York Trust Company, N.A., as Trustee under the Indenture for the Convertible Subordinated Notes due 2015</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="ke77602_exhibit_1.1"> </A>
<A NAME="toc_ke77602_1"> </A>
<BR></FONT><FONT SIZE=2><B>Exhibit 1.1    <BR>    </B></FONT></P>

<P><FONT SIZE=2><hr
noshade width=100% align=left size=4>
<hr noshade width=100% align=left size=1> </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>THERAVANCE,&nbsp;INC.
</FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>(a
Delaware corporation) </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;<BR></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;%
Subordinated Convertible Notes due 2015 </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>PURCHASE
AGREEMENT </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;<BR></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;<BR></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;<BR></FONT></P>


<P><FONT SIZE=2>Dated:
January&nbsp;[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;], 2008 </FONT></P>


<P><FONT SIZE=2><hr
noshade width=100% align=left size=1>
<hr noshade width=100% align=left size=4> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_kg77602_1_1"> </A> </FONT> <FONT SIZE=2>
THERAVANCE,&nbsp;INC. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>(a
Delaware corporation) </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>$150,000,000
</FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;]</B></FONT><FONT SIZE=2>% Subordinated Convertible Notes due 2015 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>PURCHASE AGREEMENT  </B></FONT></P>

<P ALIGN="RIGHT"><FONT SIZE=2>January&nbsp;[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;],
2008 </FONT></P>

<P><FONT SIZE=2>MERRILL
LYNCH&nbsp;&amp;&nbsp;CO.<BR>
Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Incorporated<BR>
GOLDMAN, SACHS&nbsp;&amp;&nbsp;CO.<BR>
Goldman, Sachs&nbsp;&amp;&nbsp;Co.<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;as Representatives of the several Underwriters<BR></FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><BR>c/o</FONT></DT><DD><FONT SIZE=2>Merrill
 Lynch&nbsp;&amp;&nbsp;Co.<BR>
Merrill Lynch, Pierce Fenner&nbsp;&amp; Smith<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Incorporated<BR>
4 World Financial Center<BR>
New York, New York 10080<BR>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><BR></DT><DD><FONT SIZE=2>Goldman,
Sachs&nbsp;&amp;&nbsp;Co.<BR>
85 Broad Street<BR>
New York, New York 10004 </FONT></DD></DL>


<P><FONT SIZE=2>Ladies
and Gentlemen: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Theravance,&nbsp;Inc.,
a Delaware corporation (the "Company"), confirms its agreement with Merrill Lynch&nbsp;&amp;&nbsp;Co., Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith Incorporated
("Merrill Lynch"), Goldman, Sachs,&nbsp;&amp;&nbsp;Co. ("Goldman, Sachs") and each of the other Underwriters, if any, named in Schedule&nbsp;A hereto (collectively, the "Underwriters," which term
shall also include any underwriter substituted as hereinafter provided in Section&nbsp;10 hereof), for whom Merrill Lynch and Goldman, Sachs are acting as representatives (in such capacity, the
"Representatives"), with respect to (i)&nbsp;the sale by the Company and the purchase by the Underwriters, acting severally and not jointly, of the respective principal amounts set forth in
Schedule&nbsp;A of $150,000,000 aggregate principal amount of the Company's [&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;]% Subordinated Convertible Notes due 2015 (the
"Notes"), and (ii)&nbsp;the grant by the Company to the Underwriters, acting severally and not jointly, of the option described in Section&nbsp;2(b) hereof to purchase all or any part of an
additional $22,500,000 aggregate principal amount of the Notes to cover overallotments, if any. The aforesaid $150,000,000 aggregate principal amount of the Notes (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the $22,500,000 aggregate principal amount of the Notes subject to the option described in Section&nbsp;2(b) hereof (the "Option Securities") are
hereinafter called, collectively, the "Securities." The Securities are to be issued pursuant to an indenture dated as of [&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;] (the
"Indenture") between the Company and The Bank of New York, as trustee (the "Trustee"). Securities issued in book-entry form will be issued to Cede&nbsp;&amp;&nbsp;Co. as nominee of The
Depository Trust Company ("DTC") pursuant to a letter of representations (the "DTC Agreement"), between the Company and DTC. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Securities are convertible into shares of common stock, par value $0.01 per share (the "Common Stock"), of the Company (the "Underlying Common Stock") in accordance with the terms of
the Securities and the Indenture, at the initial conversion rate specified in the Final Term Sheet, subject to adjustment as set forth in the Indenture. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company understands that the Underwriters propose to make a public offering of the Securities as soon as the Representatives deem advisable after this Agreement has been executed and
delivered and the Indenture has been qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has filed with the Securities and Exchange Commission (the "Commission") an automatic shelf registration statement on Form&nbsp;S-3
(No.&nbsp;333-[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;]), including the related preliminary prospectus or prospectuses, which registration statement became
effective upon filing under Rule&nbsp;462(e) of the rules and regulations of the Commission (the "1933 Act Regulations") under the Securities Act of 1933, as amended (the "1933 Act"). Such
registration statement covers the registration of the Securities and the Underlying Common Stock under the 1933 Act. Promptly after execution and delivery of this Agreement, the Company will prepare
and file&nbsp;a prospectus in accordance with the provisions of Rule&nbsp;430B ("Rule&nbsp;430B") of the 1933 Act Regulations and paragraph&nbsp;(b) of Rule&nbsp;424 ("Rule&nbsp;424(b)")
of the 1933 Act Regulations. Any information included in such prospectus that was omitted from such registration statement at the time it became effective but that is deemed to be part of and included
in such registration statement pursuant to Rule&nbsp;430B is referred to as "Rule&nbsp;430B Information." Each prospectus used in connection with the offering of the Securities that omitted
Rule&nbsp;430B Information, is herein called a "Preliminary Prospectus." Such registration statement, at any given time, including the amendments thereto to such time, the exhibits and any schedules
thereto at such time, the documents incorporated by reference therein pursuant to Item&nbsp;12 of Form&nbsp;S-3 under the 1933 Act at such time and the documents otherwise deemed to be
a part thereof or included therein by 1933 Act Regulations, is herein called the "Registration Statement." The Registration Statement at the time it originally became effective is herein called the
"Original Registration Statement." The final prospectus in the form first furnished to the Underwriters for use in connection with the offering of the Securities, including the documents incorporated
by reference therein pursuant to Item&nbsp;12 of Form&nbsp;S-3 under the 1933 Act at the time of the execution of this Agreement and any Preliminary Prospectuses that form&nbsp;a
part thereof, is herein called the "Prospectus." For purposes of this Agreement, all references to the Registration Statement, any Preliminary Prospectus, the Statutory Prospectus (as hereinafter
defined), the Prospectus or any Issuer Free Writing Prospectus (as hereinafter defined) or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system ("EDGAR"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
references in this Agreement to financial statements and schedules and other information which is "contained," "included" or "stated" in the Registration Statement, any Preliminary
Prospectus, the Statutory Prospectus or the Prospectus (or other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information which
is incorporated by reference in or otherwise deemed by 1933 Act Regulations to be a part of or included in the Registration Statement, any Preliminary Prospectus, the Statutory Prospectus or the
Prospectus, as the case may be; and all references in this Agreement to amendments or supplements to the Registration Statement, any Preliminary Prospectus, the Statutory Prospectus or the Prospectus
shall be deemed to mean and include the filing of any document under the Securities Exchange Act of 1934 (the "1934 Act") which is incorporated by reference in or otherwise deemed by 1933 Act
Regulations to be a part
of or included in the Registration Statement, such Preliminary Prospectus, the Statutory Prospectus or the Prospectus, as the case may be. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Representations and Warranties</I></FONT><FONT SIZE=2>. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Representations and Warranties by the Company.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company represents and warrants to each Underwriter as of
the date hereof, the Applicable Time referred to in Section&nbsp;1(a)(ii) hereof and </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<A NAME="page_kg77602_1_3"> </A>
<BR>

<P><FONT SIZE=2>as
of the Closing Time referred to in Section&nbsp;2(c) hereof, and as of each Date of Delivery (if any) referred to in Section&nbsp;2(b) hereof, and agrees with each Underwriter, as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Status as a Well-Known Seasoned Issuer.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A) At the time of filing the Original Registration
Statement, (B)&nbsp;at the time of the most recent amendment thereto for the purposes of complying with Section&nbsp;10(a)(3) of the 1933 Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to Section&nbsp;13 or 15(d) of the 1934 Act or form of prospectus), (C)&nbsp;at the time the Company or any person acting
on its behalf (within the meaning, for this clause only, of Rule&nbsp;163(c) of the 1933 Act Regulations) made any offer relating to the Securities in reliance on the exemption of Rule&nbsp;163 of
the 1933 Act Regulations and (D)&nbsp;at the date hereof, the Company was and is a "well-known seasoned issuer" as defined in Rule&nbsp;405 of the 1933 Act Regulations
("Rule&nbsp;405"), including not having been and not being an "ineligible issuer" as defined in Rule&nbsp;405. The Registration Statement is an "automatic shelf registration statement," as defined
in Rule&nbsp;405, and the Securities, since their registration on the Registration Statement, have been and remain eligible for registration by the Company on a Rule&nbsp;405 "automatic shelf
registration statement." The Company has not received from the Commission any notice pursuant to Rule&nbsp;401(g)(2) of the 1933 Act Regulations objecting to the use of the automatic shelf
registration statement form. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the time of filing the Original Registration Statement, at the earliest time thereafter that the Company or another offering participant made a </FONT><FONT SIZE=2><I>bona
fide</I></FONT><FONT SIZE=2> offer (within the meaning of Rule&nbsp;164(h)(2) of the 1933 Act Regulations) of the Securities and at the date hereof, the Company was not and is not an "ineligible
issuer," as defined in Rule&nbsp;405. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Registration Statement, Prospectus and Disclosure at Time of Sale.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Original Registration Statement
became effective upon filing under Rule&nbsp;462(e) of the 1933 Act Regulations ("Rule&nbsp;462(e)") on January&nbsp;[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;], 2008,
and any post-effective amendment thereto also became effective upon filing under Rule&nbsp;462(e). No stop order suspending the effectiveness of the Registration Statement has been
issued under the 1933 Act and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part
of the Commission for additional information has been complied with. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
offer that is a written communication relating to the Securities made prior to the filing of the Original Registration Statement by the Company or any person acting on its behalf
(within the meaning, for this paragraph only, of Rule&nbsp;163(c) of the 1933 Act Regulations) has been filed with the Commission in accordance with the exemption provided by Rule&nbsp;163 of the
1933 Act Regulations ("Rule&nbsp;163") and otherwise complied with the requirements of Rule&nbsp;163, including without limitation the legending requirement, to qualify such offer for the
exemption from Section&nbsp;5(c) of the 1933 Act provided by Rule&nbsp;163. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the respective times the Original Registration Statement and each amendment thereto became effective, at each deemed effective date with respect to the Underwriters pursuant to
Rule&nbsp;430B(f)(2) of the 1933 Act Regulations, at the Applicable Time and at the Closing Time (and, if any Option Securities are purchased, at the Date of Delivery), the Registration Statement
complied and will comply in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations, and the 1939 Act and the rules and regulations of the Commission thereunder (the
"1939 Act Regulations"), and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements
therein not misleading. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
the Prospectus nor any amendments or supplements thereto, at the time the Prospectus or any such amendment or supplement was issued and at the Closing Time and, if any Option
Securities are purchased, at the Date of Delivery, included or will include an untrue </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<A NAME="page_kg77602_1_4"> </A>
<UL>
<BR>

<P><FONT SIZE=2>statement
of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not
misleading. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Preliminary Prospectus (including the prospectus or prospectuses filed as part of the Original Registration Statement or any amendment thereto) complied when so filed in all
material respects with the 1933 Act Regulations and each Preliminary Prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation&nbsp;S-T. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of the Applicable Time (as hereinafter defined), neither (x)&nbsp;the Issuer General Use Free Writing Prospectus(es) (as defined below) issued at or prior to the Applicable Time and
the Preliminary Prospectus all considered together (collectively, the "General Disclosure Package"), nor (y)&nbsp;any individual Issuer Limited Use Free Writing Prospectus (if any), when considered
together with the General Disclosure Package, included any untrue statement of a material fact or omitted 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. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
used in this subsection and elsewhere in this Agreement: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Applicable
Time" means [&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;] [a/p]m (Eastern time) on
January&nbsp;[&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;], 2008 or such other time as agreed by the Company and the Representatives. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Business
Day" means any weekday that is not a day on which banking institutions in the City of New York are authorized or obligated to close. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Issuer
Free Writing Prospectus" means any "issuer free writing prospectus," as defined in Rule&nbsp;433 of the 1933 Act Regulations ("Rule&nbsp;433"), relating to the Securities
that (i)&nbsp;is required to be filed with the Commission by the Company, including the Final Term Sheet, (ii)&nbsp;is a "road show that is a written communication" within the meaning of
Rule&nbsp;433(d)(8)(i), whether or not required to be filed with the Commission or (iii)&nbsp;is exempt from filing pursuant to Rule&nbsp;433(d)(5)(i) because it contains a description of the
Securities or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in
the Company's records pursuant to Rule&nbsp;433(g). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Issuer
General Use Free Writing Prospectus" means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors, as evidenced by its being
specified in Schedule&nbsp;B hereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Issuer
Limited Use Free Writing Prospectus" means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"Statutory
Prospectus" as of any time means the prospectus relating to the Securities that is included in the Registration Statement immediately prior to that time, including any
document incorporated by reference therein and any Preliminary Prospectus or other prospectus deemed to be a part thereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Issuer Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the public offer and sale of the Securities or until any earlier date that
the issuer notified or notifies the Representatives as described in Section&nbsp;3(e), did not, does not and will not include any information that conflicted, conflicts or will conflict in any
material respect with the information contained in the Registration Statement or the Prospectus, including any document incorporated by reference therein and any preliminary or other prospectus deemed
to be a part thereof that has not been superseded or modified. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<!-- ZEQ.=4,SEQ=5,EFW="2181932",CP="THERAVANCE, INC.",DN="2",CHK=323582,FOLIO='4',FILE='DISK121:[08ZAA2.08ZAA77602]KG77602A.;4',USER='ABEAULI',CD='14-JAN-2008;19:34' -->
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<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
representations and warranties in this subsection shall not apply to statements in or omissions from the Registration Statement, the Prospectus, the Statutory Prospectus, any
Preliminary Prospectus or any Issuer Free Writing Prospectus made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives
expressly for use therein. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Incorporated Documents.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The documents incorporated or deemed to be incorporated by reference in the
Registration Statement and the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations or the 1934 Act and the rules and regulations of the Commission thereunder (the "1934 Act Regulations"), as applicable, and, when read
together with the other information in the Prospectus, (a)&nbsp;at the time the Original Registration Statement became effective, (b)&nbsp;at the Applicable Time, (c)&nbsp;at the earlier of the
time the Prospectus was first used and the date and time of the first contract of sale of Securities in this offering and (d)&nbsp;at the Closing Time (and if any Option Securities are purchased, at
the Date of Delivery), did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Independent Accountants.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Ernst&nbsp;&amp; Young&nbsp;LLP, which audited the financial statements and
supporting schedules included in the Registration Statement or incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus, are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The financial statements included or incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly the financial position of the Company and its consolidated subsidiaries at
the dates indicated and the statement of operations, stockholders' equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; said financial statements have been
prepared in conformity with generally accepted accounting principles ("GAAP") applied on a consistent basis throughout the periods involved. The supporting schedules, if any, present fairly in
accordance with GAAP the information required to be stated therein. The selected financial data and the summary financial information included in the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the audited financial statements included or incorporated by reference in the Registration Statement. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;No Material Adverse Change in Business.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Since the respective dates as of which information is given in the
Registration Statement, the General Disclosure Package or the Prospectus, except as otherwise stated therein, (A)&nbsp;there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse
Effect"), (B)&nbsp;there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the ordinary course of business, which are material with respect to the
Company and its subsidiaries considered as one enterprise, and (C)&nbsp;except as described in the Prospectus there has been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Good Standing of the Company.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company has been duly organized and is validly existing as a corporation
in good standing under the laws of the State of Delaware and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration
Statement, the General Disclosure Package or the Prospectus, and to enter into and perform its obligations under this Agreement; and the Company is duly qualified </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<BR>

<P><FONT SIZE=2>as
a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to be in good standing would not result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Good Standing of Subsidiaries.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The only subsidiaries of the Company are the subsidiaries listed on
Schedule&nbsp;C hereto which, considered in the aggregate as a single subsidiary, do not constitute a "significant subsidiary" as defined in Rule&nbsp;1-02 of
Regulation&nbsp;S-X. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Capitalization.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The authorized, issued and outstanding capital stock of the Company is as set forth in the
Registration Statement, the General Disclosure Package or the Prospectus in the column entitled "Actual" under the caption "Capitalization" (except for subsequent issuances, if any, pursuant to this
Agreement, pursuant to reservations, agreements or employee benefit plans referred to in the Registration Statement, the General Disclosure Package or the Prospectus or pursuant to the exercise of
convertible securities or options referred to in the Registration Statement, the General Disclosure Package or the Prospectus). The shares of issued and outstanding capital stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of the preemptive or
other similar rights of any securityholder of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Authorization of Agreement.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This Agreement has been duly authorized, executed and delivered by the Company. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Authorization of the Indenture.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Indenture has been duly authorized by the Company and duly qualified
under the 1939 Act and, when duly executed and delivered by the Company and the Trustee, will constitute a valid and binding agreement of the Company, enforceable against the Company in accordance
with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Authorization of the Securities.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Securities have been duly authorized and, at the Closing Time, will
have been duly executed by the Company and, when authenticated, issued and delivered in the manner provided for in the Indenture and delivered against payment of the purchase price therefor as
provided in this Agreement, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits of, the Indenture. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Description of the Securities and the Indenture.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Securities and the Indenture will conform in all
material respects to the respective statements relating thereto contained in the Registration Statement, the General Disclosure Package and the Prospectus and will be in substantially the respective
forms filed or incorporated by reference, as the case may be, as exhibits to the Registration Statement. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Authorization and Description of the Underlying Common Stock.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Underlying Common Stock conforms to all
statements relating thereto contained or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus. Upon issuance and delivery of the Securities in
accordance with this Agreement and the Indenture, the Securities will be convertible at the option of the holder thereof for shares of Underlying Common Stock in </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<!-- ZEQ.=6,SEQ=7,EFW="2181932",CP="THERAVANCE, INC.",DN="2",CHK=374243,FOLIO='6',FILE='DISK121:[08ZAA2.08ZAA77602]KG77602A.;4',USER='ABEAULI',CD='14-JAN-2008;19:34' -->
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<UL>
<BR>

<P><FONT SIZE=2>accordance
with the terms of the Securities and the Indenture; the shares of the Underlying Common Stock issuable upon conversion of the Securities have been duly authorized and reserved for issuance
upon such conversion by all necessary corporate action and such shares, when issued upon such conversion, will be validly issued and will be fully paid and non-assessable; no holder of
such shares will be subject to personal liability by reason of being such a holder; and the issuance of such shares upon such conversion will not be subject to the preemptive or other similar rights
of any securityholder of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Absence of Defaults and Conflicts.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Neither the Company nor any of its subsidiaries is in violation of its
charter or by-laws or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or
assets of the Company or any of its subsidiaries is subject (collectively, "Agreements and Instruments") except for such defaults that would not reasonably be expected to have a Material Adverse
Effect; and the execution, delivery and performance of this Agreement, the Indenture, the DTC Agreement and the Securities and the consummation of the transactions contemplated herein and in the
Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities as described in the Registration Statement, the General Disclosure Package and the Prospectus under the caption "Use of
Proceeds," and the issuance of the shares of Underlying Common Stock issuable upon conversion of the Securities), and compliance by the Company with its obligations hereunder and under the Indenture
and the Securities have been duly authorized by all necessary corporate action and do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation of the provisions of the charter or by-laws of the Company or any of its subsidiaries or any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any of its subsidiaries or any of
their material assets, properties or operations. As used herein, a "Repayment Event" means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of its subsidiaries. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Absence of Labor Dispute.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;No labor dispute with the employees of the Company or any of its subsidiaries
exists or, to the knowledge of the Company, is imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers,
customers or contractors, which, in either case, would result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Absence of Proceedings.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;There is no claim, action, suit, proceeding, inquiry or investigation before or
brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any of its subsidiaries,
which is required to be disclosed in the Registration Statement, the General Disclosure Package and the Prospectus (other than as disclosed therein), or which would reasonably be expected to result in
a Material Adverse Effect, or which would reasonably be expected to materially and adversely affect the performance by the Company of its obligations hereunder; the aggregate of all pending legal or
governmental proceedings to which the Company </FONT></P>

</UL>
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<P><FONT SIZE=2>or
any of its subsidiaries is a party or of which any of their respective property or assets is the subject which are not described in the Registration Statement, General Disclosure Package and the
Prospectus, including ordinary routine litigation incidental to the business, would not reasonably be expected to result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xviii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Accuracy of Exhibits.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;There are no contracts or documents which are required to be described in the
Registration Statement, the General Disclosure Package or the Prospectus or the documents incorporated by reference therein or to be filed as exhibits thereto which have not been so described and
filed as required. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xix)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Possession of Intellectual Property.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company owns, or otherwise possesses, sufficient rights to use
all patents, patent rights, licenses, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable proprietary rights), trademarks, service marks, trade names or
other intellectual property (collectively, "Intellectual Property") necessary to carry on the business of the Company as described in the Registration Statement, the General Disclosure Package or the
Prospectus, except where the lack of such rights would not result, singly or in the aggregate, in a Material Adverse Effect. The Company has not received any notice, and is not otherwise aware of any
infringement of or conflict with asserted rights of others with respect to any Intellectual Property, or of any valid grounds for any bona fide claim that would render any of the Company's
Intellectual Property rights invalid or inadequate to protect the interests of the Company or its subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xx)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Absence of Manipulation.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Neither the Company nor any Affiliate of the Company has taken, nor will the
Company or any Affiliate take, directly or indirectly, any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Absence of Further Requirements.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Company of its obligations hereunder, in connection with the
offering, issuance or sale of the Securities hereunder, the issuance of shares of Underlying Common Stock upon conversion of the Securities, the consummation of the transactions contemplated by this
Agreement, except such as have been already obtained or as may be required under the 1933 Act or the 1933 Act Regulations, state securities laws, laws and regulations of jurisdictions outside the
United States, and except for the qualification of the Indenture under the 1939 Act. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Possession of Licenses and Permits.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company and its subsidiaries possess such permits, licenses,
approvals, consents and other authorizations (collectively, "Governmental Licenses") issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the
business of the Company as described in the Registration Statement, the General Disclosure Package or the Prospectus, except where the failure so to possess would not, singly or in the aggregate,
result in a Material Adverse Effect; the Company and its subsidiaries are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would
not, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses
or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, result in a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<P><FONT SIZE=2>revocation
or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxiii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Title to Property.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company and its subsidiaries have good and marketable title or have valid rights
to lease or otherwise use all real and personal property that is material to the business of the Company, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except such as (a)&nbsp;are described in the Registration Statement, the General Disclosure Package or the Prospectus or (b)&nbsp;do not, singly or in the aggregate,
materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company or its subsidiaries; and all of the leases and
subleases material to the business of the Company and its subsidiaries, considered as one enterprise, and under which the Company or its subsidiaries holds properties described in the Registration
Statement, the General Disclosure Package or the Prospectus, are in full force and effect, and neither the Company nor any of its subsidiaries has any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Company or its subsidiaries under any of the leases or subleases mentioned above. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxiv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Investment Company Act.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company is not required, and upon the issuance and sale of the Securities as
herein contemplated and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package or the Prospectus will not be required, to register as
an "investment company" under the Investment Company Act of 1940, as amended (the "1940 Act"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Environmental Laws.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as described in the Registration Statement, the General Disclosure Package, or
the Prospectus and except as would not, singly or in the aggregate, result in a Material Adverse Effect, (A)&nbsp;neither the Company nor any of its subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or protection of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products, asbestos-containing materials or mold (collectively, "Hazardous Materials") or to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Hazardous Materials (collectively, "Environmental Laws"), (B)&nbsp;the Company and its subsidiaries have all permits, authorizations and approvals
required under any applicable Environmental Laws and are each in compliance with their requirements, (C)&nbsp;there are no pending or, to the knowledge of the Company, threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to any Environmental Law against the Company
or any of its subsidiaries and (D)&nbsp;there are no events or circumstances that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action,
suit or proceeding by any private party or governmental body or agency, against or affecting the Company or any of its subsidiaries relating to Hazardous Materials or any Environmental Laws. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxvi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Registration Rights.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except for such rights as have been satisfied or waived, there are no persons with
registration rights or other similar rights to have any securities registered pursuant to the Registration Statement or otherwise registered by the Company under the 1933 Act. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxvii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;ERISA.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth or incorporated by reference in the Prospectus, neither the Company nor any
of its subsidiaries has violated any provisions of the Employee Retirement </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<P><FONT SIZE=2>Income
Security Act of 1974, as amended, except for violations which, singly or in the aggregate, would not result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxviii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Foreign Corrupt Practices Act.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth or incorporated by reference in the Prospectus,
neither the Company nor any of its subsidiaries has violated any provisions of the Foreign Corrupt Practices Act or the rules and regulations promulgated thereunder except for such violations which,
singly or in the aggregate, would not result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxix)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Insurance.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company and its subsidiaries carry or are entitled to the benefits of insurance, with
financially sound and reputable insurers, in such amounts and covering such risks as the Company believes is reasonably prudent, and all such insurance is in full force and effect. The Company has no
reason to believe that it or any of its subsidiaries will not be able (A)&nbsp;to renew its existing insurance coverage as and when such policies expire or (B)&nbsp;to obtain comparable coverage
from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxx)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Accounting Controls and Disclosure Controls.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company and each of its subsidiaries maintain a system of
internal control over financial reporting sufficient to provide reasonable assurance that (1)&nbsp;transactions are executed in accordance with management's general or specific authorizations;
(2)&nbsp;transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (3)&nbsp;access to assets is
permitted only in accordance with management's general or specific authorization; and (4)&nbsp;the recorded accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. Except as described in the Prospectus, since the end of the Company's most recent audited fiscal year, (I)&nbsp;the Company is not aware
of any material weakness in the Company's internal control over financial reporting (whether or not remediated) and (II)&nbsp;no change in the Company's internal control over financial reporting
that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting. The Company and its subsidiaries employ disclosure controls and
procedures that are designed to reasonably assure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized
and reported, within the time periods specified in the Commission's rules and forms, and that material information regarding the Company and its subsidiaries is accumulated and communicated to the
Company's management, including its principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxxi)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Compliance with the Sarbanes-Oxley Act.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;There is and has been no failure on the part of the Company or
any of the Company's directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith (the "Sarbanes Oxley Act"), including Section&nbsp;402 related to loans and Sections&nbsp;302 and 906 related to certifications. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxxii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Pending Proceedings and Examinations.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Registration Statement is not the subject of a pending
proceeding or examination under Section&nbsp;8(d) or 8(e) of the 1933 Act, and the Company is not the subject of a pending proceeding under Section&nbsp;8A of the 1933 Act in connection with the
offering of the Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxxiii)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Trials and Studies.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Any clinical trials and human studies conducted by the Company and, to the
knowledge of the Company, any clinical trials and human studies conducted on behalf of the Company or in which the Company has participated were and, if still pending, are being conducted in
accordance with standard medical and scientific research procedures and any applicable rules, regulations and policies of the jurisdiction in which such trials and studies are </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<UL>
<BR>

<P><FONT SIZE=2>being
conducted, except where the failure to be so conducted would not reasonably be expected to have a Material Adverse Effect. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxxiv)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Regulatory Compliance.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company has operated and currently is in compliance with all applicable
rules, regulations and policies of the FDA, except where the failure to so operate or be in compliance would not reasonably be expected to have a Material Adverse Effect. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Officer's Certificates.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Any certificate signed by any officer of the Company or any of its subsidiaries
delivered to the Representatives or to counsel for the Underwriters shall be deemed a representation and warranty by the Company to each Underwriter as to the matters covered thereby. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Sale and Delivery to Underwriters; Closing</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Initial Securities.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;On the basis of the representations and warranties herein contained and subject to the
terms and conditions herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Company,
at a purchase price of [&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;]% of the aggregate principal amount of the Securities (the "Purchase Price"), the aggregate principal amount
of Initial Securities set forth in Schedule&nbsp;A opposite the name of such Underwriter plus accrued interest, if any, plus any additional principal amount of Securities which such Underwriter may
become obligated to purchase pursuant to the provisions of Section&nbsp;10 hereof. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<P><FONT SIZE=2><A
NAME="page_ki77602_1_12"> </A> </FONT> <FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Option Securities.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;In addition, on the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company hereby grants an option to the Underwriters, severally and not jointly, to purchase up to an additional $22,500,000 aggregate
principal amount of Option Securities at the Purchase Price, plus accrued interest, if any, from the Closing Time to the Date of Delivery (as defined below). The option hereby granted will expire
30&nbsp;days from and including the date hereof, and may be exercised in whole or in part from time to time only for the purpose of covering overallotments which may be made in connection with the
offering and distribution of the Initial Securities upon written notice by the Representatives to the Company setting forth the number of Option Securities as to which the several Underwriters are
then exercising the option and the time and date of payment and delivery for such Option Securities. Any such time and date of delivery (a "Date of Delivery") shall be at least two Business Days after
written notice is given as determined by the Representatives, but shall not be later than seven full Business Days after the exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the Option Securities, each of the Underwriters, acting severally and not jointly, will purchase that proportion of the
aggregate principal amount of Option Securities then being purchased which the principal amount of Initial Securities set forth in Schedule&nbsp;A opposite the name of such Underwriter bears to the
aggregate principal amount of Initial Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Payment</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;Payment of the purchase price for, and delivery of the Initial Securities shall be made at the
offices of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian,&nbsp;LLP, 155 Constitution Drive, Menlo Park, California, or at such other place as shall be agreed upon by the
Representatives and the Company, at 9:00&nbsp;A.M. (Eastern time) on the third (fourth, if the pricing occurs after 4:30&nbsp;P.M. (Eastern time) on any given day) Business Day after the date
hereof (unless postponed in accordance with the provisions of Section&nbsp;10), or such other time not later than ten Business Days after such date as shall be agreed upon by the Representatives and
the Company (such time and date of payment and delivery being herein called "Closing Time"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the purchase price for, and delivery of, such Option Securities shall be
made at the above-mentioned offices, or at such other place as shall be agreed upon by the Representatives and the Company, on each Date of Delivery as specified in the notice from the Representatives
to the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment
shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the Company, against delivery to the Representatives for the
respective accounts of the Underwriters of the Securities to be purchased by them. It is understood that each Underwriter has authorized the Representatives, for its account, to accept delivery of,
receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed to purchase. Merrill Lynch or Goldman, Sachs, individually and
not as representatives of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial
Securities or the Option Securities, if any, to be purchased by any Underwriter whose funds have not been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such Underwriter from its obligations hereunder. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Denominations; Registration</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Initial Securities and the Option Securities, if any, shall be evidenced by
one or more global securities registered in the name of Cede&nbsp;&amp;&nbsp;Co., as nominee of the DTC for the account of the Underwriters against payment to or upon the order of the Company of the
purchase price by wire transfer in immediately available funds. The certificates for the Initial Securities and the Option Securities, if any, will be made available for examination and packaging by
the Representatives in The City of New York not later than 10:00&nbsp;A.M. (Eastern Time) on the Business Day prior to the Closing Time or the relevant Date of Delivery, as the case may be. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Covenants of the Company</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company covenants with each Underwriter as follows: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Compliance with Securities Regulations and Commission Requests; Payment of Filing Fees</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company, subject
to Section&nbsp;3(b), will comply with the requirements of Rule&nbsp;430B and Rule&nbsp;424, as applicable, and will notify the Representatives immediately, and confirm the notice in writing,
(i)&nbsp;when any post-effective amendment to the Registration Statement or new registration statement relating to the Securities shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii)&nbsp;of the receipt of any comments from the Commission, (iii)&nbsp;of any request by the Commission for any amendment to the
Registration Statement or the filing of a new registration statement or any amendment or supplement to the Prospectus or any document incorporated by reference therein or otherwise deemed to be a part
thereof or for additional information, (iv)&nbsp;of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or such new registration statement or
of any order preventing or suspending the use of any Preliminary Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, or of the initiation
or threatening of any proceedings for any of such purposes or of any examination pursuant to Section&nbsp;8(e) of the 1933 Act concerning the Registration Statement and (v)&nbsp;if the Company
becomes the subject of a proceeding under Section&nbsp;8A of the 1933 Act in connection with the offering of the Securities. The Company will effect the filings required under Rule&nbsp;424(b), in
the manner and within the time period required by Rule&nbsp;424(b) (without reliance on Rule&nbsp;424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether the form
of prospectus transmitted for filing under Rule&nbsp;424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company will make
every reasonable effort to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment. The Company shall pay the required
Commission filing fees relating to the Securities within the time required by Rule&nbsp;456(b)(1) (i)&nbsp;of the 1933 Act Regulations without regard to the proviso therein and otherwise in
accordance with Rules&nbsp;456(b) and 457(r) of the 1933 Act Regulations (including, if applicable, by updating the "Calculation of Registration Fee" table in accordance with
Rule&nbsp;456(b)(1)(ii) either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule&nbsp;424(b)). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Filing of Amendments and Exchange Act Documents; Preparation of Final Term Sheet</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will give the
Representatives notice of its intention to file or prepare any amendment to the Registration Statement or new registration statement relating to the Securities or any amendment, supplement or revision
to either any Preliminary Prospectus (including any prospectus included in the Original Registration Statement or amendment thereto at the time it became effective) or to the Prospectus, whether
pursuant to the 1933 Act, the 1934 Act or otherwise, and the Company will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing or
use, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object, except as required pursuant to applicable law,
legal or administrative order or process. The Company has given the Representatives notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48&nbsp;hours prior to the
Applicable Time; the Company will give the Representatives notice of its intention to make any such filing from the Applicable Time to the Closing Time and will furnish the Representatives with copies
of any such documents a reasonable amount of time prior to such proposed filing and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably
object, except as required pursuant to applicable law, legal or administrative order or process. The Company will prepare a final term sheet (the "Final Term Sheet"), attached hereto as
Schedule&nbsp;E, reflecting the final terms of the Securities, in form and substance satisfactory to the Representatives, and shall file such Final Term Sheet as an "issuer free writing prospectus"
pursuant to Rule&nbsp;433 prior to the date that is two Business Days after the date hereof; provided that the Company shall furnish the Representatives with copies of such Final Term Sheet a
reasonable amount of time </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>13</FONT></P>

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<P><FONT SIZE=2>prior
to such proposed filing (and in any event prior to the Applicable Time) and will not use or file any such document to which the Representatives or counsel to the Underwriters shall reasonably
object. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Delivery of Registration Statements</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company has furnished or will deliver to the Representatives and
counsel for the Underwriters, without charge, signed copies of the Original Registration Statement and of each amendment thereto (including exhibits filed therewith or incorporated by reference
therein and documents incorporated or deemed to be incorporated by reference therein or otherwise deemed to be a part thereof) and signed copies of all consents and certificates of experts, and will
also deliver to the Representatives, without charge, a conformed copy of the Original Registration Statement and of each amendment thereto (without exhibits) for each of the Underwriters. The copies
of the Original Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation&nbsp;S-T. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Delivery of Prospectuses</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company has delivered to each Underwriter, without charge, as many copies of
each Preliminary Prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act. The Company will furnish to each
Underwriter, without charge, during the period when the Prospectus is required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation&nbsp;S-T. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Continued Compliance with Securities Laws</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will comply with the 1933 Act and the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations and the 1939 Act and the 1939 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Securities, any event shall occur or condition shall exist
as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at any such time to amend the Registration Statement or to file&nbsp;a new
registration statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file with the
Commission, subject to Section&nbsp;3(b), such amendment, supplement or new registration statement as may be necessary to correct such statement or omission or to comply with such requirements, the
Company will use its best efforts to have such amendment or new registration statement declared effective as soon as practicable (if it is not an automatic shelf registration statement with respect to
the Securities) and the Company will furnish to the Underwriters such number of copies of such amendment, supplement or new registration statement as the Underwriters may reasonably request. If at any
time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict in
any material respect with the information contained in the Registration Statement or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will
promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>14</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Blue Sky Qualifications</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will cooperate with the Underwriters to qualify the Securities and the
shares of Underlying Common Stock for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representatives may designate and to
maintain such qualifications in effect for a period of not less than one year from the date hereof; provided, however, that the Company shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Rule&nbsp;158</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will timely file such reports pursuant to the 1934 Act as are necessary in
order to make generally available to its securityholders as soon as practicable an earnings statement for
the purposes of, and to provide to the Underwriters the benefits contemplated by, the last paragraph of Section&nbsp;11(a) of the 1933 Act. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Use of Proceeds</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will use the net proceeds received by it from the sale of the Securities in the
manner specified in the Prospectus under "Use of Proceeds." </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Restriction on Sale of Securities</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;During a period of 90&nbsp;days from the date of the Prospectus, the
Company will not, without the prior written consent of the Representatives, directly or indirectly, 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 or otherwise transfer or dispose of any share of Common Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii)&nbsp;enter into any swap or any other agreement or any transaction that transfers, in
whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or transaction described in clause&nbsp;(i) or (ii)&nbsp;above is to be
settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to the (A)&nbsp;Securities to be sold hereunder, (B)&nbsp;the issuance
and sale of common stock by the Company to GSK pursuant to GSK's exercise of its pro rata rights following the end of each calendar quarter to purchase its pro rata portion of shares issued by the
Company in the preceding quarter (other than the Securities), (C)&nbsp;any shares of Common Stock issued pursuant to outstanding options or other rights under the Company's existing stock option
plans or other employee benefit plans, in each case as described in the Prospectus, (D)&nbsp;any options to purchase shares of Common Stock granted under the Company's existing stock option plans or
other employee benefit plans, in each case as described in the Prospectus; provided that such options shall not be vested and exercisable prior to the expiration of the lock-up period as
described in Exhibit&nbsp;B hereto, except that ordinary course replenishment and promotion stock option grants and restricted stock awards to be made on January&nbsp;29, February&nbsp;1,
March&nbsp;1 and April&nbsp;1 may vest on a monthly basis following their grant, (E)&nbsp;any shares of Common Stock issued by the Company upon the exercise of any other option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the Prospectus or (F)&nbsp;any shares of Common Stock issued by the Company pursuant to the Company's Employee Stock
Purchase Plan as described in the Prospectus. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Reservation of Securities.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company will reserve and keep available at all times, free of preemptive or
other similar rights, a sufficient number of shares of Common Stock, for the purposes of enabling the Company to satisfy any obligations to issue Underlying Common Stock upon conversion of the
Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Reporting Requirements</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company, during the period when the Prospectus is required to be delivered under
the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and the 1934 Act Regulations. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>15</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Listing.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company will use its best efforts to effect and maintain the listing of the Underlying Common
Stock issuable upon conversion of the Securities on the Nasdaq Global Market. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;DTC.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company will cooperate with the Underwriter to permit the offered Securities to be eligible for
clearance and settlement through the facilities of the DTC. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Issuer Free Writing Prospectuses.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Company represents and agrees that, unless it obtains the prior
written consent of the Representatives, and each Underwriter represents and agrees that, unless it obtains the prior written consent of the Company and the other Underwriter, it has not made and will
not make any offer relating to the Securities that would constitute an "issuer free writing prospectus," as defined in Rule&nbsp;433, or that would otherwise constitute a "free writing prospectus,"
as defined in Rule&nbsp;405, required to be filed with the Commission. Any such free writing prospectus consented to by the Company and the Underwriters are hereinafter referred to as a "Permitted
Free Writing Prospectus." The Company represents that it has treated or agrees that it will treat each Permitted Free Writing Prospectus as an "issuer free writing prospectus," as defined in
Rule&nbsp;433, and has complied and will comply with the requirements of Rule&nbsp;433 applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where
required, legending and record keeping. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Payment of Expenses</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Expenses</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company will pay or cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including (i)&nbsp;the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii)&nbsp;the preparation, printing and delivery to the Underwriters of this Agreement, any Agreement among Underwriters, the Indenture, the Securities and such other documents as
may be required in connection with the offering, purchase, sale, issuance or delivery of the Securities or the issuance or delivery of the Underlying Common Stock issuable upon conversion thereof,
(iii)&nbsp;the preparation, issuance and delivery of the certificates for the Securities to the Underwriters, including any stock or other transfer taxes, any stamp or other duties payable upon the
sale, issuance and delivery of the Securities to the Underwriters and the certificates for the Underlying Common Stock upon conversion thereof, (iv)&nbsp;the fees and disbursements of the Company's
counsel, accountants and other advisors, (v)&nbsp;the qualification of the Securities and the Underlying Common Stock under securities laws in accordance with the provisions of Section&nbsp;3(f)
hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any
supplement thereto, (vi)&nbsp;the printing and delivery to the Underwriters of copies of each Preliminary Prospectus, any Permitted Free Writing Prospectus and of the Prospectus and any amendments
or supplements thereto and any costs associated with electronic delivery of any of the foregoing by the Underwriters to investors, (vii)&nbsp;the preparation, printing and delivery to the
Underwriters of copies of the Blue Sky Survey and any supplement thereto, (viii)&nbsp;the fees and expenses of any transfer agent or registrar for the Securities, (ix)&nbsp;the costs and expenses
of the Company relating to investor presentations on any "road show" undertaken in connection with the marketing of the Securities, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any consultants engaged with the Company's consent in connection with the road show presentations, travel and lodging expenses of the
officers of the Company and any such consultants, and one-third of the cost of aircraft and other transportation chartered with the Company's consent in connection with the road show
(x)&nbsp;the filing fees incident to, and the reasonable fees and disbursements of counsel to the Underwriters in connection with, the review by the Financial Industry Regulatory Authority ("FINRA")
of the terms of the sale of the Securities, (xi)&nbsp;the fees and expenses incurred in connection with the inclusion of the Underlying Common Stock issuable upon conversion of the Securities in the
Nasdaq Global Market, (xii)&nbsp;the costs and expenses associated with the reforming of any contracts for sale of the Securities made by the Underwriters caused by a breach of the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>16</FONT></P>

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<BR>

<P><FONT SIZE=2>representation
contained in the third paragraph of Section&nbsp;1(a)(ii), and (xiii)&nbsp;the fees and expenses of the Trustee, including the fees and disbursements of counsel for the Trustee in
connection with the Indenture and the Securities. It is understood that, subject to this section and Section&nbsp;4(b), the Underwriters will pay all of their costs and expenses, including fees and
disbursements of their counsel, any travel and lodging expenses incurred by them in connection with any road show presentations and any advertising expenses connected with any offers they may make. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Termination of Agreement</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If this Agreement is terminated by the Representatives in accordance with the
provisions of Section&nbsp;5, Section&nbsp;9(a)(i) or Section&nbsp;11 hereof, the Company shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriters. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Conditions of Underwriters' Obligations</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The obligations of the several Underwriters hereunder
are subject to the accuracy of the representations and warranties of the Company contained
in Section&nbsp;1 hereof or in certificates of any officer of the Company delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and other obligations
hereunder that are required to be performed or satisfied by it at or prior to the Closing Time, and to the following further conditions: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Effectiveness of Registration Statement; Filing of Prospectus; Payment of Filing Fee</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Registration
Statement has become effective and at Closing Time no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters. A
prospectus containing the Rule&nbsp;430B Information shall have been filed with the Commission in the manner and within the time period required by Rule&nbsp;424(b) without reliance on
Rule&nbsp;424(b)(8) (or a post-effective amendment providing such information shall have been filed and become effective in accordance with the requirements of Rule&nbsp;430B). The
Final Term Sheet and any other material required to be filed by the Company pursuant to Rule&nbsp;433(d) under the Rules and Regulations, shall have been timely filed. The Company shall have paid
the required Commission filing fees relating to the Securities within the time period required by Rule&nbsp;456(1)(i) of the 1933 Act Regulations without regard to the proviso therein and otherwise
in accordance with Rules&nbsp;456(b) and 457(r) of the 1933 Act Regulations and, if applicable, shall have updated the "Calculation of Registration Fee" table in accordance with
Rule&nbsp;456(b)(1)(ii) either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule&nbsp;424(b). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Opinions of Counsel for Company</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At Closing Time, the Representatives shall have received opinions, dated as
of Closing Time, of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian,&nbsp;LLP and Shearman&nbsp;&amp; Sterling&nbsp;LLP, counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letters for each of the Underwriters to the effect set forth in Exhibits&nbsp;A-1 and
A-2 hereto, respectively, and to such further effect as counsel to the Underwriters may reasonably request. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Opinion of Counsel for Underwriters</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At Closing Time, the Representatives shall have received an opinion,
dated as of Closing Time, of Davis Polk&nbsp;&amp; Wardwell, counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters in form and
substance reasonably satisfactory to the Underwriters. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Officers' Certificate</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At Closing Time, there shall not have been, since the date hereof or since the
respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Representatives shall have
received a certificate of the Chief Executive Officer or a Vice President of the Company and of the chief financial </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>17</FONT></P>

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<P><FONT SIZE=2>or
chief accounting officer of the Company, dated as of Closing Time, to the effect that (i)&nbsp;there has been no such material adverse change, (ii)&nbsp;the representations and warranties in
Section&nbsp;1(a) hereof are true and correct with the same force and effect as though expressly made at and as of Closing Time, (iii)&nbsp;the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior to Closing Time, and (iv)&nbsp;no stop order suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are pending or, to their knowledge, contemplated by the Commission. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Accountant's Comfort Letter</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At the time of the execution of this Agreement, the Representatives shall have
received from Ernst&nbsp;&amp; Young&nbsp;LLP a letter dated such date, in form and substance reasonably satisfactory to the Representatives, together with signed or reproduced copies of such letter
for each of the other Underwriters containing statements and information of the type ordinarily included in accountants' "comfort letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement, the General Disclosure Package, and the Prospectus as of the Applicable Time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Bring-down Comfort Letter</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At Closing Time, the Representatives shall have received from
Ernst&nbsp;&amp; Young&nbsp;LLP a letter, dated as of Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection&nbsp;(f) of this Section,
except that the specified date referred to shall be a date not more than three Business Days prior to Closing Time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Lock-up Agreements</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At the date of this Agreement, the Representatives shall have received an
agreement substantially in the form of Exhibit&nbsp;B hereto signed by the persons listed on Schedule&nbsp;D hereto. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Conditions to Purchase of Option Securities</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Underwriters exercise their option
provided in Section&nbsp;2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company contained herein and the statements in any
certificates furnished by the Company and its subsidiaries hereunder shall be true and correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representatives shall have
received: </FONT></P>

<UL>
<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2><I>Officers' Certificate</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;A certificate, dated such Date of Delivery, of the Chief Executive Officer or a Vice
President of the Company and of the chief financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to Section&nbsp;5(d) hereof
remains true and correct as of such Date of Delivery.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2><I>Opinions of Counsel for Company</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;An opinion of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp;
Hachigian,&nbsp;LLP and Shearman&nbsp;&amp; Sterling&nbsp;LLP, counsel for the Company, in form and substance reasonably satisfactory to counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinions required by Section&nbsp;5(b) hereof.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iii)</FONT></DT><DD><FONT SIZE=2><I>Opinion of Counsel for Underwriters</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;An opinion of Davis Polk&nbsp;&amp; Wardwell, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section&nbsp;5(c)
hereof.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iv)</FONT></DT><DD><FONT SIZE=2><I>Bring-down Comfort Letter</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;A letter from Ernst&nbsp;&amp; Young&nbsp;LLP, in form and substance
reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the Representatives pursuant to
Section&nbsp;5(f) hereof, except that the "specified date" in the letter furnished pursuant to this paragraph shall be a date not more than five days prior to such Date of Delivery. </FONT></DD></DL>
</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>18</FONT></P>

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<UL>
<UL>
</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Additional Documents</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;At Closing Time, and at each Date of Delivery, counsel for the Underwriters shall have
been furnished with such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein contemplated. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Termination of Agreement</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If any condition specified in this Section shall not have been fulfilled when and
as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities, on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be terminated by the Representatives by written notice to the Company at any time at or prior to the Closing Time or such Date of
Delivery, as the case may be, and such termination shall be without liability of any party to any other party except as provided in Section&nbsp;4 and except that Sections&nbsp;1, 6, 7 and 8 shall
survive any such termination and remain in full force and effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Indemnification</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Indemnification of Underwriters</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company agrees to indemnify and hold harmless each Underwriter, its
affiliates, as such term is defined in Rule&nbsp;501(b) under the 1933 Act (each, an "Affiliate"), and each person, if any, who controls any Underwriter within the meaning of Section&nbsp;15 of
the 1933 Act or Section&nbsp;20 of the 1934 Act as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto), including the Rule&nbsp;430B Information, or the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any Preliminary Prospectus,
any Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section&nbsp;6(d) below) any such settlement is effected with the written consent of the Company; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;against
any and all expense whatsoever, as reasonably incurred (including the fees and disbursements of counsel chosen by the Representatives), in investigating,
preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i)&nbsp;or (ii)&nbsp;above; </FONT></P>

</UL>

<P><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>however</I></FONT><FONT SIZE=2>, that this indemnity agreement shall not apply to any loss, liability, claim, damage
or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the
Company by any Underwriter directly or through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule&nbsp;430B Information or any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus (or any amendment or supplement thereto). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>19</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Indemnification of Company, Directors and Officers</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;Each Underwriter severally agrees to indemnify and hold
harmless the Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of Section&nbsp;15 of the 1933
Act or Section&nbsp;20 of the 1934 Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection&nbsp;(a) of this Section (including,
without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim), as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including the Rule&nbsp;430B Information or any Preliminary Prospectus, any
Issuer Free Writing Prospectus, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the
Company by such Underwriters directly or through the Representatives expressly for use therein. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Actions against Parties; Notification</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified pursuant to Section&nbsp;6(a) above, counsel to the indemnified parties shall be selected by the Representatives, and,
in the case of parties indemnified pursuant to Section&nbsp;6(b) above, counsel to the indemnified parties shall be selected by the Company. An indemnifying party may participate at its own expense
in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for 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. No indemnifying party shall, without
the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section&nbsp;6 or Section&nbsp;7 hereof
(whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i)&nbsp;includes an unconditional release of each indemnified party
from all liability arising out of such litigation, investigation, proceeding or claim and (ii)&nbsp;does not include a statement as to or an admission of fault, culpability or a failure to act by or
on behalf of any indemnified party. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Settlement without Consent if Failure to Reimburse</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by
Section&nbsp;6(a)(ii) effected without its written consent if (i)&nbsp;such settlement is entered into more than 45&nbsp;days after receipt by such indemnifying party of the aforesaid request,
(ii)&nbsp;such indemnifying party shall have received notice of the terms of such settlement at least 30&nbsp;days prior to such settlement being
entered into and (iii)&nbsp;such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Contribution</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If the indemnification provided for in Section&nbsp;6 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i)&nbsp;in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>20</FONT></P>

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<BR>

<P><FONT SIZE=2>offering
of the Securities pursuant to this Agreement or (ii)&nbsp;if the allocation provided by clause&nbsp;(i) is not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause&nbsp;(i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
relative benefits received by the Company on the one hand and the Underwriters on the other hand in connection with the offering of the Securities pursuant to this Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company and the
total underwriting discount received by the Underwriters, in each case as set forth on the cover of the Prospectus bear to the aggregate initial public offering price of the Securities as set forth on
the cover of the Prospectus. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether any such untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such statement or omission. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section&nbsp;7 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section&nbsp;7.
The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section&nbsp;7 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the provisions of this Section&nbsp;7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of any such
untrue or alleged untrue statement or omission or alleged omission. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
person guilty of fraudulent misrepresentation (within the meaning of Section&nbsp;11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>21</FONT></P>

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<P><FONT SIZE=2><A
NAME="page_kk77602_1_22"> </A> </FONT> <FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Section&nbsp;7, each person, if any, who controls an Underwriter within the meaning of Section&nbsp;15 of the 1933 Act or Section&nbsp;20 of the 1934 Act and
each Underwriter's Affiliates shall have the same rights to contribution as such Underwriter, and each director of the Company, each officer of the Company who signed the Registration Statement, and
each person, if any, who controls the Company within the meaning of Section&nbsp;15 of the 1933 Act or Section&nbsp;20 of the 1934 Act shall have the same rights to contribution as the Company.
The Underwriters' respective obligations to contribute pursuant to this Section&nbsp;7 are several in proportion to the principal amount of Securities set forth opposite their respective names in
Schedule&nbsp;A hereto and not joint. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Representations, Warranties and Agreements to Survive</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;All representations, warranties and
agreements contained in this Agreement or in certificates of officers of the Company or any of its subsidiaries submitted pursuant hereto, shall remain operative and in full force and effect
regardless of (i)&nbsp;any investigation made by or on behalf of any Underwriter or its Affiliates, any person controlling any Underwriter, its officers or directors or any person controlling the
Company, and (ii)&nbsp;delivery of and payment for the Securities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Termination of Agreement</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Termination; General</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Representatives may terminate this Agreement, by notice to the Company, at any
time at or prior to Closing Time (i)&nbsp;if there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus or the
General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of business, or (ii)&nbsp;if there has occurred any material adverse change in the financial markets in the United States
or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representatives, impracticable or inadvisable to market the
Securities or to enforce contracts for the sale of the Securities, or (iii)&nbsp;if trading in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq
Global Market, or if trading generally on the American Stock Exchange or the New York Stock Exchange or in the Nasdaq Global Market has been suspended or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by such system or by order of the Commission, the National Association of Securities
Dealers,&nbsp;Inc. or any other governmental authority, or (iv)&nbsp;a material disruption has occurred in securities settlement or payment or clearance services in the United States, or
(v)&nbsp;if a commercial banking moratorium has been declared by either Federal or New York authorities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)</FONT><FONT
SIZE=2><I>&nbsp;&nbsp;&nbsp;&nbsp;Liabilities</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If this Agreement is terminated pursuant to this Section, such termination shall be without
liability of any party to any other party except as provided in Section&nbsp;4 hereof, and provided further that Sections&nbsp;1, 6, 7 and 8 shall survive such termination and remain in full force
and effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Default by One or More of the Underwriters</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If one or more of the Underwriters shall fail at
Closing Time or a Date of Delivery to purchase the Securities which it or they are obligated to purchase under this Agreement (the "Defaulted Securities"), the Representatives shall have the right,
within 24&nbsp;hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less than all, of the
Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representatives shall not have completed such arrangements within such
24-hour period, then: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;if
the aggregate principal amount of Defaulted Securities does not exceed 10% of the aggregate principal amount of the Securities to be purchased on such date, each of
the non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full amount thereof in the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>22</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>proportions
that their respective underwriting obligations hereunder bear to the underwriting obligations of all non-defaulting Underwriters, or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;if
the aggregate principal amount of Defaulted Securities exceeds 10% of the aggregate principal amount of Securities to be purchased on such date, this Agreement or,
with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Underwriters to purchase and of the Company to sell the Option Securities to be purchased and sold on
such Date of Delivery shall terminate without liability on the part of any non-defaulting Underwriter. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of Delivery which is after the Closing Time, which does not result in
a termination of the obligation of the Underwriters to purchase and the Company to sell the relevant Option Securities, as the case may be, either (i)&nbsp;the Representatives or (ii)&nbsp;the
Company shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements. As used herein, the term "Underwriter" includes any person substituted for an Underwriter under this Section&nbsp;10. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Default by the Company</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;If the Company shall fail at Closing Time or at the Date of Delivery
to sell the Securities that it is obligated to sell hereunder, then this Agreement shall terminate without any liability on the part of any nondefaulting party; </FONT> <FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT
SIZE=2><I>however</I></FONT><FONT SIZE=2>, that the provisions of Sections&nbsp;1, 4, 6, 7 and 8 shall remain in full force
and effect. No action taken pursuant to this Section shall relieve the Company from liability, if any, in respect of such default. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;12. </FONT> <FONT SIZE=2><I>Notices</I></FONT><FONT SIZE=2>. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given
if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriters shall be directed to Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith Incorporated at 4 World Financial
Center, New York, New York 10080, attention of Global Origination Counsel and Goldman, Sachs&nbsp;&amp;&nbsp;Co. at 85 Broad Street, 23rd&nbsp;Floor, New York, New York 10004, attention of
Registration Department; and notices to the Company shall be directed to it at 901 Gateway Boulevard, South San Francisco, California 94080, attention of Chief Financial Officer. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>No Advisory or Fiduciary Relationship</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company acknowledges and agrees that
(a)&nbsp;the purchase and sale of the Securities pursuant to this Agreement, including the determination of the public offering price of the Securities and any related discounts and commissions, is
an arm's-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand, (b)&nbsp;in connection with the offering contemplated hereby and the
process leading to such transaction each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, or its stockholders, creditors, employees or any
other party, (c)&nbsp;no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process
leading thereto (irrespective of whether such Underwriter has advised or is currently advising the Company on other matters) and no Underwriter has any obligation to the Company with respect to the
offering contemplated hereby except the obligations expressly set forth in this Agreement, (d)&nbsp;the Underwriters and their respective affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of the Company, and (e)&nbsp;the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering
contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>23</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;14.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Integration</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;This Agreement supersedes all prior agreements and understandings (whether
written or oral) between the Company and the Underwriters, or any of them, with respect to the subject matter hereof. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;15.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Parties</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;This Agreement shall each inure to the benefit of and be binding upon the
Underwriters and the Company and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling persons and officers
and directors referred to in Sections&nbsp;6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision
herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters and the Company and their respective successors, and
said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;16.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>GOVERNING LAW</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;17.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>TIME</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;18.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Counterparts</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SECTION&nbsp;19.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Effect of Headings</I></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Section headings herein are for convenience only and shall not affect
the construction hereof. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>24</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all
counterparts, will become a binding agreement among the Underwriters and the Company in accordance with its terms. </FONT></P>

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<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Very truly yours,</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Theravance,&nbsp;Inc.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>By</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>Title:</FONT></TD>
</TR>
</TABLE>
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<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=2 VALIGN="TOP"><FONT SIZE=2>CONFIRMED AND ACCEPTED,<BR>
&nbsp;&nbsp;&nbsp;&nbsp;as of the date first above written:</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD COLSPAN=2 VALIGN="TOP"><FONT SIZE=2>MERRILL LYNCH&nbsp;&amp;&nbsp;CO.<BR>
MERRILL LYNCH, PIERCE, FENNER&nbsp;&amp; SMITH<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;INCORPORATED<BR>
GOLDMAN, SACHS&nbsp;&amp;&nbsp;CO.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>By:</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>MERRILL LYNCH, PIERCE, FENNER&nbsp;&amp; SMITH<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;INCORPORATED</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="5%"><FONT SIZE=2>By</FONT></TD>
<TD WIDTH="46%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Authorized Signatory<BR></FONT>
</TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="46%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
themselves and as Representatives of the other Underwriters named in Schedule&nbsp;A hereto. </FONT></P>

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<TD COLSPAN=2><FONT SIZE=2>By: GOLDMAN, SACHS&nbsp;&amp;&nbsp;CO.</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>By</FONT></TD>
<TD WIDTH="47%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Authorized Signatory<BR></FONT>
</TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
themselves and as Representatives of the other Underwriters named in Schedule&nbsp;A hereto. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>25</FONT></P>

<HR NOSHADE>
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<BR>
<P><br><A NAME="08ZAA77601_2">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_ke77602_1">Exhibit 1.1</A></FONT><BR>
</UL>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.4
<SEQUENCE>3
<FILENAME>a2181932zex-4_4.htm
<DESCRIPTION>EXHIBIT 4.4
<TEXT>
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<div>

<p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit 4.4</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">THERAVANCE, INC.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">% CONVERTIBLE SUBORDINATED NOTES DUE 2015</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">INDENTURE</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">DATED AS OF JANUARY&#160;&#160;&#160; , 2008</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">THE BANK OF NEW YORK TRUST COMPANY, N.A.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">AS TRUSTEE</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;">TABLE OF CONTENTS</font></u></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
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  <td width="93%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Page</font></b></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;1</font></p>
  </td>
  <td width="6%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">DEFINITIONS AND INCORPORATION BY REFERENCE</font></p>
  </td>
  <td width="6%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.01.&nbsp; <i>Definitions</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.02.&nbsp; <i>Other Definitions</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.03.&nbsp; <i>Trust Indenture Act Provisions</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.04.&nbsp; <i>Rules&nbsp;of Construction</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;2</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THE SECURITIES</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.01.&nbsp; <i>Form&nbsp;and Dating</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.02.&nbsp; <i>Execution and Authentication</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.03.&nbsp; <i>Registrar, Paying Agent and Conversion Agent</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.04.&nbsp; <i>Paying Agent to Hold Money in Trust</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.05.&nbsp; <i>Lists of Holders of Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.06.&nbsp; <i>Transfer and Exchange</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.07.&nbsp; <i>Replacement Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.08.&nbsp; <i>Outstanding Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.09.&nbsp; <i>Treasury Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.10.&nbsp; <i>Temporary Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.11.&nbsp; <i>Cancellation</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.12.&nbsp; <i>Additional Transfer and Exchange Requirements</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.13.&nbsp; <i>CUSIP Numbers</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;3</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">REDEMPTION</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.01.&nbsp; <i>Right to Redeem; Notices to Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.02.&nbsp; <i>Selection of Securities to be Redeemed</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.03.&nbsp; <i>Notice of Redemption</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">22</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.04.&nbsp; <i>Effect of Notice of Redemption</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.05.&nbsp; <i>Deposit of Redemption Price</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.06.&nbsp; <i>Securities Redeemed in Part</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.07.&nbsp; <i>No Requirement to Register</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;4</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.64%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">PURCHASE</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.01.&nbsp; <i>Repurchase of Securities at Option of the Holder upon a Fundamental
  Change</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.36%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">i</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.02.&nbsp; <i>Effect of Fundamental Change Repurchase Notice</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.03.&nbsp; <i>Deposit of Fundamental Change Repurchase Price</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.04.&nbsp; <i>Repayment to the Company</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.05.&nbsp; <i>Securities Purchased in Part</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.06.&nbsp; <i>Compliance with Securities Laws upon Purchase of Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.07.&nbsp; <i>Purchase of Securities in Open Market</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;5</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CONVERSION</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.01.&nbsp; <i>Conversion Privilege and Conversion Rate</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.02.&nbsp; <i>Conversion Procedure</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.03.&nbsp; <i>Fractional Shares</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.04.&nbsp; <i>Taxes on Conversion</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.05.&nbsp; <i>Company to Provide Stock</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.06.&nbsp; <i>Adjustment of Conversion Rate</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.07.&nbsp; <i>No Adjustment</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.08.&nbsp; <i>Notice of Adjustment</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.09.&nbsp; <i>Notice of Certain Transactions</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.10.&nbsp; <i>Effect of Recapitalization, Reclassification, Consolidation, Merger
  or Sale</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">41</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.11.&nbsp; <i>Trustee&#146;s Disclaimer</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">42</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.12.&nbsp; <i>Voluntary Increase</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">42</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;6</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">SUBORDINATION</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.01.&nbsp; <i>Agreement of Subordination</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">42</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.02.&nbsp; <i>Payments to Holders</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">43</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.03.&nbsp; <i>Subrogation of Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">45</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.04.&nbsp; <i>Authorization to Effect Subordination</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">46</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.05.&nbsp; <i>Notice to Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">47</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.06.&nbsp; <i>Trustee&#146;s Relation to Senior Indebtedness</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.07.&nbsp; <i>No Impairment of Subordination</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.08.&nbsp; <i>Certain Conversions Deemed Payment</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.09.&nbsp; <i>Article&nbsp;Applicable to Paying Agents</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.10.&nbsp; <i>Senior Indebtedness Entitled to Rely</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">49</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.11.&nbsp; <i>Reliance on Judicial Order or Certificate of Liquidating Agent</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">49</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.12.&nbsp; <i>Rights of Trustee as Holder of Senior Indebtedness; Preservation of
  Trustee&#146;s Rights</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">49</font></p>
  </td>
 </tr>
 <tr>
  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;7</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">COVENANTS</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.48%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.01.&nbsp; <i>Payment of Securities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">49</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.02.&nbsp; <i>SEC and Other Reports</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">50</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.03.&nbsp; <i>Compliance Certificates</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.04.&nbsp; <i>Further Instruments and Acts</i></font></p>
  </td>
  <td width="6%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:6.52%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>
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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ii</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=3,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=835816,FOLIO='ii',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.05.&nbsp; <i>Maintenance of Corporate Existence</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.06.&nbsp; <i>Stay, Extension and Usury Laws</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.07.&nbsp; <i>Maintenance of Office or Agency</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;8</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CONSOLIDATION; MERGER; CONVEYANCE; TRANSFER
  OR LEASE</font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;8.01.&nbsp; <i>Company May&nbsp;Consolidate, Etc., Only on Certain Terms</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">52</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;8.02.&nbsp; <i>Successor Substituted</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">52</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;9</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">DEFAULT AND REMEDIES</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.01.&nbsp; <i>Events of Default</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">53</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.02.&nbsp; <i>Acceleration</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">55</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.03.&nbsp; <i>Other Remedies</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.04.&nbsp; <i>Waiver of Defaults and Events of Default</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.05.&nbsp; <i>Control by Majority</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.06.&nbsp; <i>Limitations on Suits</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">57</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.07.&nbsp; <i>Rights of Holders to Receive Payment and to Convert</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">57</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.08.&nbsp; <i>Collection Suit by Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">57</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.09.&nbsp; <i>Trustee May&nbsp;File Proofs of Claim</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">57</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.10.&nbsp; <i>Priorities</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">58</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.11.&nbsp; <i>Undertaking for Costs</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">58</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;10</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">TRUSTEE</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.38%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.38%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.01.&nbsp; <i>Obligations of Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">59</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.02.&nbsp; <i>Rights of Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">60</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.03.&nbsp; <i>Individual Rights of Trustee</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">61</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.04.&nbsp; <i>Trustee&#146;s Disclaimer</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">62</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.05.&nbsp; <i>Notice of Default or Events of Default</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">62</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.06.&nbsp; <i>Reports by Trustee to Holders</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">62</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.07.&nbsp; <i>Compensation and Indemnity</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">62</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.08.&nbsp; <i>Replacement of Trustee</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">63</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.09.&nbsp; <i>Successor Trustee by Merger, Etc.</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">64</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.10.&nbsp; <i>Eligibility; Disqualification</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">64</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.11.&nbsp; <i>Preferential Collection of Claims Against Company</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">64</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;11</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">SATISFACTION AND DISCHARGE OF INDENTURE</font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.01.&nbsp; <i>Satisfaction and Discharge of Indenture</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">65</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.02.&nbsp; <i>Application of Trust Money</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">66</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.03.&nbsp; <i>Repayment to Company</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">66</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.04.&nbsp; <i>Reinstatement</i></font></p>
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  <td width="6%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:6.62%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">66</font></p>
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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">iii</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=4,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=341172,FOLIO='iii',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;12</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">AMENDMENTS; SUPPLEMENTS AND WAIVERS</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.01.&nbsp; <i>Without Consent of Holders</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">66</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.02.&nbsp; <i>With Consent of Holders</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">67</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.03.&nbsp; <i>Compliance with Trust Indenture Act</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.04.&nbsp; <i>Revocation and Effect of Consents</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.05.&nbsp; <i>Notation on or Exchange of Securities</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.06.&nbsp; <i>Trustee to Sign Amendments, Etc.</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">69</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.07.&nbsp; <i>Effect of Supplemental Indentures</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">69</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Article&nbsp;13</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">MISCELLANEOUS</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.01.&nbsp; <i>Trust Indenture Act Controls</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">69</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.02.&nbsp; <i>Notices</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">69</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.03.&nbsp; <i>Communications by Holders with Other Holders</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">71</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.04.&nbsp; <i>Certificate and Opinion as to Conditions Precedent</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">71</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.05.&nbsp; <i>Record Date for Vote or Consent of Holders of Securities</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.06.&nbsp; <i>Rules&nbsp;by Trustee, Paying Agent, Registrar and Conversion Agent</i></font></p>
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  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.07.&nbsp; <i>Legal Holidays</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.08.&nbsp; <i>Governing Law</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.09.&nbsp; <i>No Adverse Interpretation of Other Agreements</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.10.&nbsp; <i>No Recourse Against Others</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.11.&nbsp; <i>No Security Interest Created</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.12.&nbsp; <i>Successors</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.13.&nbsp; <i>Multiple Counterparts</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.14. &nbsp;<i>Separability</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.15.&nbsp; <i>Table of Contents, Headings, Etc.</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.16.&nbsp; <i>Waiver of Jury Trial</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.17.&nbsp; <i>Force Majeure</i></font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="93%" valign="top" style="padding:0in .7pt 0in .7pt;width:93.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit&nbsp;A</font></p>
  </td>
  <td width="6%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:6.78%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-1</font></p>
  </td>
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</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">iv</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CROSS REFERENCE TABLE*</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
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  <td width="48%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">TIA Section</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><u><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;"><font style="text-decoration:none;">&nbsp;</font></font></u></b></p>
  </td>
  <td width="48%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Indenture Section</font></b></p>
  </td>
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  <td width="48%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;310</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">310(a)(1)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.10</font></p>
  </td>
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  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.10</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)(3)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)(4)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)(5)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.10</font></p>
  </td>
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  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.10</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;311</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">311(a)</font></p>
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  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.11</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.11</font></p>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;312</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">312(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.03</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.03</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;313</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">313(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.06(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)(1)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.06(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.06(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.06(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;314</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">314(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.02(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)(1)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.04</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.04</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)(3)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.04</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;315</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">315(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.01(b)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.05</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.01(a)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)(1)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.01(d)</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">v</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

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 <tr>
  <td width="48%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">TIA Section</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><u><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;"><font style="text-decoration:none;">&nbsp;</font></font></u></b></p>
  </td>
  <td width="48%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Indenture Section</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.01(d)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)(3)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.01(d)</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.11</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;316</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">316(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.09</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">316(a)(1)(A)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.05</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">316(a)(1)(B)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.04</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">316(a)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">N/A</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.07</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.05</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;317</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">317(a)(1)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.08</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">317(a)(2)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.09</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">317(b)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.04</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;318(a)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
 <tr>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.38%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">318(c)</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:3.34%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="48%" valign="top" style="padding:0in .7pt 0in .7pt;width:48.28%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.01</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160; * This Cross-Reference Table
shall not, for any purpose, be deemed a part of this Indenture.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">** N.A.&#160; means Not Applicable</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">vi</font></p>

<div style="margin:0in 0in .0001pt;text-indent:0in;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=7,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=393864,FOLIO='vi',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THIS INDENTURE dated as of January&nbsp;&#160;&#160;&#160; , 2008 is between Theravance,&nbsp;Inc., a
corporation duly organized under the laws of the State of Delaware (the
&#147;Company&#148;), and The Bank of New York Trust Company, N.A., a national banking
association duly organized and existing under the laws of the United States of
America, as Trustee (the &#147;Trustee&#148;).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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&#146;s&#160;&#160;&#160;&#160;&#160; % Convertible Subordinated Notes Due&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; , 2015.</font></p>

<p style="margin:0in 0in 12.0pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE
1<br>
DEFINITIONS AND INCORPORATION BY REFERENCE</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.01<i>.&#160; Definitions.</i></font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Affiliate&#148;
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.&#160; For
the purposes of this definition, &#147;control&#148; 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 &#147;controlling&#148; and &#147;controlled&#148; have meanings
correlative to the foregoing.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Agent&#148; means
any Registrar, Paying Agent or Conversion Agent.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Applicable
Procedures&#148; means, with respect to any transfer or exchange of beneficial
ownership interests in a Global Security, the rules&nbsp;and procedures of the
Depositary, to the extent applicable to such transfer or exchange.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Beneficial
Ownership&#148; means the definition such term is given in accordance with Rule&nbsp;13d-3
promulgated by the SEC under the Exchange Act.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Board of
Directors&#148; 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.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Business Day&#148;
means any weekday that is not a day on which banking institutions in the City of
New York are authorized or obligated to close.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Capital
Stock&#148; of any Person means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated) equity of such Person, but excluding any debt securities
convertible into such equity.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Cash&#148; or &#147;cash&#148; 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.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

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</div>
<!-- ZEQ.=1,SEQ=8,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=751614,FOLIO='',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Certificated
Security&#148; means a Security that is in substantially the form attached as Exhibit&nbsp;A
but that does not include the legend or the schedule called for by footnote 1
thereof.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Change of
Control&#148; means the occurrence of any of the following after the original
issuance of the Securities: (i)&nbsp;the acquisition by any Person of
Beneficial Ownership, directly or indirectly, through a purchase, merger or
other acquisition transaction or series of transactions, of shares of the
Company&#146;s Capital Stock entitling that Person to exercise 50% or more of the
total voting power of all shares of the Company&#146;s Capital Stock entitled to
vote generally in elections of directors, other than any acquisition by the
Company, any of its subsidiaries or any of its employee benefit plans; (ii)&nbsp;the
consolidation or merger of the Company with or into any other Person, any
merger of another Person into the Company, any reclassification or
recapitalization, or any conveyance, transfer, sale, lease or other disposition
of all or substantially all of the Company&#146;s properties and assets to another
Person other than to one or more of the Company&#146;s wholly-owned subsidiaries, <i>provided</i> that this clause (ii)&nbsp;shall not apply to (A)&nbsp;any
transaction (x)&nbsp;that does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of the Company&#146;s Capital Stock
and (y)&nbsp;pursuant to which holders of the Company&#146;s Capital Stock
immediately prior to the transaction have the entitlement to exercise, directly
or indirectly, 50% or more of the total voting power of all shares of the
Company&#146;s Capital Stock entitled to vote generally in elections of directors of
the continuing or surviving Person immediately after the transaction; or (B)&nbsp;any
merger solely for the purpose of changing the Company&#146;s jurisdiction of
incorporation and resulting in a reclassification, conversion or exchange of
outstanding shares of Common Stock solely into shares of common stock of the
surviving entity; (iii)&nbsp;if, during any consecutive two-year period,
individuals who at the beginning of that two-year period constituted the
Company&#146;s Board of Directors, together with any new directors whose election to
the Company&#146;s Board of Directors, or whose nomination for election by the
Company&#146;s stockholders, was approved by a vote of a majority of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved, cease
for any reason to constitute a majority of the Company&#146;s Board of Directors then
in office; or (iv)&nbsp;the stockholders of the Company pass a resolution
approving a plan of liquidation or dissolution.&#160;
Notwithstanding anything to the contrary set forth herein, it will not
otherwise constitute a Change of Control if at least 90% of the consideration
for the Common Stock (excluding cash payments for fractional shares and cash
payments made in respect of dissenters&#146; appraisal rights) in the transaction or
transactions constituting a Change of Control consists of common stock or
American Depositary Shares representing shares of common stock, in each case
which are traded on a U.S. national securities exchange, or which will be so
traded or quoted when issued or exchanged in connection with the Change of
Control, and as a result of such transaction or transactions the Securities
become convertible solely into such consideration; provided that, with respect
to an entity organized under the laws of a jurisdiction outside the United
States, such entity has a worldwide total market capitalization (calculated in
U.S. dollars) of its equity securities of at least two times the market
capitalization of the Company before giving effect to the consolidation or
merger.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Closing Price&#148; means on any Trading Day, the
reported last sale price per share (or if no last sale price is reported, the
average of the bid and ask prices per share or, if more than one in either
case, the average of the average bid and the average ask prices per share) on
such date </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>

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</div>
<!-- ZEQ.=1,SEQ=9,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=690826,FOLIO='2',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">reported by the Nasdaq Global Market or, if the Common Stock (or the
applicable security) is not quoted on the Nasdaq Global Market, as reported by
the principal national securities exchange on which the Common Stock (or such
other security) is listed, or if no such prices are available, the Closing
Price per share shall be the fair value of a share of Common Stock (or such
other security) as reasonably determined by the Board of Directors (which
determination shall be conclusive and shall be evidenced by an Officers&#146;
Certificate delivered to the Trustee).</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Common Stock&#148;
means the common stock of the Company, par value $0.01, as it exists on the
date of this Indenture and any shares of any class or classes of Capital Stock
of the Company resulting from any reclassification or reclassifications
thereof, or, in the event of a merger, consolidation or other similar
transaction involving the Company that is otherwise permitted hereunder in
which the Company is not the surviving corporation, the common stock, common
equity interests, ordinary shares or depositary shares or other certificates
representing common equity interests of such surviving corporation or its
direct or indirect parent corporation, and which have no preference in respect
of dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company and which are not subject
to redemption by the Company; <i>provided, however</i>,
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.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Company&#148;
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 &#147;Company&#148; shall mean such successor.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Conversion
Price&#148; per share of Common Stock as of any day means the result obtained by
dividing (i)&nbsp;$1,000 by (ii)&nbsp;the then applicable Conversion Rate,
rounded to the nearest cent.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Conversion
Rate&#148; means the rate at which shares of Common Stock shall be delivered upon
conversion, which rate shall be initially&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; shares of Common Stock for each
$1,000 principal amount of Securities, as adjusted from time to time pursuant
to the provisions of this Indenture.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Corporate
Trust Office&#148; means the principal office of the Trustee at which at any time
its corporate trust business shall be administered, which office at the date
hereof is located at 700 South Flower Street, Suite&nbsp;500, Los Angeles, CA
90017, Attention: Corporate Unit, or such other address as the Trustee may
designate from time to time by notice to the Holders and the Company, or the
principal corporate trust office of any successor Trustee (or such other
address as such successor Trustee may designate from time to time by notice to
the Holders and the Company).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Default&#148; means, when used with respect to
the Securities, any event that is or, after notice or passage of time, or both,
would be, an Event of Default.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>

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</div>
<!-- ZEQ.=1,SEQ=10,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=925747,FOLIO='3',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Designated
Senior Indebtedness&#148; means the Company&#146;s obligations under any particular
Senior Indebtedness in which the instrument creating or evidencing the same or
the assumption or guarantee thereof (or related agreements or documents to
which the Company is a party) expressly provides that such Indebtedness shall
be &#147;Designated Senior Indebtedness&#148; for purposes of this Indenture (<i>provided</i> that such instrument, agreement or other document
may place limitations and conditions on the right of such Senior Indebtedness
to exercise the rights of Designated Senior Indebtedness).&#160; If any payment made to any holder of any
Designated Senior Indebtedness or its representative with respect to such
Designated Senior Indebtedness is rescinded or must otherwise be returned by
such holder or representative of such holder upon the insolvency, bankruptcy or
reorganization of the Company or otherwise, the reinstated Indebtedness of the
Company arising as a result of such rescission or return shall constitute
Designated Senior Indebtedness effective as of the date of such rescission or
return.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Exchange Act&#148;
means the Securities Exchange Act of 1934, as amended, and the rules&nbsp;and
regulations promulgated thereunder, as in effect from time to time.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Final
Maturity Date&#148; means January&nbsp;15, 2015.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental
Change&#148; means the occurrence of a Change of Control or a Termination of Trading
following the original issuance of the Securities.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental
Change Effective Date&#148; means the date on which any Fundamental Change becomes
effective.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental
Change Repurchase Price&#148; of any Security, means 100% of the principal amount of
the Security to be purchased plus accrued and unpaid interest, if any, to, but
excluding, the Fundamental Change Repurchase Date.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;GAAP&#148; means
generally accepted accounting principles in the United States of America as in
effect from time to time, including those set forth in (i)&nbsp;the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants, (ii)&nbsp;the statements and pronouncements of
the Financial Accounting Standards Board, (iii)&nbsp;such other statements by
such other entity as approved by a significant segment of the accounting
profession and (iv)&nbsp;the rules&nbsp;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&nbsp;13 of the
Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Global Security&#148; means a Security in global
form that is in substantially the form attached as Exhibit&nbsp;A and that
includes the legend and schedule called for in footnote 1 thereof and which is
deposited with the Depositary or its custodian and registered in the name of
the Depositary or its nominee.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>

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</div>
<!-- ZEQ.=1,SEQ=11,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=57530,FOLIO='4',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Holder&#148; or
&#147;Holder of a Security&#148; means the person in whose name a Security is registered
on the Registrar&#146;s books.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Indebtedness&#148;
means, without duplication:</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all of the Company&#146;s
indebtedness, obligations and other liabilities (contingent or otherwise) for
borrowed money (including obligations in respect of overdrafts, foreign
exchange contracts, currency exchange agreements, interest rate protection
agreements, and any loans or advances from banks, whether or not evidenced by
notes or similar instruments) or evidenced by credit or loan agreements, bonds,
debentures, notes or similar instruments (whether or not the recourse of the
lender is to the whole of the Company&#146;s assets or to only a portion thereof),
other than any trade accounts payable or other accrued current expense incurred
in the ordinary course of business in connection with the obtaining of
materials or services;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all of the Company&#146;s
reimbursement obligations and other liabilities (contingent or otherwise) with
respect to letters of credit, bank guarantees or bankers&#146; acceptances;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all of the Company&#146;s
obligations and liabilities (contingent or otherwise)</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt 1.0in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>in respect of leases
required, in conformity with GAAP, to be accounted for as capitalized lease
obligations on the Company&#146;s balance sheet,</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt 1.0in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>as lessee under other
leases for facilities equipment (and related assets leased together therewith),
whether or not capitalized, entered into or leased for financing purposes (as
determined by the Company), or</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt 1.0in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>under any lease or
related document (including a purchase agreement) in connection with the lease
of real property or improvements (or any personal property included as part of
any such lease) that provides that the Company is contractually obligated to
purchase or cause a third party to purchase the leased property and thereby
guarantee a minimum residual value of the leased property to the lessor and all
of the Company&#146;s obligations under such lease or related document to purchase
or to cause a third party to purchase such leased property, (whether or not
such lease transaction is characterized as an operating lease or a capitalized
lease in accordance with GAAP);</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all of the Company&#146;s
obligations (contingent or otherwise) with respect to an interest rate,
currency or other swap, cap, floor or collar agreement, hedge agreement,
forward contract, or other similar instrument or foreign currency hedge,
exchange, purchase or similar instrument or agreement;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all of the Company&#146;s
direct or indirect guarantees, agreements to be jointly liable or similar
agreements in respect of, and obligations or liabilities (contingent or </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>

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</div>
<!-- ZEQ.=1,SEQ=12,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=893258,FOLIO='5',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">otherwise) to purchase or otherwise acquire
or otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another person of the kind described in clauses (i)&nbsp;through
(iv);</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>any indebtedness or
other obligations described in clauses (i)&nbsp;through (v)&nbsp;secured by any
mortgage, pledge, lien or other encumbrance existing on property which is owned
or held by the Company, regardless of whether the indebtedness or other
obligation secured thereby shall be assumed by the Company; and</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>any and all deferrals,
renewals, extensions and refundings of, or amendments, modifications or
supplements to, any indebtedness, obligation or liability of the kind described
in clauses (i)&nbsp;through (vi).</p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Indenture&#148;
means this Indenture as amended or supplemented from time to time pursuant to
the terms of this Indenture, including the provisions of the TIA that are
automatically deemed to be a part of this Indenture by operation of the TIA.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Interest
Payment Date&#148; means January&nbsp;15 and July&nbsp;15 of each year, commencing July&nbsp;15,
2008.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Issue Date&#148;
of any Security means the date on which the Security was originally issued or
deemed issued as set forth on the face of the Security.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Last Reported
Sale Price&#148; on any date means the closing sale price per share of the Common
Stock (or if no closing sale price is reported, the average of the bid and ask
prices or, if more than one in either case, the average of the average bid and
the average asked prices) on that date as reported in composite transactions
for the principal U.S.&#160; national or
regional securities exchange on which the Common Stock is listed for trading.&#160; If the Common Stock is not listed for trading
on a U.S.&#160; national or regional
securities exchange on the relevant date, the &#147;Last Reported Sale Price&#148; will
be the last quoted bid price for the Common Stock in the over-the-counter
market on the relevant date as reported by the National Quotation Bureau or similar
organization.&#160; If the Common Stock is not
so quoted, the &#147;Last Reported Sale Price&#148; will be the average of the mid-point
of the last bid and ask prices for the Common Stock on the relevant date from
each of at least three nationally recognized independent investment banking
firms selected by the Company for this purpose.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Officer&#148;
means the Chairman of the Board, the Chief Executive Officer, the President,
any Senior Vice President, the Chief Financial Officer, the Controller, the
Secretary, or any Assistant Controller or any Assistant Secretary of the
Company designated by one of the former officers.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Officers&#146; Certificate&#148; means a certificate
signed on behalf of the Company by two Officers; <i>provided,
however</i>, that for purposes of Sections 5.11 and 7.03, &#147;Officers&#146;
Certificate&#148; means a certificate signed by (a)&nbsp;the principal executive
officer, principal financial officer or principal accounting officer of the
Company and (b)&nbsp;one other officer.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>

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</div>
<!-- ZEQ.=1,SEQ=13,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=890481,FOLIO='6',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Opinion of
Counsel&#148; means a written opinion from legal counsel.&#160; The counsel may be an employee of or counsel
to the Company.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Person&#148; or
&#147;person&#148; means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
syndicate or group that would be deemed to be a &#147;person&#148; under Section&nbsp;13(d)(3)&nbsp;of
the Exchange Act or any other entity.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Principal&#148; or
&#147;principal&#148; of a debt security, including the Securities, means the principal
of the security plus, when appropriate, the premium, if any, on the security.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Redemption
Date&#148; shall mean the date specified for redemption of the Securities in
accordance with the terms of the Securities and Article&nbsp;3 hereof.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Regular
Record Date&#148; means, with respect to each Interest Payment Date, the January&nbsp;1
or July&nbsp;1, as the case may be, next preceding such Interest Payment Date.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Responsible
Officer&#148; means, when used with respect to the Trustee, any officer within the
corporate trust services department of the Trustee with direct responsibility
for the administration of this Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of such person&#146;s knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the
administration of this Indenture.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;SEC&#148; means
the Securities and Exchange Commission.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Securities&#148;
means the up to $150,000,000 aggregate principal amount ($172,500,000 aggregate
principal amount if the Underwriters exercise their over-allotment option to
purchase up to an additional $22,500,000 aggregate principal amount of notes in
full) of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; % Convertible
Subordinated Notes due 2015, or any of them (each a &#147;Security&#148;), as amended or
supplemented from time to time, that are issued under this Indenture.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Securities
Act&#148; means the Securities Act of 1933, as amended, and the rules&nbsp;and
regulations promulgated thereunder, as in effect from time to time.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Securities
Custodian&#148; means the Trustee, as custodian with respect to the Securities in
global form, or any successor thereto.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Senior Indebtedness&#148; means the principal of,
premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim
for postpetition interest is allowable as a claim in any such proceeding) and
rent payable on or in connection with, and all fees, costs, expenses and other
amounts accrued or due on or in connection with, Indebtedness of the Company,
whether secured or unsecured, absolute or contingent, due or to become due,
outstanding on the date of this Indenture or thereafter created, incurred, assumed,
guaranteed or in effect guaranteed by the Company, including all deferrals,
renewals, extensions or refundings of, or amendments, </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">modifications or supplements to, the foregoing, unless in the case of
any particular Indebtedness the instrument creating or evidencing the same or
the assumption or guarantee thereof expressly provides that such Indebtedness
shall not be senior in right of payment to the Securities or expressly provides
that such Indebtedness is on the same basis or junior to the Securities.&#160; Senior Indebtedness does not include:</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Indebtedness that
expressly provides that such Indebtedness shall not be senior in right of
payment to the Securities or expressly provides that such Indebtedness is on
the same basis or junior in right of payment to the Securities;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Indebtedness that is
expressly subordinated to any Senior Indebtedness;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Indebtedness
subordinated by operation of law;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>trade payables and
accrued expenses of the Company (including, without limitation, accrued
compensation and accrued restructuring charges) or deferred purchase price for
goods, service or materials purchased or provided in the ordinary course of
business;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>lease obligations other
than those described in clause (iii)&nbsp;of the definition of &#147;Indebtedness&#148;
above;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>any Indebtedness of the
Company to or among any of its subsidiaries; and</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>any obligation for
federal, state, local or other taxes.</p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Stock Price&#148;
means the price paid, or deemed to be paid, per share of the Common Stock in
connection with a Fundamental Change as determined pursuant to Section&nbsp;4.01(e).</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Subsidiary&#148;
means, in respect of any Person, any corporation, association, partnership or
other business entity of which more than 50% of the total voting power of
shares of Capital Stock or other interests (including partnership interests)
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers, general partners or trustees thereof is at the
time owned or controlled, directly or indirectly, by (a)&nbsp;such Person; (b)&nbsp;such
Person and one or more Subsidiaries of such Person; or (c)&nbsp;one or more
Subsidiaries of such Person.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Termination of Trading&#148; means the
termination (but not the temporary suspension) of trading of the Common Stock,
which will be deemed to have occurred if the Common Stock or other common stock
into which the Securities are convertible is neither listed for trading on a
United States national securities exchange nor approved for listing on any
United States system of automated dissemination of quotations of securities
prices, or traded in over-the-counter securities markets, and no American
Depository Shares or similar instruments for such Common Stock or such other
common stock into which the Securities are convertible are so listed or
approved for listing in the United States.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=15,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=70748,FOLIO='8',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;TIA&#148; means
the Trust Indenture Act of 1939, as amended, and the rules&nbsp;and regulations
thereunder as in effect on the date of this Indenture, except to the extent
that the Trust Indenture Act or any amendment thereto expressly provides for
application of the Trust Indenture Act as in effect on another date.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Trading Day&#148;
means any day on which the Nasdaq Global Market or, if the Common Stock is not
quoted on the Nasdaq Global Market, the principal national securities exchange
on which the Common Stock is listed is open for trading or, if the Common Stock
is not so listed, admitted for trading or quoted, any Business Day.&#160; A Trading Day only includes those days that
have a scheduled closing time of 4:00&nbsp;p.m.&#160;
(New York City time) or the then standard closing time for regular
trading on the relevant exchange or trading system.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Trustee&#148;
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.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Underwriters&#148;
means Merrill Lynch, Pierce, Fenner&nbsp;&amp; Smith Incorporated and Goldman,
Sachs&nbsp;&amp; Co.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Vice
President&#148; 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 &#147;vice president.&#148;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Voting Stock&#148;
of a Person means all classes of Capital Stock or other interests (including
partnership interests) of such Person then outstanding and normally entitled
(without regard to the occurrence of any contingency within the control of such
person to satisfy) to vote in the election of directors, managers or trustees
thereof.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.02<i>.&#160; Other Definitions.</i></font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="1" cellspacing="0" cellpadding="0" width="86%" style="border:none;border-collapse:collapse;margin-left:.5in;width:86.7%;">
 <tr>
  <td width="81%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Term</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Defined in <br>
  Section</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Agent Members&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Bankruptcy Law&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Business Combination&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.10</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Company Order&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.02</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Conversion Agent&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Conversion Date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.02</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Current Market Price&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;DTC&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Depositary&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="1" cellspacing="0" cellpadding="0" width="86%" style="border:none;border-collapse:collapse;margin-left:.5in;width:86.7%;">
 <tr>
  <td width="81%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Term</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Defined in <br>
  Section</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Determination Date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Distributed Securities&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Event of Default&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Expiration Date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Expiration Time&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental Change Company Notice&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental Change Repurchase Date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Fundamental Change Repurchase Notice&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Legal Holiday&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.07</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Legend&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.12</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Make Whole Premium&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Notice of Default&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Paying Agent&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Payment Blockage Notice&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.02</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Primary Registrar&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Purchase Agreement&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Purchased Shares&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;record date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Receiver&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Redemption Price&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.01(b)</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Registrar&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Resale Restriction Termination Date&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.12</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Rights&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Rights Plan&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Spinoff Securities&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Spinoff Valuation Period&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;tender offer&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="81%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:81.16%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;Triggering Distribution&#148;</font></p>
  </td>
  <td width="3%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:3.92%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:12.56%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.06</font></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;padding:0in .7pt 0in .7pt;width:2.36%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.03<i>.&#160; Trust Indenture Act Provisions.</i></font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Whenever this
Indenture refers to a provision of the TIA, that provision is incorporated by
reference in and made a part of this Indenture.&#160;
This Indenture shall also include those provisions of the TIA required
to be included herein by the provisions of the Trust Indenture Reform Act of
1990.&#160; The following TIA terms used in
this Indenture have the following meanings:</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;indenture
securities&#148; means the Securities;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;indenture
security holder&#148; means a Holder of a Security;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;indenture to
be qualified&#148; means this Indenture;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;indenture
trustee&#148; or &#147;institutional trustee&#148; means the Trustee; and</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;obligor&#148; on
the indenture securities means the Company or any other obligor on the
Securities.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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&nbsp;and not otherwise
defined herein have the meanings assigned to them therein.</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;1.04<i>.&#160; Rules&nbsp;of Construction.</i></font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Unless the context otherwise requires:</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>a term has the meaning
assigned to it;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>an accounting term not
otherwise defined has the meaning assigned to it in accordance with GAAP;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>words in the singular
include the plural, and words in the plural include the singular;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>provisions apply to
successive events and transactions;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the term &#147;merger&#148;
includes a statutory share exchange and the term &#147;merged&#148; has a correlative
meaning;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the masculine gender
includes the feminine and the neuter;</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>references to agreements
and other instruments include subsequent amendments thereto; and</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>all &#147;Article&#148;, &#147;Exhibit&#148;
and &#147;Section&#148; references are to Articles, Exhibits and Sections, respectively,
of or to this Indenture unless otherwise specified herein, and </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the terms &#147;herein,&#148; &#147;hereof&#148; and other words
of similar import refer to this Indenture as a whole and not to any particular
Article, Section&nbsp;or other subdivision.</font></p>

<p style="margin:0in 0in 12.0pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE
2<br>
THE SECURITIES</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.01<i>.&#160; Form&nbsp;and Dating.&#160; </i>The Securities and the Trustee&#146;s
certificate of authentication shall be substantially in the respective forms
set forth in <u>Exhibit&nbsp;A</u> which Exhibit&nbsp;is incorporated in and
made part of this Indenture.&#160; The
Securities may have notations, legends or endorsements required by law, stock
exchange or automated quotation system rule&nbsp;or regulation or usage.&#160; The Company shall provide any such notations,
legends or endorsements to the Trustee in writing.&#160; Each Security shall be dated the date of its
authentication.&#160; The Securities are being
offered and sold by the Company pursuant to a Purchase Agreement dated January&nbsp;&#160;&#160;&#160;&#160;&#160;&#160; , 2008 (the &#147;Purchase Agreement&#148;)
between the Company and the Underwriters.&#160;
The terms and provisions contained in the Securities shall constitute, and
are hereby expressly made, a part of this Indenture, and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.&#160; However, to the extent any provision of any Security
conflicts with the express provisions of this Indenture, the provisions of this
Indenture shall govern and be controlling.</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><i>Global Securities</i>.&#160; All of the Securities shall be issued
initially in the form of one or more Global Securities, which shall be
deposited on behalf of the purchasers of the securities represented thereby
with the Trustee, at its Corporate Trust Office, as custodian for the
depositary, The Depository Trust Company (&#147;DTC&#148;, and such depositary, or any
successor thereto, being hereinafter referred to as the &#147;Depositary&#148;), and
registered in the name of its nominee, Cede&nbsp;&amp; Co.&#160; (or any successor thereto), for the accounts
of participants in the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><i>Global Securities in
General</i>.&#160; Each Global Security
shall represent such of the outstanding Securities as shall be specified
therein and each shall provide that it shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon and that the
aggregate amount of outstanding Securities represented thereby may from time to
time be reduced or increased, as appropriate, to reflect replacements,
exchanges, redemption, purchases or conversions of such Securities.&#160; 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&nbsp;2.12 and shall be made on the records of the Trustee
and the Depositary.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Members of, or participants in, the
Depositary (&#147;Agent Members&#148;) 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 </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=19,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=868273,FOLIO='12',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">owner and Holder of such Global Security for all purposes
whatsoever.&#160; Notwithstanding the
foregoing, nothing herein shall (i)&nbsp;prevent the Company, the Trustee or
any agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or (ii)&nbsp;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.</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><i>Book Entry Provisions</i>.&#160; The Company shall execute and the Trustee
shall, in accordance with this Section&nbsp;2.01(c), authenticate and deliver
initially one or more Global Securities that (i)&nbsp;shall be registered in
the name of the Depositary or its nominee, (ii)&nbsp;shall be delivered by the
Trustee to the Depositary or pursuant to the Depositary&#146;s instructions and (iii)&nbsp;shall
bear legends substantially to the following effect:</p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE&nbsp;&amp;
CO.&#160; 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&nbsp;&amp; CO.&#160; 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&nbsp;&amp; CO., HAS AN
INTEREST HEREIN.&#160; 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.&#160; 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&nbsp;FOR SECURITIES IN DEFINITIVE
FORM, THIS SECURITY MAY&nbsp;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.&#148;</font></p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.02<i>.&#160; Execution and Authentication.</i></font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The aggregate principal amount of Securities
which may be authenticated and delivered under this Indenture is limited,
pursuant to the Purchase Agreement, to $150,000,000 aggregate principal amount
($172,500,000 aggregate principal amount if the Underwriters exercise their
over-allotment option in full).</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>An Officer shall sign the
Securities for the Company by manual or facsimile signature.&#160; Typographic and other minor errors or defects
in any such facsimile signature shall </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=20,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=1040765,FOLIO='13',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">not affect the validity or enforceability of any Security that has been
authenticated and delivered by the Trustee.</font></p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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.</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>A Security shall not be valid until an
authorized signatory of the Trustee by manual signature signs the certificate
of authentication on the Security.&#160; The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Trustee shall authenticate and make
available for delivery Securities for original issue in the aggregate principal
amount of up to $150,000,000 aggregate principal amount ($172,500,000 aggregate
principal amount if the Underwriters exercise their over-allotment option in
full by executing an over-allotment exercise notice and delivering such executed
over-allotment exercise notice to the Trustee and the Company) upon receipt of
a written order or orders of the Company signed by an Officer of the Company (a
&#147;Company Order&#148;).&#160; The Company Order
shall specify the amount of Securities to be authenticated, shall provide that
all such Securities will be represented by a Global Security and the date on
which each original issue of Securities is to be authenticated.</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Trustee shall act as the initial
authenticating agent.&#160; Thereafter, the
Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Securities.&#160; An
authenticating agent may authenticate Securities whenever the Trustee may do
so.&#160; Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent.&#160; An authenticating agent shall have the same
rights as an Agent to deal with the Company or an Affiliate of the Company.</p>

<p style="font-size:10.0pt;margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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.</p>

<p style="margin:0in 0in 12.0pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.03<i>.&#160; Registrar, Paying Agent and Conversion Agent.</i></font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company shall maintain
one or more offices or agencies where Securities may be presented for
registration of transfer or for exchange (each, a &#147;Registrar&#148;), one or more
offices or agencies where Securities may be presented for payment (each, a
&#147;Paying Agent&#148;), one or more offices or agencies where Securities may be
presented for conversion (each, a &#147;Conversion Agent&#148;) 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.&#160;
The Company will at all times maintain a Paying Agent, Conversion Agent,
Registrar and an office or agency where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served.&#160; One of the Registrars (the &#147;Primary
Registrar&#148;) shall keep a register of the Securities and of their transfer and
exchange.&#160; The Company shall provide
written notice to the Trustee of any Registrar, Securities Agent, Conversion
Agent or Paying Agent that is not also the Trustee.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=21,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=936981,FOLIO='14',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_01_77602.CHC",USER="DNICHOL",CD='Jan 14 22:59 2008' -->



<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, <i>provided</i> that the Agent may be an Affiliate of the
Trustee.&#160; The agreement shall implement
the provisions of this Indenture that relate to such Agent.&#160; The Company shall notify the Trustee of the
name and address of any Agent not a party to this Indenture.&#160; 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.&#160; The
Company or any Affiliate of the Company may act as Paying Agent (except for the
purposes of Section&nbsp;7.01 and Article&nbsp;11).</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company hereby initially designates the
Trustee as Paying Agent, Registrar, Securities Custodian and Conversion Agent,
and designates the Corporate Trust Office of the Trustee as an office or agency
where notices and demands to or upon the Company in respect of the Securities
and this Indenture shall be served.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.04<i>.&#160; Paying Agent to Hold Money in
Trust.&#160; </i>Prior to
12:00&nbsp;p.m.&#160; (noon), New York City
time, on each due date of the payment of principal of, or interest on, any
Securities, the Company shall deposit with the Paying Agent a sum sufficient to
pay such principal or interest so becoming due.&#160;
Subject to Section&nbsp;9.02, a Paying Agent shall hold in trust for the
benefit of Holders of Securities or the Trustee all money held by the Paying
Agent for the payment of principal of, or interest on, the Securities, and
shall notify the Trustee of any failure by the Company (or any other obligor on
the Securities) to make any such payment.&#160;
If the Company or an Affiliate of the Company acts as Paying Agent, it
shall, before 12:00&nbsp;p.m. &#160;(noon),
New York City time, on each due date of the principal of, or interest on, any
Securities, segregate the money and hold it as a separate trust fund.&#160; 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.&#160; Upon
doing so, the Paying Agent (other than the Company) shall have no further
liability for the money.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.05<i>.&#160; Lists of Holders of
Securities.&#160; </i>The Trustee shall
preserve in as current a form as is reasonably practicable the most recent list
available to it of the names and addresses of Holders of Securities.&#160; If the Trustee is not the Primary Registrar,
the Company shall furnish to the Trustee on or before each Interest Payment
Date and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of the
names and addresses of Holders of Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.06<i>. &#160;Transfer and Exchange.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to compliance with any applicable
additional requirements contained in Section&nbsp;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; <i>provided, however</i>,
that every Security presented or surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by an assignment form and, if </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=22,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=642559,FOLIO='15',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">applicable, a transfer
certificate each in the form included in <u>Exhibit&nbsp;A</u>, and completed
in a manner satisfactory to the Registrar and duly executed by the Holder
thereof or its attorney duly authorized in writing.&#160; To permit registration of transfers and
exchanges, upon surrender of any Security for registration of transfer or
exchange at an office or agency maintained pursuant to Section&nbsp;2.03, the
Company shall execute and the Trustee shall authenticate Securities of a like
aggregate principal amount at the Registrar&#146;s request.&#160; 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; <i>provided</i> that this sentence shall
not apply to any exchange pursuant to Section&nbsp;2.10, 2.12(a), 4.05,
5.02(e)&nbsp;or 12.05.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Neither the Company, any Registrar nor the
Trustee shall be required to exchange or register a transfer of any Securities
or portions thereof in respect of which a Fundamental Change Repurchase Notice
has been delivered and not withdrawn by the Holder thereof (except, in the case
of the purchase of a Security in part, the portion thereof not to be
purchased).</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Any Registrar appointed pursuant to
Section&nbsp;2.03 shall provide to the Trustee such information as the Trustee
may reasonably require in connection with the delivery by such Registrar of
Securities upon transfer or exchange of Securities.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Each Holder of a Security agrees to indemnify
and hold harmless the Company and the Trustee against any liability that may
result from the transfer, exchange or assignment of such Holder&#146;s Security in
violation of any provision of this Indenture and/or applicable United States
federal or state securities law.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.07<i>.&#160; Replacement Securities.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If any mutilated Security is surrendered to
the Company, a Registrar or the Trustee, and the Company, a Registrar and the
Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Security, and there is delivered to the Company, the applicable
Registrar and the Trustee such security or indemnity as will be required by
them to save each of them harmless, then, in the absence of notice to the
Company, such Registrar or the Trustee that </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16</font></p>

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</div>
<!-- ZEQ.=1,SEQ=23,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=365820,FOLIO='16',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If any such mutilated, destroyed, lost or
stolen Security has become or is about to become due and payable, or is about
to be redeemed or purchased by the Company pursuant to Article&nbsp;3 or 4, or
converted pursuant to Article&nbsp;5, the Company in its discretion may,
instead of issuing a new Security, pay, redeem, purchase or convert such
Security, as the case may be.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Upon the issuance of any new Securities under
this Section&nbsp;2.07, the Company may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the reasonable fees and
expenses of the Trustee or the Registrar) in connection therewith.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Every new Security issued pursuant to this
Section&nbsp;2.07 in lieu of any mutilated, destroyed, lost or stolen Security
shall constitute an original additional contractual obligation of the Company,
whether or not the mutilated, destroyed, lost or stolen Security shall be at
any time enforceable by anyone, and shall be entitled to all benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The provisions of this Section&nbsp;2.07 are
(to the extent lawful) exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.<i>08.&#160; Outstanding Securities.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Securities outstanding at any time are all
Securities authenticated by the Trustee, except for those canceled by it, those
redeemed or purchased pursuant to Article&nbsp;3 or 4, those converted pursuant
to Article&nbsp;5, those delivered to the Trustee for cancellation or
surrendered for transfer or exchange and those described in this
Section&nbsp;2.08 as not outstanding.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If a Paying Agent (other than the Company or
an Affiliate of the Company) holds in respect of the outstanding Securities on
a Redemption Date, a Fundamental Change Repurchase Date or the Final Maturity
Date money sufficient to pay the principal of (including premium, if any) and
accrued interest on Securities (or portions thereof) payable on that date, then
on and after such Redemption Date, Fundamental Change Repurchase Date or Final
Maturity Date, as the case may be, such Securities (or portions thereof, as the
case may be) shall cease to be outstanding and cash interest on them shall
cease to accrue.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to the restrictions contained in
Section&nbsp;2.09, a Security does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Security.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.09<i>.&#160; Treasury Securities.&#160; </i>In determining whether the Holders
of the required principal amount of Securities have concurred in any notice,
direction, waiver or consent, </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>

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</div>
<!-- ZEQ.=1,SEQ=24,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=545741,FOLIO='17',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Securities owned by the Company or any other
obligor on the Securities or by any Affiliate of the Company or of such other
obligor shall be disregarded, except that, for purposes of determining whether
the Trustee shall be protected in relying on any such notice, direction, waiver
or consent, only Securities which a Responsible Officer of the Trustee with
responsibility for this Indenture actually knows are so owned shall be so
disregarded.&#160; 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&#146;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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.10<i>.&#160; Temporary Securities.&#160; </i>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.&#160; 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.&#160; Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate and deliver definitive Securities in exchange for temporary
Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.11<i>.&#160; Cancellation.&#160; </i>The Company at any time may
deliver Securities to the Trustee for cancellation.&#160; The Registrar, the Paying Agent and the
Conversion Agent shall forward to the Trustee or its agent any Securities
surrendered to them for transfer, exchange, redemption, purchase, payment or
conversion.&#160; The Trustee and no one else
shall promptly cancel, in accordance with its standard procedures, all
Securities surrendered for transfer, exchange, redemption, purchase, payment,
conversion or cancellation and shall dispose of the cancelled Securities in
accordance with its customary procedures or deliver the canceled Securities to
the Company upon its request therefor.&#160;
All Securities which are redeemed, purchased or otherwise acquired by
the Company or any of its Subsidiaries prior to the Final Maturity Date
pursuant to Article&nbsp;3 or 4 shall be delivered to the Trustee for
cancellation, and the Company may not hold or resell such Securities or issue
any new Securities to replace any such Securities or any Securities that any
Holder has converted pursuant to Article&nbsp;5.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.12<i>.&#160; Additional Transfer and
Exchange Requirements.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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;
<i>provided</i> 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.&#160;
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.&#160;
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&nbsp;2.12.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>

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</div>
<!-- ZEQ.=1,SEQ=25,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=266683,FOLIO='18',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The provisions of clauses (i), (ii),
(iii)&nbsp;and (iv)&nbsp;below shall apply only to Global Securities:</p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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; <i>provided</i> 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)&nbsp;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 &#147;<b>clearing agency</b>&#148; registered under the Exchange Act, and a
successor Depositary is not appointed by the Company within 90 days,
(B)&nbsp;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)&nbsp;an Event of Default has
occurred and is continuing.&#160; Any Global
Security exchanged pursuant to clauses (A)&nbsp;or (B)&nbsp;above shall be so
exchanged in whole and not in part, and any Global Security exchanged pursuant
to clause (C)&nbsp;above may be exchanged in whole or from time to time in part
as directed by the Depositary.&#160; Any
Security issued in exchange for a Global Security or any portion thereof shall
be a Global Security; <i>provided</i> 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.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Securities issued in exchange for a Global
Security or any portion thereof shall be issued in definitive, fully-registered
book entry form, without interest coupons, shall have an aggregate principal
amount equal to that of such Global Security or portion thereof to be so
exchanged, shall be registered in such names and be in such authorized
denominations as the Depositary shall designate and shall bear any applicable
legend provided for herein.&#160; Any Global
Security to be exchanged in whole shall be surrendered by the Depositary to the
Trustee, as Registrar.&#160; 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.&#160; 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; <i>provided, however</i>,
that any Global Security surrendered for exchange shall be duly endorsed or
accompanied by a written instrument of transfer in accordance with the proviso
to the first paragraph of Section&nbsp;2.06(a).</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to the provisions of clause (v)&nbsp;below, the registered
Holder may grant proxies and otherwise authorize any Person, including Agent
Members and persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under this Indenture or the
Securities.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19</font></p>

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</div>
<!-- ZEQ.=1,SEQ=26,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=508655,FOLIO='19',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>In the event of the occurrence of any of the events specified in clause
(i)&nbsp;above, the Company will promptly make available to the Trustee a
reasonable supply of Certificated Securities in definitive, fully registered
form, without interest coupons.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Neither Agent Members nor any other Persons
on whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Security registered in the name of the
Depositary or any nominee thereof, or under any such Global Security, and the
Depositary or such nominee, as the case may be, may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute owner
and holder of such Global Security for all purposes whatsoever.&#160; 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.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>In the event that Certificated Securities are
issued in exchange for beneficial interests in Global Securities and,
thereafter, the events or conditions specified in Section&nbsp;2.12(b)(i)&nbsp;which
required such exchange shall cease to exist, the Company shall deliver notice
to the Trustee and to the Holders stating that Holders may exchange
Certificated Securities for interests in Global Securities by complying with
the procedures set forth in this Indenture and briefly describing such
procedures and the events or circumstances requiring that such notice be
given.&#160; Thereafter, if Certificated
Securities are presented by a Holder to a Registrar with a request:</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>to register the transfer of such Certificated
Securities to a person who will take delivery thereof in the form of a
beneficial interest in a Global Security; or</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>to exchange such Certificated Securities for
an equal principal amount of beneficial interests in a Global Security, which
beneficial interests will be owned by the Holder transferring such Certificated
Securities,</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the Registrar shall register the transfer or
make the exchange as requested by canceling such Certificated Securities and
causing, or directing the Custodian to cause, the aggregate principal amount of
the applicable Global Security to be increased accordingly and, if no such
Global Security is then outstanding, the Company shall issue and the Trustee,
upon receipt of a Company Order, shall authenticate and deliver a new Global
Security; <i>provided, however</i>, that the Certificated
Securities presented or surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
accordance with the proviso to the first paragraph of Section&nbsp;2.06(a).</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;2.13<i>.&#160; CUSIP Numbers.&#160; </i>The Company in issuing the
Securities may use one or more &#147;CUSIP&#148; numbers (if then generally in use), and,
if so, the Trustee shall use &#147;CUSIP&#148; numbers in notices of redemption or
purchase as a convenience to Holders; <i>provided</i> that
any </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=27,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=580564,FOLIO='20',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">such notice may state that no representation
is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption or purchase and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption or purchase shall not be affected by any
defect in or omission of such numbers.&#160;
The Company will promptly notify the Trustee of any change in the
&#147;CUSIP&#148; numbers.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 3</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">REDEMPTION</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.01<i>.&#160; Right to Redeem; Notices to
Trustee.&#160; </i>(a)&nbsp;The
Securities may be redeemed in whole or in part at the option of the Company on
or after January&nbsp;15, 2012 and prior to the Final Maturity Date, if the
Last Reported Sale Price of the Common Stock has been greater than or equal to
130% of the Conversion Price then in effect for at least 20 Trading Days during
any 30 consecutive Trading Day period prior to the date on which the Company
provides notice of redemption.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The redemption price at which the Securities
are redeemable (the &#147;Redemption Price&#148;) shall be payable in cash and shall be
equal to 100% of the principal amount of Securities being redeemed, together
with accrued and unpaid interest to, but excluding, the Redemption Date; <i>provided, however</i>, that if Securities are redeemed on a date
that is after the record date for an interest payment and on or prior to the
corresponding Interest Payment Date, the Company shall pay, on the
corresponding Interest Payment date, accrued and unpaid interest, if any, to
the Holder as of the close of business on the record date, and not to the
Holder submitting the Securities for redemption.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Company may not redeem any Securities
unless all accrued and unpaid interest thereon has been or is simultaneously
paid for all semiannual periods or portions thereof terminating prior to the
Redemption Date.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as provided in this Section&nbsp;3.01,
the Securities shall not be redeemable by the Company.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.02<i>.&#160; Selection of Securities to be
Redeemed.&#160; </i>If less than all
the Securities are to be redeemed, the Trustee shall select the Securities to
be redeemed pro rata or by lot or by any other method the Trustee considers
fair and appropriate (so long as such method is not prohibited by the
rules&nbsp;of the Nasdaq Global Select Market or any stock exchange on which
the Securities are then listed, as applicable).&#160;
The Trustee shall make the selection within 7 days from its receipt of
the notice from the Company delivered pursuant to Section&nbsp;3.03 from
outstanding Securities not previously called for redemption.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Securities and portions of them the Trustee selects
shall be in principal amounts of $1,000 or integral multiples of $1,000.&#160; Provisions of this Indenture that apply to
Securities called for redemption in whole also apply to Securities called for
redemption in part.&#160; The </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=28,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=883958,FOLIO='21',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trustee shall notify the
Company promptly of the Securities or portions of Securities to be redeemed.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If any Security selected for partial
redemption is converted in part before termination of the conversion right with
respect to the portion of the Security so selected, the converted portion of
such Security shall be deemed (so far as may be) to be the portion selected for
redemption.&#160; Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as outstanding for the purpose of such selection.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.03<i>.&#160; Notice of Redemption.&#160; </i>At least 30 days but not more than
60 days before a Redemption Date, the Company shall mail a notice of redemption
by first-class mail, postage prepaid, to the Trustee, the Paying Agent and each
Holder of Securities to be redeemed.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The notice
shall specify the Securities to be redeemed and shall state:</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Redemption Date;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Redemption Price;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Conversion Price;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
name and address of the Paying Agent and Conversion Agent;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>that
Securities called for redemption may be converted at any time before the close
of business on the Business Day immediately preceding the Redemption Date;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>that
Holders who want to convert Securities must satisfy the requirements set forth
therein and in this Indenture;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>that
Securities called for redemption must be surrendered to the Paying Agent for
cancellation to collect the Redemption Price;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>if fewer
than all the outstanding Securities are to be redeemed, the certificate numbers
(if such Securities are held other than in global form) and Principal Amounts
of the particular Securities to be redeemed;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ix)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>that,
unless the Company defaults in making payment of such Redemption Price,
Interest will cease to accrue on and after the Redemption Date; and</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(x)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
CUSIP number of the Securities.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">At the Company&#146;s written request delivered at
least 45 days prior to the date such notice is to be given (unless a shorter
time period shall be acceptable to the Trustee), the Trustee shall give the notice
of redemption to each Holder of Securities to be redeemed in the Company&#146;s name
and at the Company&#146;s expense.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">22</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=29,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=1010783,FOLIO='22',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.04<i>.&#160; Effect of Notice of
Redemption.&#160; </i>Once notice of
redemption is given, Securities called for redemption become due and payable on
the Redemption Date and at the Redemption Price stated in the notice except for
Securities that are converted in accordance with the terms of this
Indenture.&#160; Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price stated in the
notice.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.05<i>.&#160; Deposit of Redemption
Price.&#160; </i>Prior to 10:00&nbsp;a.m.,
New York City time, on a Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient
to pay the Redemption Price of all Securities to be redeemed on that date other
than Securities or portions of Securities called for redemption which on or
prior thereto have been delivered by the Company to the Trustee for
cancellation or have been converted.&#160; The
Paying Agent shall as promptly as practicable return to the Company any money
not required for that purpose.&#160; If such
money is then held by the Company in trust and is not required for such purpose
it shall be discharged from such trust.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.06<i>.&#160; Securities Redeemed in
Part.&#160; </i>Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate and deliver to the Holder a new Security in an authorized
denomination equal in principal amount to the unredeemed portion of the
Security surrendered.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;3.07<i>.&#160; No Requirement to
Register.&#160; </i>Unless the Company
defaults in the payment of the Redemption Price, the Company shall not be
required to issue, register the transfer of, or convert any Securities after
the close of business on the Business Day immediately preceding the Redemption
Date or register the transfer or conversion of any Securities so selected for
redemption, in whole or in part, except the unredeemed portion of any Security
being redeemed in part.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE
4</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">PURCHASE</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.01<i>.&#160; Repurchase of Securities at Option of the
Holder upon a Fundamental Change.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If a Fundamental Change occurs prior to the
Final Maturity Date, each Holder of a Security shall have the right, at the
option of the Holder, to require the Company to repurchase for cash all or any
portion of the Securities of such Holder equal to $1,000 principal amount (or
an integral multiple thereof) at the Fundamental Change Repurchase Price, on
the date that is not less than 30 days nor more than 45 days after the date of
the Fundamental Change Company Notice pursuant to subsection 4.01(b)&nbsp;(the
&#147;Fundamental Change Repurchase Date&#148;); <i>provided that</i>,
if the Fundamental Change Repurchase Date is after the Regular Record Date for
an interest payment and on or prior to the corresponding Interest Payment Date,
the Company shall pay, on the corresponding Interest Payment date, accrued and
unpaid interest, if any, to the Holder as of </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=30,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=737062,FOLIO='23',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the close of
business on the Regular Record date, and not to the Holder submitting the
Securities for repurchase.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>At least twenty (20) days prior to the
anticipated effective date of a Fundamental Change, if practicable, but in any
case as promptly as practicable, the Company shall mail a written notice of the
Fundamental Change and of the resulting repurchase right to the Trustee, Paying
Agent and to each Holder (and to beneficial owners as required by applicable
law) (the &#147;Fundamental Change Company Notice&#148;).&#160;
The Fundamental Change Company Notice shall include the form of a
Fundamental Change Repurchase Notice to be completed by the Holder and shall
state:</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
events causing such Fundamental Change;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
date (or expected date) of such Fundamental Change;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
last date by which the Fundamental Change Repurchase Notice must be delivered
to elect the repurchase option pursuant to this Section&nbsp;4.01;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Fundamental Change Repurchase Date;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Fundamental Change Repurchase Price;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
Holder&#146;s right to require the Company to purchase the Securities;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
name and address of each Paying Agent and Conversion Agent;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the then
effective Conversion Rate and any adjustments to the Conversion Rate resulting
from such Fundamental Change;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ix)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
procedures that the Holder must follow to exercise conversion rights under Article&nbsp;5
and that Securities as to which a Fundamental Change Repurchase Notice has been
given may be converted into Common Stock pursuant to Article&nbsp;5 of this
Indenture only to the extent that the Fundamental Change Repurchase Notice has
been withdrawn in accordance with the terms of this Indenture;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(x)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
procedures that the Holder must follow to exercise rights under this Section&nbsp;4.01;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(xi)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
procedures for withdrawing a Fundamental Change Repurchase Notice;</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(xii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>that,
unless the Company fails to pay such Fundamental Change Repurchase Price,
Securities covered by any Fundamental Change Repurchase Notice will cease to be
outstanding and interest will cease to accrue on and after the Fundamental
Change Repurchase Date; and</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(xiii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the
CUSIP number of the Securities.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">24</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=31,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=528489,FOLIO='24',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">At the Company&#146;s request, the Trustee shall
give such Fundamental Change Company Notice in the Company&#146;s name and at the
Company&#146;s expense; provided, that, in all cases, the text of such Fundamental
Change Company Notice shall be prepared by the Company.&#160; If any of the Securities is in the form of a
Global Security, then the Company shall modify such notice to the extent
necessary to accord with the Applicable Procedures relating to the purchase of
Global Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>A Holder may exercise its rights specified in
Section&nbsp;4.01(a)&nbsp;upon delivery of a written notice (which shall be in
substantially the form attached as <u>Exhibit&nbsp;A</u> under the heading
&#147;Fundamental Change Repurchase Notice&#148; 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&#146;s Applicable
Procedures) of the exercise of such rights (a &#147;Fundamental Change Repurchase
Notice&#148;) to the Company or any Paying Agent at any time prior to the close of
business on the Business Day next preceding the Fundamental Change Repurchase
Date, subject to extension to comply with applicable law.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Fundamental Change Repurchase Notice shall state:&#160; (A)&nbsp;the certificate number (if such
Security is held other than in global form) of the Security which the Holder
will deliver to be purchased (or, if the Security is held in global form, any
other items required to comply with the Applicable Procedures), (B)&nbsp;the
portion of the principal amount of the Security which the Holder will deliver
to be purchased, in integral multiples of $1,000, and (C)&nbsp;that such
Security shall be purchased as of the Fundamental Change Repurchase Date
pursuant to the terms and conditions specified in the Securities and in this
Indenture.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
delivery of a Security for which a Fundamental Change Repurchase Notice has
been timely delivered to any Paying Agent and not validly withdrawn prior to,
on or after the Fundamental Change Repurchase Date (together with all necessary
endorsements) at the office of such Paying Agent shall be a condition to the
receipt by the Holder of the Fundamental Change Repurchase Price therefor.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Company shall only be obliged to purchase, pursuant to this Section&nbsp;4.01,
a portion of a Security if the principal amount of such portion is $1,000 or an
integral multiple of $1,000 (provisions of this Indenture that apply to the
purchase of all of a Security also apply to the purchase of such portion of
such Security).</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Notwithstanding
anything herein to the contrary, any Holder delivering to a Paying Agent the
Fundamental Change Repurchase Notice contemplated by this Section&nbsp;4.01(c)&nbsp;shall
have the right to withdraw such Fundamental Change Repurchase Notice in whole
or in a portion thereof that is a principal amount of $1,000 or in an integral
multiple thereof at any time prior to the close of business on the Business Day
prior to the Fundamental Change Repurchase Date by delivery of a written notice
of withdrawal to the Paying Agent in accordance with Section&nbsp;4.02.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">25</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=32,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=585878,FOLIO='25',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>A
Paying Agent shall promptly notify the Company of the receipt by it of any
Fundamental Change Repurchase Notice or written withdrawal thereof.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Anything
herein to the contrary notwithstanding, in the case of Global Securities, any
Fundamental Change Repurchase Notice may be delivered or withdrawn and such
Securities may be surrendered or delivered for purchase in accordance with the
Applicable Procedures as in effect from time to time.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.02<i>.&#160; Effect of Fundamental Change Repurchase
Notice.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Upon
receipt by any Paying Agent of a properly completed Fundamental Change
Repurchase Notice from a Holder, the Holder of the Security in respect of which
such Fundamental Change Repurchase Notice was given shall (unless such
Fundamental Change Repurchase Notice is withdrawn as specified in Section&nbsp;4.02(b))
thereafter be entitled to receive the Fundamental Change Repurchase Price with
respect to such Security, subject to the occurrence of the Fundamental Change
Effective Date and an absence of an Event of Default, or a continuation thereof
(other than a Default in the payment of the Fundamental Change Repurchase
Price).&#160; Such Fundamental Change
Repurchase Price shall be paid to such Holder promptly following the later of (i)&nbsp;the
Fundamental Change Repurchase Date (<i>provided</i> that
the conditions in Section&nbsp;4.01 have been satisfied) and (ii)&nbsp;the time
of delivery of such Security to a Paying Agent by the Holder thereof in the
manner required by Section&nbsp;4.01(c).&#160;
Securities in respect of which a Fundamental Change Repurchase Notice
has been given by the Holder thereof may not be converted into shares of Common
Stock pursuant to Article&nbsp;5 on or after the date of the delivery of such
Fundamental Change Repurchase Notice unless such Fundamental Change Repurchase
Notice has first been validly withdrawn in accordance with Section&nbsp;4.02(b)&nbsp;with
respect to the Securities to be converted.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>A
Fundamental Change Repurchase Notice may be withdrawn by means of a written
notice (which may be delivered by mail, overnight courier, hand delivery,
facsimile transmission or in any other written form and, in the case of Global
Securities, may be delivered by other means in accordance with the Applicable
Procedures) of withdrawal delivered by the Holder to a Paying Agent at any time
prior to the close of business on the Business Day immediately prior to the
Fundamental Change Repurchase Date, specifying (i)&nbsp;the principal amount of
the Security or portion thereof (which must be a principal amount of $1,000 or
an integral multiple of $1,000 in excess thereof) with respect to which such
notice of withdrawal is being submitted, (ii)&nbsp;if certificated Securities
have been issued, the certificate number of the Security being withdrawn in
whole or in withdrawable part (or if the Securities are not certificated, such
written notice must comply with the Applicable Procedures) and (iii)&nbsp;the
portion of the principal amount of the Security that will remain subject to the
Fundamental Change Repurchase Notice, which portion must be a principal amount
of $1,000 or an integral multiple thereof.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=33,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=273405,FOLIO='26',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.03<i>.&#160; Deposit of Fundamental Change Repurchase
Price.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>On or
before 12:00&nbsp;p.m.&#160; (noon) New York
City time on the Business Day following the applicable Fundamental Change
Repurchase Date, the Company shall deposit with the Trustee or with a Paying
Agent (or if the Company or an Affiliate of the Company is acting as the Paying
Agent, shall segregate and hold in trust as provided in Section&nbsp;2.04) an
amount of money (in immediately available funds if deposited on or after such
Fundamental Change Repurchase Date), sufficient to pay the aggregate
Fundamental Change Repurchase Price of all the Securities or portions thereof
that are to be purchased as of such Fundamental Change Repurchase Date.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If a Paying
Agent or the Trustee holds, in accordance with the terms hereof, money
sufficient to pay the Fundamental Change Repurchase Price of any Security for
which a Fundamental Change Repurchase Notice has been tendered and not
withdrawn in accordance with this Indenture then, on the Business Day following
the applicable Fundamental Change Repurchase Date, such Security will cease to
be outstanding, whether or not the Security is delivered to the Paying Agent or
the Trustee, and interest and, shall cease to accrue, and the rights of the
Holder in respect of the Security shall terminate (other than the right to
receive the Fundamental Change Repurchase Price as aforesaid).&#160; The Company shall publicly announce the
principal amount of Securities repurchased on or as soon as practicable after
the Fundamental Change Repurchase Date.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Paying
Agent will promptly return to the respective Holders thereof any Securities
with respect to which a Fundamental Change Repurchase Notice has been withdrawn
in compliance with this Indenture.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If a
Fundamental Change Repurchase Date falls after a Regular Record Date and on or
before the related Interest Payment Date, then interest on the Securities
payable on such Interest Payment Date will be payable to the Holders in whose
names the Securities are registered at the close of business on such Regular
Record Date.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.04<i>.&#160; Repayment to the Company.&#160; </i>To the extent that the aggregate
amount of cash deposited by the Company pursuant to Section&nbsp;4.03 exceeds
the aggregate Fundamental Change Repurchase Price of the Securities or portions
thereof that the Company is obligated to purchase, then promptly after the
Fundamental Change Repurchase Date the Trustee or a Paying Agent, as the case
may be, shall return any such excess cash to the Company.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.05<i>.&#160; Securities Purchased in
Part.&#160; </i>Any Security that is to
be purchased only in part shall be surrendered at the office of a Paying Agent,
and promptly after the Fundamental Change Repurchase Date, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such
Security, without service charge, a new Security or Securities, of such
authorized denomination or denominations as may be requested by such Holder
(which must be equal to $1,000 principal amount or any integral thereof), in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Security so surrendered that is not purchased.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">27</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=34,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=333788,FOLIO='27',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.06<i>.&#160; Compliance with Securities
Laws upon Purchase of Securities.&#160; </i>In
connection with any offer to purchase of Securities under Section&nbsp;4.01,
the Company shall (a)&nbsp;comply with Rule&nbsp;13e-4 and Rule&nbsp;14e-1 (or
any successor to either such Rule), and any other tender offer rules, if
applicable, under the Exchange Act, (b)&nbsp;file the related Schedule TO (or
any successor or similar schedule, form or report) if required under the
Exchange Act, and (c)&nbsp;otherwise comply with all federal and state
securities laws in connection with such offer to purchase or purchase of
Securities, all so as to permit the rights of the Holders and obligations of
the Company under Sections 4.01 through 4.04 to be exercised in the time and in
the manner specified therein.&#160; To the
extent that compliance with any such laws, rules&nbsp;and regulations would
result in a conflict with any of the terms hereof, this Indenture is hereby
modified to the extent required for the Company to comply with such laws, rules&nbsp;and
regulations.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;4.07<i>.&#160; Purchase of Securities in Open
Market.&#160; </i>The Company may, to
the extent permitted by applicable law, at any time, repurchase Securities in
the open market, by tender at any price or by negotiated transactions.&#160; The Company may, to the extent permitted by
applicable law, surrender any Security purchased by the Company pursuant to
this Article&nbsp;4 to the Trustee for cancellation or reissue or resell any
Security.&#160; Any securities surrendered to
the Trustee for cancellation may not be reissued or resold by the Company and
will be canceled promptly in accordance with Section&nbsp;2.11.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE
5</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">CONVERSION</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.01<i>.&#160; Conversion Privilege and Conversion Rate.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to
and upon compliance with the provisions of this Article&nbsp;5, at the option
of the Holder thereof, any Security or portion thereof that is an integral
multiple of $1,000 principal amount may be converted into fully paid and
non-assessable shares (calculated as to each conversion to the nearest
1/10,000th of a share) of Common Stock prior to the close of business on the Business
Day immediately preceding the Final Maturity Date or such earlier date set
forth in this Article&nbsp;5, unless redeemed or purchased by the Company at
the Holder&#146;s option, at the Conversion Rate in effect at such time, determined
as hereinafter provided.&#160; When a Holder
receives Common Stock upon conversion, such Holder will also receive the
associated preferred stock purchase right under the Company&#146;s rights agreement
adopted in 2004 (as amended in 2007) related to its series A junior
participating preferred stock, unless, prior to conversion, the rights have
expired, terminated or been exchanged.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Provisions
of this Indenture that apply to conversion of all of a Security also apply to
conversion of a portion of a Security.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>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&nbsp;5.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=35,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=591516,FOLIO='28',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Conversion Rate shall be adjusted in certain instances as provided in Section&nbsp;5.01(e)&nbsp;and
Section&nbsp;5.06.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If there
shall have occurred an event specified in clauses (i)&nbsp;or (ii)&nbsp;of the
definition of Change of Control, the Company shall pay a &#147;Make Whole Premium&#148;
to the Holders of the Securities whose conversion notice is received by the
conversion agent on or subsequent to the date 10 Trading Days before the date
the Company announces as the anticipated Fundamental Change Effective Date but
before the close of business on the Business Day immediately preceding the
Fundamental Change Repurchase Date or 10 Trading Days after the actual
effective date of the Fundamental Change, if later, by increasing the Conversion
Rate for such Securities.&#160; The number of
additional shares of Common Stock per $1,000 principal amount of Securities
constituting the Make Whole Premium shall be determined by the Company by
reference to the table below, based on the Fundamental Change Effective Date
and the Stock Price of such Fundamental Change; <i>provided</i>
that if the Stock Price or Fundamental Change Effective Date are not set forth
on the table: (i)&nbsp;if the actual Stock Price on the Fundamental Change
Effective Date is between two Stock Prices on the table or the actual
Fundamental Change Effective Date is between two Fundamental Change Effective
Dates on the table, the Make Whole Premium will be determined by a
straight-line interpolation between the Make Whole Premiums set forth for the
two Stock Prices and the two Fundamental Change Effective Dates on the table
based on a 365-day year, as applicable, (ii)&nbsp;if the Stock Price on the
Fundamental Change Effective Date exceeds $&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; per share, subject to adjustment as
set forth herein, no Make Whole Premium will be paid, and (iii)&nbsp;if the
Stock Price on the Fundamental Change Effective Date is less than $&#160;&#160;&#160;&#160;&#160;&#160;&#160; per share, subject to adjustment as set
forth herein, no Make Whole Premium will be paid.&#160; If Holders of the Common Stock receive only
cash in the Fundamental Change, the Stock Price shall be the cash amount paid
per share of the Common Stock in connection with the Fundamental Change.&#160; Otherwise, the Stock Price shall be equal to
the average Closing Prices of the Common Stock for each of the 10 Trading Days
immediately preceding, but not including, the applicable Fundamental Change
Effective Date.</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Make&nbsp;Whole&nbsp;Premium&nbsp;upon&nbsp;Certain&nbsp;Fundamental&nbsp;Changes</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(Number&nbsp;of&nbsp;Additional&nbsp;Shares)</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="99%" colspan="17" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:99.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Effective&nbsp;Date</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.0%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Stock<br>
  Price</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;&nbsp;&nbsp;,<br>
  2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2009</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2010</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2011</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2012</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2013</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2014</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="9%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">January&nbsp;15,<br>
  2015</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:11.0%;">
  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
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  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Stock Prices set forth in the first
column of the table above will be adjusted as of any date on which the
Conversion Rate of the Securities is adjusted.&#160;
The adjusted Stock Prices will equal the Stock Prices applicable
immediately prior to such adjustment multiplied by a fraction, the numerator of
which is the Conversion Rate immediately prior to the adjustment giving rise to
the Stock Price adjustment and the denominator of which is the Conversion Rate
as so adjusted.&#160; The number of additional
shares set forth in the table above will be adjusted in the same manner </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">29</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=36,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=529223,FOLIO='29',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">as the Conversion Rate as set
forth in Section&nbsp;5.06 hereof, other than as a result of an adjustment of
the Conversion Rate by adding the Make Whole Premium as described above.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding the foregoing paragraph, in
no event will the total number of shares of Common Stock issuable upon
conversion of a Security exceed&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
per $1,000 principal amount, subject to adjustment in the same manner as
the Conversion Rate as set forth in clauses (i)&nbsp;through (vii)&nbsp;of Section&nbsp;5.06(a)&nbsp;hereof.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The additional shares issuable pursuant to
this Section&nbsp;5.01(e)&nbsp;shall be delivered upon the later of (i)&nbsp;the
settlement date for the conversion and (ii)&nbsp;promptly following the
Fundamental Change Effective Date.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>By
delivering the number of shares of Common Stock issuable on conversion to the
Trustee, or to the Conversion Agent, if the Conversion Agent is other than the
Trustee, the Company will be deemed to have satisfied its obligation to pay the
principal amount of the Securities so converted and its obligation to pay
accrued and unpaid interest attributable to the period from the most recent
Interest Payment Date through the Conversion Date (which amount will be deemed
paid in full rather than cancelled, extinguished or forfeited).</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Trustee
may conclusively rely on the Company&#146;s calculations of the Make Whole Premium.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.02<i>.&#160; Conversion Procedure.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>To convert
a Security, a Holder must (i)&nbsp;complete and manually sign the conversion
notice on the back of the Security and deliver such notice to a Conversion
Agent, (ii)&nbsp;surrender the Security to a Conversion Agent, (iii)&nbsp;furnish
appropriate endorsements and transfer documents if required by a Registrar or a
Conversion Agent, and (iv)&nbsp;pay all transfer or similar taxes, if required
pursuant to Section&nbsp;5.04.&#160; The date
on which the Holder satisfies all of those requirements is the &#147;Conversion
Date.&#148; Upon the conversion of a Security, the Company will deliver the shares
of Common Stock (and cash in lieu of fractional shares), to the Trustee (or to
the Conversion Agent, if the Conversion Agent is other than the Trustee), as
applicable, no later than three (3)&nbsp;Business Days after the Conversion
Date.&#160; Anything herein to the contrary
notwithstanding, in the case of Global Securities, conversion notices may be
delivered and such Securities may be surrendered for conversion in accordance
with the Applicable Procedures as in effect from time to time.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The person
in whose name the shares of Common Stock are issuable upon conversion shall be
deemed to be a holder of record of such Common Stock on the Conversion Date; <i>provided, however</i>, that no surrender of a Security on any
Conversion Date when the stock transfer books of the Company shall be closed
shall be effective to constitute the person or persons entitled to receive the
shares of Common Stock upon conversion as the record holder or holders of such
shares of Common Stock on such date, but such surrender shall be effective to
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 </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=37,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=718615,FOLIO='30',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">which such
stock transfer books are open; provided further that such conversion shall be
at the Conversion Rate in effect on the Conversion Date as if the stock
transfer books of the Company had not been closed.&#160; Upon conversion of a Security, such person
shall no longer be a Holder of such Security.&#160;
Except as set forth in this Indenture, no payment or adjustment will be
made for dividends or distributions declared or made on shares of Common Stock
issued upon conversion of a Security prior to the issuance of such shares.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If a
holder surrenders a Security for conversion during the period from the close of
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date, then, despite the
conversion, the Company shall, on the Interest Payment Date, pay the semiannual
interest payable on such Security to the Person who was the Holder at the close
of business on the Regular Record Date.&#160;
Such Security, upon surrender to the Company for conversion, must be
accompanied by funds equal to the amount of interest payable on the Security so
converted, <i>provided</i> that no such payment need be
made (i)&nbsp;in connection with any conversion following the Regular Record
Date immediately preceding the final Interest Payment Date, (ii)&nbsp;if the
Company had specified a Fundamental Change Purchase Date that is after a
Regular Record Date and on or prior to the Business Day following the
corresponding Interest Payment Date, (iii)&nbsp;in connection with any
conversion of Securities that have been called by the Company for redemption
and in respect of which the Company had specified a Redemption Date that is
after a Regular Record Date but on or prior to the corresponding Interest
Payment Date, or (iv)&nbsp;to the extent of any overdue interest, if any
overdue interest exists at the time of conversion with respect to such
Security.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to Section&nbsp;5.02(c),
nothing in this Section&nbsp;shall affect the right of a Holder in whose name
any Security is registered at the close of business on a Regular Record Date to
receive the interest payable on such Security on the related Interest Payment
Date in accordance with the terms of this Indenture and the Securities.&#160; If a Holder converts more than one Security
at the same time, the number of shares of Common Stock issuable upon the
conversion, if any, (and the amount of any cash in lieu of fractional shares
pursuant to Section&nbsp;5.03) shall be based on the aggregate principal amount
of all Securities so converted.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>In the
case of any Security which is converted in part only, upon such conversion the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder thereof, without service charge, a new Security or Securities of
authorized denominations in an aggregate principal amount equal to, and in exchange
for, the unconverted portion of the principal amount of such Security.&#160; A Security may be converted in part, but only
if the principal amount of such part is an integral multiple of $1,000 and the
principal amount of such Security to remain outstanding after such conversion
is equal to $1,000 or any integral multiple of $1,000 in excess thereof.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.03<i>.&#160; Fractional Shares.&#160; </i>The Company will not issue
fractional shares of Common Stock upon conversion of Securities.&#160; If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares that shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted hereby) so surrendered.&#160;
In lieu of </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31</font></p>

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</div>
<!-- ZEQ.=1,SEQ=38,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=416531,FOLIO='31',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">any fractional share, the
Company will pay an amount in cash for the current market value of the
fractional share.&#160; The current market
value of a fractional share shall be determined (calculated to the nearest
1/100th of a share) by multiplying the average of the Closing Price of the
Common Stock on the Trading Day immediately preceding the Conversion Date by
such fractional share and rounding the product to the nearest whole cent.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.04<i>.&#160; Taxes on Conversion.&#160; </i>If a Holder converts a Security,
the Holder shall pay any transfer, stamp or similar taxes or duties related to
the issue or delivery of shares of Common Stock upon such conversion.&#160; The Holder shall also pay any such tax with
respect to cash received in lieu of fractional shares.&#160; In addition, the Holder shall pay any such
tax which is due because the Holder requests the shares to be issued in a name
other than the Holder&#146;s name.&#160; The
Conversion Agent may refuse to deliver the certificate representing the Common
Stock being issued in a name other than the Holder&#146;s name until the Conversion
Agent receives a sum sufficient to pay any tax which will be due because the
shares are to be issued in a name other than the Holder&#146;s name.&#160; Nothing herein shall preclude any tax
withholding required by law or regulation.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.05<i>.&#160; Company to Provide Stock.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Company shall, prior to issuance of any Securities hereunder, and from time to
time as may be necessary, reserve, out of its authorized but unissued Common
Stock, a sufficient number of shares of Common Stock to permit the conversion
of all outstanding Securities into shares of Common Stock.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>All shares
of Common Stock delivered upon conversion of the Securities shall be newly
issued shares, shall be duly authorized, validly issued, fully paid and
nonassessable and shall be free from preemptive or similar rights and free of
any lien or adverse claim as the result of any action by the Company.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Company will endeavor promptly to comply with all federal and state securities
laws regulating the offer and delivery of shares of Common Stock upon
conversion of Securities.</p>

<p style="margin:0in 0in .0001pt;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.06<i>.&#160; Adjustment of Conversion Rate.</i></font></p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Conversion Rate shall be adjusted from time to time by the Company as follows:</p>

<p style="margin:0in 0in .0001pt;page-break-after:avoid;text-indent:.65in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If
the Company shall pay a dividend or make a distribution on outstanding Common
Stock in shares of Common Stock, the Conversion Rate in effect immediately
prior to the record date for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased so that the same
shall equal the rate determined by the Company by multiplying the Conversion
Rate in effect immediately prior to such record date by a fraction of which the
numerator shall be the sum of the number of shares of Common Stock outstanding
at the close of business on such record </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">32</font></p>

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</div>
<!-- ZEQ.=1,SEQ=39,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=893209,FOLIO='32',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">date plus the total number of shares of
Common Stock constituting such dividend or other distribution and of which the
denominator shall be the number of shares of Common Stock outstanding at the
close of business on such record date.&#160;
Such adjustment shall be made successively whenever any such dividend or
distribution is made and shall become effective immediately after such record
date.&#160; For the purpose of this clause
(i), the number of shares of Common Stock at any time outstanding shall not
include shares held in the treasury of the Company.&#160; The Company will not pay any dividend or make
any distribution on Common Stock held in the treasury of the Company.&#160; If any dividend or distribution of the type
described in this clause is declared but not so paid or made, the Conversion
Rate shall again be adjusted to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If
the Company shall subdivide its outstanding Common Stock into a greater number
of shares, or combine its outstanding Common Stock into a smaller number of
shares, the Conversion Rate in effect immediately prior to the day upon which
such subdivision or combination becomes effective shall be, in the case of a
subdivision of Common Stock, proportionately increased and, in the case of a
combination of Common Stock, proportionately reduced.&#160; Such adjustment shall be made successively
whenever any such subdivision or combination of the Common Stock occurs and
shall become effective immediately after the date upon which such subdivision
or combination becomes effective.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If
the Company shall issue certain rights or warrants to all or substantially all
holders of its outstanding Common Stock entitling them (for a period expiring
within 45 days after such issuance) to subscribe for or purchase shares of
Common Stock (or securities convertible into Common Stock) at a price per share
(or having a conversion price per share) less than the Current Market Price per
share of Common Stock (as determined in accordance with clause (ix)&nbsp;of
this Section&nbsp;5.06(a)) on the record date for the determination of
shareholders entitled to receive such rights or warrants, the Conversion Rate
in effect immediately prior thereto shall be adjusted so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect
immediately prior to such record date by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on such record date plus the number of additional shares of Common
Stock that such rights or warrants entitle holders thereof to subscribe for or
purchase (or into which such convertible securities are convertible) and of
which the denominator shall be the number of shares of Common Stock outstanding
at the close of business on such record date plus the number of shares which
the aggregate offering price of the total number of shares of Common Stock so
offered for subscription or purchase (or the aggregate conversion price of the
convertible securities so offered for subscription or purchase, which shall be
determined by multiplying the number of shares of Common Stock issuable upon
conversion of such convertible securities by the conversion price per share of
Common Stock pursuant to the terms of such convertible securities) would purchase
at the Current Market Price per share of Common Stock on such record date.&#160; Such adjustment shall be made successively
whenever any such rights or warrants (or convertible securities) are issued, </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">33</font></p>

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</div>
<!-- ZEQ.=1,SEQ=40,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=670737,FOLIO='33',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and shall become effective immediately after
such record date.&#160; To the extent that
shares of Common Stock (or securities convertible into Common Stock) are not
delivered after the expiration of such rights or warrants, the Conversion Rate
shall be readjusted to the Conversion Rate that would then be in effect had the
adjustments made upon the issuance of such rights or warrants been made on the
basis of delivery of only the number of shares of Common Stock (or securities
convertible into Common Stock) actually delivered.&#160; If such rights or warrants are not so issued,
the Conversion Rate shall again be adjusted to be the Conversion Rate that
would then be in effect if the record date for the determination of
shareholders entitled to receive such rights or warrants had not been
fixed.&#160; In determining whether any rights
or warrants entitle the shareholders to subscribe for or purchase shares of
Common Stock at a price less than the Current Market Price per share of Common
Stock and in determining the aggregate offering price of the total number of
shares of Common Stock so offered, there shall be taken into account any
consideration received by the Company for such rights or warrants and any
amount payable on exercise or conversion thereof, the value of such consideration,
if other than cash, to be determined by the Board of Directors.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If
the Company shall make a dividend or other distribution to all or substantially
all holders of its Common Stock of Capital Stock, other than Common Stock, or
evidences of indebtedness or other assets of the Company, including securities
(excluding (x)&nbsp;any issuance of rights or warrants for which an adjustment
was made pursuant to Section&nbsp;5.06(a)(iii), (y)&nbsp;dividends or
distributions in connection with a reclassification, consolidation, merger,
combination, sale or conveyance resulting in a change in the conversion
consideration pursuant to Section&nbsp;5.10, or pursuant to any Rights Plan or (z)&nbsp;any
dividend or distribution paid exclusively in cash for which an adjustment was
made pursuant to Section&nbsp;5.06(a)(vi)) (the &#147;Distributed Securities&#148;), then
in each such case (unless the Company distributes such Distributed Securities
for distribution to the Holders of Securities on such dividend or distribution
date as if each Holder had converted such Security into Common Stock
immediately prior to the record date with respect to such distribution) the
Conversion Rate in effect immediately prior to the record date fixed for the
determination of shareholders entitled to receive such dividend or distribution
shall be adjusted so that the same shall equal the rate determined by
multiplying the Conversion Rate in effect immediately prior to such record date
by a fraction of which the numerator shall be the Current Market Price per
share of the Common Stock on such record date and of which the denominator
shall be Current Market Price per share on such record date less the fair
market value (as determined in good faith by the Board of Directors, whose
determination shall be conclusive evidence of such fair market value and which
shall be evidenced by an Officers&#146; Certificate delivered to the Trustee) on
such record date of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock (determined on the basis of the number
of shares of Common Stock outstanding at the close of business on such record
date).&#160; Such adjustment 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.&#160;
In the event that such dividend or </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">34</font></p>

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</div>
<!-- ZEQ.=1,SEQ=41,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=288755,FOLIO='34',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">distribution is not so paid or made, the
Conversion Rate shall again be adjusted to be the Conversion Rate that would
then be in effect if such dividend or distribution had not been declared.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If the fair market value (as so
determined) of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price per share of the Common Stock on such record date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder of a
Security shall have the right to receive upon conversion the amount of
Distributed Securities so distributed that such Holder would have received had
such Holder converted each Security on such record date.&#160; If the Board of Directors determines the fair
market value of any distribution for purposes of this Section&nbsp;5.06(a)(iv)&nbsp;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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding the foregoing,
if the securities distributed by the Company to all holders of its Common Stock
consist of Capital Stock of, or similar equity interests in, a Subsidiary or
other business unit of the Company (the &#147;Spinoff Securities&#148;), the Conversion
Rate shall be adjusted, unless the Company makes an equivalent distribution to
the Holders of the Securities, so that the same shall be equal to the rate
determined by multiplying the Conversion Rate in effect on the record date
fixed for the determination of shareholders entitled to receive such
distribution by a fraction, the numerator of which shall be the sum of (A)&nbsp;the
average Closing Price of one share of Common Stock over the ten consecutive
Trading Day period (the &#147;Spinoff Valuation Period&#148;) commencing on and including
the Trading Day on which ex-dividend trading commences for such distribution on
the Nasdaq Global Market or such other U.S.&#160;
national or regional exchange or market on which the Common Stock is
then listed or quoted and (B)&nbsp;the average of the Closing Prices over the
Spinoff Valuation Period of the Spinoff Securities multiplied by the number of
Spinoff Securities distributed in respect of one share of Common Stock and the
denominator of which shall be the average Closing Price of one share of Common
Stock over the Spinoff Valuation Period, such adjustment to become effective
immediately prior to the opening of business on the tenth Trading Day after the
date on which ex-dividend trading commences; <i>provided,
however</i>, that the Company may in lieu of the foregoing adjustment
elect to make adequate provision so that each Holder of Securities shall have
the right to receive upon conversion thereof the amount of such Spinoff
Securities that such Holder of Securities would have received if such
Securities had been converted on the record date with respect to such
distribution.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>With
respect to any rights or warrants (the &#147;Rights&#148;) that may be issued or
distributed pursuant to any rights plan of the Company currently in effect or
that the Company implements after the date of this Indenture (a &#147;Rights Plan&#148;),
or if the Company&#146;s current Rights Plan is still in effect, in lieu of any
adjustment required by any other provision of this Section&nbsp;5.06 upon
conversion of the Securities into Common </p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">35</font></p>

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</div>
<!-- ZEQ.=1,SEQ=42,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=192332,FOLIO='35',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Stock, to the extent that such Rights Plan is
in effect upon such conversion, the Holders of Securities will receive, with
respect to the shares of Common Stock issued upon conversion, the Rights
described therein (whether or not the Rights have separated from the Common
Stock at the time of conversion), subject to the limitations set forth in and
in accordance with any such Rights Plan; <i>provided</i> that
in the case of the Company&#146;s current Rights Plan or a future Rights Plan to the
extent applicable, if, at the time of conversion, the Rights have separated
from the shares of Common Stock in accordance with the provisions of the Rights
Plan so that Holders would not be entitled to receive any rights in respect of
the shares of Common Stock issuable upon conversion of the Securities as a
result of the timing of the Conversion Date, the Conversion Rate will be
adjusted as if the Company distributed to all holders of Common Stock
Distributed Securities constituting such rights as provided in the first paragraph
of clause (iv)&nbsp;of this Section&nbsp;5.06(a), subject to appropriate
readjustment in the event of the expiration, termination, repurchase or
redemption of the Rights.&#160; 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&nbsp;5.06(a).&#160; Other than as specified in this clause (v)&nbsp;of
this Section&nbsp;5.06(a), there will not be any adjustment to the Conversion
Rate as the result of the issuance of any Rights, the distribution of separate
certificates representing such Rights, the exercise or redemption of such
Rights in accordance with any Rights Plan or the termination or invalidation of
any Rights.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If
the Company shall, by dividend or otherwise, at any time distribute (a
&#147;Triggering Distribution&#148;) to all holders of its Common Stock a payment
consisting exclusively of cash (excluding any dividend or distribution in
connection with the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary) the Conversion Rate shall be increased so
that the same shall equal the rate determined by multiplying such Conversion
Rate in effect at the opening of business on the date on which ex-dividend
trading commences for such Triggering Distribution (a &#147;Determination Date&#148;) by
a fraction of which the numerator shall be the average of the Last Reported
Sale Price for the ten Trading Days prior to the date on which ex-dividend
trading commences for such dividend or distribution and the denominator of
which shall be the difference between (A)&nbsp;such average price of the Common
Stock and (B)&nbsp;the amount in cash per share of such dividend or
distribution, such increase to become effective immediately prior to the
opening of business on the day following the Determination Date.&#160; If the amount of cash dividend or
distribution applicable to one share of Common Stock is equal to or greater than
the Last Reported Sale Price per share of the Common Stock on the Determination
Date, in lieu of the foregoing adjustment, adequate provision shall be made so
that each Holder of a Security shall have the right to receive upon conversion
the amount of cash so distributed that such Holder would have received had such
Holder converted each Security on such Determination Date.&#160; In the event that such dividend or
distribution is not so paid or made, the Conversion Rate shall again be
adjusted to be the Conversion Rate that would then be in effect if such divided
or distribution had not been declared.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">36</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=43,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=879930,FOLIO='36',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If any
tender offer made by the Company or any of its Subsidiaries for all or any
portion of Common Stock shall expire, then, if the tender offer shall require
the payment to shareholders of consideration per share of Common Stock having a
fair market value (determined as provided below) that exceeds Closing Price per
share of Common Stock on the Trading Day next succeeding the last date (the &#147;Expiration
Date&#148;) 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 &#147;Expiration Time&#148;), the
Conversion Rate shall be increased so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior to
the close of business on the Expiration Date by a fraction of which the
numerator shall be the sum of (A)&nbsp;the fair market value of the aggregate
consideration (the fair market value as determined in good faith by the Board
of Directors, whose determination shall be conclusive evidence of such fair
market value and which shall be evidenced by an Officer&#146;s Certificate delivered
to the Trustee) payable to shareholders based on the acceptance (up to any
maximum specified in the terms of the tender offer) of all shares validly
tendered and not withdrawn as of the Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the &#147;Purchased Shares&#148;)
and (B)&nbsp;the product of the number of shares of Common Stock outstanding
(less any Purchased Shares and excluding any shares held in the treasury of the
Company) at the Expiration Time and the Closing Price per share of Common Stock
on the Trading Day next succeeding the Expiration Date and the denominator of
which shall be the product of the number of shares of Common Stock outstanding
(including Purchased Shares but excluding any shares held in the treasury of
the Company) at the Expiration Time multiplied by the Closing Price per share
of the Common Stock on the Trading Day next succeeding the Expiration Date,
such increase to become effective immediately prior to the opening of business
on the day following the Expiration Date.&#160;
In the event that the Company is obligated to purchase shares pursuant
to any such tender offer, but the Company is permanently prevented by
applicable law from effecting any or all such purchases or any or all such
purchases are rescinded, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would have been in effect based upon the number of shares
actually purchased, if any.&#160; If the
application of this clause (vii)&nbsp;of Section&nbsp;5.06(a)&nbsp;to any
tender offer would result in a decrease in the Conversion Rate, no adjustment
shall be made for such tender offer under this clause (vii).</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>For
purposes of this Section&nbsp;5.06, the term &#147;tender offer&#148; shall mean and
include both tender offers and exchange offers, all references to &#147;purchases&#148;
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 &#147;tendered shares&#148; (and all
similar references) shall mean and include shares tendered in both tender
offers and exchange offers.</p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ix)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>For
purposes of any computation under this Section&nbsp;5.06, &#147;Current Market
Price&#148; shall mean the average of the daily Closing Prices per share of Common
Stock for each of the ten consecutive Trading Days immediately prior to the
date in question; <i>provided, however</i>, that if:</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">37</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=44,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=630649,FOLIO='37',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_03_77602.CHC",USER="DNICHOL",CD='Jan 15 02:37 2008' -->



<div>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160; the &#147;ex&#148; date (as
hereinafter defined) for any event (other than the issuance or distribution
requiring such computation) that requires an adjustment to the Conversion Rate
pursuant to Section&nbsp;5.06(a)&nbsp;(i), (ii), (iii), (iv), (v), (vi)&nbsp;or
(vii)&nbsp;occurs during such ten consecutive Trading Days, the Closing Price
for each Trading Day prior to the &#147;ex&#148; date for such other event shall be
adjusted by dividing such Closing Price by the same fraction by which the
Conversion Rate is so required to be adjusted as a result of such other event;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160; the &#147;ex&#148; date for any
event (other than the issuance or distribution requiring such computation) that
requires an adjustment to the Conversion Rate pursuant to Section&nbsp;5.06(a)&nbsp;(i),
(ii), (iii), (iv), (v), (vi)&nbsp;or (vii)&nbsp;occurs on or after the &#147;ex&#148;
date for the issuance or distribution requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after the
&#147;ex&#148; date for such other event shall be adjusted by dividing such Closing Price
by the reciprocal of the fraction by which the Conversion Rate is so required
to be adjusted as a result of such other event; and</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160; the &#147;ex&#148; date for the
issuance or distribution requiring such computation is prior to the day in
question, after taking into account any adjustment required pursuant to the
immediately preceding clause (A)&nbsp;or (B)&nbsp;of this Section&nbsp;5.06(a)(ix),
the Closing Price for each Trading Day on or after such &#147;ex&#148; date shall be
adjusted by adding thereto the amount of any cash and the fair market value (as
determined in good faith by the Board of Directors in a manner consistent with
any determination of such value for purposes of Section&nbsp;5.06(a)(iv)&nbsp;or
(vii), whose determination shall be conclusive and set forth in a Board
Resolution) of the evidences of indebtedness, shares of capital stock or assets
being distributed applicable to one share of Common Stock as of the close of
business on the day before such &#147;ex&#148; date.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">For purposes
of any computation under Section&nbsp;5.06(a), if the &#147;ex&#148; date for any event
(other than the tender offer that is the subject of the adjustment pursuant to Section&nbsp;5.06(a)(vii))
that requires an adjustment to the Conversion Rate pursuant to Section&nbsp;5.06(a)(i),
(ii), (iii), (iv), (v)&nbsp;or (vi)&nbsp;occurs on the date of the Expiration
Time for the tender or exchange offer requiring such computation or on the
Trading Day next following the Expiration Time, the Closing Price for each
Trading Day on and after the &#147;ex&#148; date for such other event shall be adjusted
by dividing such Closing Price by the reciprocal of the fraction by which the
Conversion Rate is so required to be adjusted as a result of such other
event.&#160; For purposes of this Section&nbsp;5.06(a)(ix)&nbsp;the
term &#147;ex&#148; date, when used:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:59.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160; with respect to any issuance or distribution, means the first
date on which the Common Stock trades regular way on the relevant exchange or
in the relevant market from which the Closing Price was obtained without the
right to receive such issuance or distribution;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">38</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=45,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=735499,FOLIO='38',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:60.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160; with respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common Stock trades regular way
on such exchange or in such market after the time at which such subdivision or
combination becomes effective, and</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:60.0pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:60.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160; with respect to any tender or exchange offer, means the first
date on which the Common Stock trades regular way on such exchange or in such
market after the Expiration Time of such offer.</font></p>

<p style="margin:0in 0in .0001pt 1.0in;text-indent:60.0pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the foregoing, whenever successive adjustments to the Conversion Rate are
called for pursuant to this Section&nbsp;5.06, such adjustments shall be made
to the Current Market Price as may be necessary or appropriate to effectuate
the intent of this Section&nbsp;5.06 and to avoid unjust or inequitable results
as determined in good faith by the Board of Directors and evidenced by an
Officers&#146; Certificate delivered to the Trustee.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; In any case in which this Section&nbsp;5.06
shall require that an adjustment be made following a record date, a
Determination Date or Expiration Date, as the case may be, established for the
purposes specified in this Section&nbsp;5.06, the Company may elect to defer
(but only until three Business Days following the filing by the Company with
the Trustee of the certificate described in Section&nbsp;5.08) issuing to the
Holder of any Security converted after such record date, Determination Date or
Expiration Date the shares of Common Stock and other Capital Stock of the
Company issuable upon such conversion over and above the shares of Common Stock
and other Capital Stock of the Company (or other cash, property or securities,
as applicable) issuable upon such conversion only on the basis of the
Conversion Rate prior to adjustment; and, in lieu of any cash, property or
securities the issuance of which is so deferred, the Company shall issue or
cause its transfer agents to issue due bills or other appropriate evidence
prepared by the Company of the right to receive such cash, property or
securities.&#160; If any distribution in
respect of which an adjustment to the Conversion Rate is required to be made as
of the record date, Determination Date or Expiration Date therefore is not
thereafter made or paid by the Company for any reason, the Conversion Rate
shall be readjusted to the Conversion Rate which would then be in effect if
such record date had not been fixed or such record date, Determination Date or
Expiration Date had not occurred.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; For purposes of this Section&nbsp;5.06,
&#147;record date&#148; shall mean, with respect to any dividend, distribution or other
transaction or event in which the holders of Common Stock have the right to
receive any cash, securities or other property or in which the Common Stock (or
other applicable security) is exchanged or converted into any combination of
cash, securities or other property, the date fixed for determination of
shareholders entitled to receive such cash, security or other property (whether
or not such date is fixed by the Board of Directors or by statute, contract or
otherwise).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If one or more events occur requiring an
adjustment be made to the Conversion Rate for a particular period, adjustments
to the Conversion Rate shall be determined by the Company&#146;s Board of Directors
to reflect the combined impact of such Conversion Rate adjustment events, as
set out in this Section&nbsp;5.06, during such period.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">39</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=46,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=443821,FOLIO='39',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Notwithstanding the provisions set forth
in Section&nbsp;5.06(a), in no event shall the total number of shares of Common
Stock issuable upon conversion of a Security exceed&#160;&#160;&#160;&#160;&#160;&#160; shares per $1,000 principal amount of
Securities, subject to adjustments in the same manner as the Conversion Rate as
set forth in clauses (i)&nbsp;through (vii)&nbsp;of Section&nbsp;5.06(a).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.07<i>.&#160; No Adjustment.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; No adjustment in the Conversion Rate
shall be required if Holders may, by virtue of their ownership of the
Securities, participate in the transactions set forth in Section&nbsp;5.06
above (to the same extent as if the Securities had been converted into Common Stock
immediately prior to such transactions) without converting the Securities held
by such Holders.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; No adjustment in the Conversion Rate
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the Conversion Rate as last adjusted; <i>provided,
however</i>, that any adjustments which would be required to be made but
for this Section&nbsp;5.07(b)&nbsp;shall be carried forward and taken into
account in any subsequent adjustment.&#160;
The Company shall adjust for any carry forward amount upon conversion
regardless of the 1% threshold.&#160; All
calculations under this Article&nbsp;5 shall be made to the nearest cent or to
the nearest one-ten thousandth of a share, as the case may be, with one half
cent and 0.00005 of a share, respectively, being rounded upward.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; No adjustment in the Conversion Rate
shall be required for issuances of Common Stock pursuant to a Company plan for
reinvestment of dividends, the issuance of Common Stock or options to purchase
shares of Common Stock pursuant to any present or future employee, director or
consultant benefit plan or program of or assumed by the Company, upon the
issuance of Common Stock pursuant to any option, warrant or right, or exercise
of any exchangeable or convertible security outstanding as of the Issue Date,
repurchases by the Company of Common Stock not expressly discussed in this Article&nbsp;5
or interest or for a change to a par value of the Common Stock.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160; To the extent that the Securities become
convertible into the right to receive cash, no adjustment need be made
thereafter as to the cash.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.08<i>.&#160; Notice of Adjustment.&#160; </i>Whenever the Conversion Rate or
conversion privilege is required to be adjusted pursuant to this Indenture, the
Company shall promptly mail to Holders a notice of the adjustment and file with
the Trustee an Officers&#146; Certificate briefly stating the facts requiring the
adjustment and the manner of computing it.&#160;
Failure to mail such notice or any defect therein shall not affect the
validity of any such adjustment.&#160; Unless
and until the Trustee shall receive an Officers&#146; Certificate setting forth an
adjustment of the Conversion Rate, the Trustee may assume without inquiry that
the Conversion Rate has not been adjusted and that the last Conversion Rate of
which it has knowledge remains in effect.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.09<i>.&#160; Notice of Certain
Transactions.&#160; </i>In the event
that there is a dissolution or liquidation of the Company, the Company shall
mail to Holders and file with the Trustee a notice stating the proposed
effective date.&#160; The Company shall mail
such notice at least 10 days before </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=47,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=923683,FOLIO='40',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">such proposed
effective date.&#160; Failure to mail such
notice or any defect therein shall not affect the validity of any transaction
referred to in this Section&nbsp;5.09.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.10<i>.&#160; Effect of Recapitalization,
Reclassification, Consolidation, Merger or Sale.&#160; </i>If any of following events occur
(each, a &#147;Business Combination&#148;):</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160; any recapitalization, reclassification or change of the
Common Stock, other than changes resulting from a subdivision or a combination,</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160; a consolidation, merger or combination
involving the Company,</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160; a sale, conveyance or lease to another
corporation of all or substantially all of the property and assets of the Company,
other than to one or more of the Company&#146;s subsidiaries, or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160; any statutory share exchange,</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">in each case as a result of
which holders of Common Stock are entitled to receive stock, other securities,
other property or assets (including cash or any combination thereof) with
respect to or in exchange for Common Stock, the Company or the successor or
purchasing corporation, as the case may be, shall execute with the Trustee a
supplemental indenture (which shall comply with the TIA as in force at the date
of execution of such supplemental indenture if such supplemental indenture is
then required to so comply) providing that the Holders of the Securities then
outstanding will be entitled thereafter to convert such Securities into the
kind and amount of shares of stock, other securities or other property or
assets (including cash or any combination thereof) which they would have owned
or been entitled to receive upon such Business Combination had such Securities
been converted into Common Stock immediately prior to such Business
Combination, except that such Holders will not receive the Make Whole Premium
if such Holder does not convert its Securities &#147;in connection with&#148; the
relevant Fundamental Change.&#160; A conversion
of the Securities by a Holder will be deemed for these purposes to be &#147;in
connection with&#148; a Fundamental Change if the notice of such conversion is
provided in compliance with Section&nbsp;5.02(a)&nbsp;to the Conversion Agent
on or subsequent to the date 10 Trading Days prior to the date announced by the
Company as the anticipated Fundamental Change Effective Date but before the
close of business on the Business Day immediately preceding the related
Fundamental Change Repurchase Date.&#160; In
the event holders of Common Stock have the opportunity to elect the form of
consideration to be received in such Business Combination, the Securities will
be convertible into the weighted average of the kind and amount of
consideration received by the holders of the Common Stock that affirmatively
make such an election. &#160;The Company may
not become a party to any such transaction unless its terms are consistent with
this Section&nbsp;5.10.&#160; Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article&nbsp;5.&#160; If, in the case of any such Business
Combination, the stock or other securities and assets receivable thereupon by a
holder of shares of Common Stock includes shares of stock or other securities
and assets of a corporation other than the successor or purchasing corporation,
as the case may be, in such Business Combination, then such supplemental
indenture shall also be </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">41</font></p>

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</div>
<!-- ZEQ.=1,SEQ=48,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=665427,FOLIO='41',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">executed by such other
corporation and shall contain such additional provisions to protect the
interests of the Holders of the Securities as the Board of Directors shall
reasonably consider necessary by reason of the foregoing, including to the
extent practicable the provisions providing for the Repurchase Rights set forth
in Article&nbsp;4 hereof.&#160;
Notwithstanding anything contained in this Section, and for the
avoidance of doubt, this Section&nbsp;shall not affect the right of a Holder to
convert its Securities into shares of Common Stock prior to the effective date
of the Business Combination.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.11<i>.&#160; Trustee&#146;s Disclaimer.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee shall have no duty to
determine when an adjustment under this Article&nbsp;5 should be made, how it
should be made or what such adjustment should be, but may accept as conclusive
evidence of that fact or the correctness of any such adjustment, and shall be
protected in relying upon, an Officers Certificate and/or an Opinion of
Counsel, including the Officers&#146; Certificate with respect thereto which the
Company is obligated to file with the Trustee pursuant to Section&nbsp;5.08.&#160; 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&#146;s failure
to comply with any provisions of this Article&nbsp;5.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee shall not be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture executed pursuant to Section&nbsp;5.10, but may accept
as conclusive evidence of the correctness thereof, and shall be fully protected
in relying upon, the officers, Certificate and Opinion of Counsel, with respect
thereto which the Company is obligated to file with the Trustee pursuant to Section&nbsp;13.04.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;5.12<i>.&#160; Voluntary Increase.&#160; </i>The Company from time to time may
increase the Conversion Rate, to the extent permitted by law, by any amount for
any period of time if the period is at least 20 days, and the Company provides
15 days prior written notice to any increase in the Conversion Rate to the
Trustee and Holders.&#160; The Company may
also make such an increase to the Conversion Rate as the Board of Directors
deems advisable to avoid or diminish U.S.&#160;
federal income tax to holders of shares of Common Stock in connection
with a dividend or distribution of stock (or rights to acquire stock) or from
any event treated as such for U.S.&#160;
federal income tax purposes.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the foregoing paragraph, in no event will the total number of shares of Common
Stock issuable upon conversion of a Security exceed&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; shares per $1,000 principal amount,
subject to adjustment in the same manner as the Conversion Rate as set forth in
clauses (i)&nbsp;through (vii)&nbsp;of Section&nbsp;5.06(a)&nbsp;hereof.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 6<br>
SUBORDINATION</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.01<i>.&#160; Agreement of Subordination.&#160; </i>The Company covenants and agrees,
and each Holder of Securities issued hereunder by its acceptance thereof
likewise covenants and </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">42</font></p>

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</div>
<!-- ZEQ.=1,SEQ=49,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=781258,FOLIO='42',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">agrees, that
all Securities shall be issued subject to the provisions of this Article&nbsp;6;
and each Person holding any Security, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees to be bound by
such provisions.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The payment of
the principal of, premium, if any, and interest on, all Securities (including,
but not limited to, the Fundamental Change Repurchase Price with respect to the
Securities subject to purchase in accordance with Article&nbsp;4 as provided in
this Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full in cash, or other payment satisfactory to the holders of
Senior Indebtedness, of all Senior Indebtedness, whether outstanding at the
date of this Indenture or thereafter incurred.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">No provision
of this Article&nbsp;6 shall prevent the occurrence of any default or Event of
Default hereunder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.02<i>.&#160; Payments to Holders.&#160; </i>The Company shall not make any
payment with respect to the principal of, or premium, if any, or interest on
the Securities (including, but not limited to, the Fundamental Change
Repurchase Price with respect to the Securities subject to purchase in
accordance with Article&nbsp;4 as provided in this Indenture), except payments
and distributions made by the Trustee as permitted by the first or second
paragraph of Section&nbsp;6.05, and shall not purchase or otherwise acquire for
value any Securities if:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; a default in the payment of principal,
premium, interest, rent or other obligations due on any Senior Indebtedness
occurs and is continuing (or, in the case of Senior Indebtedness for which
there is a period of grace, in the event of such a default that continues
beyond the period of grace, if any, specified in the instrument or lease
evidencing such Senior Indebtedness), unless and until such default shall have
been cured or waived or shall have ceased to exist and notice thereof has been
given to the Trustee; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; a default, other than a payment default,
on Designated Senior Indebtedness occurs and is continuing that then permits
holders of such Designated Senior Indebtedness to accelerate its maturity and
the Trustee receives a notice of the default (a &#147;Payment Blockage Notice&#148;) from
the Company or a holder of Designated Senior Indebtedness or a representative
of such holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company
may and shall resume payments on and distributions in respect of the Securities
upon:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160; in the case of a payment default of Senior Indebtedness, upon
the date on which such default is cured or waived or otherwise ceases to exist;
and</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160; in the case of a non-payment default on Designated Senior
Indebtedness referred to in clause (b)&nbsp;above, the earlier of (A)&nbsp;179
days after the date on which a Payment Blockage Notice is received, and (B)&nbsp;the
date on which the non-payment default is cured or waived or otherwise ceases to
exist, unless this Article&nbsp;6 otherwise prohibits the payment or
distribution at the time of such payment or distribution.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">43</font></p>

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</div>
<!-- ZEQ.=1,SEQ=50,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=986321,FOLIO='43',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Subject to the
provisions of Section&nbsp;6.05, no subsequent Payment Blockage pursuant to
this Section&nbsp;6.02 may be commenced unless (i)&nbsp;at least 365 days shall
have elapsed since the Company&#146;s receipt of the immediately prior Payment
Blockage Notice and (ii)&nbsp;all scheduled payments of principal, premium or
interest on the Securities that have come due have been paid in full in
cash.&#160; No nonpayment default that existed
or was continuing on the date of delivery of any Payment Blockage Notice to the
Trustee (unless such default was waived, cured or otherwise ceased to exist and
thereafter subsequently reoccurred) shall be, or be made, the basis for a
subsequent Payment Blockage Notice.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Upon any
payment by the Company, or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any
dissolution or winding-up or liquidation or reorganization of the Company
(whether voluntary or involuntary) or in bankruptcy, insolvency, receivership
or similar proceedings, all amounts due or to become due upon all Senior
Indebtedness shall first be paid in full in cash, or other payment satisfactory
to the holders of Senior Indebtedness (except payments made pursuant to Article&nbsp;11
from monies deposited with the Trustee pursuant thereto prior to commencement
of proceedings for such dissolution, winding-up, liquidation or
reorganization); and upon any such dissolution or winding-up or liquidation or
reorganization of the Company or bankruptcy, insolvency, receivership or other
similar proceeding, any payment by the Company, or distribution of assets of
the Company of any kind or character, whether in cash, property or securities,
to which the Holders of the Securities or the Trustee would be entitled, except
for the provision of this Article&nbsp;6, shall (except as aforesaid) be paid
by the Company or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, or by the Holders of
the Securities or by the Trustee under this Indenture if received by them or
it, directly to the holders of Senior Indebtedness (pro rata to such holders on
the basis of the respective amounts of Senior Indebtedness held by such
holders, or as otherwise required by law or a court order) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full in cash, or other payment
satisfactory to the holders of Senior Indebtedness, after giving effect to any
concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the Holders of the
Securities or to the Trustee.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the event
of the acceleration of the Securities because of an Event of Default, no
payment or distribution shall be made to the Trustee or any Holder of
Securities in respect of the principal of, premium, if any, or interest on the
Securities (including, but not limited to, the Fundamental Change Repurchase
Price with respect to the Securities subject to purchase in accordance with Article&nbsp;4
as provided in this Indenture), except payments and distributions made by the Trustee
as permitted by the first or second paragraph of Section&nbsp;6.05, until all
Senior Indebtedness has been paid in full in cash or other payment satisfactory
to the holders of Senior Indebtedness or such acceleration is rescinded in
accordance with the terms of this Indenture.&#160;
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness of
such acceleration.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">44</font></p>

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</div>
<!-- ZEQ.=1,SEQ=51,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=840014,FOLIO='44',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the event that,
notwithstanding the foregoing provisions, any payment or distribution of assets
of the Company of any kind or character, whether in cash, property or
securities (including, without limitation, by way of setoff or otherwise),
prohibited by the foregoing, shall be received by the Trustee or the Holders of
the Securities before all Senior Indebtedness is paid in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, or provision is
made for such payment thereof in accordance with its terms in cash or other
payment satisfactory to the holders of Senior Indebtedness, such payment or
distribution shall be held in trust for the benefit of and shall be paid over
or delivered to the holders of Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full, in cash or other
payment satisfactory to the holders of Senior Indebtedness, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Nothing in
this Section&nbsp;6.02 shall apply to claims of, or payments to, the Trustee
under or pursuant to Section&nbsp;10.07.&#160;
This Section&nbsp;6.02 shall be subject to the further provisions of Section&nbsp;6.05.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">For purposes
of this Article&nbsp;6, the words, &#147;cash, property or securities&#148; shall not be
deemed to include shares of stock of the Company as reorganized or readjusted,
or securities of the Company or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is subordinated at least
to the extent provided in this Article&nbsp;6 with respect to the Securities to
the payment of all Senior Indebtedness which may at the time be outstanding; <i>provided</i> that (i)&nbsp;the Senior Indebtedness is assumed by
the new corporation, if any, resulting from any reorganization or readjustment,
and (ii)&nbsp;the rights of the holders of Senior Indebtedness (other than
leases which are not assumed by the Company or the new corporation, as the case
may be) are not, without the consent of such Holders, altered by such
reorganization or readjustment.&#160; The
consolidation of the Company with, or the merger of the Company into, another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided for in Article&nbsp;8
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section&nbsp;6.02 if such other corporation shall, as
a part of such consolidation, merger, conveyance or transfer, comply with the
conditions stated in Article&nbsp;8.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.03<i>.&#160; Subrogation of
Securities.&#160; </i>Subject to the
payment in full, in cash or other payment satisfactory to the holders of Senior
Indebtedness, of all Senior Indebtedness, the rights of the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Indebtedness pursuant to the provisions of
this Article&nbsp;6 (equally and ratably with the holders of all indebtedness
of the Company which by its express terms is subordinated to other indebtedness
of the Company to substantially the same extent as the Securities are subordinated
and is entitled to like rights of subrogation) to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">45</font></p>

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</div>
<!-- ZEQ.=1,SEQ=52,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=683545,FOLIO='45',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">securities of
the Company applicable to the Senior Indebtedness until the principal, premium,
if any, and interest on the Securities shall be paid in full in cash or other
payment satisfactory to the holders of Senior Indebtedness.&#160; For the purposes of such subrogation, no
payments or distributions to the holders of the Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article&nbsp;6, and
no payment pursuant to the provisions of this Article&nbsp;6, to or for the
benefit of the holders of Senior Indebtedness by Holders of the Securities or
the Trustee, shall, as between the Company, its creditors other than holders of
Senior Indebtedness, and the Holders of the Securities, be deemed to be a payment
by the Company to or on account of the Senior Indebtedness.&#160; No payments or distributions of cash,
property or securities to or for the benefit of the Holders of the Securities,
pursuant to the subrogation provisions of this Article&nbsp;6, which would
otherwise have been paid to the holders of Senior Indebtedness shall be deemed
to be a payment by the Company to or for the account of the Securities.&#160; It is understood that the provisions of this Article&nbsp;6
are and are intended solely for the purposes of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Nothing
contained in this Article&nbsp;6 or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of, and premium, if any,
and interest on the Securities as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the Holders of the Securities and creditors of the Company
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article&nbsp;6 of the
holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Upon any
payment or distribution of assets of the Company referred to in this Article&nbsp;6,
the Trustee, subject to the provisions of Section&nbsp;10.01, and the Holders
of the Securities shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which such bankruptcy, dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other person making such payment or distribution, delivered to the Trustee
or to the Holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon and all other facts pertinent thereto or to this Article&nbsp;6.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.04<i>. &#160;Authorization to Effect
Subordination.&#160; </i>Each Holder of
a Security by the Holder&#146;s acceptance thereof authorizes and directs the
Trustee on the Holder&#146;s behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article&nbsp;6
and appoints the Trustee to act as the Holder&#146;s attorney-in-fact for any and
all such purposes.&#160; If the Trustee does
not file a proper proof of claim or proof of debt in the form required in any
proceeding referred to in Section&nbsp;6.03 hereof at least 30 days before the </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">46</font></p>

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</div>
<!-- ZEQ.=1,SEQ=53,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=641176,FOLIO='46',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">expiration of
the time to file such claim, the holders of any Senior Indebtedness or their
representatives are hereby authorized to file an appropriate claim for and on
behalf of the Holders of the Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.05<i>.&#160; Notice to Trustee.&#160; </i>The Company shall give prompt
written notice in the form of an Officers&#146; Certificate to a Responsible Officer
of the Trustee and to any Paying Agent of (a)&nbsp;all Senior Indebtedness
incurred by the Company, including the names of representatives of such holders
(if actually known by the Company) of holders of Senior Indebtedness and (b)&nbsp;any
fact known to the Company which would prohibit the making of any payment of
monies to or by the Trustee or any Paying Agent in respect of the Securities
pursuant to the provisions of this Article&nbsp;6.&#160; Notwithstanding the provisions of this Article&nbsp;6
or any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of monies to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article&nbsp;6, unless and until a Responsible Officer
of the Trustee shall have received written notice thereof at the Corporate
Trust Office from the Company (in the form of an Officers&#146; Certificate) or a
holder or holders of Senior Indebtedness (or a representative of such holder or
holders) or from any trustee thereof; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Section&nbsp;10.01,
shall be entitled in all respects to assume that no such facts exist; <i>provided</i> that if on a date not fewer than one Business Day
prior to the date upon which by the terms hereof any such monies may become
payable for any purpose (including, without limitation, the payment of the
principal of, or premium, if any, or interest on any Security) the Trustee
shall not have received, with respect to such monies, the notice provided for in
this Section&nbsp;6.05, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such monies and to apply the same to the purpose for which they were received,
and shall not be affected by any notice to the contrary which may be received
by it on or after such prior date.&#160;
Notwithstanding anything in this Article&nbsp;6 to the contrary, nothing
shall prevent any payment by the Trustee to the Holders of monies deposited
with it pursuant to Article&nbsp;11, and any such payment shall not be subject
to the provisions of Article&nbsp;6.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Trustee,
subject to the provisions of Section&nbsp;10.01, shall be entitled to rely on
the delivery to it of a written notice by a representative of such a holder of
Senior Indebtedness or a person representing himself to be a holder of Senior
Indebtedness (or a trustee on behalf of such holder) to establish that such
notice has been given by a representative of a holder of Senior Indebtedness or
a trustee on behalf of any such holder or holders.&#160; In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
person as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article&nbsp;6, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article&nbsp;6, and if such
evidence is not furnished the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">47</font></p>

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</div>
<!-- ZEQ.=1,SEQ=54,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=109826,FOLIO='47',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.06<i>.&#160; Trustee&#146;s Relation to Senior
Indebtedness.&#160; </i>The Trustee in
its individual capacity shall be entitled to all the rights set forth in this Article&nbsp;6
in respect of any Senior Indebtedness at any time held by it, to the same
extent as any other holder of Senior Indebtedness, and nothing in Section&nbsp;10.11
or elsewhere in this Indenture shall deprive the Trustee of any of its rights
as such holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With respect
to the holders of Senior Indebtedness, the Trustee undertakes to perform or to
observe only such of its covenants and obligations as are specifically set
forth in this Article&nbsp;6, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into this Indenture
against the Trustee.&#160; The Trustee shall
not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness
and, subject to the provisions of Section&nbsp;10.01, the Trustee shall not be
liable to any holder of Senior Indebtedness if it shall, mistakenly or
otherwise, pay over or deliver to Holders of Securities, the Company or any
other person money or assets to which any holder of Senior Indebtedness shall
be entitled by virtue of this Article&nbsp;6 or otherwise.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.07<i>.&#160; No Impairment of Subordination.&#160; </i>No right of any present or future
holder of any Senior Indebtedness to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder, or by any noncompliance by the Company with the terms,
provisions and covenants of this Indenture, regardless of any knowledge thereof
which any such holder may have or otherwise be charged with.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.08<i>.&#160; Certain Conversions Deemed
Payment.&#160; </i>For the purposes of
this Article&nbsp;6 only, (a)&nbsp; the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article&nbsp;5
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Securities or on account of
the purchase or other acquisition of Securities, and (b)&nbsp; the payment,
issuance or delivery of cash (except in satisfaction of fractional shares
pursuant to Section&nbsp;5.03), property or securities (other than junior
securities) upon conversion of a Security shall be deemed to constitute payment
on account of the principal of such Security.&#160;
For the purposes of this Section&nbsp;6.08, the term &#147;junior securities&#148;
means (i)&nbsp;shares of any Capital Stock of any class of the Company, or (ii)&nbsp;securities
of the Company which are subordinated in right of payment to all Senior
Indebtedness which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article.&#160; Nothing contained in this Article&nbsp;6 or
elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the right, which is absolute and unconditional,
of the Holder of any Security to convert such Security in accordance with Article&nbsp;5.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.09<i>.&#160; Article&nbsp;Applicable to
Paying Agents.&#160; </i>If at any time
any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term &#147;Trustee&#148; as used in this Article&nbsp;shall
(unless the context otherwise requires) be construed as extending to and including
such Paying Agent within its meaning as fully for all intents and purposes as
if such Paying Agent were named in this Article&nbsp;in addition to or in place
of the </font></p>

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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">48</font></p>

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</div>
<!-- ZEQ.=1,SEQ=55,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=219321,FOLIO='48',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trustee; <i>provided, however</i>, that the first paragraph of Section&nbsp;6.05
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as Paying Agent.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.10<i>.&#160; Senior Indebtedness Entitled
to Rely.&#160; </i>The holders of
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article&nbsp;6, and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing thereto.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.11<i>.&#160; Reliance on Judicial Order or
Certificate of Liquidating Agent.&#160; </i>Upon
any payment or distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section&nbsp;7.01, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, liquidating trustee, Securities Custodian, receiver,
assignee for the benefit of creditors, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of Securities,
for the purpose of ascertaining the persons entitled to participate in such
payment or distribution, the holders of Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;6.12<i>.&#160; Rights of Trustee as Holder of
Senior Indebtedness; Preservation of Trustee&#146;s Rights.&#160; </i>The Trustee or any authenticating
agent in its individual capacity shall be entitled to all the rights set forth
in this Article&nbsp;with respect to any Senior Indebtedness which may at any
time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee or any authenticating
agent of any of its rights as such holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Nothing in
this Article&nbsp;shall apply to claims of, or payments to, the Trustee under
or pursuant to Section&nbsp;10.07.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 7<br>
COVENANTS</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.01<i>.&#160; Payment of Securities.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160; A
payment of principal or interest shall be considered paid on the date it is due
if the Paying Agent (other than the Company) holds by 12:00&nbsp;p.m.&#160; (noon), New York City time, on that date
money, deposited by or on behalf of the Company sufficient to make the
payment.&#160; Subject to Section&nbsp;5.02,
accrued and unpaid interest on any Security that is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security is registered at the close of business on
the Regular Record Date for such interest at the office or </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">49</font></p>

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</div>
<!-- ZEQ.=1,SEQ=56,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=378845,FOLIO='49',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">agency of the
Company maintained for such purpose.&#160;
Principal, Fundamental Change Repurchase Price, and interest, if
payable, shall be considered paid on the applicable date due if on such date
(or, in the case of Fundamental Change Repurchase Price, on the Business Day
following the applicable Fundamental Change Repurchase Date) the Trustee or the
Paying Agent holds, in accordance with this Indenture, money sufficient to pay
all such amounts then due.&#160; The Company
shall, to the fullest extent permitted by law, pay interest in immediately
available funds on overdue principal amount and interest at the annual rate
borne by the Securities compounded semiannually, which interest shall accrue
from the date such overdue amount was originally due to the date payment of
such amount, including interest thereon, has been made or duly provided
for.&#160; All such interest shall be payable
on demand.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Payment of the principal of and
interest, if any, on the Securities shall be made at the office or agency of
the Company maintained for that purpose (which shall initially be at the
address set forth in Section&nbsp;2.03(c)) in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; <i>provided, however</i>,
that at the option of the Company payment of interest may be made by check
mailed to the address of the Person entitled thereto as such address appears in
the Register; provided further that a Holder with an aggregate principal amount
in excess of $2,000,000 will be paid by wire transfer in immediately available
funds at the election of such Holder if such Holder has provided wire transfer
instructions to the Trustee at least 10 Business Days prior to the payment
date.&#160; Any wire transfer instructions
received by the Trustee will remain in effect until revoked by the Holder.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.02<i>.&#160; SEC and Other Reports.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Company shall deliver to the Trustee
all reports and other information and documents which it is required to file
with the SEC pursuant to Section&nbsp;13 or 15(d)&nbsp;of the Exchange Act
(including its Annual Report on Form&nbsp;10-K and its Quarterly Reports on Form&nbsp;10-Q),
within 15 days after it files them with the SEC; <i>provided</i>
that any such reports, information and documents filed with the SEC pursuant to
its Electronic Data Gathering, Analysis and Retrieval (or EDGAR) system shall
be deemed to be filed with the Trustee.&#160;
In the event that the Company is no longer subject to the reporting
requirements of Section&nbsp;13 or 15(d)&nbsp;of the Exchange Act, the Company
shall continue to provide the Trustee with reports containing substantially the
same information as would be required to be filed with the SEC had the Company
continued to have been subject to such reporting requirements.&#160; In such event, such reports will be provided
at the times the Company would have been required to provide reports had it
continued to be subject to such reporting requirements.&#160; The Company also shall comply with the
provisions of TIA Section&nbsp;314(a).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee&#146;s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">50</font></p>

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</div>
<!-- ZEQ.=1,SEQ=57,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=541792,FOLIO='50',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">including the
Company&#146;s compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers&#146; Certificates).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.03<i>.&#160; Compliance Certificates.&#160; </i>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&nbsp;31, 2007), an Officers&#146;
Certificate as to the signer&#146;s knowledge of the Company&#146;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.&#160; If such signer knows of such a Default or
Event of Default, the Officers&#146; Certificate shall describe the Default or Event
of Default and the efforts to remedy the same.&#160;
For the purposes of this Section&nbsp;7.03, compliance shall be
determined without regard to any grace period or requirement of notice provided
pursuant to the terms of this Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.04<i>.&#160; Further Instruments and
Acts.&#160; </i>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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.05<i>.&#160; Maintenance of Corporate
Existence.&#160; </i>Subject to Article&nbsp;8,
the Company will do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.06<i>.&#160; Stay, Extension and Usury
Laws.&#160; </i>The Company covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of or
accrued but unpaid interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture, and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;7.07<i>.&#160; Maintenance of Office or
Agency.&#160; </i>The Company will
maintain an office or agency of the Trustee, Registrar and Paying Agent where
securities may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer or purchase and where notices and
demands to or upon the company in respect of the Securities and this Indenture
may be served.&#160; The Corporate Trust
Office shall initially be one such office or agency for all of the aforesaid
purposes.&#160; The Company shall give prompt
written notice to the Trustee of the location, and of any change in the
location, of any such office or agency (other than a change in the location of
the office of the Trustee).&#160; If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the Trustee
set forth in Section&nbsp;13.02.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=58,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=994110,FOLIO='51',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company
may also from time to time designate one or more other offices or agencies
where the Securities may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; <i>provided, however</i>, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 8<br>
CONSOLIDATION; MERGER; CONVEYANCE; TRANSFER OR LEASE</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;8.01<i>.&#160; Company May&nbsp;Consolidate,
Etc., Only on Certain Terms.&#160; </i>The
Company may not consolidate with or merge into any Person (unless the Company
is the surviving corporation) or convey, transfer or lease the property and
assets, substantially as an entirety, of the Company to another Person, other
than to one or more of the Company&#146;s wholly-owned subsidiaries, unless:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Person (if other than the Company)
formed by such consolidation or into which the Company is merged, or the Person
which acquires by conveyance, transfer or lease all or substantially all of the
properties and assets of the Company, shall (i)&nbsp;be a corporation, limited
liability company, partnership, trust or other business entity organized and
existing under the laws of the United States of America, any State thereof or
the District of Columbia and (ii)&nbsp;such Person (if other than the Company)
expressly assumes, by an indenture supplemental hereto, executed and delivered
to the Trustee, in form satisfactory to the Trustee, the obligations of the
Company under the Securities and this Indenture and the performance or
observance of every covenant and provision of this Indenture and the Securities
required on the part of the Company to be performed or observed and the conversion
rights shall be provided for in accordance with Article&nbsp;5, by supplemental
indenture satisfactory in form to the Trustee, executed and delivered to the
Trustee, by the Person (if other than the Company) formed by such consolidation
or into which the Company shall have been merged or by the Person which shall
have acquired the Company&#146;s assets;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; if the Company will not be the resulting
or surviving corporation, the Company shall have, at or prior to the effective
date of such consolidation, merger or transfer, delivered to the Trustee an
Officers&#146; Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer complies with this Section&nbsp;8.01 and, if
a supplemental indenture is required in connection with such transaction, such
supplemental indenture complies with this Article, and that all conditions
precedent herein provided for relating to such transaction have been complied
with.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;8.02<i>.&#160; Successor Substituted.&#160; </i>Upon any consolidation of the
Company with, or merger of the Company into, any other Person or any conveyance,
transfer or lease substantially as an entirety, of the properties and assets of
the Company and its Subsidiaries, taken as a whole, </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">52</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=59,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=346864,FOLIO='52',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">in accordance
with Section&nbsp;8.01, the successor Person formed by such consolidation or
into which the Company is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except
in the case of a lease, and except for obligations the predecessor Person may
have under a supplemental indenture, the predecessor Person shall be relieved
of all obligations and covenants under this Indenture and the Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 9<br>
DEFAULT AND REMEDIES</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.01<i>.&#160; Events of Default.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; An &#147;Event of Default&#148; shall occur if:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay when due the Principal,
Redemption Price or any Fundamental Change Repurchase Price of any Security,
when the same becomes due and payable, whether or not such payment is
prohibited by the subordination provisions hereunder; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay an installment of interest,
on any of the Securities, which failure continues for 30 days after the date
when due whether or not such payment is prohibited by the subordination
provisions hereunder; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to deliver when due all shares of
Common Stock, including any Make-Whole Premium, if any, and any cash
deliverable upon conversion of the Securities, which failure continues for 10
days; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to perform or observe (or obtain a
waiver with respect to) any other term, covenant or agreement contained in the
Securities or this Indenture for a period of 75 days after receipt by the
Company of a Notice of Default specifying such failure; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay any principal by the end of
any applicable grace period or resulting in acceleration of other Indebtedness
of the Company for borrowed money where the aggregate principal amount with
respect to which the default or acceleration has occurred exceeds $15 million, <i>provided</i> that if any such default is cured, waived,
rescinded or annulled, then the Event of Default by reason thereof would be
deemed not to have occurred;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company pursuant to or within the meaning of any
Bankruptcy Law:</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; commences as a debtor a voluntary case or proceeding; or</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">53</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=60,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=401756,FOLIO='53',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the entry of an order for relief against it in
an involuntary case or proceeding or the commencement of any case against it;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the appointment of a Receiver of it or for all
or substantially all of its property; or</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(D)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; makes a general assignment for the benefit of its creditors;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(E)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(F)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the filing of such a petition or the
appointment of or taking possession by a Receiver; or</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.8in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; grants relief against the Company in an involuntary case or
proceeding or adjudicates the Company insolvent or bankrupt;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; appoints a Receiver of the Company or for all or
substantially all of the property of the Company; or</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; orders the winding up or liquidation of the Company;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.8in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and in each
case the order or decree remains unstayed and in effect for 60 consecutive
days.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The term
&#147;Bankruptcy Law&#148; means Title 11 of the United States Code (or any successor
thereto) or any similar federal or state law for the relief of debtors.&#160; The term &#147;Receiver&#148; means any receiver,
trustee, assignee, liquidator, sequestrator or similar official under any
Bankruptcy Law.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Notwithstanding Section&nbsp;9.01(a), no
Event of Default under clause (iv)&nbsp;of Section&nbsp;9.01(a)&nbsp;shall
occur until the Trustee notifies the Company in writing upon the written
direction of the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding, or the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding notify the Company and the
Trustee in writing, of the Default (a &#147;Notice of Default&#148;), and the Company
does not cure the Default within the time specified in clauses (iv)&nbsp;of Section&nbsp;9.01(a)&nbsp;after
receipt of such notice.&#160; A notice given
pursuant to this Section&nbsp;9.01 shall be given by registered or certified
mail, must specify the Default, demand that it be remedied and state that the
notice is a Notice of Default.&#160; When any
Default under this Section&nbsp;9.01 is cured, it ceases.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Company will deliver to the Trustee,
within five Business Days after becoming aware of the occurrence of a Default
or Event of Default, written notice thereof.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">54</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=61,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=888079,FOLIO='54',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Trustee
shall not be charged with knowledge of any Event of Default unless written
notice thereof shall have been given to a Responsible Officer with
responsibility for this Indenture at the Corporate Trust Office of the Trustee
by the Company, a Paying Agent, any Holder or any agent of any Holder or unless
a Responsible Officer with responsibility for this Indenture acquires actual
knowledge of such Event of Default in the course of performing other duties
pursuant to this Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.02<i>.&#160; Acceleration.&#160; </i>If an Event of Default (other than
an Event of Default specified in clause (vi)&nbsp;or (vii)&nbsp;of Section&nbsp;9.01(a))
occurs and is continuing with respect to the Company, the Trustee may, by
notice to the Company, and shall upon the written direction of the Holders of
at least 25% in aggregate principal amount of the Securities then outstanding,
or the Holders of at least 25% in aggregate principal amount of the Securities
then outstanding may, by notice to the Company and the Trustee, declare the
principal amount and accrued and unpaid interest, if any, through the date of
declaration on all the Securities to be immediately due and payable; <i>provided, however</i>, that so long as any Designated Senior
Indebtedness is outstanding, such acceleration of the Securities shall not be
effective until the earlier of (x)&nbsp;an acceleration of such Designated
Senior Indebtedness or (y)&nbsp;five (5)&nbsp;Business Days after receipt by
the Trustee of written notice of such acceleration of the Securities.&#160; Upon such a declaration, such principal
amount and such accrued and unpaid interest, if any, shall be due and payable
immediately.&#160; If an Event of Default
specified in Section&nbsp;9.01(a)(vi)&nbsp;or (vii)&nbsp;occurs in respect of
the Company and is continuing, the principal amount and accrued but unpaid
interest, if any, on all the Securities shall become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holders of Securities.&#160; 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)&nbsp;all
existing Events of Default, other than the nonpayment of the principal of the
Securities which have become due solely by such declaration of acceleration,
have been cured or waived; (b)&nbsp;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)&nbsp;the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; and (d)&nbsp;all payments due to the Trustee and any
predecessor Trustee under Section&nbsp;10.07 have been made.&#160; No such rescission shall affect any
subsequent Default or impair any right consequent thereto.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the acceleration provision above, to the extent elected by the Company, the
sole remedy for an Event of Default relating to the failure to comply with the
reporting obligations in the indenture with respect to SEC filings that are
described above under Section&nbsp;7.02(a), and for any failure to comply with
the requirements of Section&nbsp;314(a)(1)&nbsp;of the Trust Indenture Act,
will for the first 180 days after the occurrence of such an Event of Default
consist exclusively of the right to receive special interest on the Securities
at an annual rate equal to 1.0% of the outstanding principal amount of the
Securities.&#160; This special interest will
be paid semi-annually in arrears, with the first semi-annual payment due on the
first Interest Payment Date following the date on which the special interest
began to accrue on any Securities.&#160; The
special interest will accrue on all outstanding Securities from and including
the date on which an Event of Default relating to a failure to comply with the
reporting obligations hereunder first </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">55</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=62,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=283715,FOLIO='55',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">occurs to but
not including the 180th day (or earlier, if the Event of Default relating to
the reporting obligations is cured or waived prior to such 180th day),
whereupon such special interest will cease to accrue and, if the Event of
Default relating to reporting obligations has not been cured or waived prior to
such 180th day, the Securities will be subject to acceleration as provided
above.&#160; In the event the Company does not
elect to pay special interest upon an Event of Default in accordance with this
paragraph, the Securities will be subject to acceleration as provided above.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.03<i>.&#160; Other Remedies.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If an Event of Default occurs and is
continuing, the Trustee may, but shall not be obligated to, pursue any
available remedy by proceeding at law or in equity to collect payment of the
principal amount and accrued and unpaid interest, if any, on the Securities or
to enforce the performance of any provision of the Securities or this
Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160; 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.&#160;
No remedy is exclusive of any other remedy.&#160; All available remedies are cumulative to the
extent permitted by applicable law.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.04<i>.&#160; Waiver of Defaults and Events
of Default.&#160; </i>Subject to
Sections 9.02, 9.07 and 12.02, the Holders of a majority in aggregate principal
amount of the Securities then outstanding by notice to the Trustee may waive an
existing Default or Event of Default and its consequences, except an uncured
Default or Event of Default in the payment of the principal of, premium, if
any, or any accrued but unpaid interest on any Security, an uncured failure by
the Company to convert any Securities into Common Stock or any Default or Event
of Default in respect of any provision of this Indenture or the Securities
which, under Section&nbsp;12.02, cannot be modified or amended without the
consent of the Holder of each Security affected.&#160; When a Default or Event of Default is waived,
it is cured and ceases to exist.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.05<i>. &#160;Control by Majority.&#160; </i>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.&#160; 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 offered security or indemnity satisfactory to it; <i>provided, however</i>, that the Trustee may take any other
action deemed proper by the Trustee which is not inconsistent with such
direction.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">56</font></p>

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</div>
<!-- ZEQ.=1,SEQ=63,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=435522,FOLIO='56',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.06<i>.&#160; Limitations on Suits.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; A Holder may not pursue any remedy with
respect to this Indenture or the Securities (except actions for payment of
overdue principal, premium, if any, or interest or for the conversion of the Securities
pursuant to Article&nbsp;5) unless:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Holder gives to the Trustee written notice of a
continuing Event of Default;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; such Holder or Holders offer to the Trustee security or
indemnity acceptable to the Trustee against any loss, liability or expense;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of security or indemnity; and</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; No Holder of a Security shall have any
right under any provision of this Indenture or the Securities to affect,
disturb, or prejudice the rights of another Holder of a Security or to obtain a
preference or priority over another Holder of a Security.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.07<i>.&#160; Rights of Holders to Receive
Payment and to Convert.&#160; </i>Notwithstanding
any other provision of this Indenture, the right of any Holder of a Security to
receive payment of the principal amount, Fundamental Change Repurchase Price,
or Make-Whole Premium and interest, if any in respect of the Securities held by
such Holder, on or after the respective due dates expressed in the Securities
and this Indenture, (whether upon repurchase or otherwise), and to convert such
Security in accordance with Article&nbsp;5, and to bring suit for the
enforcement of any such payment on or after such respective due dates or for
the right to convert in accordance with Article&nbsp;5, is, subject to
compliance with the provisions of Section&nbsp;9.06, absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.08<i>.&#160; Collection Suit by
Trustee.&#160; </i>If an Event of
Default described in clause (i)&nbsp;or (ii)&nbsp;of Section&nbsp;9.01(a)&nbsp;occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company or another obligor on the
Securities for the whole amount owing with respect to the Securities and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.09<i>.&#160; Trustee May&nbsp;File Proofs
of Claim.&#160; </i>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, </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">57</font></p>

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</div>
<!-- ZEQ.=1,SEQ=64,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=72294,FOLIO='57',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">disbursements
and advances of the Trustee, its agents and counsel) and the Holders allowed in
any judicial proceedings relative to the Company (or any other obligor on the
Securities), its creditors or its property and shall be entitled and empowered
to collect and receive any money or other property payable or deliverable on
any such claims and to distribute the same, and any Receiver in any such
judicial proceeding is hereby authorized by each Holder to make such payments
to the Trustee and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due
to it for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section&nbsp;10.07, and to the extent that such payment of the reasonable
compensation, expenses, disbursements and advances in any such proceedings
shall be denied for any reason, payment of the same shall be secured by a lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other property which the Holders may be entitled to receive in
such proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.&#160; Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to,
or, on behalf of any Holder, to authorize, accept or adopt any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.10<i>.&#160; Priorities.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If the Trustee collects any money
pursuant to this Article&nbsp;9, it shall pay out the money in the following
order:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; First, to the Trustee for amounts due under Section&nbsp;10.07;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Second, to the Holders of Senior Indebtedness to the
extent required by Article&nbsp;6;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Third, to Holders for amounts due and unpaid on the
Securities for the principal amount and interest, as applicable, ratably,
without preference or priority of any kind, according to such respective
amounts due and payable on the Holders&#146; Securities; and</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Fourth, the balance, if any, to the Company.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee may fix a record date and
payment date for any payment to Holders pursuant to this Section&nbsp;9.10.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;9.11<i>.&#160; Undertaking for Costs.&#160; </i>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&#146; fees and expenses (whether incurred
before trial, at trial, on appeal or in any bankruptcy or arbitration or other
administrative proceeding), against any </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">58</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=65,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=379696,FOLIO='58',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">party litigant
in the suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant.&#160; This
Section&nbsp;9.11 does not apply to a suit made by the Trustee, a suit by a
Holder pursuant to Section&nbsp;9.07, or a suit by Holders of more than 10% in
aggregate principal amount of the Securities then outstanding.&#160; This Section&nbsp;9.11 shall be in lieu of Section&nbsp;315(e)&nbsp;of
the TIA and such Section&nbsp;315(e)&nbsp;is hereby expressly excluded from
this Indenture, as permitted by the TIA.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 10<br>
TRUSTEE</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.01<i>.&#160; Obligations of Trustee.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If an Event of Default of which a
Responsible Officer of the Trustee shall have actual knowledge has occurred and
is continuing, the Trustee may (and shall upon the written direction of the
Holders of at least 25% in aggregate principal amount of the Securities then
outstanding and being furnished with indemnity acceptable to it) exercise such
of the rights and powers vested in it by this Indenture.&#160; If an Event of Default of which a Responsible
Officer of the Trustee shall have actual knowledge has occurred and is
continuing, the Trustee shall use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Except during the continuance of an
Event of Default of which a Responsible Officer of the Trustee shall have
actual knowledge, the Trustee need perform only those duties as are
specifically set forth in this Indenture and no others.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Section&nbsp;10.01(b)&nbsp;shall
be in lieu of Section&nbsp;315(a)&nbsp;of the TIA and such Section&nbsp;315(a)&nbsp;is
hereby expressly excluded from this Indenture, as permitted by the TIA.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160; The Trustee, however, shall
examine any certificates and opinions which by any provision hereof are
specifically required to be delivered to the Trustee to determine whether or
not they conform on their face to the requirements of this Indenture, but need
not confirm or investigate the accuracy of mathematical calculations or other
facts stated therein</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee may not be relieved from
liability for its own gross negligent action, its own gross negligent failure
to act, or its own willful misconduct, except that:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; this paragraph does not limit the effect of Section&nbsp;10.01(b);</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was grossly negligent in ascertaining the pertinent facts; and</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">59</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=66,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=708800,FOLIO='59',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with this Indenture or a
direction received by it pursuant to Section&nbsp;9.05.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Section&nbsp;10.01(d)&nbsp;shall
be in lieu of Sections 315(d)(1), 315(d)(2)&nbsp;and 315(d)(3)&nbsp;of the TIA
and such Sections are hereby expressly excluded from this Indenture as
permitted by the TIA.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160; No provision of this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers unless the Trustee shall have received
adequate security or indemnity in its opinion against potential costs and
liabilities incurred by it relating thereto.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Every provision of this Indenture that
in any way relates to the Trustee is subject to subsections (a), (b), (c), (d)&nbsp;and
(e)&nbsp;of this Section&nbsp;10.01.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160; Money held in trust by
the Trustee need not be segregated from other funds except to the extent
required by law.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(h)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee shall not be liable for any
delays occurring as a result of force majeure.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.02<i>.&#160; Rights of Trustee.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Subject to Section&nbsp;10.01:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee may rely conclusively and shall be protected
in acting or refraining from acting upon any document believed by it to be
genuine and to have been signed or presented by the proper person.&#160; The Trustee need not investigate any fact or
matter stated in the document.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; Before the Trustee acts or refrains from acting, it may
require an Officers&#146; Certificate or an Opinion of Counsel, which shall conform
to Section&nbsp;13.04(b).&#160; The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers&#146; Certificate or Opinion of Counsel.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys or custodians, and the Trustee shall not be responsible for
any misconduct or negligence on the part of any such agent, attorney or
custodian appointed by the Trustee with due care.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">60</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=67,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=901606,FOLIO='60',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture or to institute, conduct or
defend any litigation hereunder or in relation hereto at the request or
direction of any of the Holders pursuant to this Indenture, unless such Holders
shall have offered to the Trustee security or indemnity satisfactory to the Trustee
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee shall not be deemed to have notice or knowledge
of any Default or Event of Default, or Fundamental Change unless a Responsible
Officer of the Trustee has actual knowledge thereof or unless written notice of
any event which is in fact such a Default is received by the Trustee at the
Corporate Trust Office, and such notice references the Securities and this
Indenture.&#160; In the absence of receipt of
such notice or actual knowledge, the Trustee may conclusively assume that there
is no Default, Event of Default, or Fundamental Change.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ix)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(x)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; In no event shall the Trustee be responsible or liable
for special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.03<i>.&#160; Individual Rights of
Trustee.&#160; </i>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 </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">61</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=68,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=863759,FOLIO='61',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trustee.&#160; Any Agent may do the same with like
rights.&#160; However, the Trustee is subject
to Sections 10.10 and 10.11.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.04<i>.&#160; Trustee&#146;s Disclaimer.&#160; </i>The Trustee makes no
representation as to the validity or adequacy of this Indenture or the
Securities.&#160; It shall not be accountable
for the Company&#146;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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.05<i>.&#160; Notice of Default or Events of
Default.&#160; </i>If a Default or an
Event of Default occurs and is continuing and if it is known to a Responsible
Officer of the Trustee, the Trustee shall mail to each Holder of a Security
notice of all uncured Defaults or Events of Default known to it within 90 days
after it occurs or, if later, within 15 days after it becomes known to the Trustee.&#160; However, the Trustee may withhold the notice
if and for so long as a committee of its Responsible Officers in good faith
determines that withholding notice is in the interests of Holders of
Securities, except in the case of a Default or an Event of Default in payment
of the principal of, or premium, if any, or interest on any Security when due
or in the payment of any purchase obligation, or the Company&#146;s failure to
convert Securities when obligated to convert them.&#160; This Section&nbsp;10.05 is in lieu of section
315(b)&nbsp;of the TIA and such provision is expressly excluded from this
Indenture as permitted by the TIA.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.06<i>.&#160; Reports by Trustee to Holders.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If a report is required by TIA Section&nbsp;313,
within 60 days after each May&nbsp;15, beginning with the May&nbsp;15 following
the date of this Indenture, the Trustee shall mail to each Holder of Securities
a brief report dated as of such May&nbsp;15 that complies with TIA Section&nbsp;313(a).&#160; If required by TIA Section&nbsp;313, the
Trustee also shall comply with TIA Sections 313(b)(2), (c)&nbsp;and (d).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; A copy of each report at the time of its
mailing to Holders of Securities shall be mailed to the Company and, to the
extent required by the TIA, filed with the SEC, and each stock exchange, if
any, on which the Securities are listed.&#160;
The Company shall notify the Trustee whenever the Securities become
listed on any stock exchange or listed or admitted to trading on any quotation
system and any changes in the stock exchanges or quotation systems on which the
Securities are listed or admitted to trading and of any delisting thereof.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.07<i>.&#160; Compensation and Indemnity.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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).&#160; The
Company shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it.&#160; Such expenses may include the reasonable
compensation, disbursements and expenses of the Trustee&#146;s agents and counsel.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">62</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=69,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=761115,FOLIO='62',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Company shall indemnify and hold
harmless the Trustee or any predecessor Trustee (which for purposes of this Section&nbsp;10.07
shall include its officers, directors, employees and agents) for, and hold it
harmless against, any and all loss, liability, claim, damage or expense
including taxes (other than franchise taxes and taxes based upon, measured by
or determined by the income of the Trustee), incurred by it in connection with
the acceptance or administration of its duties under this Indenture or any
action or failure to act as authorized or within the discretion or rights or
powers conferred upon the Trustee hereunder including the reasonable costs and
expenses of the Trustee and its counsel in defending (including reasonable
legal fees and expenses whether incurred before trial, at trial, on appeal or
in any bankruptcy or arbitration or other administrative proceeding) itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.&#160;
The Trustee shall notify the Company promptly of any claim asserted
against the Trustee of which it has received written notice for which it may
seek indemnity.&#160; The Company need not pay
for any settlement effected without its prior written consent, which shall not
be unreasonably withheld.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Company need not reimburse the
Trustee for any expense or indemnify it against any loss or liability
determined to have been caused by its own gross negligence, willful misconduct
or bad faith.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160; To secure the Company&#146;s payment
obligations in this Section&nbsp;10.07, the Trustee shall have a senior claim
to which the Securities are hereby made subordinate on all money or property
held or collected by the Trustee.&#160; The
obligations of the Company under this Section&nbsp;10.07 shall survive the
satisfaction and discharge of this Indenture or the resignation or removal of
the Trustee.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160; When the Trustee incurs expenses or
renders services after an Event of Default specified in clause (vi)&nbsp;or (vii)&nbsp;of
Section&nbsp;9.01(a)&nbsp;occurs, the expenses and the compensation for the
services are intended to constitute expenses of administration under any
Bankruptcy Law.&#160; The provisions of this Section&nbsp;shall
survive the termination of this Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.08<i>.&#160; Replacement of Trustee.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee may resign by so notifying
the Company.&#160; The Holders of a majority
in aggregate principal amount of the Securities then outstanding may remove the
Trustee by so notifying the Trustee and the Company and may, with the Company&#146;s
written consent, appoint a successor Trustee.&#160;
The Company may remove the Trustee at any time, so long as no Default or
Event of Default has occurred and is continuing, and appoint a Successor
Trustee in accordance with this Section&nbsp;10.08.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160;
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.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">63</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=70,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=196316,FOLIO='63',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If a successor Trustee does not take
office within 45 days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of 10% in principal amount of the
Securities then outstanding may petition any court of competent jurisdiction at
the expense of the Company for the appointment of a successor Trustee at the
expense of the Company.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160; If the Trustee fails to comply with Section&nbsp;10.10,
any Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)&#160;&#160;&#160;&#160;&#160;&#160;&#160; A successor Trustee shall deliver a
written acceptance of its appointment to the retiring Trustee and to the
Company.&#160; Promptly thereafter, the retiring
Trustee shall (upon payment of its charges hereunder) transfer all property
held by it as Trustee to the successor Trustee and be released from its
obligations (exclusive of any liabilities that the retiring Trustee may have
incurred while acting as Trustee) hereunder, the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture.&#160; A successor Trustee shall mail notice of its
succession to each Holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; A retiring Trustee shall not be liable
for the acts or omissions of any successor Trustee after its succession.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Notwithstanding replacement of the
Trustee pursuant to this Section&nbsp;10.08, the Company&#146;s obligations under Section&nbsp;10.07
shall continue for the benefit of the retiring Trustee.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.09<i>.&#160; Successor Trustee by Merger,
Etc.&#160; </i>If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business (including the administration of this
Indenture) to, another corporation, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Trustee; provided
such transferee corporation shall qualify and be eligible under Section&nbsp;10.10.&#160; Such successor Trustee shall promptly mail
notice of its succession to the Company and each Holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.10<i>.&#160; Eligibility;
Disqualification.&#160; </i>The Trustee
shall always satisfy the requirements of paragraphs (1), (2)&nbsp;and (5)&nbsp;of
TIA Section&nbsp;310(a).&#160; The Trustee (or
its parent holding company) shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition.&#160; 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&nbsp;10.&#160; The Trustee shall be subject to the
provisions of TIA Section&nbsp;310(b).&#160;
Nothing herein shall prevent the Trustee from filing with the SEC the
application referred to in the penultimate paragraph of TIA Section&nbsp;310(b).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;10.11<i>.&#160; Preferential Collection of
Claims Against Company.&#160; </i>The
Trustee shall comply with TIA Section&nbsp;311(a), excluding any creditor
relationship listed in TIA Section&nbsp;311(b).&#160;
A Trustee who has resigned or been removed shall be subject to TIA Section&nbsp;311(a)&nbsp;to
the extent indicated therein.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">64</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=71,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=357605,FOLIO='64',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 11<br>
SATISFACTION AND DISCHARGE OF INDENTURE</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.01<i>.&#160; Satisfaction and Discharge of
Indenture.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; This Indenture shall cease to be of
further force and effect (except as to any surviving rights of conversion,
registration of transfer or exchange of Securities herein expressly provided
for and except as further provided below), and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when either:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; all Securities theretofore authenticated and delivered
(other than (A)&nbsp;Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section&nbsp;2.07 and (B)&nbsp;Securities
for whose payment money has theretofore been deposited in trust and thereafter
repaid to the Company as provided in Section&nbsp;11.03) have been delivered to
the Trustee for cancellation; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; all such Securities not theretofore delivered to the
Trustee for cancellation,</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; have become due and payable, or</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.8in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.6in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; will become due and payable at the Final Maturity Date
within one year; provided in the case of clause (ii), that</font></p>

<p style="margin:0in 0in .0001pt 1.05in;text-indent:.8in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.7in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company has deposited with the Trustee or a Paying
Agent (other than the Company or any of its Affiliates) as trust funds in trust
for the purpose of and in an amount sufficient to pay and discharge all
indebtedness related to such Securities not theretofore delivered to the
Trustee for cancellation, for principal and interest to the date of such
deposit (in the case of Securities which have become due and payable) or to the
Final Maturity Date, as the case may be;</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.9in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.7in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.9in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.7in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(3)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company has delivered to the Trustee an Officers&#146;
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein relating to the satisfaction and discharge of this Indenture
have been complied with.</font></p>

<p style="margin:0in 0in .0001pt 1.6in;text-indent:.9in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Notwithstanding the satisfaction and
discharge of this Indenture, the obligations of the Company with respect to the
conversion privilege and the Conversion Rate of the Securities pursuant to Article&nbsp;5,
the obligations of the Company to the Trustee under Section&nbsp;10.07 and, if
money shall have been deposited with the Trustee pursuant to clause (ii)&nbsp;of
Section&nbsp;11.01(a), the provisions of Sections 2.03, 2.04, 2.05, 2.06, 2.07,
2.12, 7.01 and 13.05, Article&nbsp;5, and this Article&nbsp;11, shall survive
such satisfaction and discharge until the Securities have been paid in full.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">65</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=72,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=219109,FOLIO='65',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.02<i>.&#160; Application of Trust
Money.&#160; </i>Subject to the provisions
of Section&nbsp;11.03, the Trustee or a Paying Agent shall hold in trust, for
the benefit of the Holders, all money deposited with it pursuant to Section&nbsp;11.01
and shall apply the deposited money in accordance with this Indenture and the
Securities to the payment of the principal of and interest on the Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.03<i>.&#160; Repayment to Company.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee and each Paying Agent shall
promptly pay to the Company upon request any excess money (i)&nbsp;deposited
with them pursuant to Section&nbsp;11.01 and (ii)&nbsp;held by them at any
time.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Trustee and each Paying Agent shall,
subject to applicable abandonment property laws, pay to the Company upon
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after a right to such money has matured; <i>provided, however</i>, 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.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;11.04<i>.&#160; Reinstatement.&#160; </i>If the Trustee or any Paying Agent
is unable to apply any money in accordance with Section&nbsp;11.02 by reason of
any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company&#146;s obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to Section&nbsp;11.01
until such time as the Trustee or such Paying Agent is permitted to apply all
such money in accordance with Section&nbsp;11.02; <i>provided,
however</i>, that if the Company has made any payment of the principal
of or interest on any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive any such payment from the money held by the Trustee
or such Paying Agent.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 12<br>
AMENDMENTS; SUPPLEMENTS AND WAIVERS</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.01<i>.&#160; Without Consent of Holders.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; The Company and the Trustee may amend or
supplement this Indenture or the Securities without notice to or consent of any
Holder of a Security for the purpose of:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; evidencing a successor to the Company and the assumption
by that successor of the Company&#146;s obligations under this Indenture and the
Securities;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">66</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=73,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=887063,FOLIO='66',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; adding to the Company&#146;s covenants for the benefit of the
Holders or surrendering any right or power conferred upon the Company;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; securing the Company&#146;s obligations in respect of the
Securities;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; evidencing and providing for the acceptance of the appointment
of a successor trustee in accordance with Article&nbsp;10;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; complying with the requirements of the SEC in order to
maintain the qualification of this Indenture under the TIA, as contemplated by
this Indenture or otherwise;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; to conform the provisions of this Indenture to the
&#147;Description of the Notes&#148; section contained in the final prospectus of the
Company dated January&nbsp;&#160;&#160;&#160;&#160; , 2008;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; curing any ambiguity, omission, inconsistency or correcting
or supplementing any defective provision contained in this Indenture; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)&#160;&#160;&#160;&#160;&#160;&#160;&#160; making any other changes to the Indenture that do not
adversely affect the rights of the Holders in any material respect.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.02<i>.&#160; With Consent of Holders.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.&#160; However, subject to Section&nbsp;12.04,
without the written consent of each Holder affected, an amendment, supplement
or waiver may not:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; alter the manner of calculation or rate of accrual of
interest on any Security or change the time of payment of any installment of
interest on, any Security;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; make any of the Securities payable in money or securities
other than that stated in the Securities;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; change the stated maturity of any Security;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; reduce the principal amount or Fundamental Change
Repurchase Price (as applicable) with respect to any of the Securities;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; make any change that adversely affects the rights of
Holders to require the Company to purchase Securities at the option of Holders;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; impair the right to institute suit for the enforcement of
any payment on or with respect to any Security or with respect to the
conversion of any Security;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">67</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=74,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=2821,FOLIO='67',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; change the currency of payment of principal of, or interest
on, the Securities;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)&#160;&#160;&#160;&#160;&#160;&#160;&#160; except as otherwise permitted or contemplated by Section&nbsp;5.10,
adversely affect the conversion rights (including any Make-Whole Premium) of
the Securities; or</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ix)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; change the percentage in aggregate principal amount of
Securities outstanding necessary to modify or amend this Indenture or to waive
any past Default.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Without limiting the provisions of Section&nbsp;12.02(a)&nbsp;hereof,
the Holders of a majority in aggregate principal amount of the Securities then
outstanding may, on behalf of all the Holders of all Securities, (i)&nbsp;waive
compliance by the Company with the restrictive provisions of this Indenture,
and (ii)&nbsp;waive any past Default or Event of Default under this Indenture
and its consequences, except an uncured failure to pay when due the principal
amount, accrued and unpaid interest or Fundamental Change Repurchase Price, or
in the obligation to deliver Common Stock, if any and as applicable, or in
respect of any provision which under this Indenture cannot be modified or
amended without the consent of the Holder of each outstanding Security
affected.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160; After an amendment, supplement or waiver
under this Section&nbsp;12.02 becomes effective, the Company shall promptly
mail to the Holders affected thereby a notice briefly describing the amendment,
supplement or waiver.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.03<i>.&#160; Compliance with Trust
Indenture Act.&#160; </i>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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.04<i>.&#160; Revocation and Effect of
Consents.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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&#146;s Security, even if notation
of the consent is not made on any Security.&#160;
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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; After an amendment, supplement or waiver
becomes effective, it shall bind every Holder of a Security.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.05<i>.&#160; Notation on or Exchange of
Securities.&#160; </i>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.&#160; The Trustee may place an appropriate notation
on the Security about the changed terms and return it to the Holder.&#160; Alternatively, if the Company or the Trustee
so </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=75,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=638919,FOLIO='68',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">determines,
the Company in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.06<i>.&#160; Trustee to Sign Amendments,
Etc.&#160; </i>The Trustee shall sign
any amendment or supplemental indenture authorized pursuant to this Article&nbsp;12
if the amendment or supplemental indenture does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.&#160; If it does, the Trustee may, in its sole
discretion, but need not sign it.&#160; In
signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be provided with and, subject to Section&nbsp;10.01, shall be
fully protected in relying upon, an Opinion of Counsel and an Officers&#146;
Certificate stating that such amendment or supplemental indenture is authorized
or permitted by this Indenture.&#160; The
Company may not sign an amendment or supplemental indenture until the Board of
Directors approves it.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;12.07<i>.&#160; Effect of Supplemental
Indentures.&#160; </i>Upon the
execution of any supplemental indenture under this Article&nbsp;12, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;font-variant:normal !important;">ARTICLE 13<br>
MISCELLANEOUS</font></p>

<p style="margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.01<i>.&#160; Trust Indenture Act
Controls.&#160; </i>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&nbsp;318(c)&nbsp;thereof,
such imposed duties shall control.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.02<i>.&#160; Notices.&#160; </i>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:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If to the
Company, to:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Theravance,&nbsp;Inc.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">901
Gateway&#160; Boulevard</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">South San
Francisco, CA&#160; 94080</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attn:&#160; General Counsel</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Fax:&#160; 650-808-6019</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">69</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=76,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=394535,FOLIO='69',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">with a copy
to:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gunderson
Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian LLP</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">155
Constitution Avenue</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Menlo Park,
CA&#160; 94025</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attn:&#160; David Young</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Fax:&#160; 650-321-2800</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Shearman&nbsp;&amp;
Sterling LLP</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">525 Market
Street</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">San Francisco,
CA&#160; 94105</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attn:&#160; Mark Hyland</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Fax:&#160; 415-616-1381</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">if to the
Trustee, to:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Bank of
New York Trust Company, N.A.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">700 South
Flower Street</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Suite&nbsp;500</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Los Angeles,
CA 90017</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attn:
Corporate Unit</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Fax:
213-630-6298</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Such notices
or communications shall be effective when received.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company or
the Trustee by notice to the other may designate additional or different
addresses for subsequent notices or communications.&#160; Notice to or from the Trustee shall not be
via electronic mail.&#160; Notices to the
Trustee via facsimile shall promptly be followed by the original written
notice.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Any notice or
communication mailed to a Holder of a Security shall be mailed by first-class
mail or delivered by an overnight delivery service to it at its address shown
on the register kept by the Primary Registrar.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Trustee
agrees to accept and act upon facsimile transmission of written instructions
and/or directions pursuant to this Indenture given by the Company, <i>provided, however</i> that: (i)&nbsp;the Company, subsequent to
such facsimile transmission of written instructions and/or directions, shall
provide the originally executed instructions and/or directions to the Trustee
in a timely manner and (ii)&nbsp;such originally executed instructions and/or
directions shall be signed by an &#147;Officer&#148; of the Company</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Failure to
mail a notice or communication to a Holder of a Security or any defect in it
shall not affect its sufficiency with respect to other Holders of
Securities.&#160; If a notice or </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">70</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=77,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=510041,FOLIO='70',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">communication
to a Holder of a Security is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If the Company
mails any notice to a Holder of a Security, it shall mail a copy to the Trustee
and each Registrar, Paying Agent and Conversion Agent.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.03<i>.&#160; Communications by Holders with
Other Holders.&#160; </i>Holders of
Securities may communicate pursuant to TIA Section&nbsp;312(b)&nbsp;with other
Holders of Securities with respect to their rights under this Indenture or the
Securities.&#160; The Company, the Trustee,
the Registrar and any other person shall have the protection of TIA Section&nbsp;312(c).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.04<i>.&#160; Certificate and Opinion as to
Conditions Precedent.</i></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; an Officers&#146; 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</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160; Each Officers&#146; Certificate and Opinion
of Counsel with respect to compliance with a condition or covenant provided for
in this Indenture shall include:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; a statement that the person making such certificate or
opinion has read such covenant or condition;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 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</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:.75in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">provided,
however</font></i>, that with respect to matters of fact an
Opinion of Counsel may rely on an Officers&#146; Certificate or certificates of
public officials.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">71</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=78,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=745516,FOLIO='71',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.05<i>.&#160; Record Date for Vote or
Consent of Holders of Securities.&#160; </i>The
Company (or, in the event deposits have been made pursuant to Section&nbsp;11.01,
the Trustee) may set a record date for purposes of determining the identity of
Holders entitled to vote or consent to any action by vote or consent authorized
or permitted under this Indenture, which record date shall not be more than 30
days prior to the date of the commencement of solicitation of such action.&#160; Notwithstanding the provisions of Section&nbsp;12.04,
if a record date is fixed, those persons who were Holders of Securities at the
close of business on such record date (or their duly designated proxies), and
only those persons, shall be entitled to take such action by vote or consent or
to revoke any vote or consent previously given, whether or not such persons
continue to be Holders after such record date.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.06<i>.&#160; Rules&nbsp;by Trustee, Paying
Agent, Registrar and Conversion Agent.&#160; </i>The
Trustee may make reasonable rules&nbsp;(not inconsistent with the terms of this
Indenture) for action by or at a meeting of Holders.&#160; Any Registrar, Paying Agent or Conversion
Agent may make reasonable rules&nbsp;for its functions.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.07<i>.&#160; Legal Holidays.&#160; </i>A &#147;Legal Holiday&#148; is a Saturday,
Sunday or a day on which state or federally chartered banking institutions in
New York, New York or Los Angeles, California are authorized or obligated to
close.&#160; 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.&#160; If a Regular Record Date is a Legal Holiday,
the record date shall not be affected.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.08<i>.&#160; Governing Law.&#160; </i>This Indenture and the Securities
shall be governed by, and construed in accordance with, the laws of the State
of New York.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.09<i>.&#160; No Adverse Interpretation of
Other Agreements.&#160; </i>This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary of the Company.&#160; Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.10<i>.&#160; No Recourse Against
Others.&#160; </i>All liability
described in paragraph 17 of the Securities of any director, officer, employee
or shareholder, as such, of the Company hereby is waived and released by each
of the Holders.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.11<i>.&#160; No Security Interest
Created.&#160; </i>Nothing in this
Indenture or in the Securities, express or implied, shall be construed to
constitute a security interest under the Uniform Commercial Code or similar
legislation, now in effect or hereafter enacted and made effective, in any
jurisdiction.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.12<i>.&#160; Successors.&#160; </i>All agreements of the Company in
this Indenture and the Securities shall bind its successor.&#160; All agreements of the Trustee in this
Indenture shall bind its successor.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=79,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=576899,FOLIO='72',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.13<i>.&#160; Multiple Counterparts.&#160; </i>The parties may sign multiple
counterparts of this Indenture.&#160; Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.14<i>.&#160; Separability.&#160; </i>If any provisions in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.15<i>.&#160; Table of Contents, Headings,
Etc. &#160;</i>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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.16<i>.&#160; Waiver of Jury Trial.&#160; </i>EACH OF THE COMPANY AND THE
TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION
CONTEMPLATED HEREBY.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Section&nbsp;13.17<i>.&#160; Force Majeure.&#160; </i>In no event shall the Trustee be
responsible or liable for any failure or delay in the performance of its
obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work
stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services; it being understood that the Trustee shall use reasonable efforts
which are consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">[SIGNATURE PAGE FOLLOWS]</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">73</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=80,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=256451,FOLIO='73',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS
WHEREOF, the parties hereto have hereunto set their hands as of the date and
year first above written.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THERAVANCE,
  INC.</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="200" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:149.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="69" valign="top" style="padding:0in 0in 0in 0in;width:51.75pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THE BANK OF
  NEW YORK TRUST<br>
  COMPANY, N.A., as Trustee</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="200" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:149.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="69" valign="top" style="padding:0in 0in 0in 0in;width:51.75pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=81,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=794018,FOLIO='',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">EXHIBIT A</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">[FORM&nbsp;OF FACE OF SECURITY]</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE&nbsp;&amp; CO.&#160; 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&nbsp;&amp; CO.&#160; 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&nbsp;&amp; CO., HAS AN
INTEREST HEREIN.&#160; 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.&#160; 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&nbsp;FOR SECURITIES IN DEFINITIVE
FORM, THIS SECURITY MAY&nbsp;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.(1)</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1)&nbsp;This
paragraph should be included if the Security is a Global Security.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-1</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=82,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=708226,FOLIO='A-1',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">THERAVANCE, INC.</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">% Convertible Subordinated Notes due 2015</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.42%;">
  <p style="margin:0in 0in .0001pt .5in;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">No.</font></p>
  </td>
  <td width="49%" valign="bottom" style="padding:0in 0in 0in 0in;width:49.58%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CUSIP: 88338T
  AA2</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Theravance,&nbsp;Inc.,
a Delaware corporation, promises to pay to Cede&nbsp;&amp; Co.&#160; or registered assigns the principal amount
of&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;) on January&nbsp;15,
2015.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Security
shall bear interest as specified on the other side of this Security.&#160; This Security is convertible as specified on
the other side of this Security.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Additional
provisions of this Security are set forth on the other side of this Security.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated: January&nbsp;&#160;&#160;&#160;&#160;&#160; , 2008</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">[SIGNATURE PAGE FOLLOWS]</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-2</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=83,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=2708,FOLIO='A-2',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">IN WITNESS WHEREOF, the Company has caused
this instrument to be duly executed.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THERAVANCE,
  INC.</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="296" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:221.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="200" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:149.85pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="69" valign="top" style="padding:0in 0in 0in 0in;width:51.75pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name:</font></p>
  </td>
 </tr>
 <tr>
  <td width="424" valign="top" style="padding:0in 0in 0in 0in;width:318.15pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="27" valign="top" style="padding:0in 0in 0in 0in;width:20.25pt;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="269" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:2.8in;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title:</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated: January&nbsp;&#160;&#160;&#160; , 2008</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Trustee&#146;s
Certificate of Authentication:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This is one of
the Securities referred to in</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">the
within-mentioned Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">THE BANK OF
NEW YORK </font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">TRUST COMPANY,
N.A., as Trustee</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="10%" valign="top" style="padding:0in 0in 0in 0in;width:10.58%;">
  <p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="26%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:26.76%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.66%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="10%" valign="top" style="padding:0in 0in 0in 0in;width:10.58%;">
  <p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="26%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:26.76%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Authorized Signatory</font></p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.66%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-3</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=84,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=57282,FOLIO='A-3',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">[FORM&nbsp;OF
REVERSE SIDE OF SECURITY]</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">THERAVANCE, INC.</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">% CONVERTIBLE SUBORDINATED NOTES DUE 2015</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; INTEREST</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Theravance,&nbsp;Inc.,
a Delaware corporation (the &#147;Company&#148;, 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&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; % per annum.&#160; The Company shall pay interest semiannually
on January&nbsp;15 and July&nbsp;15 of each year (each an &#147;Interest Payment
Date&#148;), commencing July&nbsp;15, 2008.&#160;
Each payment of interest will include interest accrued for the period
commencing on and including the immediately preceding Interest Payment Date, <i>provided</i> that the first interest payment on July&nbsp;15,
2008, will include interest from January&nbsp;&#160;&#160;&#160;&#160; , 2008 through the day before the relevant
Interest Payment Date (or purchase date, as the case may be).&#160; Cash interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months.&#160; Any payment required to be made on a day that
is not a Business Day shall be made on the next succeeding Business Day.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">No sinking
fund is provided for the Securities.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; METHOD OF PAYMENT</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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 January&nbsp;1
or July&nbsp;1, as the case may be, (each, a &#147;Regular Record Date&#148;) next
preceding the related Interest Payment Date.&#160;
The Holder must surrender this Security to a Paying Agent to collect
payment of principal.&#160; 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.&#160; The Company may pay principal and interest in
respect of any Certificated Security by check or wire payable in such money; <i>provided, however</i>, that a Holder with an aggregate principal
amount in excess of $2,000,000 will be paid by wire transfer in immediately
available funds at the election of such Holder if such Holder has provided wire
transfer instructions to the Trustee at least 10 Business Days prior to the
Payment Date.&#160; The Company may mail an
interest check to the Holder&#146;s registered address.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Any wire
transfer instructions received by the Trustee will remain in effect until
revoked by the Holder.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; PAYING AGENT,
REGISTRAR AND CONVERSION AGENT</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Initially, The
Bank of New York Trust Company, N.A. (the &#147;Trustee&#148;, which term shall include
any successor trustee under the Indenture hereinafter referred to) will act as
Paying </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-4</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=85,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=606255,FOLIO='A-4',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Agent,
Registrar and Conversion Agent.&#160; The Company
may change any Paying Agent, Registrar or Conversion Agent without notice to
the Holder.&#160; The Company or any of its
Subsidiaries may, subject to certain limitations set forth in the Indenture,
act as Paying Agent or Registrar.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; INDENTURE,
LIMITATIONS</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Security
is one of a duly authorized issue of Securities of the Company designated as
its&#160;&#160;&#160;&#160;&#160;&#160; % Convertible Subordinated
Notes Due 2015 (the &#147;Securities&#148;), issued under an Indenture dated as of January&nbsp;&#160;&#160;&#160; , 2008 (together with any supplemental indentures
thereto, the &#147;Indenture&#148;), between the Company and the Trustee.&#160; 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.&#160; 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.&#160;
Capitalized terms not defined herein have the meaning ascribed to such terms
in the Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Securities
are unsecured, subordinated obligations of the Company limited to $150,000,000
aggregate principal amount ($172,500,000 aggregate principal amount if the
Underwriters exercise their over-allotment option in full, except as provided
for in the Indenture).&#160; The Indenture
does not limit other debt of the Company, secured or unsecured.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; REDEMPTION</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Prior to January&nbsp;15,
2012, the notes will not be redeemable.&#160;
On or after January&nbsp;15, 2012 and prior to the Final Maturity Date,
the Company may redeem for cash all or part of the notes if the Last Reported
Sale Price of the Company&#146;s common stock has been at least 130% of the
Conversion Price then in effect for at least 20 Trading Days during any 30
consecutive Trading Day period prior to the date on which we provide notice of
redemption.&#160; The Redemption Price will
equal 100% of the principal amount of the Securities being redeemed, plus
accrued and unpaid interest to but excluding the Redemption Date, except as
described below.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; PURCHASE OF
SECURITIES AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If a
Fundamental Change occurs prior to the Final Maturity Date, at the option of
the Holder and subject to the terms and conditions of the Indenture, the
Company shall become obligated to purchase for cash, subject to certain
exceptions described in the Indenture 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) of the Securities held by such Holder on a date specified by the
Company that is not less than 30 nor more than 45 days after the date of the
Fundamental Change Company Notice, at a purchase price equal to 100% of the
principal amount thereof together with accrued and unpaid interest, if any, to,
but excluding, the Fundamental Change Repurchase Date.&#160; 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) at any time prior to the close of
business on the Business Day next preceding the Fundamental Change </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-5</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=86,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=533561,FOLIO='A-5',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Repurchase
Date by delivering a written notice of withdrawal to the Paying Agent in
accordance with the terms of the Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; CONVERSION</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Subject to and
upon compliance with the provisions of the Indenture, a Holder may surrender
for conversion any Security that is $1,000 principal amount or integral
multiples thereof.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; SUBORDINATION</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To the extent
provided in the Indenture, the Securities are subordinated to Senior
Indebtedness, as defined in the Indenture, of the Company.&#160; To the extent provided in the Indenture,
Senior Indebtedness must be paid in full before the Securities may be
paid.&#160; The Company agrees, and each Security
holder by accepting a Security agrees, to the subordination provisions
contained in the Indenture and authorizes the Trustee to give it effect and
appoints the Trustee as attorney-in-fact for such purpose.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; DENOMINATIONS,
TRANSFER, EXCHANGE</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Securities
are in registered form, without coupons, in denominations of $1,000 principal
amount and integral multiples of $1,000 principal amount.&#160; A Holder may register the transfer of or
exchange Securities in accordance with the Indenture.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; PERSONS DEEMED OWNERS</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Holder of
a Security may be treated as the owner of it for all purposes.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; UNCLAIMED MONEY</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If money for
the payment of principal or interest remains unclaimed for two years, the
Trustee and any Paying Agent will pay the money back to the Company at its
written request, subject to applicable unclaimed property law and the
provisions of the Indenture.&#160; 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; AMENDMENT,
SUPPLEMENT AND WAIVER</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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 </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-6</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=87,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=440420,FOLIO='A-6',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">amount of the
Securities then outstanding.&#160; Without the
consent of or notice to any Holder, the Company and the Trustee may amend or
supplement the Indenture or the Securities as provided in the Indenture.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; SUCCESSOR ENTITY</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; DEFAULTS AND
REMEDIES</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Under the
Indenture, an Event of Default shall occur if:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay when
due the Principal, Redemption Price or any Fundamental Change Repurchase Price
of any Security, when the same becomes due and payable, whether or not such
payment is prohibited by the subordination provisions under the Indenture; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(2)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay an
installment of interest, on any of the Securities, which failure continues for
30 days after the date when due, whether or not such payment is prohibited by
the subordination provisions under the Indenture; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(3)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to deliver
when due all shares of Common Stock, including any Make-Whole Premium, if any,
and any cash deliverable upon conversion of the Securities, which failure
continues for 10 days; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(4)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to perform or
observe (or obtain a waiver with respect to) any other term, covenant or agreement
contained in the Securities or the Indenture for a period of 75 days after
receipt by the Company of a Notice of Default specifying such failure; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company shall fail to pay any
principal by the end of any applicable grace period or resulting in
acceleration of other Indebtedness of the Company for borrowed money where the
aggregate principal amount with respect to which the default or acceleration
has occurred exceeds $15 million, <i>provided</i> that
if any such default is cured, waived, rescinded or annulled, then the Event of
Default by reason thereof would be deemed not to have occurred; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(6)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; the Company pursuant to or within the
meaning of any Bankruptcy Law:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; commences as a debtor
a voluntary case or proceeding; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the
entry of an order for relief against it in an involuntary case or proceeding or
the commencement of any case against it;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-7</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=88,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=657892,FOLIO='A-7',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the
appointment of a Receiver of it or for all or substantially all of its
property; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(D)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; makes a general
assignment for the benefit of its creditors;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(E)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; files a petition in
bankruptcy or answer or consent seeking reorganization or relief; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(F)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; consents to the
filing of such a petition or the appointment of or taking possession by a
Receiver; or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; a court of competent jurisdiction
enters an order or decree under any Bankruptcy Law that:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(A)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; grants relief against
the Company in an involuntary case or proceeding or adjudicates the Company
insolvent or bankrupt;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(B)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; appoints a Receiver
of the Company or for all or substantially all of the property of the Company;
or</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(C)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; orders the winding
up or liquidation of the Company;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and in each
case the order or decree remains unstayed and in effect for 60 consecutive days.&#160; The term &#147;Bankruptcy Law&#148; means Title 11 of
the United States Code (or any successor thereto) or any similar federal or
state law for the relief of debtors.&#160; The
term &#147;Receiver&#148; means any receiver, trustee, assignee, liquidator, sequestrator
or similar official under any Bankruptcy Law.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the above, no Event of Default under clauses (4)&nbsp;or (5)&nbsp;above shall
occur until the Trustee notifies the Company in writing upon the written
direction of the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding, or the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding notify the Company and the
Trustee in writing, of the Default (a &#147;Notice of Default&#148;), and the Company
does not cure the Default within the time specified in clause (4)&nbsp;or (5),
as applicable, after receipt of such notice.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If an Event of
Default (other than an Event of Default specified in clause (6)&nbsp;or (7)&nbsp;above)
occurs and is continuing with respect to the Company, the Trustee may, by
notice to the Company, and shall upon the written direction of the Holders of
at least 25% in aggregate principal amount of the Securities then outstanding,
or the Holders of at least 25% in aggregate principal amount of the Securities
then outstanding may, by notice to the Company and the Trustee, declare the
principal amount and accrued and unpaid interest, if any, through the date of
declaration on all the Securities to be immediately due and payable; <i>provided, however</i>, that so long as any Designated Senior
Indebtedness is outstanding, such acceleration of the Securities shall not be
effective until the earlier of (x)&nbsp;an acceleration of such Designated
Senior Indebtedness or (y)&nbsp;five (5)&nbsp;Business Days after receipt by
the Trustee of written notice of such </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-8</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=89,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=104699,FOLIO='A-8',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


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<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">acceleration
of the Securities.&#160; Upon such a
declaration, such principal amount and such accrued and unpaid interest, if
any, shall be due and payable immediately.&#160;
If an Event of Default specified in clauses (6)&nbsp;or (7)&nbsp;occurs
in respect of the Company and is continuing, the principal amount and accrued
but unpaid interest, if any, on all the Securities shall become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders of Securities.&#160;
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)&nbsp;all existing Events of Default,
other than the nonpayment of the principal of the Securities which have become
due solely by such declaration of acceleration, have been cured or waived; (b)&nbsp;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)&nbsp;the rescission would not conflict with
any judgment or decree of a court of competent jurisdiction; and (d)&nbsp;all
payments due to the Trustee and any predecessor Trustee under the Indenture
have been made.&#160; No such rescission shall
affect any subsequent Default or impair any right consequent thereto.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the acceleration provision above, to the extent elected by the Company, the
sole remedy for an Event of Default relating to the failure to comply with the
reporting obligations in the indenture with respect to SEC filings that are
described under Section&nbsp;6.02(a)&nbsp;of the Indenture, and for any failure
to comply with the requirements of Section&nbsp;314(a)(1)&nbsp;of the Trust
Indenture Act, will for the first 180 days after the occurrence of such an
Event of Default consist exclusively of the right to receive special interest on
the Securities at an annual rate equal to 1.0% of the outstanding principal
amount of the Securities.&#160; This special
interest will be paid semi-annually in arrears, with the first semi-annual
payment due on the first Interest Payment Date following the date on which the
special interest began to accrue on any Securities.&#160; The special interest will accrue on all
outstanding Securities from and including the date on which an Event of Default
relating to a failure to comply with the reporting obligations hereunder first
occurs to but not including the 180th day (or earlier, if the Event of Default
relating to the reporting obligations is cured or waived prior to such 180th
day), such special interest will cease to accrue and, if the Event of Default
relating to reporting obligations has not been cured or waived prior to such
180th day, the Securities will be subject to acceleration as provided
above.&#160; In the event the Company does not
elect to pay special interest upon an Event of Default in accordance with this
paragraph, the Securities will be subject to acceleration as provided
above.&#160; Holders may not enforce the
Indenture or the Securities except as provided in the Indenture.&#160; The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities.&#160; Subject to certain limitations, Holders of a
majority in aggregate principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power.&#160; The Trustee may withhold from Holders notice
of any continuing Default (except a Default in payment of principal or
interest) if and so long as it determines that withholding notice is in their
interests.&#160; The Company is required to
file periodic certificates with the Trustee as to the Company&#146;s compliance with
the Indenture and knowledge or status of any Default.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-9</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=90,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=767455,FOLIO='A-9',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; TRUSTEE DEALINGS
WITH THE COMPANY</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Bank of
New York Trust Company, N.A., the initial 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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; NO RECOURSE AGAINST
OTHERS</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A director,
officer, employee or shareholder, 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.&#160; The
Holder of this Security by accepting this Security waives and releases all such
liability.&#160; The waiver and release are
part of the consideration for the issuance of this Security.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; AUTHENTICATION</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; ABBREVIATIONS AND
DEFINITIONS</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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).</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; INDENTURE TO
CONTROL; GOVERNING LAW</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the case of
any conflict between the provisions of this Security and the Indenture, the provisions
of the Indenture shall control.&#160; This
Security and the Indenture shall be governed by, and construed in accordance
with, the laws of the State of New York.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company
will furnish to any Holder, upon written request and without charge, a copy of
the Indenture.&#160; Requests may be made
to:&#160; Theravance,&nbsp;Inc.,
901&nbsp;Gateway Boulevard, South San Francisco, California 94080,
Attention:&#160; General Counsel (Fax:&#160; 650-827-8690).</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-10</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=91,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=968648,FOLIO='A-10',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">ASSIGNMENT FORM</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="35%" valign="top" style="padding:0in .7pt 0in .7pt;width:35.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To&nbsp;assign&nbsp;this&nbsp;Security,&nbsp;fill&nbsp;in&nbsp;the&nbsp;form&nbsp;below:</font></p>
  </td>
  <td width="64%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:64.78%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="35%" valign="top" style="padding:0in .7pt 0in .7pt;width:35.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="64%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:64.78%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="35%" valign="top" style="padding:0in .7pt 0in .7pt;width:35.22%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I or we
  assign and transfer this Security to</font></p>
  </td>
  <td width="64%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:64.78%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="66%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:66.68%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Insert assignee&#146;s
  soc &nbsp;sec. or tax I.D. no.):</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Print or
  type assignee&#146;s name, address and zip code)</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="25%" valign="top" style="padding:0in .7pt 0in .7pt;width:25.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and
  irrevocably appoint</font></p>
  </td>
  <td width="75%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:75.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">agent to transfer this Security
on the books of the Company.&#160; The agent
may substitute another to act for him or her.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Your Signature</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:</font></p>
  </td>
  <td width="19%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:19.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="25%" valign="top" style="padding:0in 0in 0in 0in;width:25.84%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Sign
  exactly as your name appears on the other side of this Security)</font></p>
  </td>
 </tr>
 <tr height="0">
  <td width="37" style="border:none;"></td>
  <td width="145" style="border:none;"></td>
  <td width="193" style="border:none;"></td>
  <td width="372" style="border:none;"></td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt 3.0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">*Signature guaranteed by:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="21%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:21.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">*</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i)&nbsp;the Securities Transfer Agent
Medallion Program (STAMP); (ii)&nbsp;the New York Stock Exchange Medallion
Program (MSP); (iii)&nbsp;the Stock Exchange Medallion Program (SEMP); or (iv)&nbsp;such
other guaranty program acceptable to the Trustee.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-11</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=92,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=849213,FOLIO='A-11',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">CONVERSION NOTICE</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To convert
this Security into Common Stock of the Company, check the box: </font><font face="Wingdings">o</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">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): $<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If you want
the stock certificate made out in another person&#146;s name, fill in the form
below:</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="66%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:66.68%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Insert&nbsp;assignee&#146;s&nbsp;soc.&nbsp; sec.&nbsp;
  or tax I.D.&nbsp; no.):</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:33.34%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="33%" valign="top" style="padding:0in .7pt 0in .7pt;width:33.32%;">
  <p style="margin:0in 0in .0001pt;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Print or
  type assignee&#146;s name, address and zip code)</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-indent:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="25%" valign="top" style="padding:0in .7pt 0in .7pt;width:25.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">and
  irrevocably appoint</font></p>
  </td>
  <td width="75%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:75.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">agent to transfer this Security
on the books of the Company.&#160; The agent
may substitute another to act for him or her.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Your Signature</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:</font></p>
  </td>
  <td width="19%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:19.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="25%" valign="top" style="padding:0in 0in 0in 0in;width:25.84%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Sign
  exactly as your name appears on the other side of this Security)</font></p>
  </td>
 </tr>
 <tr height="0">
  <td width="37" style="border:none;"></td>
  <td width="145" style="border:none;"></td>
  <td width="193" style="border:none;"></td>
  <td width="372" style="border:none;"></td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">*Signature guaranteed by:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="21%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:21.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="75%" valign="top" style="padding:0in 0in 0in 0in;width:75.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.0in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">*</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The signature
must be guaranteed by an institution which is a member of one of the following
recognized signature guaranty programs: (i)&nbsp;the Securities Transfer Agent
Medallion Program (STAMP); (ii)&nbsp;the New York Stock Exchange Medallion
Program (MSP); (iii)&nbsp;the Stock Exchange Medallion Program (SEMP); or (iv)&nbsp;such
other guaranty program acceptable to the Trustee.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-12</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- ZEQ.=1,SEQ=93,EFW="2181932",CP="THERAVANCE, INC.",DN="3",CHK=1011867,FOLIO='A-12',FILE="DISK121:[08ZAA2.08ZAA77602.EDGAR]EX4-4_05_77602.CHC",USER="DNICHOL",CD='Jan 15 02:44 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">FUNDAMENTAL CHANGE REPURCHASE NOTICE</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">To: Theravance,&nbsp;Inc.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
undersigned registered owner of this Security hereby irrevocably acknowledges
receipt of a notice from Theravance,&nbsp;Inc.&#160;
(the &#147;Company&#148;) as to the occurrence of a Fundamental Change with
respect to the Company and requests and instructs the Company to purchase 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 Security and the Indenture referred to in the Security at the
Fundamental Change Repurchase Price, together with accrued and unpaid interest,
to, but excluding, such date, to the registered Holder hereof.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.84%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated:</font></p>
  </td>
  <td width="18%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.58%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="25%" valign="top" style="padding:0in 0in 0in 0in;width:25.84%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Signature
  (s)</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Signature(s)&nbsp;must be guaranteed by a
  qualified guarantor institution with membership in an approved signature
  guarantee program pursuant to Rule&nbsp;17Ad-15 under the Securities Exchange
  Act of 1934.</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:50.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Signature Guaranty</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 2.5in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Principal amount to be redeemed (in an</font></p>

<p style="margin:0in 2.5in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">integral multiple of $1,000, if less than all): $<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></font></p>

<p style="margin:0in 2.5in .0001pt 0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">NOTICE: The signature to the
foregoing Election must correspond to the Name as written upon the face of this
Security in every particular, without any alteration or change whatsoever.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-13</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">SCHEDULE OF EXCHANGES OF SECURITIES(1)</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman">&nbsp;</font></b></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The following
exchanges, purchases or conversions of a part of this Global Security have been
made:</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="26%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:26.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Principal&nbsp;Amount&nbsp;of&nbsp;this<br>
  Global&nbsp;Note&nbsp;Following<br>
  Such&nbsp;Decrease&nbsp;Date&nbsp;of<br>
  Exchange&nbsp;(or&nbsp;Increase)</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Authorized&nbsp;Signatory<br>
  of&nbsp;Securities<br>
  Custodian</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="25%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:25.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Amount&nbsp;of&nbsp;Decrease&nbsp;in<br>
  Principal&nbsp;Amount&nbsp;of&nbsp;this&nbsp;Global<br>
  Note</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Amount&nbsp;of&nbsp;increase<br>
  in&nbsp;Principal<br>
  Amount&nbsp;of&nbsp;this<br>
  Global&nbsp;Note</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="26%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:26.5%;">
  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="25%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:25.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
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  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" style="padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
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  <td width="26%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:26.5%;">
  <p style="margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="25%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:25.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
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  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
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</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; This schedule should be included only
if the Security is a Global Security.</font></p>

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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-14</font></p>

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<TYPE>EX-5.1
<SEQUENCE>4
<FILENAME>a2181932zex-5_1.htm
<DESCRIPTION>EXHIBIT 5.1
<TEXT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>EXHIBIT 5.1  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>[Letterhead
of Shearman&nbsp;&amp; Sterling LLP] </FONT></P>

<P ALIGN="RIGHT"><FONT SIZE=2>January&nbsp;15,
2008 </FONT></P>

<P><FONT SIZE=2>Theravance,&nbsp;Inc.<BR>
901 Gateway Boulevard<BR>
South San Francisco, CA 94080 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ke77601_theravance,_inc."> </A>
<A NAME="toc_ke77601_1"> </A>
<BR></FONT><FONT SIZE=2><I>Theravance,&nbsp;Inc.    <BR>    </I></FONT></P>

<P><FONT SIZE=2>Ladies
and Gentlemen: </FONT></P>

<P><FONT SIZE=2>We
have acted as special counsel to Theravance,&nbsp;Inc., a Delaware corporation (the "</FONT><FONT SIZE=2><I>Company</I></FONT><FONT SIZE=2>"), in connection with the preparation of a
registration statement on Form&nbsp;S-3 (the "</FONT><FONT SIZE=2><I>Registration Statement</I></FONT><FONT SIZE=2>") filed with the Securities and Exchange Commission (the
"</FONT><FONT SIZE=2><I>Commission</I></FONT><FONT SIZE=2>") on January&nbsp;9, 2008, relating to the offering, pursuant to Rule&nbsp;415 under the Securities Act of 1933, as amended (the
"</FONT><FONT SIZE=2><I>Securities Act</I></FONT><FONT SIZE=2>"), by the Company of unsecured Convertible Subordinated Notes due 2015 of the Company (the
"</FONT><FONT SIZE=2><I>Notes</I></FONT><FONT SIZE=2>") and the underlying common stock of the Company, par value $0.01 per share (the "</FONT><FONT SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>"),
and associated preferred stock purchase rights to be issued pursuant to the Amended and Restated Rights Agreement dated as of June&nbsp;22, 2007, between the Company and The Bank of New York, as
Rights Agent, issuable upon conversion of the Notes. Certain terms of the Notes to be issued by the Company will be approved by the Board of Directors of the Company or a committee thereof or certain
authorized officers of the Company as part of the corporate action taken and to be taken (collectively, the "</FONT><FONT SIZE=2><I>Corporate Actions</I></FONT><FONT SIZE=2>") in connection with the
issuance of the Notes. The Notes will be issued pursuant to an indenture (the "</FONT><FONT SIZE=2><I>Indenture</I></FONT><FONT SIZE=2>") in the form filed as Exhibit&nbsp;4.4 to
the Registration Statement, proposed to be entered into by the Company and The Bank of New York Trust Company, N.A., as trustee (the "</FONT><FONT SIZE=2><I>Trustee</I></FONT><FONT SIZE=2>"). </FONT></P>


<P><FONT SIZE=2>In
that connection, we have reviewed originals or copies of the: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;The
Registration Statement; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;The
form of Indenture; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;A
form of certificate evidencing the Notes attached as an exhibit to the Indenture; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;The
certificate of incorporation and bylaws of the Company, as certified by an officer of the Company; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;A
specimen copy of the share certificate representing the Common Stock. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>We
have also reviewed originals or copies of such other corporate records of the Company, certificates of public officials and of officers of the Company and agreements and other documents as we have
deemed necessary as a basis for the opinions expressed below. </FONT></P>

<P><FONT SIZE=2>In
our review of the Indenture and other documents, and otherwise for the purposes of this opinion, we have assumed: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;The
genuineness of all signatures. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;The
authenticity of the originals of the documents submitted to us. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;The
conformity to authentic originals of any documents submitted to us as copies. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;As
to matters of fact, the truthfulness of the representations made in certificates of public officials and officers of the Company. </FONT></P>

</UL>
</UL>
<HR NOSHADE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;That
the Indenture will be the legal, valid and binding obligation of each party thereto, other than the Company, enforceable against each such party in accordance with
its terms. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;That:
</FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;The
Company is an entity duly organized and validly existing under the laws of the jurisdiction of its organization. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;The
Company will duly execute and deliver the Indenture and the Notes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;The
execution, delivery and performance by the Company of the Indenture will not: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;except
with respect to Generally Applicable Law, violate any law, rule or regulation applicable to it; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;result
in any conflict with or breach of any agreement or document binding on it of which the addressee hereof has knowledge, has received notice or has reason to know. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;Except
with respect to Generally Applicable Law, no authorization, approval, consent or other action by, and no notice to or filing with, any governmental authority or
regulatory body or (to the extent the same is required under any agreement or document binding on it of which the addressee has knowledge, has received notice or has reason to know) any other third
party is required for the due execution, delivery or performance by the Company of the Indenture or, if any such authorization, approval, consent, action, notice or filing is required, it will be duly
obtained, taken, given or made and is in full force and effect. </FONT></P>

</UL>
</UL>
</UL>
</UL>

<P><FONT SIZE=2>We
have not independently established the validity of the foregoing assumptions. </FONT></P>

<P><FONT SIZE=2>"</FONT><FONT
SIZE=2><I>Generally Applicable Law</I></FONT><FONT SIZE=2>" means the federal law of the United States of America and the law of the State of New York (including the rules and
regulations promulgated thereunder or pursuant thereto), that a New York lawyer exercising customary professional diligence would reasonably be expected to recognize as being applicable to the
Company, the Indenture, the Notes or the transactions governed by the Indenture and the Notes, and for purposes of assumption paragraph&nbsp;(f) above the General Corporation Law of the State of
Delaware. Without limiting the generality of the foregoing definition of Generally Applicable Law, the term "Generally Applicable Law" does not include any law, rule or regulation that is applicable
to the Company, the Indenture, the Notes or such transactions solely because such law, rule or regulation is part of a regulatory regime applicable to the specific assets or business of any party to
the Indenture or any of its affiliates. </FONT></P>

<P><FONT SIZE=2>Based
upon the foregoing and upon such other investigation as we have deemed necessary and subject to the assumptions and qualifications set forth herein, we are of the opinion that, following the
completion of all Corporate Actions and the payment to the Company of full consideration for the Notes by the purchasers thereof, </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company (a)&nbsp;has the corporate power to execute, deliver and perform the Indenture and the Notes and (b)&nbsp;has taken all corporate action necessary to
authorize the execution, delivery and performance of the Indenture and the Notes. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Assuming
that the Indenture has been duly authorized, executed and delivered by the Trustee, when the Indenture has been duly executed and delivered by the Company, the
Indenture will constitute the legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms. </FONT></P>

</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

<HR NOSHADE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When
the Notes have been duly executed by the Company and authenticated by the Trustee in accordance with the Indenture, the Notes will constitute legal, valid and
binding obligations of the Company enforceable against the Company in accordance with their terms and will be entitled to the benefits of the Indenture. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>Our
opinions expressed above are subject to the following qualifications: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;Our
opinions in paragraphs 2 and 3 above are subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally (including without limitation all laws relating to fraudulent transfers). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;Our
opinions in paragraphs 2 and 3 above are also subject to the effect of general principles of equity, including without limitation concepts of materiality,
reasonableness, good faith and fair dealing (regardless of whether considered in a proceeding in equity or at law). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;Our
opinions are limited to Generally Applicable Law, and we do not express any opinion herein concerning any other law. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>This
opinion letter is rendered to you in connection with the preparation and filing of the Registration Statement. This opinion letter may not be relied upon by you for any other purpose without our
prior written consent. </FONT></P>

<P><FONT SIZE=2>This
opinion letter speaks only as of the date hereof. We expressly disclaim any responsibility to advise you of any development or circumstance of any kind, including any change of law or fact, that
may occur after the date of this opinion letter that might affect the opinions expressed therein. </FONT></P>

<P><FONT SIZE=2>We
hereby consent to the filing of this opinion letter as an exhibit to the Registration Statement and to the use of our name under the heading "Legal Matters" in the Prospectus. In giving this
consent, we do not hereby admit that we are in the category of persons whose consent is required under Section&nbsp;7 of the Securities Act or the rules and regulations of the Commission promulgated
thereunder. </FONT></P>

<P><FONT SIZE=2>Very
truly yours, </FONT></P>

<P><FONT SIZE=2>/s/
SHEARMAN &amp; STERLING LLP </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=3,SEQ=3,EFW="2181932",CP="THERAVANCE, INC.",DN="4",CHK=894278,FOLIO='3',FILE='DISK133:[08ZAA1.08ZAA77601]KE77601A.;6',USER='CMOUA',CD='15-JAN-2008;06:09' -->
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<BR>
<P><br><A NAME="08ZAA77601_4">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_ke77601_1">Theravance, Inc.</A></FONT><BR>
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</BODY>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.2
<SEQUENCE>5
<FILENAME>a2181932zex-5_2.htm
<DESCRIPTION>EXHIBIT 5.2
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit 5.2  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>[Letterhead
of Gunderson Dettmer Stough Villeneuve Franklin&nbsp;&amp; Hachigian,&nbsp;LLP] </FONT></P>

<P ALIGN="RIGHT"><FONT SIZE=2>January&nbsp;15,
2008 </FONT></P>

<P><FONT SIZE=2>Theravance,&nbsp;Inc.<BR>
901 Gateway Boulevard<BR>
South San Francisco, CA 94080 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><I>Theravance,&nbsp;Inc.</I></FONT></P>

<P><FONT SIZE=2>Ladies
and Gentlemen: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have acted as counsel to Theravance,&nbsp;Inc., a Delaware corporation (the "</FONT><FONT SIZE=2><I>Company</I></FONT><FONT SIZE=2>"), in connection with the preparation of a
registration statement on Form&nbsp;S-3 (the "</FONT><FONT SIZE=2><I>Registration Statement</I></FONT><FONT SIZE=2>") filed with the Securities and Exchange Commission (the
"</FONT><FONT SIZE=2><I>Commission</I></FONT><FONT SIZE=2>") on January&nbsp;15, 2008, relating to the offering, pursuant to Rule&nbsp;415 under the Securities Act of 1933, as amended (the
"</FONT><FONT SIZE=2><I>Securities Act</I></FONT><FONT SIZE=2>"), by the Company of unsecured Convertible Subordinated Notes due 2015 of the Company (the
"</FONT><FONT SIZE=2><I>Notes</I></FONT><FONT SIZE=2>") and the underlying common stock of the Company, par value $0.01 per share (the "</FONT><FONT SIZE=2><I>Common Stock</I></FONT><FONT SIZE=2>"),
and associated preferred stock purchase rights (the "</FONT><FONT SIZE=2><I>Rights</I></FONT><FONT SIZE=2>") to be issued pursuant to the Amended and Restated Rights Agreement, dated as of
June&nbsp;22, 2007 (the "</FONT><FONT SIZE=2><I>Rights Agreement</I></FONT><FONT SIZE=2>"), between the Company and The Bank of New York, as Rights Agent, issuable upon conversion of the Notes.
Certain terms of the Notes to be issued by the Company will be approved by the Board of Directors of the Company or a committee thereof or certain authorized officers of the Company as part of the
corporate action taken and to be taken (collectively, the "</FONT><FONT SIZE=2><I>Corporate Actions</I></FONT><FONT SIZE=2>") in connection with the issuance of the Notes. The Notes will be issued
pursuant to an indenture in the
form filed as Exhibit&nbsp;4.4 to the Registration Statement, proposed to be entered into by the Company and The Bank of New York Trust Company, N.A., as trustee. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
that connection, we have reviewed originals or copies of the: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>The
Registration Statement;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>The
Rights Agreement;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>The
certificate of incorporation and bylaws of the Company, as certified by an officer of the Company; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(d)</FONT></DT><DD><FONT SIZE=2>A
specimen copy of the share certificate representing the Common Stock. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have also reviewed originals or copies of such other corporate records of the Company, certificates of public officials and of officers of the Company and agreements and other
documents as we have deemed necessary as a basis for the opinion expressed below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
our review of the Rights Agreement and other documents, and otherwise for the purposes of this opinion, we have assumed: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>The
genuineness of all signatures.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>The
authenticity of the originals of the documents submitted to us.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>The
conformity to authentic originals of any documents submitted to us as copies.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(d)</FONT></DT><DD><FONT SIZE=2>As
to matters of fact, the truthfulness of the representations made in certificates of public officials and officers of the Company. </FONT></DD></DL>
</UL>
<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_kg77601_1_2"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(e)</FONT></DT><DD><FONT SIZE=2>That
the Rights Agreement was duly authorized, executed and delivered by the Rights Agent and that the members of the Board of Directors of the Company have acted in a manner
consistent with their fiduciary duties as required under applicable law in adopting the Rights Agreement. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have not independently established the validity of the foregoing assumptions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based
upon the foregoing and upon such other investigation as we have deemed necessary and subject to the assumptions and qualifications set forth herein, we are of the opinion that,
following the completion of all Corporate Actions and the payment to the Company of full consideration for the Notes by the purchasers thereof, </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>With
respect to any Common Stock and the associated Rights that may be issued upon the conversion of the Notes, upon due exercise of applicable conversion rights in accordance with the
terms of the Notes, the Common Stock and the associated Rights will be validly issued and the Common Stock will be fully paid and nonassessable. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
opinion letter is based as to matters of law solely on the applicable provisions of the Delaware General Corporation Law, as amended, as currently in effect. We do not express any
opinion herein concerning any other law. As used herein, the term "Delaware General Corporation Law, as amended" includes the statutory provisions contained therein, all applicable provisions of the
Delaware Constitution, and reported judicial decisions interpreting these laws. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
should be understood that the opinion above concerning the Rights does not address the determination a court of competent jurisdiction may make regarding whether the Board of
Directors of the Company would be required to redeem or terminate, or take other action with respect to, the Rights at some future time based on the facts and circumstances existing at that time and
that our opinion above addresses the Rights and the Rights Agreement in their entirety and not any particular provision of the Rights or the Rights Agreement and that it is not settled whether the
invalidity of any particular provision of a rights agreement or of rights issued thereunder would result in invalidating in their entirety such rights. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
opinion letter is rendered to you in connection with the preparation and filing of the Registration Statement. This opinion letter may not be relied upon by you for any other
purpose without our prior written consent. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
opinion letter speaks only as of the date hereof. We expressly disclaim any responsibility to advise you of any development or circumstance of any kind, including any change of law
or fact, that may occur after the date of this opinion letter that might affect the opinions expressed therein. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
hereby consent to the filing of this opinion letter as an exhibit to the Registration Statement and to the use of our name under the heading "Legal Matters" in the Prospectus. In
giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section&nbsp;7 of the Securities Act or the rules and regulations of the Commission
promulgated thereunder. </FONT></P>

<P><FONT SIZE=2>Very
truly yours, </FONT></P>

<P><FONT SIZE=2>/s/
GUNDERSON DETTMER STOUGH<BR>
&nbsp;&nbsp;&nbsp;&nbsp;VILLENEUVE FRANKLIN&nbsp;&amp; HACHIGIAN,&nbsp;LLP </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12.1
<SEQUENCE>6
<FILENAME>a2181932zex-12_1.htm
<DESCRIPTION>EXHIBIT 12.1
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#08ZAA77601_6">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
<!-- TOC_END -->
<P ALIGN="RIGHT"><FONT SIZE=2><B>EXHIBIT 12.1  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="km77601_statement_of_computation_of_ra__sta02893"> </A>
<A NAME="toc_km77601_1"> </A>
<BR></FONT><FONT SIZE=2><B>Statement of Computation of Ratio of Earnings to Fixed Charges<BR>  (Unaudited)    <BR>    </B></FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="25%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%" ROWSPAN=2><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=14 ROWSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Year Ended December 31,</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="25%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%" ROWSPAN=2><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ROWSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Nine Months Ended<BR>
September 30, 2007</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="25%" ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2002</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2003</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2004</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2005</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>2006</B></FONT><HR NOSHADE></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="25%" ALIGN="LEFT"><FONT SIZE=1><I>(in thousands)</I></FONT><BR>
<BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=1>&nbsp;</FONT><BR></TH>
<TH WIDTH="1%"><FONT SIZE=1>&nbsp;</FONT></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2><B>Earnings:</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Loss before income taxes</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>(79,227</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>(70,583</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(102,654</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(143,164</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(166,044</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>(126,939</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Add: Fixed charges</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,325</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,032</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,855</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,818</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,881</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>1,379</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="25%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Total Earnings</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>(76,902</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>(68,551</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(100,799</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(141,346</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>(164,163</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>(125,560</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="25%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="25%"><BR><FONT SIZE=2><B>Fixed charges:</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="7%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="9%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Interest expense</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>913</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>920</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>575</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>309</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>193</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>72</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Estimated interest component of rent expense</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>1,412</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>1,112</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,280</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,509</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,688</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>1,307</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="25%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2>Total fixed charges</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,325</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,032</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,855</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,818</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>1,881</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>1,379</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="25%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="25%"><FONT SIZE=2><B>Ratio of earnings to fixed charges</B></FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="RIGHT"><FONT SIZE=2>Note 1</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
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<P><FONT SIZE=2>Note&nbsp;1:
Earnings for 2002, 2003, 2004, 2005, 2006 and the nine months ended September&nbsp;30, 2007 were insufficient to cover fixed charges by $79.2&nbsp;million, $70.6&nbsp;million,
$102.7&nbsp;million, $143.2&nbsp;million, $166.0&nbsp;million and $126.9&nbsp;million, respectively. </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P><br><A NAME="08ZAA77601_6">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_km77601_1">Statement of Computation of Ratio of Earnings to Fixed Charges (Unaudited)</A></FONT><BR>
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<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>7
<FILENAME>a2181932zex-23_1.htm
<DESCRIPTION>EXHIBIT 23.1
<TEXT>
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<HEAD>
</HEAD>
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<BR>
<P ALIGN="RIGHT"><FONT SIZE=2><B>EXHIBIT&nbsp;23.1  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Consent of Independent Registered Public Accounting Firm  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We consent to the reference to our firm under the caption "Experts" in the Registration Statement (Form&nbsp;S-3) and related prospectus of
Theravance,&nbsp;Inc. for the registration of shares of its common stock and convertible subordinated promissory notes due 2015 and to the incorporation by reference therein of our reports dated
February&nbsp;27, 2007, with respect to the consolidated financial statements of Theravance,&nbsp;Inc., Theravance,&nbsp;Inc. management's assessment of the effectiveness of internal control
over financial reporting, and the effectiveness of internal control over financial reporting of Theravance,&nbsp;Inc., included in its Annual Report (Form&nbsp;10-K) for the year ended
December&nbsp;31, 2006, filed with the Securities and Exchange Commission. </FONT></P>

<P ALIGN="RIGHT"><FONT SIZE=2>/s/
Ernst&nbsp;&amp; Young LLP </FONT></P>

<P><FONT SIZE=2>Palo
Alto, CA<BR>
January 14, 2008 </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<DOCUMENT>
<TYPE>EX-25.1
<SEQUENCE>8
<FILENAME>a2181932zex-25_1.htm
<DESCRIPTION>EXHIBIT 25.1
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#08ZAA77601_8">QuickLinks</A></FONT>
<font size=3> -- Click here to rapidly navigate through this document</font>
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<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="ko77602_exhibit_25.1"> </A>
<A NAME="toc_ko77602_1"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT 25.1    <BR>    </B></FONT></P>

<P><FONT SIZE=2><hr
noshade width=100% align=left size=4>
<hr noshade width=100% align=left size=1> </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>FORM T-1  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>SECURITIES AND EXCHANGE COMMISSION<BR>  </B></FONT><FONT SIZE=2><B>Washington, D.C. 20549  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=3><B>STATEMENT OF ELIGIBILITY<BR>
UNDER THE TRUST INDENTURE ACT OF 1939 OF A<BR>
CORPORATION DESIGNATED TO ACT AS TRUSTEE<BR>
<BR>
CHECK IF AN APPLICATION TO DETERMINE<BR>
ELIGIBILITY OF A TRUSTEE PURSUANT TO<BR>
SECTION 305(b)(2)&nbsp;&nbsp;&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT>  </B></FONT></P>

<HR NOSHADE ALIGN="CENTER" WIDTH="120">
<P ALIGN="CENTER"><FONT SIZE=5><B>THE BANK OF NEW YORK TRUST COMPANY, N.A.<BR>  </B></FONT><FONT SIZE=2>(Exact name of trustee as specified in its charter) </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><FONT SIZE=2>(State of incorporation<BR>
if not a U.S. national bank)</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><FONT SIZE=2><B>95-3571558</B></FONT><FONT SIZE=2><BR>
(I.R.S. employer<BR>
identification no.)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><BR><FONT SIZE=2><B>700 South Flower Street<BR>
Suite 500<BR>
Los Angeles, California</B></FONT><FONT SIZE=2><BR>
(Address of principal executive offices)</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><BR><FONT SIZE=2><B>90017</B></FONT><FONT SIZE=2><BR>
(Zip code)</FONT></TD>
</TR>
</TABLE>
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<HR NOSHADE ALIGN="CENTER" WIDTH="120">
<P ALIGN="CENTER"><FONT SIZE=5><B>THERAVANCE,&nbsp;INC.<BR>  </B></FONT><FONT SIZE=2>(Exact name of obligor as specified in its charter) </FONT></P>

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<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><FONT SIZE=2><B>Delaware</B></FONT><FONT SIZE=2><BR>
(State or other jurisdiction of incorporation or organization)</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><FONT SIZE=2><B>94-3265960</B></FONT><FONT SIZE=2><BR>
(I.R.S. employer identification no.)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><BR><FONT SIZE=2><B>901 Gateway Boulevard<BR>
South San Francisco, California</B></FONT><FONT SIZE=2><BR>
(Address of principal executive offices)</FONT></TD>
<TD WIDTH="3%" VALIGN="BOTTOM"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER" VALIGN="BOTTOM"><BR><FONT SIZE=2><B>94080</B></FONT><FONT SIZE=2><BR>
(Zip code)</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2><B>Convertible Subordinated Notes due 2015<BR>  </B></FONT><FONT SIZE=2>(Title of the indenture securities) </FONT></P>

<P><FONT SIZE=2><hr
noshade width=100% align=left size=1>
<hr noshade width=100% align=left size=4> </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P><FONT SIZE=2><A
NAME="page_kq77602_1_2"> </A> </FONT> <FONT SIZE=2>
\ </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>1.</B></FONT></DT><DD><FONT SIZE=2><B>General information.&nbsp;&nbsp;&nbsp;&nbsp;Furnish the following information as to the trustee:
<BR><BR> </B></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>(a)</B></FONT></DT><DD><FONT SIZE=2><B> Name and address of each examining or supervising authority to which it is subject.  </B></FONT></DD></DL>
</DD></DL>
<BR>

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<TH WIDTH="49%" ALIGN="CENTER"><FONT SIZE=1><B>Name<BR> </B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="49%" ALIGN="CENTER"><FONT SIZE=1><B>Address</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="49%"><FONT SIZE=2>Comptroller of the Currency<BR>
United States Department of the Treasury</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>Washington, D.C. 20219</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="49%"><FONT SIZE=2><BR>
Federal Reserve Bank</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
San Francisco, California 94105</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="49%"><FONT SIZE=2><BR>
Federal Deposit Insurance Corporation</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
Washington, D.C. 20429</FONT></TD>
</TR>
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<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>(b)</B></FONT></DT><DD><FONT SIZE=2><B>Whether it is authorized to exercise corporate trust powers.  </B></FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yes. </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>2.</B></FONT></DT><DD><FONT SIZE=2><B>Affiliations with Obligor.  </B></FONT></DD></DL>
<UL>

<P><FONT SIZE=2><B>If the obligor is an affiliate of the trustee, describe each such affiliation.  </B></FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;None. </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>16.</B></FONT></DT><DD><FONT SIZE=2><B>List of Exhibits.  </B></FONT></DD></DL>
<UL>

<P><FONT SIZE=2><B>Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule&nbsp;7a-29
under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R. 229.10(d).</B></FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>A
copy of the articles of association of The Bank of New York Trust Company, N.A. (Exhibit&nbsp;1 to Form&nbsp;T-1 filed with Registration Statement
No.&nbsp;333-121948).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>A
copy of certificate of authority of the trustee to commence business. (Exhibit&nbsp;2 to Form&nbsp;T-1 filed with Registration Statement
No.&nbsp;333-121948).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>A
copy of the authorization of the trustee to exercise corporate trust powers. (Exhibit&nbsp;3 to Form&nbsp;T-1 filed with Registration Statement
No.&nbsp;333-121948).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.</FONT></DT><DD><FONT SIZE=2>A
copy of the existing by-laws of the trustee. (Exhibit&nbsp;4 to Form&nbsp;T-1 filed with Registration Statement No.&nbsp;333-121948).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.</FONT></DT><DD><FONT SIZE=2>The
consent of the trustee required by Section&nbsp;321(b) of the Act. (Exhibit&nbsp;6 to Form&nbsp;T-1 filed with Registration Statement
No.&nbsp;333-121948).
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>7.</FONT></DT><DD><FONT SIZE=2>A
copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

<HR NOSHADE>
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<UL>
</UL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2><B>SIGNATURE  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Act, the trustee, The Bank of New York Trust Company, N.A., a banking association organized and existing under the laws of the
United States of America, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of Los Angeles and State of
California, on the 8th&nbsp;day of January,&nbsp;2008. </FONT></P>

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<TD COLSPAN=3><FONT SIZE=2>THE BANK OF NEW YORK TRUST COMPANY, N.A.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="45%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>TERESA PETTA</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Name:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="45%"><FONT SIZE=2>TERESA PETTA</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="8%"><FONT SIZE=2>Title:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="45%"><FONT SIZE=2>VICE PRESIDENT</FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

<HR NOSHADE>
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<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="page_ks77602_1_1"> </A> </FONT> <FONT SIZE=2><B>EXHIBIT 7  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>Consolidated Report of Condition of<BR>
THE BANK OF NEW YORK TRUST COMPANY, N.A.<BR>
of 700 South Flower Street, Suite 200, Los Angeles, CA 90017  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the close of business September&nbsp;30, 2007, published in accordance with Federal regulatory authority instructions. </FONT></P>

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<TH COLSPAN=2 ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Dollar Amounts<BR>
in Thousands</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2><B>ASSETS</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Cash and balances due from depository institutions:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Noninterest-bearing balances and currency and coin</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>11,268</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Interest-bearing balances</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Securities:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Held-to-maturity securities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>40</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Available-for-sale securities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>115,996</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Federal funds sold and securities purchased under agreements to resell:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Federal funds sold</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>49,900</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Securities purchased under agreements to resell</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>108,174</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Loans and lease financing receivables:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Loans and leases held for sale</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Loans and leases, net of unearned income</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>LESS: Allowance for loan and lease losses</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Loans and leases, net of unearned income and allowance</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Trading assets</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Premises and fixed assets (including capitalized leases)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>12,972</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Other real estate owned</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Investments in unconsolidated subsidiaries and associated companies</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Not applicable</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Intangible assets:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Goodwill</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>871,685</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Other Intangible Assets</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>308,586</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Other assets</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>148,668</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Total assets</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>1,627,289</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
</TR>
</TABLE>
<!-- insert table folio -->
<BR>
<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=4,EFW="2181932",CP="THERAVANCE, INC.",DN="8",CHK=994684,FOLIO='1',FILE='DISK121:[08ZAA2.08ZAA77602]KS77602A.;6',USER='ABEAULI',CD='14-JAN-2008;16:46' -->
<A NAME="page_ks77602_1_2"> </A>
<!-- end of table folio -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><BR><FONT SIZE=2><B>LIABILITIES</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Deposits:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>In domestic offices</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>2,567</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Noninterest-bearing</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>2,567</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Interest-bearing</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Not applicable</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Federal funds purchased and securities sold under agreements to repurchase:</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Federal funds purchased</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="77%"><FONT SIZE=2>Securities sold under agreements to repurchase</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Trading liabilities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Other borrowed money:<BR>
(includes mortgage indebtedness and obligations under capitalized leases)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>168,691</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Not applicable</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Not applicable</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Subordinated notes and debentures</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Other liabilities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>148,215</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Total liabilities</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>319,473</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Minority interest in consolidated subsidiaries</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><BR><FONT SIZE=2><B>EQUITY CAPITAL</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="16%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Perpetual preferred stock and related surplus</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Common stock</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>1,000</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Surplus (exclude all surplus related to preferred stock)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>1,121,520</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Retained earnings</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>184,893</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Accumulated other comprehensive income</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>403</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Other equity capital components</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Total equity capital</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>1,307,816</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD COLSPAN=2><FONT SIZE=2>Total liabilities, minority interest, and equity capital (sum of items&nbsp;21, 22, and&nbsp;28)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" ALIGN="RIGHT"><FONT SIZE=2>1,627,289</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD COLSPAN=2><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD COLSPAN=2 ALIGN="RIGHT"><HR NOSHADE SIZE=4></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I,
Karen Bayz, Vice President of the above-named bank do hereby declare that the Reports of Condition and Income (including the supporting schedules) for this report date have been
prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true to the best of my knowledge and belief. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="14%"><FONT SIZE=2>Karen Bayz</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="78%"><FONT SIZE=2>Vice President</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We,
the undersigned directors (trustees), attest to the correctness of the Report of Condition (including the supporting schedules) for this report date and declare that it has been
examined by us and to the
best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="30%"><FONT SIZE=2>Michael K. Klugman, President</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="62%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="30%"><FONT SIZE=2>Frank P. Sulzberger, MD</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="62%"><FONT SIZE=2>Directors (Trustees)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="30%"><FONT SIZE=2>William D. Lindelof, VP</FONT></TD>
<TD WIDTH="1%"><FONT SIZE=2>)</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="62%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=2,SEQ=5,EFW="2181932",CP="THERAVANCE, INC.",DN="8",CHK=604859,FOLIO='2',FILE='DISK121:[08ZAA2.08ZAA77602]KS77602A.;6',USER='ABEAULI',CD='14-JAN-2008;16:46' -->
<!-- THIS IS THE END OF A COMPOSITION COMPONENT -->
<BR>
<P><br><A NAME="08ZAA77601_8">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<UL>
<FONT SIZE=2><A HREF="#toc_ko77602_1">EXHIBIT 25.1</A></FONT><BR>
</UL>
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</HTML>
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</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>9
<FILENAME>g984214.jpg
<DESCRIPTION>G984214.JPG
<TEXT>
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