Cincinnati Bell 2006 Annual Report Download - page 107

(b) Any “person,” as such term is defined in Section 3(a)(9) of the Exchange Act and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act, being or becoming “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of CBI representing 20% or more of
the combined voting power of CBI’s then outstanding securities eligible to vote for the election of the Board
(for purposes of this subsection 11.3, the “CBI Voting Securities”). It is provided, however, that the event
described in this paragraph (b) shall not be deemed to be a Change in Control if such event results from any
of the following: (i) the acquisition of any CBI Voting Securities by the Company, (ii) the acquisition of any
CBI Voting Securities by any employee benefit plan (or related trust) sponsored or maintained by the
Company, (iii) the acquisition of any CBI Voting Securities by any underwriter temporarily holding
securities pursuant to an offering of such securities, or (iv) a Non-Qualifying Transaction (as defined in
paragraph (c) of this subsection 11.3).
(c) The consummation of a merger, consolidation, statutory share exchange, or similar form of
corporate transaction involving the Company (for purposes of this paragraph (c), a “Reorganization”) or sale
or other disposition of all or substantially all of the assets of CBI to an entity that is not an affiliate of CBI
(for purposes of this paragraph (c), a “Sale”), that in each case requires the approval of CBI’s shareholders
under the law of CBI’s jurisdiction of organization, whether for such Reorganization or Sale (or the issuance
of securities of CBI in such Reorganization or Sale), unless immediately following such Reorganization or
Sale:
(1) more than 60% of the total voting power (in respect of the election of directors, or similar
officials in the case of an entity other than a corporation) of (i) the entity resulting from such
Reorganization or the entity which has acquired all or substantially all of the assets of CBI (for
purposes of this paragraph (c) and in either case, the “Surviving Entity”), or (ii) if applicable, the
ultimate parent entity that directly or indirectly has beneficial ownership of more than 50% of the total
voting power (in respect of the election of directors, or similar officials in the case of an entity other
than a corporation) of the Surviving Entity (for purposes of this paragraph (c), the “Parent Entity”), is
represented by CBI Voting Securities that were outstanding immediately prior to such Reorganization
or Sale (or, if applicable, is represented by shares into which such CBI Voting Securities were
converted pursuant to such Reorganization or Sale), and such voting power among the holders thereof
is in substantially the same proportion as the voting power of such CBI Voting Securities among the
holders thereof immediately prior to the Reorganization or Sale;
(2) no person (other than any employee benefit plan sponsored or maintained by the Surviving
Entity or the Parent Entity or the related trust of any such plan) is or becomes the beneficial owner,
directly or indirectly, of 20% or more of the total voting power (in respect of the election of directors,
or similar officials in the case of an entity other than a corporation) of the outstanding voting securities
of the Parent Entity (or, if there is no Parent Entity, the Surviving Entity); and
(3) at least a majority of the members of the board of directors (or similar officials in the case of
an entity other than a corporation) of the Parent Entity (or, if there is no Parent Entity, the Surviving
Entity) following the consummation of the Reorganization or Sale were, at the time of the approval by
the Board of the execution of the initial agreement providing for such Reorganization or Sale,
Incumbent Directors (any Reorganization or Sale which satisfies all of the criteria specified in
subparagraphs (1), (2), and (3) of this paragraph (c) being deemed to be a “Non-Qualifying
Transaction” for purposes of this subsection 11.3).
(d) The shareholders of CBI approving a plan of complete liquidation or dissolution of CBI.
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any person
acquires beneficial ownership of more than 20% of the CBI Voting Securities as a result of the acquisition of CBI
Voting Securities by CBI which reduces the number of CBI Voting Securities outstanding; provided that, if after
such acquisition by CBI such person becomes the beneficial owner of additional CBI Voting Securities that
increases the percentage of outstanding CBI Voting Securities beneficially owned by such person, a Change in
Control shall then occur.
B-7
Proxy Statement