XM Radio 2009 Annual Report Download - page 70

to have become the record holder of such securities on, and such certificate shall be dated, the next succeeding
Business Day on which the transfer books of the Company are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Rights Certificate shall not be entitled to any rights of a holder of any
security of the Company with respect to shares for which the Rights are or may be exercisable, including,
without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided
herein.
SECTION 11 Adjustment of Purchase Price, Number and Kind of Securities or Number of Rights
The Purchase Price, the number of shares of Preferred Stock or other securities or property purchasable
upon exercise of each Right and the number of Rights outstanding are subject to adjustment from time to time
as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the Record Date (A) declare a dividend on the
shares of Preferred Stock payable in shares of Preferred Stock, (B) subdivide the outstanding shares of
Preferred Stock, (C) combine the outstanding shares of Preferred Stock into a smaller number of shares of
Preferred Stock or (D) issue any shares of its capital stock in a reclassification of the shares of Preferred Stock
(including any such reclassification in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), except as otherwise provided in this Section 11(a), the Purchase Price in
effect at the time of the record date for such dividend or of the effective date of such subdivision, combination
or reclassification, as the case may be, and the number and kind of shares of capital stock issuable on such
date, shall be proportionately adjusted so that the holder of any Right exercised after such time shall be
entitled to receive the aggregate number and kind of shares of capital stock which, if such Right had been
exercised immediately prior to such date and at a time when the transfer books of the Company for the shares
of Preferred Stock were open, the holder would have owned upon such exercise and been entitled to receive
by virtue of such dividend, subdivision, combination or reclassification; provided, however, that in no event
shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon exercise of one Right.
(ii) Subject to Section 24 of this Agreement and except as otherwise provided in this Section 11(a)(ii)
and Section 11(a)(iii), in the event that any Person becomes an Acquiring Person (a ‘‘Trigger Event”), each
holder of a Right shall thereafter have the right to receive, upon exercise thereof at a price equal to the then-
current Purchase Price in accordance with the terms of this Agreement such number of shares of Common
Stock as shall equal the result obtained by (x) multiplying the then-current Purchase Price by the number of
one-millionth of a share of Preferred Stock for which a Right is then exercisable and dividing that product by
(y) 50% of the Current Per Share Market Price of the Company’s Common Stock (determined pursuant to
Section 11(d) hereof) on the date of the occurrence of such event; provided, however, that the Purchase Price
(as so adjusted) and the number of shares of Common Stock so receivable upon exercise of a Right shall
thereafter be subject to further adjustment as appropriate in accordance with Section 11(f) hereof. After the
occurrence of a Trigger Event, Rights will no longer be exercisable for the purchase of Preferred Stock, except
as provided in Section 11(a)(iii).
Notwithstanding anything in this Agreement to the contrary, however, from and after the time (the
“invalidation time”) when any Person first becomes an Acquiring Person, any Rights that are beneficially
owned by (A) any Acquiring Person (or any Affiliate or Associate of any Acquiring Person), (B) a transferee
of any Acquiring Person (or any such Affiliate or Associate) who becomes a transferee after the invalidation
time or (C) a transferee of any Acquiring Person (or any such Affiliate or Associate) who became a transferee
prior to or concurrently with the invalidation time pursuant to either (1) a transfer from the Acquiring Person
to holders of its equity securities or to any Person with whom it has any continuing agreement, arrangement or
understanding, written or otherwise, regarding the transferred Rights or (2) a transfer that the Board has
determined is part of a plan, arrangement or understanding, written or otherwise, which has the purpose or
effect of avoiding the provisions of this paragraph, and subsequent transferees of such Persons (with respect to
the Rights acquired from such Persons, only), shall be null and void without any further action and any holder
of such Rights shall thereafter have no rights whatsoever with respect to such Rights under any provision of
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