XM Radio 2009 Annual Report Download - page 71

this Agreement. The Company will use commercially reasonable efforts to ensure that the provisions of this
Section 11(a)(ii) are complied with, but shall have no liability to any holder of Rights Certificates or other
Person as a result of its failure to make any determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder. From and after the invalidation time, no Right Certificates shall
be issued pursuant to Section 3 or Section 6 hereof that represents Rights that are or have become null and
void pursuant to the provisions of this paragraph, and any Right Certificates delivered to the Rights Agent that
represents Rights that are or have become null and void pursuant to the provisions of this paragraph shall be
cancelled. The Company shall give the Rights Agent written notice of the identity of any such Acquiring
Person, Associate or Affiliate, or the nominee of any of the foregoing, and the Rights Agent may rely on such
notice in carrying out its duties under this Agreement and shall be deemed not to have any knowledge of the
identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the foregoing unless
and until it shall have received such notice.
(iii) The Company may at its option substitute for a share of Common Stock issuable upon the exercise
of Rights in accordance with the foregoing subparagraph (ii) such number or fractions of shares of Preferred
Stock having an aggregate current market value equal to the Current Per Share Market Price of a share of
Common Stock. In the event that there shall be an insufficient number of shares of Common Stock authorized
but unissued (and unreserved) to permit the exercise in full of the Rights in accordance with the foregoing
subparagraph (ii), the Board shall, with respect to such deficiency, to the extent permitted by applicable law
and any material agreements then in effect to which the Company is a party (A) determine the excess of
(x) the value of the shares of Common Stock issuable upon the exercise of a Right in accordance with the
foregoing subparagraph (ii) (the “Current Value”) over (y) the then-current Purchase Price multiplied by the
number of one-millionths of shares of Preferred Stock for which a Right was exercisable immediately prior to
the time that the Acquiring Person became such (such excess, the “Spread”), and (B) with respect to each
Right (other than Rights which have become null and void pursuant to Section 11(a)(ii)), make adequate
provision to substitute for the shares of Common Stock issuable in accordance with subparagraph (ii) upon
exercise of the Right and payment of the applicable Purchase Price, (1) cash, (2) a reduction in such Purchase
Price, (3) shares of Preferred Stock or other equity securities of the Company (including, without limitation,
shares or fractions of shares of preferred stock which, by virtue of having dividend, voting and liquidation
rights substantially comparable to those of the shares of Common Stock, are deemed in good faith by the
Board to have substantially the same value as the shares of Common Stock, as the case may be (such shares
of preferred stock and shares or fractions of shares of preferred stock are hereinafter referred to as “Common
Stock Equivalents”), (4) debt securities of the Company, (5) other assets or (6) any combination of the
foregoing, having a value which, when added to the value of the shares of Common Stock actually issued
upon exercise of such Right, shall have an aggregate value equal to the Current Value (less the amount of any
such reduction in the applicable Purchase Price), where such aggregate value has been determined by the
Board (upon the advice of a nationally recognized investment banking firm selected by the Board in good
faith); provided, however, if the Company shall not make adequate provision to deliver value pursuant to
clause (B) above within 30 days following but not including the date that the Acquiring Person became such
(the “Section 11(a)(ii) Trigger Date”), then the Company shall be obligated to deliver, to the extent permitted
by applicable law and any material agreements then in effect to which the Company is a party, upon the
surrender for exercise of a Right and without requiring payment of the Purchase Price, shares of Common
Stock (to the extent available), and then, if necessary, such number or fractions of shares of Preferred Stock
(to the extent available) and then, if necessary, cash, which shares and/or cash have an aggregate value equal
to the Spread. If within the 30 day period referred to above the Board shall determine in good faith that it is
likely that sufficient additional shares of Common Stock could be authorized for issuance upon exercise in full
of the Rights, then, if the Board so elects, such 30 day period may be extended to the extent necessary, but not
more than 90 days after but not including the Section 11(a)(ii) Trigger Date, in order that the Company may
seek stockholder approval for the authorization of such additional shares (such 30 day period, as it may be
extended, is hereinafter called the “Substitution Period”). To the extent that the Company determines that some
action need be taken pursuant to the second and/or third sentence of this Section 11(a)(iii), the Company
(x) shall provide, subject to Section 11(a)(ii) hereof and the last sentence of this Section 11(a)(iii) hereof, that
such action shall apply uniformly to all outstanding Rights and (y) may suspend the exercisability of the
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