XM Radio 2009 Annual Report Download - page 75

exercised after such record date the number of one-millionths of a share of Preferred Stock or other securities
of the Company, if any, issuable upon such exercise over and above the number of one-millionths of a share of
Preferred Stock or other securities of the Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided, however, that the Company delivers to such holder
a due bill or other appropriate instrument evidencing such holder’s right to receive such additional shares of
Preferred Stock or other securities upon the occurrence of the event requiring such adjustment.
(m) Notwithstanding anything in this Agreement to the contrary, the Company shall be entitled to make
such reductions in the Purchase Price, in addition to those adjustments expressly required by this Section 11,
as and to the extent that in its good faith judgment the Board determines to be necessary or advisable in order
that any (i) consolidation or subdivision of the shares of Preferred Stock, (ii) issuance wholly for cash of
shares of Preferred Stock at less than the Current Per Share Market Price therefor, (iii) issuance wholly for
cash of shares of Preferred Stock or securities which by their terms are convertible into or exchangeable for
shares of Preferred Stock, (iv) stock dividends or (v) issuance of rights, options or warrants referred to in this
Section 11, hereafter made by the Company to holders of its shares of Preferred Stock is not taxable to such
stockholders.
(n) Notwithstanding anything in this Agreement to the contrary, in the event that the Company at any
time after the Record Date and prior to the Distribution Date (i) pays a dividend on the outstanding shares of
Common Stock payable in shares of Common Stock, (ii) subdivides the outstanding shares of Common Stock,
(iii) combines the outstanding shares of Common Stock into a smaller number of shares or (iv) issues any
shares of its capital stock in a reclassification of the outstanding shares of Common Stock (including any such
reclassification in connection with a consolidation or merger in which the Company is the continuing or
surviving corporation), the number of Rights associated with each share of Common Stock then outstanding,
or issued or delivered thereafter but prior to the Distribution Date, shall be proportionately adjusted so that the
number of Rights thereafter associated with each share of Common Stock following any such event equals the
result obtained by multiplying the number of Rights associated with each share of Common Stock immediately
prior to such event by a fraction the numerator of which is the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and the denominator of which is the total number
of shares of Common Stock outstanding immediately following the occurrence of such event. The adjustments
provided for in this Section 11(n) shall be made successively whenever such a dividend is paid or such a
subdivision, combination or reclassification is effected.
SECTION 12 Certificate of Adjusted Purchase Price or Number of Shares
Whenever an adjustment is made or any event affecting the Rights or their exercisability (including
without limitation an event which causes Rights to become null and void) occurs as provided in Section 11,
the Company shall promptly (a) prepare a certificate setting forth such adjustment and a brief, reasonably
detailed statement of the facts, computations, methodology, and calculations accounting for such adjustment,
or describing such event, (b) file with the Rights Agent, and with each transfer agent for the shares of
Preferred Stock and the shares of Common Stock, a copy of such certificate, and (c) mail a brief summary
thereof to each holder of a Rights Certificate in accordance with Section 25 and Section 26 hereof. The Rights
Agent shall be fully protected in relying on any such certificate and on any adjustment or statement therein
contained and shall have no duty or liability with respect to, and shall not be deemed to have knowledge of
any such adjustment or any such event unless and until it shall have received such certificate.
SECTION 13 Reserved
SECTION 14 Fractional Rights and Fractional Shares
(a) The Company shall not be required to issue fractions of Rights or to distribute Rights Certificates
which evidence fractional Rights. In lieu of such fractional Rights, the Company shall pay to the registered
holders of the Rights Certificates with regard to which such fractional Rights would otherwise be issuable, an
amount in cash equal to the same fraction of the current market value of one Right. For purposes of this
Section 14(a), the current market value of one Right is the closing price of the Rights for the Trading Day
immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing
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