XM Radio 2009 Annual Report Download - page 82

to the extent that, in its good faith judgment the Board determines that the issuance of such Right or Rights
Certificate could have a material adverse tax consequence to the Company or to the Person to whom or which
such Right or Rights Certificate otherwise would be issued, and (ii) no such Rights or Rights Certificates shall
be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the
issuance thereof (provided that, in the case of any such adjustment with respect to the Series B-1 Preferred
Stock, such adjustment shall have been made in accordance with the Company’s Certificate of Designation
with respect to such series). Anything contained herein to the contrary notwithstanding, if at any time
following the Distribution Date and prior to the Expiration Date, any shares of Common Stock are issued
without Rights upon any conversion of shares of Series B-1 Preferred Stock then outstanding, then from and
after the effective time of such conversion of shares of Series B-1 Preferred Stock, the Company shall not
issue any additional Rights hereunder, except as provided in clause (i) of the preceding sentence.
SECTION 23 Redemption
(a) The Board may, at any time prior to the Distribution Date, redeem all but not less than all the then-
outstanding Rights at the Redemption Price. The redemption of the Rights may be made effective at such time,
on such basis and with such conditions as the Board in its sole discretion may establish. The Company may, at
its option, pay the Redemption Price in cash, securities or any other form of consideration deemed appropriate
by the Board.
(b) Immediately upon the effectiveness of the redemption of the Rights, and without any further action
and without any notice, the right to exercise the Rights shall terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price for each Right so held without interest thereon.
Promptly after the effectiveness of the redemption of the Rights, the Company shall give notice of such
redemption to the holders of the then outstanding Rights (with prompt written notice thereof to the Rights
Agent) by mailing such notice to all such holders at each holder’s last address as it appears upon the registry
books of the Rights Agent or, prior to the Distribution Date, on the registry books of the transfer agent for the
shares of Common Stock; provided however, that the failure to give, or any defect in, any such notice will not
affect the validity of the Redemption of the Rights. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the notice. Each such notice of redemption shall
state the method by which the payment of the Redemption Price shall be made.
SECTION 24 Exchange
(a) Subject to Section 24(c), on or after the Distribution Date, the Company (i) if on such date the voting
rights set forth in Section 12 of the Certificate of Designations for the Series B-1 Preferred Stock are still in
effect (the expiration of such voting rights, the “B-1 Consent Right Termination Date”), shall and (ii) at any
time thereafter, may, at the option of the Board, exchange all of the then-outstanding and exercisable Rights
(which shall not include Rights that have become null and void pursuant to the provisions of Section 11(a)(ii)
hereof) for shares of Common Stock at an exchange ratio of one share of Common Stock per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date
hereof (such number of shares of Common Stock per Right being hereinafter referred to as the “Exchange
Ratio”). If pursuant to an exchange in accordance with the terms of this Section 24(a), a registered holder of
any Rights Certificate is entitled to receive shares of Common Stock in an aggregate amount that is not a
whole number, the Company will round downward the number of whole shares of Common Stock so issued to
the nearest whole number.
(b) Immediately upon the action of the Board ordering the exchange of Rights pursuant to subsection (a)
of this Section 24 and without any further action and without any notice, the right to exercise such Rights
shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of
shares of Common Stock equal to the number of such Rights held by such holder multiplied by the Exchange
Ratio (or, pursuant to Section 24(c), the equivalent number of shares of Preferred Stock). Promptly after the
effectiveness of the exchange of Rights as provided in subsection (a) of this Section 24, the Company shall
publicly announce such exchange (with prompt written notice thereof to the Rights Agent) and within 10
calendar days thereafter, shall give notice of such exchange to all of the holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent; provided, however, that the failure to
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