Adjustments to Conversion Rate. The Conversion Rate shall be subject to adjustments from time to time as follows: (1) In case at any time after the Closing Date the Company shall pay or make a dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock) in shares of its Common Stock, the Conversion Rate in effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or other distribution shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 3 contracts

Samples: Debenture Purchase Agreement (Orion Newco Services Inc), Debenture Purchase Agreement (Orion Newco Services Inc), Debenture Purchase Agreement (British Aerospace Holdings Inc)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as ~~follows~~described below, except that the Company will not make any adjustments to the Conversion Rate if Holders of the Security participate, as a result of holding the Securities, in any transaction described below without having to convert their Securities: (1a) ~~In case at any time after the Closing Date~~ If the Company ~~shall pay or make~~ issues shares of Capital Stock as a dividend or ~~other~~ distribution on ~~any class of Capital Stock~~ shares of the ~~Company (other than the Series C Preferred Stock) in shares of its Common~~ Capital Stock, or effects a share split or share combination, the Conversion Rate will be adjusted based on the following formula: CR'=CR0 x OS' --- OS0 where, CR0 = the Conversion Rate in effect at immediately prior to the ~~opening~~ Ex-Dividend Date of ~~business on the day following the date fixed for the determination of stockholders entitled to receive~~ such dividend or ~~other distribution shall be increased by dividing~~ distribution, or the effective date of such share split or share combination, as applicable CR' = the Conversion Rate ~~by a fraction of which the numerator shall be~~ in effect immediately after such Ex-Dividend Date or effective date OS0 = the number of shares of ~~Common~~ Capital Stock outstanding ~~at the close of business on the~~ immediately prior to such Ex-Dividend Date or effective date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), OS' = the number of shares of ~~Common~~ Capital Stock ~~at any time~~ outstanding immediately prior to such Ex-Dividend date or effective date after giving effect to such dividend, distribution, share split or share combination Such adjustment shall ~~not include shares held in~~ become effective immediately after 9:00 a.m., New York City time, on the ~~treasury of~~ Business Day following the ~~Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock~~Record Date for such dividend or distribution, or the date fixed for determination for such share split or share combination. The Company will not pay any dividend or make any distribution on shares of ~~Common~~ Capital Stock held in treasury by the ~~treasury~~ Company. If any dividend or distribution of the ~~Company~~type described in this Section 11.02(a) is declared but not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. (2b) ~~In case at any time after the Closing Date,~~ If the Company ~~shall issue rights~~ issues to all or ~~warrants to~~ substantially all holders of its ~~Common~~ Capital Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ any rights or warrants entitling them for a period of not more than 45 calendar days to subscribe for or purchase shares of ~~Common~~ Capital Stock at a price per share less than the ~~current market price per share (determined as provided in paragraph (8) of this Section 15.4)~~ average of the ~~Common~~ Last Reported Sale Prices of the Capital Stock for the 10 consecutive Trading-Day period ending on the Scheduled Trading Day immediately preceding the date of announcement of such issuance, the Conversion Rate will be adjusted based on the following formula: CR'=CR0 x OS0+X ----- OS0+Y where, CR0 = the conversion rate in effect immediately prior the Ex-Dividend Date for such issuance CR' = the conversion rate in effect immediately after such Ex-Dividend Date OS0 = the number of shares of Capital Stock outstanding immediately after such Ex-Dividend Date X = the total number of shares of Capital Stock issuable pursuant to such rights or warrants Y = the number of shares of Capital Stock equal to the aggregate price payable to exercise such rights or warrants divided by the average of the Last Reported Sale Prices of the Capital Stock over the 10 consecutive Trading-Day period ending on the Trading Day immediately preceding the date of announcement of the issuance of such rights or warrants Such adjustment shall be successively made whenever any such rights or warrants are issued and shall become effective immediately after 9:00 a.m., New York City time, on the Business Day following the date fixed for such determination. The Company shall not issue any such rights, options or warrants in respect of shares of Capital Stock held in treasury by the ~~determination~~ Company. To the extent that shares of ~~stockholders entitled to receive~~ Capital Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate ~~in effect at the opening of business on the day following the date fixed for such determination~~ shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase readjusted to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate ~~pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration~~ that would then be ~~recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments~~ in ~~the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2),~~ the number of shares of ~~Common~~ Capital Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stockactually delivered. ~~The Company will not issue any~~ If such rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)are not so issued, the Conversion Rate shall again be adjusted ~~so that the same shall equal the rate determined by dividing~~ to be the Conversion Rate that would then be in effect ~~immediately prior to the close of business on the~~ if such date fixed for the determination of stockholders entitled to receive such ~~distribution by a fraction~~ rights or warrants had not been fixed. In determining whether any rights or warrants entitle the Holders to subscribe for or purchase shares of ~~which~~ Capital Stock at less than such Last Reported Sale Price, and in determining the ~~numerator~~ aggregate offering price of such shares of Capital Stock, there shall be taken into account any consideration received by the ~~current market price per share~~ Company for such rights or warrants and any amount payable on exercise or conversion thereof, the value of such consideration, if other than cash, to be determined by the Company's Board of Directors. (~~determined as provided in paragraph (8)~~ c) If the Company distributes shares of ~~this Section 15.4)~~ capital stock of the ~~Common Stock~~ Company, evidences of its indebtedness or other assets or property of the Company to all or substantially all holders of the Capital Stock, excluding: (i) dividends or distributions and rights or warrants referred to in clause (a) or (b) above; and (ii) dividends or distributions paid exclusively in cash; then the Conversion Rate will be adjusted based on the ~~date fixed~~ following formula: CR'=CR0 x SP0 ------- SP0-FMV where, CR0 = the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such ~~determination less~~ distribution CR' = the ~~then fair market value~~ Conversion Rate in effect immediately after such Ex-Dividend Date SP0 = the average of the Last Reported Sale Prices of the Capital Stock over the 10 consecutive Trading-Day period ending on the Scheduled Trading Day immediately preceding the Ex-Dividend Date for such distribution FMV = the Fair Market Value (~~each reference to "fair market value" in this Section 15.4 shall mean the fair market value~~ as determined by the Company's Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolutionDirectors) of the ~~portion~~ shares of ~~the~~ capital stock, evidences of indebtedness, assets or ~~evidences of indebtedness so~~ property distributed ~~applicable~~ with respect to ~~one (1)~~ each outstanding share of ~~Common~~ Capital Stock ~~and~~ on the ~~denominator~~ Record Date for such distribution. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately prior to ~~the opening of business~~ 9:00 a.m., New York City time, on the ~~day~~ Business Day following the date fixed for the determination of stockholders entitled to receive such distribution~~. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute~~ . With respect to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no an adjustment pursuant to this ~~paragraph~~ clause (5c) ~~or paragraph (6) of this Section 15.4~~ where there has been ~~made and (z)~~ a payment of a dividend or other distribution on the ~~aggregate~~ Capital Stock or shares of capital stock of any ~~cash plus the fair market value~~ class or series, or similar equity interest, of or relating to a Subsidiary or other ~~consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve~~ business unit (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determinationa "Spin-Off"), the Conversion Rate ~~shall~~ in effect immediately before 5:00 p.m., New York City time, on the effective date for such Spin-off will be increased ~~so that~~ based on the ~~same shall equal the rate determined by dividing~~ following formula: CR'-CR0 x FMV0+MP0 -------- MP0 where, CR0 = the Conversion Rate in effect immediately prior to the ~~close~~ effective date of ~~business~~ the adjustment CR' = the Conversion Rate in effect immediately after the effective date of the adjustment FMV0 = the average of the Last Reported Sale Prices of the capital stock or similar equity interest distributed to Holders of Capital Stock applicable to one share of Capital Stock over the first 10 consecutive Trading-Day period after, and including, the effective date of the Spin-Off MP0 = the average of the Last Reported Sale Prices of Capital Stock over the first 10 consecutive Trading-Day period after, and including, the effective date of the Spin-Off. Such adjustment shall occur on the tenth Trading Day from, and including, the effective date ~~fixed for determination~~ of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable Spin-Off; provided that in respect of any ~~other tender offer~~conversion within 10 Trading Days immediately following, by and including, the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount effective date of any ~~distributions~~ Spin-Off, references with respect to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) 10 Trading Days shall be deemed ~~to involve (a) a distribution~~ replaced with such lesser number of ~~such securities other than Common Stock to all holders of Common Stock (and~~ Trading Days as have elapsed between the effective date of such ~~reclassification shall be deemed~~ Spin-Off and the Conversion Date in determining the applicable Conversion Rate. (d) If any regular, quarterly cash dividend or distribution made to be all or substantially all holders of Capital Stock does not equal $0.06 per share (the "~~the date fixed for the determination of stockholders entitled to receive such distribution" and~~ Initial Dividend Threshold"~~the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4~~), ~~and~~ the Conversion Rate will be adjusted based on the following formulas: (bA) ~~a subdivision~~ if the per share amount of such regular, quarterly cash dividend or ~~combination~~distribution is greater than the Initial Dividend Threshold, as the ~~case may be~~Conversion Rate will be adjusted based on the following formula: CR'=CR0 x SP0 ----- SP0-C where, of CR0 = the ~~number of shares of Common Stock outstanding~~ Conversion Rate in effect immediately prior to the Ex-Dividend Date for such ~~reclassification into~~ distribution CR' = the ~~number~~ Conversion Rate in effect immediately after the Ex-Dividend Date for such distribution SP0 = the Last Reported Sale Price of ~~shares~~ the Capital Stock on the Trading Day immediately preceding the Ex-Dividend Date for such distribution C = the amount in cash per share the Company distributes to holders of ~~Common~~ Capital Stock ~~outstanding immediately thereafter (and~~ in excess of the ~~effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as~~ Initial Dividend Threshold in the case ~~may be, and "the day upon which such subdivision or combination becomes effective" within the meaning~~ of ~~paragraph (3) of this Section 15.4)~~a regular quarterly dividend. (~~8) For~~ B) if the ~~purpose~~ per share amount of ~~any computation under paragraph (2)~~such regular, ~~(4), (5)~~ quarterly cash dividend or ~~(6) of this Section 15.4~~distribution is less than the Initial Dividend Threshold, the ~~current market price~~ Conversion Rate will be adjusted based on the following formula: CR'=CR0 x SP0 ----- SP0+C where, CR0 = the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such distribution CR' = the Conversion Rate in effect immediately after the Ex-Dividend Date for such distribution SP0 = the Last Reported Sale Price of the Capital Stock on the Trading Day immediately preceding the Ex-Dividend Date for such distribution C = the Initial Dividend Threshold minus the amount in cash per share ~~of Common Stock on any date shall be calculated by~~ the Company ~~and be deemed~~ distributes to ~~be the average~~ holders of ~~the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day~~ Capital Stock. The Initial Dividend Threshold is subject to adjustment in ~~question and (ii) the day before the "ex" date with respect~~ a manner inversely proportional to ~~the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect~~ adjustments to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate~~, for~~ ; provided that no adjustment will be made to the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend ~~or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or~~ threshold amount for any ~~other reasons~~adjustment made to the Conversion Rate under this clause (d)(i).

Appears in 2 contracts

Samples: Indenture (Chemed Corp), Indenture (Chemed Corp)

Adjustments to Conversion Rate. The Conversion Rate shall be subject to ~~adjustments~~ adjustment from time to ~~time~~ time, without duplication, as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend~~ distribution on its Common Stock, payable exclusively in shares of Common Stock or other ~~distribution on any class of~~ Capital Stock of the ~~Company~~ Company; (~~other than~~ ii) subdivide or split its outstanding Common Stock into a greater number of shares; (iii) combine or reclassify its outstanding Common Stock into a smaller number of shares; or (iv) issue by reclassification of the ~~Series C Preferred Stock) in~~ shares of ~~its~~ Common Stock any shares of the Company’s Capital Stock, the Conversion Rate in effect immediately prior to the record date or effective date, as the case may be, for the adjustment pursuant to this Section 9.8(a) as described below, shall be adjusted so that the Holder of any Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock and/or Capital Stock which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to such record date or effective date, as the case may be. An adjustment made pursuant to this Section 9.8(a) shall become effective immediately after the applicable record date in the case of a dividend or distribution and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Common Stock. If any dividend or distribution of the type described in clause (i) above is not so paid or made, the Conversion Rate shall again be immediately readjusted, effective as of the date the Board of Directors determines not to pursue such action, to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. If any subdivision or split, combination or reclassification or issuance of the type described in clauses (ii) through (iv) of this Section 9.8(a) is not so made, the Conversion Rate shall again be immediately readjusted, effective as of the date the Board of Directors determines not to pursue such action, to the Conversion Rate that would then be in effect if such subdivision or split, combination or reclassification or issuance had not been declared. (b) In case the Company at any time or from time to time after the ~~opening~~ issuance of ~~business~~ the Notes shall issue rights or warrants to all or substantially all holders of the Common Stock entitling them to subscribe for or purchase Common Stock at a price per share less (or having a conversion price per share less) than the then Current Market Price per share of Common Stock, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to 5:00 p.m. New York City time on the ~~day following the~~ record date fixed for ~~the~~ determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution shall be increased by dividing such Conversion Rate~~ warrants (prior to any adjustment in accordance with this Section 9.8(b)) by a fraction of which (i) the numerator shall be the number of shares of Common Stock outstanding at on such record date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and (ii) the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such record date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at the Current Market Price per share of Common Stock on the earlier of such ~~dividend~~ record date and the Trading Day immediately preceding the ex date for such issuance of rights or ~~other distribution~~warrants. Such adjustment shall be made successively whenever any such rights or warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the record date for the determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall immediately be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be immediately readjusted to be the Conversion Rate which would then be in effect if such record date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Current Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (c) In case the Company shall, by dividend or in a merger, amalgamation or consolidation or otherwise, distribute to all or substantially all holders of Common Stock any evidences of Indebtedness, shares of Capital Stock of any class or series, other securities, cash or assets (excluding (i) any dividend, distribution or issuance covered by those referred to in Section 9.8(a) or 9.8(b) hereof, (ii) any dividend or distribution paid exclusively in cash referred to in Section 9.8(d) hereof or (iii) any dividend or distribution that constitutes a Spin-Off which is covered by Section 9.8(e) hereof), or rights or warrants to subscribe for or purchase any of its securities (including the distribution of rights to all holders of Common Stock pursuant to a stockholders rights plan or the detachment of such rights under the terms of such stockholder rights plan but excluding those rights or warrants referred to in Section 9.8(b)) (any of the foregoing hereinafter in this Section 9.8(c) called the “Distributed Assets”), then in each such case the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to 5:00 p.m. New York City time on the record date fixed for determination of stockholders entitled to receive such ~~determination~~distribution by a fraction of which (A) the numerator shall be the Current Market Price per share of the Common Stock and (B) the denominator shall be (1) the Current Market Price per share of the Common Stock less (2) the Fair Market Value on such record date (as determined in good faith by the Board of Directors, whose determination shall be conclusive evidence of such Fair Market Value, and described in a certificate filed with the Trustee and the Paying Agent) of the portion of the Distributed Assets so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the record date for the determination of stockholders entitled to receive such distribution; provided, however, that, if (i) the Fair Market Value of the portion of the Distributed Assets so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price of the Common Stock or (ii) the Current Market Price of the Common Stock is greater than the Fair Market Value per share of such Distributed Assets by less than $1.00, then, in lieu of the adjustment provided in this Section 9.8(c), adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights or warrants comprising the Distributed Assets the Holder would have received had such Holder converted such Notes immediately prior to the record date for the determination of stockholders entitled to receive such distribution. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. (d) In case the Company shall make any distributions, by dividend or otherwise, consisting exclusively of cash to all or substantially all holders of outstanding shares of Common Stock, then, and in each such case, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to 5:00 p.m. New York City time on the record date fixed for the determination of holders of Common Stock entitled to receive such distribution by a fraction of which (A) the numerator shall be the Current Market Price per share of the Common Stock and (B) the denominator shall be (1) the Current Market Price per share of Common Stock minus (2) the amount per share of such distribution (appropriately adjusted from time to time for any stock dividends on or subdivisions or combination of Common Stock); provided, however, that if (i) the per share amount of such distribution equals or exceeds the Current Market Price of the Common Stock or (ii) the Current Market Price of the Common Stock exceeds the per share amount of such distribution by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of a Note shall have the right to receive upon conversion, such dividend or distribution such Holder would have received had such Holder converted each Note immediately prior to the record date for the determination of stockholders entitled to receive the distribution. (e) In the event that the Company makes any distribution to all holders of Common Stock that constitutes a Spin-Off, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to 5:00 p.m. New York City time on the record date fixed for the determination of holders of Common Stock entitled to receive such distribution by a fraction of which (i) the numerator shall be the Spin-Off Market Price per share of the Common Stock on such record date plus the Spin-Off Market Price per Equity Interest of the Subsidiary or other business unit of the Company on such record date applicable to each share of Common Stock and (ii) the denominator shall be the Spin-Off Market Price per share of the Common Stock. The adjustment to the Conversion Rate set forth in this Section 9.8(e) will occur at the earlier of (1) the 10th Trading Day from, and including, the effective date of the Spin-Off and (2) the date of the Initial Public Offering of the securities being distributed in the Spin-Off, if that Initial Public Offering is effected simultaneously with the Spin-Off; provided, however, that, if (i) the Spin-Off Market Price per Equity Interest of the Subsidiary so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price of the Common Stock or (ii) the Current Market Price of the Common Stock is greater than the Spin-Off Market Price per Equity Interest of the Subsidiary by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of a Note shall have the right to receive upon conversion, such distribution such Holder would have received had such Holder converted such Note immediately prior to the record date for the determination of stockholders entitled to receive the distribution. (f) In case a repurchase, tender or exchange offer for Common Stock made by the Company or any Subsidiary shall expire and such repurchase, tender or exchange offer (as amended upon the expiration thereof) shall require the payment to stockholders of consideration per share of Common Stock having a Fair Market Value (as determined in good faith by the Company’s Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that as of the date of repurchase or the last time (the “Expiration Time”) tenders or exchanges may be made pursuant to such tender or exchange offer (as it may be amended) exceeds the Closing Price of a share of Common Stock on the Trading Day next succeeding the date of repurchase or Expiration Time, as the case may be, the Conversion Rate shall be adjusted so that the same shall equal the rate determined by multiplying the Conversion Rate by a fraction, (i) the numerator of which shall be the sum of (x) the Fair Market Value (determined as aforesaid) of the aggregate consideration payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of all shares validly tendered or exchanged and not withdrawn as of the Expiration Time, or repurchased, (the shares deemed so accepted up to any such maximum, or repurchased being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) at the Expiration Time or date of repurchase, as the case may be, and the Closing Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time or date of repurchase, as the case may be, and (ii) the denominator of which shall be the number of shares of Common Stock outstanding (including any repurchased or tendered or exchanged shares) at the Expiration Time or date of repurchase, as the case may be, multiplied by the Closing Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time or date of repurchase, as the case may be, such adjustment to become effective immediately prior to the opening of business on the day following the Expiration Time or date of repurchase, as the case may be. If the Company is obligated to purchase shares pursuant to any such repurchase, tender or exchange offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Rate shall again immediately be readjusted to be the Conversion Rate that would then be in effect if such repurchase, tender or exchange offer had not been made. (g) Upon conversion of the Notes, the Holders shall receive, if they receive shares of Common Stock, in addition to the Common Stock issuable upon such conversion, the rights issued under any shareholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion) unless, prior to conversion, the rights have expired, terminated or been redeemed or exchanged in accordance with the rights plan. If, and only if, the Holders of Notes receive rights under such shareholder rights plans as described in the preceding sentence upon conversion of their Notes, then no other adjustment pursuant to this Section 9.8 shall be made in connection with such shareholder rights plans. (h) For ~~the~~ purposes of this ~~paragraph (1)~~Section 9.8, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2i) ~~In case at~~ Notwithstanding any ~~time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders~~ of the ~~Debentures upon conversion) entitling them~~ foregoing, in no event shall the Conversion Rate as adjusted pursuant to ~~subscribe for or purchase~~ this Section 9.8 exceed 35.8422 shares of Common Stock ~~at a price~~ issuable upon conversion per ~~share less~~ $1,000 principal amount of Notes, other than ~~the current market price per share (determined as provided in paragraph (8)~~ on account of ~~this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled~~ proportional adjustments to ~~receive such rights or warrants,~~ the Conversion Rate in ~~effect at~~ the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription manner set forth in paragraphs (a) through (c) or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2e) of this Section ~~15.4,~~ 9.8. This Section 9.8 shall not apply to any ~~dividend~~ event or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash occurrence that is ~~distributed upon a merger or consolidation~~ subject to ~~which~~ Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination9.14. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 2 contracts

Samples: Indenture (Aar Corp), Indenture (Aar Corp)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as ~~follows~~described below, except that the Company will not make any adjustments to the Conversion Rate if Holders of the Securities participate (as a result of holding the Securities, and at the same time as holders of the Common Stock participate) in any of the transactions described in this Section 11.02 as if such Holders of the Securities held a number of shares of the Common Stock equal to the applicable Conversion Rate, multiplied by the principal amount (expressed in thousands) of Securities held by such Holders, without having to convert their Securities: (1a) ~~In case at any time after the Closing Date~~ If the Company ~~shall pay or make~~ issues shares of Common Stock as a dividend or ~~other~~ distribution on ~~any class of Capital Stock~~ shares of the ~~Company (other than the Series C Preferred Stock) in shares of its~~ Common Stock, or effects a share split or share combination, the Conversion Rate will be adjusted based on the following formula: CR’=CR0 x OS’ OS0 where, CR0 = the Conversion Rate in effect at immediately prior to the ~~opening~~ Ex-Dividend Date of ~~business on the day following the date fixed for the determination of stockholders entitled to receive~~ such dividend or ~~other distribution shall be increased by dividing~~ distribution, or the effective date of such share split or share combination, as applicable CR’ = the Conversion Rate ~~by a fraction of which the numerator shall be~~ in effect immediately after such Ex-Dividend Date or effective date, as applicable OS0 = the number of shares of Common Stock outstanding ~~at the close of business on the date fixed for~~ immediately prior to such ~~determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend~~ Ex-Dividend Date or ~~other distribution~~effective date, ~~such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1),~~ as applicable OS’ = the number of shares of Common Stock ~~at any time~~ outstanding immediately prior to such Ex-Dividend Date or effective date, as applicable, after giving pro forma effect to such dividend, distribution, share split or share combination Such adjustment shall ~~not include shares held in~~ become effective immediately after 9:00 a.m., New York City time, on the ~~treasury of~~ Business Day following the ~~Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock~~Record Date for such dividend or distribution, or the date fixed for determination for such share split or share combination. The Company will not pay any dividend or make any distribution on shares of Common Stock held in treasury by the ~~treasury~~ Company. If any dividend or distribution of the ~~Company~~type described in this Section 11.02(a) is declared but not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. (2b) ~~In case at any time after the Closing Date,~~ If the Company ~~shall issue~~ distributes to holders of all or substantially all the Common Stock any rights or warrants ~~to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them for a period of not more than 60 calendar days to subscribe for or purchase shares of Common Stock at a price per share less than the ~~current market price per share (determined as provided in paragraph (8)~~ average of ~~this Section 15.4)~~ the Last Reported Sale Prices of the Common Stock for the 10 consecutive Trading-Day period ending on the Trading Day immediately preceding the date of announcement of such distribution, the Conversion Rate will be adjusted based on the following formula: CR’=CR0 x OS0+X OS0+Y where, CR0 = the Conversion Rate in effect immediately prior the Ex-Dividend Date for such distribution CR’ = the Conversion Rate in effect immediately after such Ex-Dividend Date OS0 = the number of shares of Common Stock outstanding immediately after such Ex-Dividend Date X = the total number of shares of Common Stock issuable pursuant to such rights or warrants Y = the number of shares of Common Stock equal to the aggregate price payable to exercise such rights or warrants divided by the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading-Day period ending on the Trading Day immediately preceding the date of announcement of the distribution of such rights or warrants Such adjustment shall be successively made whenever any such rights or warrants are issued and shall become effective immediately after 9:00 a.m., New York City time, on the Business Day following the date fixed for such determination. The Company shall not issue any such rights, options or warrants in respect of shares of Common Stock held in treasury by the ~~determination~~ Company. To the extent that shares of ~~stockholders entitled to receive~~ Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate ~~in effect at the opening of business on the day following the date fixed for such determination~~ shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase readjusted to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate ~~pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration~~ that would then be ~~recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments~~ in ~~the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall~~ are not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)so issued, the Conversion Rate shall again be adjusted ~~so that the same shall equal the rate determined by dividing~~ to be the Conversion Rate that would then be in effect ~~immediately prior to the close of business on the~~ if such date fixed for the determination of stockholders entitled to receive such ~~distribution by a fraction~~ rights or warrants had not been fixed. In determining whether any rights or warrants entitle the Holders to subscribe for or purchase shares of ~~which~~ Common Stock at less than such Last Reported Sale Price, and in determining the ~~numerator~~ aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the ~~current market price per share~~ Company for such rights or warrants and any amount payable on exercise or conversion thereof, the value of such consideration, if other than cash, to be determined by the Company’s Board of Directors. (~~determined~~ c) If the Company distributes shares of capital stock of the Company, evidences of its indebtedness or other assets or property of the Company to holders of all or substantially all the Common Stock, excluding: (i) dividends or distributions and rights or warrants referred to in clause (a) or (b) above; (ii) dividends or distributions paid exclusively in cash; and (iii) as ~~provided~~ described below in ~~paragraph~~ this subsection (8) c) with respect to Spin-Offs then the Conversion Rate will be adjusted based on the following formula: CR’=CR0 x SP0 SP0-FMV where, CR0 = the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such distribution CR’ = the Conversion Rate in effect immediately after such Ex-Dividend Date SP0 = the average of ~~this Section 15.4)~~ the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading-Day period ending on the ~~date fixed~~ Trading Day immediately preceding the Ex-Dividend Date for such ~~determination less~~ distribution FMV = the ~~then fair market value~~ Fair Market Value (~~each reference to "fair market value" in this Section 15.4 shall mean the fair market value~~ as determined by the Company’s Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolutionDirectors) of the ~~portion~~ shares of ~~the~~ capital stock, evidences of indebtedness, assets or ~~evidences of indebtedness so~~ property distributed ~~applicable~~ with respect to ~~one (1)~~ each outstanding share of Common Stock ~~and~~ on the ~~denominator~~ Record Date for such distribution. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately prior to ~~the opening of business~~ 9:00 a.m., New York City time, on the ~~day~~ Business Day following the date fixed for the determination of stockholders entitled to receive such distribution~~. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute~~ . With respect to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no an adjustment pursuant to this ~~paragraph~~ clause (5c) ~~or paragraph (6) of this Section 15.4~~ where there has been ~~made and (z) the aggregate~~ a payment of ~~any cash plus the fair market value of~~ a dividend or other ~~consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of~~ distribution on the Common Stock ~~concluded within the twelve (12) months preceding the date of payment of such distribution and~~ in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of ~~Common Stock entitled~~ capital stock of any class or series, or similar equity interest, of or relating to ~~receive such distribution times the number of shares of Common Stock outstanding on such date~~a Subsidiary or other business unit (a “Spin-Off”), ~~then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing~~ the Conversion Rate in effect immediately prior to ~~the close of business~~ 5:00 p.m., New York City time, on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such ~~reclassification~~ Spin-Off will be increased based on the following formula: CR’=CR0 x FMV0+MP0 MP0 where, CR0 = the Conversion Rate in effect immediately prior to 5:00 p.m., New York City time, on the effective date of the Spin-Off CR’ = the Conversion Rate in effect immediately after the effective date of the Spin-Off FMV0 = the average of the Last Reported Sale Prices of the capital stock or similar equity interest distributed to Holders of Common Stock applicable to one share of Common Stock over the first 10 consecutive Trading-Day period from, and including, the effective date of the Spin-Off MP0 = the average of the Last Reported Sale Prices of Common Stock over the first 10 consecutive Trading-Day period from, and including, the effective date of the Spin-Off. Such adjustment shall occur on the tenth Trading Day from, and including, the effective date of the Spin-Off and shall be applied on a retroactive basis from, and including, the effective date of the Spin-Off; provided that in respect of any conversion occurring prior to the effective date of the Spin-Off with respect to which the related Observation Period would conclude during the 10 Trading Days from, and including, the effective date of any Spin-Off, references with respect to the Spin-Off to the 10 consecutive Trading-Day period shall be deemed ~~to be "the date fixed for the determination of stockholders entitled to receive~~ replaced with such ~~distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the~~ lesser number of ~~shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and~~ Trading Days as have elapsed between the effective date of such ~~reclassification~~ Spin-Off and the last day of the related Observation Period in determining the applicable Conversion Rate; provided further that in respect of any conversion occurring prior to the effective date of the Spin-Off with respect to which the related Observation Period would conclude during the three Trading Days from, and including, the effective date of such Spin-Off, references to the 10 consecutive Trading-Day period shall be deemed replaced with a three consecutive Trading-Day period with such adjustment to ~~be "~~the ~~day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be~~Conversion Rate being applied on a retroactive basis from, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4including, the ~~current market price per share of Common Stock on any~~ effective date ~~shall be calculated by the Company and be deemed to be the average~~ of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distributionSpin-Off. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 2 contracts

Samples: Indenture (Newmont Mining Corp /De/), Indenture (Newmont Mining Corp /De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to ~~time~~ time, without duplication, as follows: (1a) In case ~~at any time after~~ the ~~Closing Date the Company shall~~ Issuer shall: (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, exclusively in shares of its capital stock, on the Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; (iii) combine its outstanding Common Stock into a smaller number of shares; or (iv) reclassify its Common Stock, the Conversion Rate in effect immediately prior to the record date or effective date, as the case may be, for the adjustment pursuant to this Section 6.06(a) as described below, shall be adjusted so that the Holder of any 2023 Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock of the Issuer which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such 2023 Notes been converted immediately prior to such record date or effective date, as the case may be. An adjustment made pursuant to this Section 6.06(a) shall become effective immediately after the applicable record date in the case of a dividend or distribution and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Issuer's Common Stock. If any dividend or distribution of the type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. (b) In case the Issuer shall issue rights or warrants to all holders of the Common Stock entitling them (for a period expiring within 60 days after the date of issuance of such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Market Price per share of ~~business~~ Common Stock on the ~~day following the~~ record date fixed for ~~the~~ determination of ~~stockholders~~ shareholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately after such record date shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately after such record date by a fraction of which (i) the numerator shall be the number of shares of Common Stock outstanding at on such record date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and (ii) the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such record date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at the Market Price per share of Common Stock on the earlier of such ~~dividend~~ record date or ~~other distribution~~the Trading Day immediately preceding the ex date for such issuance of rights or warrants. Such adjustment shall be made successively whenever any such rights or warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the record date for the determination of shareholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such record date for the determination of shareholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Issuer for such rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (c) In case the Issuer shall, by dividend or otherwise, distribute to all holders of Common Stock any assets, debt securities or rights or warrants to purchase any of its securities (excluding (i) any dividend, distribution or issuance covered by those referred to in Section 6.06(a) or Section 6.06(b) hereof and (ii) any dividend or distribution paid exclusively in cash) (any of the foregoing hereinafter in this Section 6.06(c) called the "Distributed Assets or Securities") in an aggregate amount per share of Common Stock that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 6.06(c) has been made, exceeds 15% of the Market Price on the Trading Day immediately preceding the declaration of such distribution, then the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date mentioned below by a fraction of which (A) the numerator shall be the Market Price per share of the Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex date for such dividend or distribution, and (B) the denominator shall be (1) the Market Price per share of the Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex date for such dividend or distribution less (2) the Fair Market Value on the earlier of such record date or the Trading Day immediately preceding the ex date for such dividend or distribution (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such distribution; provided, however, that, if (i) the Fair Market Value of the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the record date for the determination of shareholders entitled to receive such distribution or (ii) the Market Price of the Common Stock on the record date for the determination of shareholders entitled to receive such distribution is greater than the Fair Market Value per share of such Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights or warrants comprising the Distributed Assets or Securities the Holder would have received had such Holder converted such 2023 Notes immediately prior to the record date for the determination of shareholders entitled to receive such distribution. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. (d) In case the Issuer shall make (i) any distributions, by dividend or otherwise, during any quarterly fiscal periods consisting exclusively of cash to all holders of outstanding shares of Common Stock in an aggregate amount that, together with (ii) other all-cash or all-check distributions made to all holders of outstanding shares of Common Stock during such quarterly fiscal period, and (iii) any cash and the Fair Market Value, as of the expiration of any tender or exchange offer (other than consideration payable in respect of any odd-lot tender offer) of consideration payable in respect of any tender or exchange offer by the Issuer or any of the Issuer's Subsidiaries for all or any portion of shares of Common Stock concluded during such quarterly fiscal period, exceed the product of $0 multiplied by the number of shares of Common Stock outstanding on the record date for such distribution, then, and in each such case, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive such ~~determination~~distribution by a fraction of which (A) the numerator shall be the Market Price per share of the Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex date for such dividend or distribution and (B) the denominator shall be (1) the Market Price per share of Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex date for such dividend or distribution plus (2) $0 less (3) an amount equal to the quotient of (x) the combined amount distributed or payable in the transactions described in clauses (i), (ii) and (iii) above during such quarterly fiscal period and (y) the number of shares of Common Stock outstanding on such record date, such adjustment to become effective immediately after the record date for the determination of shareholders entitled to receive such distribution. (e) With respect to Section 6.06(c) hereof, in the event that the Issuer makes any distribution to all holders of Common Stock consisting of Equity Interests in a Subsidiary or other business unit of the Issuer, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive such distribution by a fraction of which (i) the numerator shall be (x) the Spin-off Market Price per share of the Common Stock on such record date plus (y) the Spin-off Market Price per Equity Interest of the Subsidiary or other business unit of the Issuer on such record date and (ii) the denominator shall be the Spin-off Market Price per share of the Common Stock on such record date, such adjustment to become effective 10 Trading Days after the effective date of such distribution of Equity Interests in a Subsidiary or other business unit of the Issuer. (f) Upon conversion of the 2023 Notes, the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under any future shareholder rights plan the Issuer implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion) unless, prior to conversion, the rights have expired, terminated or been redeemed or exchanged in accordance with such rights plan. If, and only if, the Holders of 2023 Notes receive rights under such shareholder rights plans as described in the preceding sentence upon conversion of their 2023 Notes, then no other adjustment pursuant to this Section 6.06 shall be made in connection with such shareholder rights plans. (g) For ~~the~~ purposes of this ~~paragraph (1)~~Section 6.06, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the ~~Company~~ Issuer but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The ~~Company will~~ Issuer shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the ~~Company~~Issuer. (2h) ~~In case at any time after~~ Notwithstanding the ~~Closing Date~~foregoing, ~~the Company~~ in no event shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate ~~in effect at~~ exceed the ~~opening~~ maximum conversion rate specified under this Section 6.06(h) (the "Maximum Conversion Rate") as a result of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment ~~in the Conversion Rate~~ pursuant to ~~this subsection (2), if any such right or warrant shall expire~~ Section 6.06(c) and ~~shall not have been exercised, the~~ Section 6.06(d) hereof. The Maximum Conversion Rate shall ~~immediately upon such expiration~~ initially be ~~recomputed~~ 138.6963 and ~~effective immediately upon such expiration~~ shall be ~~increased~~ appropriately adjusted from time to ~~the price which it would have been (but reflecting~~ time for any ~~other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights~~ stock dividends on or ~~warrants) had the adjustment~~ subdivisions or combinations of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Maximum Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up not apply to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been adjustments made pursuant to ~~such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including~~ any ~~tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date~~ of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to events in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (56.06(a) or (6Section 6.06(b) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distributionhereof. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 2 contracts

Samples: Supplemental Indenture (CMS Energy Corp), Supplemental Indenture (Consumers Energy Co)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall pay a dividend or make a ~~dividend or other~~ distribution ~~on any class~~ of ~~Capital Stock of the Company (other than the Series C Preferred Stock) in~~ shares of Common Stock on its Common Stock, the Conversion Rate shall be increased so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect at immediately prior to the ~~opening~~ close of business on the ~~day following the~~ record date ~~fixed~~ for ~~the determination of stockholders entitled to receive~~ such dividend or other distribution by a fraction, (i) the numerator of which shall be ~~increased by dividing~~ the sum of the number of shares of Common Stock outstanding at the close of business on such ~~Conversion Rate by a fraction~~ record date plus the total number of shares of Common Stock constituting such dividend or other distribution; and (ii) the denominator of which ~~the numerator~~ shall be the number of shares of Common Stock outstanding at the close of business on ~~the date fixed for~~ such ~~determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution~~record date, such increase to become effective immediately after the opening of business on ~~the day following the date fixed for~~ such ~~determination~~record date. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay If any dividend or ~~make any~~ distribution ~~on shares of Common Stock held in the treasury~~ of the ~~Company~~type described in this Section 12.06(a) is declared but not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. (2b) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of its Common Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 45 days after the date of issuance of such rights or warrants) to subscribe for or purchase ~~shares of~~ Common Stock (or securities convertible into Common Stock) at a price per share less than the ~~current market price~~ Current Market Price (as defined below) per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4) of the~~ Common Stock on the record date ~~fixed~~ for ~~the determination~~ such issuance of ~~stockholders entitled to receive such~~ rights or warrants, the Conversion Rate in effect at immediately shall be increased so that the ~~opening~~ same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on ~~the day following the~~ such record date ~~fixed for such determination shall be increased by dividing such Conversion Rate~~ by a ~~fraction~~ fraction, (i) the numerator of which ~~the numerator~~ shall be the number of shares of Common Stock outstanding at on such record date plus the ~~close~~ number of ~~business~~ additional shares of Common Stock offered for subscription or purchase pursuant to such rights or warrants, and (ii) the denominator of which shall be the number of shares of Common Stock outstanding on ~~the~~ such record date ~~fixed for such determination~~ plus the number of shares of Common Stock ~~which~~ that could be purchased at the Current Market Price (as defined below) on such record date with the aggregate ~~of the~~ offering price of the total number of shares of Common Stock ~~so offered for subscription~~ that could be purchase pursuant to such rights or ~~purchase would purchase at such current market price and the denominator~~ warrants. Such adjustment shall be ~~the number of shares of Common Stock outstanding at the close of business on the date fixed for~~ made successively whenever any such ~~determination plus the number of shares of Common Stock so offered for subscription~~ rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the record date ~~fixed~~ for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants~~) had~~ . To the ~~adjustment~~ extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2)~~are not so issued, the ~~number of~~ Conversion Rate shall again be adjusted to be the Conversion Rate that would be in effect if such rights or warrants had not been issued. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at ~~any time outstanding shall not include shares held~~ less than such Current Market Price, and in determining the ~~treasury~~ aggregate offering price of ~~the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of~~ such shares of Common Stock~~. The~~ , there shall be taken into account any consideration received by the Company ~~will not issue any~~ for such rights or ~~warrants in respect~~ warrants, the value of ~~shares~~ such consideration, if other than cash, to be determined by the Board of ~~Common Stock held in the treasury of the Company~~Directors. (3c) In case ~~at any time after the Closing Date,~~ outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately ~~increased and~~increased, and conversely, in case ~~at any time after the date hereof,~~ outstanding shares of Common Stock shall ~~each~~ be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4d) In case ~~at any time after the Closing Date,~~ the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding (x) any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, (y) distributions referred to in Sections 12.06(a) and 12.06(b) hereof or (z) distributions paid exclusively in cash) its Capital Stock (other than Common Stock), evidences of its ~~indebtedness or assets (including stock or other securities of the Company or any other issuer~~indebtedness, ~~but excluding any~~ cash, rights or warrants ~~referred to~~ or other assets, including securities (any of the foregoing hereinafter in ~~paragraph (2) of~~ this Section ~~15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1~~12.06(d) ~~of this Section 15.4)~~called the "DISTRIBUTED ASSETS") then, the Conversion Rate shall be ~~adjusted~~ increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the close of business on the record date ~~fixed for the determination of stockholders entitled~~ with respect to ~~receive~~ such distribution by a ~~fraction~~ fraction, (i) the numerator of which ~~the numerator~~ shall be the ~~current market price~~ Current Market Price per share of the Common Stock on such record date, and (ii) the denominator of which shall be the Current Market Price per share of the Common Stock on such record date less the Fair Market Value on such record date (as determined ~~as provided~~ by the Board of Directors, whose determination shall be conclusive, and described in ~~paragraph~~ an Officers' Certificate filed with the Trustee and the Paying Agent) of the Distributed Assets so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the record date for such distribution; provided, however, that, if (8) x) the Fair Market Value of ~~this Section 15.4)~~ the portion of the Distributed Assets so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price of the Common Stock on the record date ~~fixed for~~ or (y) the Current Market Price of the Common Stock on the Record Date is greater than the Fair Market Value of such ~~determination~~ Distributed Assets by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the Distributed Assets the holder would have received had such holder converted such Convertible Subordinated Notes immediately prior to such record date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then ~~fair market value (each reference to "fair market value"~~ be in ~~this Section 15.4 shall mean the fair market value as determined by~~ effect if such distribution had not been declared. If the Board of Directors determines the Fair Market Value of any distribution for purposes of this Section 12.06(d) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price on the applicable Record Date. For purposes of this Section 12.06(d) and Section 12.06(a) and (b), any dividend or distribution to which this Section 12.06(d) is applicable that also includes shares of Common Stock, or such rights or warrants to subscribe for or purchase shares of Common Stock of the ~~Company~~ type described in ~~good faith~~Section 12.06(b) (or both), ~~whose determination~~ shall be ~~described in a Board Resolution, a copy of which shall~~ deemed instead to be ~~delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one~~ (1) ~~share~~ a dividend or distribution of the evidences of indebtedness, assets or shares of Capital Stock other than such shares of Common Stock or rights or warrants (and ~~the denominator~~ any Conversion Rate adjustment required by this Section 12.06(d) with respect to such dividend or distribution shall then be made) immediately followed by (2) a dividend or distribution of such ~~current market price per share~~ shares of ~~the~~ Common ~~Stock,~~ Stock or such rights or warrants (and any further Conversion Rate adjustment required by Sections 12.06(a) and (b) with respect to ~~become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive~~ such ~~distribution~~dividend or distribution shall then be made). (5e) In case ~~at any time after the Closing Date (A)~~ the Company ~~shall, by dividend or otherwise, distribute to all holders of its~~ shall make a distribution on the Common Stock consisting exclusively of cash (~~excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph~~ the "CURRENT CASH DISTRIBUTION"), but only if the sum (4the "AGGREGATE DISTRIBUTION") ~~of this Section 15.4) and (B)(I) the total~~ of (x) the ~~aggregate amount of such cash distribution~~Current Cash Distribution, plus (y) the aggregate amount of any other distributions made exclusively in cash to all holders of ~~its~~ Common Stock ~~made exclusively in cash~~ within the ~~twelve (12)~~ 12 months preceding the record date ~~of payment of such distribution~~ for the Current Cash Distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 12.06(e) ~~or paragraph (6) of this Section 15.4~~ has been ~~made and~~ made, plus (z) the aggregate amount of ~~any cash plus the fair market value of other consideration payable~~ all Excess Payments (as defined below) in respect of any tender or exchange offers or other negotiated transactions by the Company or any of its Subsidiaries for ~~all or any portion of the~~ Common Stock concluded within the ~~twelve (12)~~ 12 months preceding the record date ~~of payment of such distribution~~ for the Current Cash Distribution and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 12.06(e) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (10%)~~ 2.0% of the product of the ~~current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock~~ Current Market Price on ~~the~~ such record date ~~for the determination of holders of shares of Common Stock entitled to receive such distribution times~~ and the number of shares of Common Stock outstanding on such date, then, ~~and~~ the Conversion Rate shall be increased so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in ~~each such case,~~ effect immediately ~~after~~ prior to the close of business on the record date by a fraction, (i) the numerator of which shall be the Current Market Price per share of the Common Stock on such record date, and (ii) the denominator of which shall be the Current Market Price per share of the Common Stock on such record date less the amount of the Aggregate Distribution applicable to one share of Common Stock. Such adjustment shall become effective immediately after the record date for ~~determination~~the Current Cash Distribution. (f) In case the Company or any of its Subsidiaries shall make a payment in respect of a tender offer or exchange offer for all or any portion of Common Stock and the aggregate amount of the cash and the Fair Market Value of any other consideration included in such payment exceeds 12.5% of the product of the Current Market Price per share on the expiration date (the "OFFER EXPIRATION DATE") of such tender or exchange offer and the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the close of business on the ~~date fixed for determination of the stockholders entitled to receive such distribution~~ Offer Expiration Date by a ~~fraction~~ fraction, (i) the numerator of which shall be ~~equal to such current market price~~ the Current Market Price per share of the Common Stock on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Offer Expiration ~~Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and~~ Date, and (ii) the denominator of which shall be ~~equal to such current market price per share on such date for determination. (6) In case at any time after~~ the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price Current Market Price per share of the Common Stock ~~(determined as provided in paragraph (8) of this Section 15.4)~~ on such record date less the ~~date~~ amount of the ~~last time (the "Expiration Time") tenders could have been made pursuant~~ Excess Payments attributable to ~~such tender offer (as it may be amended) times the number of shares~~ one share of Common ~~Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case,~~ Stock. Such adjustment shall become effective immediately ~~prior to the opening of business on the day~~ after the ~~date of the~~ Offer Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares")Date. (7g) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.Article 12:

Appears in 1 contract

Samples: Indenture (Doubleclick Inc)

Adjustments to Conversion Rate. ~~The~~ Notwithstanding anything in ------------------------------ this Section 8 to the contrary, no change in the Conversion Rate shall be ~~subject~~ made until the cumulative effect of the adjustments called for by this Section 8 since the date of the last change in the Conversion Rate would change the Conversion Rate by more than 1%. However, once the cumulative effect would result in such a change, then the Conversion Rate shall be changed to reflect all adjustments called for by this Section 8 and not previously made. Subject to the foregoing, the Conversion Rate shall be adjusted from time to time as follows: (1a) In case at of any ~~time after the Closing Date the Company shall pay~~ consolidation or ~~make a dividend or other distribution on any class of Capital Stock~~ merger of the ~~Company~~ Corporation with any other corporation (other than a wholly owned subsidiary of the ~~Series C Preferred Stock)~~ Corporation), or in case of any sale or transfer of all or substantially all of the assets of the Corporation, or in case of any share exchange pursuant to which all of the outstanding shares of ~~its~~ Common ~~Stock~~Stock are converted into other securities or property, the ~~Conversion Rate in effect~~ Corporation shall, prior to or at the ~~opening~~ time of ~~business on~~ such transaction, make appropriate provision or cause appropriate provision to be made so that holders of each share of Convertible Preferred Stock then outstanding shall have the ~~day following~~ right thereafter to convert such share of Convertible Preferred Stock into the ~~date fixed for the determination~~ kind and amount of ~~stockholders entitled to receive~~ shares of stock and other securities and property receivable upon such ~~dividend~~ consolidation, merger, sale, transfer or ~~other distribution shall be increased by dividing such Conversion Rate~~ share exchange by a ~~fraction~~ holder of ~~which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ into which such share of Convertible Preferred Stock could have been converted immediately prior to the ~~close of business on the~~ effective date ~~fixed for such determination and the denominator shall be the sum~~ of such ~~number of shares and the total number of shares constituting~~ consolidation, merger, sale, transfer or share exchange. If in connection with any such ~~dividend~~ consolidation, merger, sale, transfer or ~~other distribution~~share exchange, ~~such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number~~ each holder of shares of Common Stock ~~at any time outstanding~~ is entitled to elect to receive either securities, cash or other assets upon completion of such transaction, the Corporation shall ~~not include shares held in~~ provide or cause to be provided to each holder of Convertible Preferred Stock the ~~treasury of~~ right to elect the ~~Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend~~ securities, cash or ~~make any distribution on shares of Common~~ other assets into which the Convertible Preferred Stock held in by such holder shall be convertible after completion of any such transaction on the ~~treasury of~~ same terms and subject to the ~~Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis~~ same conditions applicable to holders of the ~~Debentures upon conversion) entitling them to subscribe for or purchase shares of~~ Common Stock ~~at a price per share less than the current market price per share~~ (~~determined as provided in paragraph (8) of this Section 15.4)~~ including, without limitation, notice of the ~~Common Stock~~ right to elect, limitations on the ~~date fixed for the determination of stockholders entitled to receive~~ period in which such ~~rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination~~ election shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price made and the ~~denominator shall be~~ effect of failing to exercise the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2election), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3b) In case ~~at any time after~~ the ~~Closing Date, outstanding~~ Corporation shall (i) pay a dividend or make a distribution on its Common Stock in shares of its capital stock, (ii) subdivide its outstanding Common Stock ~~shall be subdivided~~ into a greater number of shares, (iii) combine the shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, its outstanding ~~shares of~~ Common Stock ~~shall each be combined~~ into a smaller number of ~~shares of Common Stock~~shares, ~~the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase~~ or ~~reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective.~~ (4iv) ~~In case at any time after the Closing Date, the Company shall,~~ issue by ~~dividend or otherwise, distribute to all holders~~ reclassification of its Common Stock ~~evidences~~ any shares of its ~~indebtedness or assets (including stock or other securities of the Company or any other issuer~~capital stock, ~~but excluding any rights or warrants referred to~~ then in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing each such case the Conversion Rate in effect immediately prior thereto shall be proportionately adjusted so that the holder of any Convertible Preferred Stock thereafter surrendered for conversion shall be entitled to receive, to the ~~close~~ extent permitted by applicable law, the number and kind of ~~business on~~ shares of capital stock of the ~~date fixed for the determination of stockholders~~ Corporation which such holder would have owned or have been entitled to receive after the happening of such ~~distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common~~ event had such Convertible Preferred Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective been converted immediately prior to the ~~opening of business on~~ record date for such event (or if no record date is established in connection with such event, the ~~day following the~~ effective date ~~fixed~~ for ~~the determination of stockholders entitled to receive~~ such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no action). An adjustment pursuant to this ~~paragraph~~ subparagraph (5b) shall become effective immediately after the record date in the case of a stock dividend or ~~paragraph~~ distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. (6i) In case the Corporation shall issue Additional Shares of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock ~~concluded within~~ (as defined herein) (including, without limitation, Additional Shares of Common Stock deemed to be issued pursuant to Section 8(c)(iii)) without consideration or for a consideration per share less than the ~~twelve~~ Current Market Price (12as defined herein) ~~months preceding~~ calculated as provided herein as of the date of ~~payment of~~ and immediately prior to such ~~distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made~~issue, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and then in each such ~~case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing~~ case the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such issue date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted ~~so that~~ in accordance with the ~~same shall equal~~ formula: O + N C//1//= C x O + N x P ----- M where C//1// = the ~~price determined by dividing~~ adjusted Conversion Rate. C = the current Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of Rate. O = the number of shares of Common Stock outstanding immediately prior to such ~~reclassification into~~ issue. N = the number of additional shares of Common Stock offered. P = the offering price per share of the additional shares. M = the Current Market Price per share of Common Stock immediately prior to such issue. For the purpose of such calculation, the number of shares of Common Stock outstanding immediately ~~thereafter~~ prior to such issue shall be calculated on a fully diluted basis, as if all shares of Convertible Preferred Stock and all Convertible Securities had been fully converted into shares of Common Stock immediately prior to such issuance and any outstanding warrants, options or other rights for the purchase of shares of stock or convertible securities had been fully exercised immediately prior to such issuance (and the ~~effective date~~ resulting securities fully converted into shares of Common Stock, if so convertible) as of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4)date. (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) ~~the day before the "ex" date with respect to the issuance or distribution requiring such computation.~~ For purposes of this ~~paragraph~~Section 8(c), the ~~term~~ following definitions shall apply: (A) "~~'ex' date"~~Options" shall mean rights, ~~when used with respect~~ options or warrants to ~~any issuance~~ ------- subscribe for, purchase or ~~distribution, means the first date on which the~~ otherwise acquire either Common Stock ~~trades regular way on the applicable~~ or Convertible Securities; (B) "Convertible Securities" shall mean any ---------------------- evidences of indebtedness, shares or other securities ~~exchange~~ convertible into or ~~in the applicable securities market without the right to receive such issuance or distribution.~~ exchangeable for Common Stock; (9C) ~~The Company may make such increases in the Conversion Rate, for the remaining term~~ "Additional Shares of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of Common Stock" --------------------------------- shall mean all shares of Common Stock ~~resulting from any dividend~~ issued (or, pursuant to Section 8(c)(iii), deemed to be issued) by the Corporation after July 26, 1999, other than shares of Common Stock issued or ~~distribution~~ issuable: (1) upon conversion of ~~stock~~ shares of the Convertible Preferred Stock or ~~issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.~~upon

Appears in 1 contract

Samples: Preferred Stock Purchase Agreement (New Century Financial Corp)

Appears in 1 contract

Samples: Indenture (Lear Corp /De/)

Adjustments to Conversion Rate. The Conversion Rate of each series of Securities shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) ~~In case~~ If the Company shall at any time ~~after~~ prior to the ~~Closing Date~~ Stated Maturity subdivide the ~~Company shall pay or make a dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock) in~~ shares of ~~its~~ Common Stock, by split-up or otherwise, or combine the shares of Common Stock, or issue additional shares of Common Stock as a dividend, the Conversion Rate shall be adjusted by multiplying the Conversion Rate in effect ~~at the opening of business on the day following the date fixed for the determination of stockholders entitled~~ immediately prior to ~~receive~~ such ~~dividend or other distribution shall be increased by dividing such Conversion Rate~~ event by a ~~fraction~~ fraction, the numerator of which ~~the numerator~~ shall be the number of shares of Common Stock outstanding ~~at the close of business on the date fixed for~~ immediately after such ~~determination~~ event, and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which ~~the numerator~~ shall be the number of shares of Common Stock ~~outstanding~~ immediately prior to such event. Any adjustment under this Section 12.2(a) shall become effective at the close of business on the date ~~fixed for such determination plus~~ the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective, or as of the Dividend Record Date of such dividend, or in the event that no record date is fixed, upon the making of such dividend. (4b) ~~In case at any time after~~ Notwithstanding the ~~Closing Date~~foregoing, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate no adjustment shall be ~~adjusted so that the same~~ made hereunder, nor shall ~~equal the rate determined by dividing the Conversion Rate in effect immediately prior~~ an adjustment be made to the ~~close~~ ability of ~~business~~ a Holder of a Security to convert, for any distribution described herein if the Holder will otherwise participate on an as-converted basis in the ~~date fixed for the determination~~ distribution without conversion of ~~stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distributionHolder’s Securities. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9c) The Company may (but is not required to) make such increases in the Conversion Rate, ~~for the remaining term of the Debentures or any shorter term,~~ in addition to those required by ~~paragraphs (1), (2), (3), (4), (5~~Section 12.2(a) ~~and (6)~~ as the Board of ~~this Section 15.4, as it~~ Directors considers to be advisable ~~in order~~ to avoid or diminish any income tax to ~~any~~ holders ~~of shares~~ of Common Stock ~~resulting from any~~ or rights to purchase Common Stock in connection with a dividend or distribution of ~~stock~~ shares (or ~~issuance of~~ rights to acquire shares) or ~~warrants to purchase or subscribe for stock or from~~ any similar event treated as such for income tax ~~purposes or~~ purposes. To the extent permitted by applicable law, the Company from time to time may increase the Conversion Rate by any amount for any period of at least 20 days if the Board of Directors shall have made a determination that such increase would be in the best interests of the Company, which determination shall be conclusive. (d) Except as stated herein, the Company will not adjust the Conversion Rate for the issuance of shares of Common Stock or any securities convertible into or exchangeable for shares of Common Stock or the right to purchase shares of Common Stock or such convertible or exchangeable securities. For the avoidance of doubt, no adjustment to the Conversion Rate need be made: (1) upon the issuance of any shares of Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on securities of the Company and the investment of additional optional amounts in shares of Common Stock under any plan; (2) upon the issuance of any shares of Common Stock or options or rights to purchase shares of Common Stock pursuant to any present equity participation plan or employee, director or consultant benefit plan or program of or assumed by the Company or any of its Subsidiaries; (3) upon the issuance of any shares of Common Stock pursuant to any option, warrant, right, or exercisable, exchangeable or convertible security not described in (2) above and outstanding as of the date the Securities were first issued; (4) for a change in the par value of the Common Stock; or (5) for accrued and unpaid interest. (e) [All calculations under this Article XII shall be made by the Company and shall be made to the nearest cent or to the nearest one-ten thousandth (1/10,000) of a share, as the case may be. The Company will not be required to make an adjustment in the Conversion Rate unless the adjustment would require a change of at least 1% in the Conversion Rate. However, the Company will carry forward any adjustments that are less than 1% of the Conversion Rate and make such carried forward adjustments, regardless of whether aggregate adjustment is less than 1% within one year of the first such adjustment carried forward, upon redemption, upon conversion, upon a Change of Control or upon the Stated Maturity.] (f) Whenever the Conversion Rate is adjusted as herein provided, the Company shall promptly file with the Trustee and any Conversion Agent other ~~reasons~~than the Trustee an Officers’ Certificate setting forth the Conversion Rate after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Unless and until a Trust Officer of the Trustee shall have received such Officers’ Certificate, the Trustee shall not be deemed to have knowledge of any adjustment of the Conversion Rate and may assume that the last Conversion Rate of which it has knowledge is still in effect. Promptly after delivery of such certificate, the Company shall prepare a notice of such adjustment of the Conversion Rate setting forth the adjusted Conversion Rate and the date on which each adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Rate to each Securityholder at his last address appearing on the Securities Register within 20 days after execution thereof. Failure to deliver such notice shall not affect the legality or validity of any such adjustment.

Appears in 1 contract

Samples: Indenture (Interstate Bakeries Corp/De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of its capital stock, on its Common Stock; (b) subdivide its outstanding Common Stock into a greater number of shares; (c) combine its outstanding Common Stock into a smaller number of shares; or (d) reclassify its Common Stock, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on~~ any CZARS thereafter surrendered for conversion shall be entitled to receive the ~~day following~~ number of shares of Common Stock of the Company which such holder would have owned or have been entitled to receive after the happening of any of the events described above had such CZARS been converted immediately prior to the happening of such event. If any dividend or distribution of the type described in clause (a) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. An adjustment made pursuant to this Section 2.07(1) shall become effective immediately after the applicable Record Date in the case of a dividend and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Company's Common Stock. (2) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the Sale Price per share of Common Stock at the Record Date for the determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately prior thereto shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of the issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed~~ of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Sale Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of the stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Sale Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such ~~determination~~rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (3) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in Section 2.07(2) hereof) (any of the foregoing hereinafter in this Section 2.07(3) called the "Distributed Assets or Securities") in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 2.07(3) has been made, exceeds 15% of the product of the Market Price on the day preceding the declaration of such distribution times the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the Market Price per share of the Common Stock on the Record Date mentioned below, and the denominator shall be the Market Price per share of the Common Stock on such Record Date less the fair market value on such Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the Record Date for the determination of stockholders entitled to receive such distribution; provided, however, that no adjustment will be made in respect of any such dividends and distributions that result in the payment of any contingent interest to the Holders; provided, further, that, if the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is (a) equal to or greater than the Sale Price of the Common Stock on the Record Date or (b) the Sale Price of the Common Stock on the Record Date is greater than the fair market value of the Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights warrants or options the Holder would have received had such Holder converted such CZARS immediately prior to such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. Notwithstanding the foregoing provisions of Section 2.07(2) or (3), no adjustment shall be made thereunder for any distribution described therein if the Company makes proper provision so that each Holder of a CZARS who converts such CZARS (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of assets or Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such CZARS for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such CZARS would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such CZARS. Upon conversion of the CZARS the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under the Company's existing stockholder rights plan and any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). No adjustment pursuant to this Section 2.07 shall be made in connection with such stockholder rights plans. (4) For ~~the~~ purposes of this ~~paragraph (1)~~Section 2.07, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Supplemental Indenture (Us Bancorp \De\)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of ~~its~~ Common Stock or other capital stock, on Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on the day following the date fixed~~ any Note thereafter surrendered for ~~the determination of stockholders~~ conversion shall be entitled to receive ~~such dividend or other distribution shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ which such holder would have owned or have been entitled to receive after the ~~close~~ happening of ~~business on~~ any of the ~~date fixed for~~ events described above had such ~~determination and~~ Note been converted immediately prior to the ~~denominator shall be the sum~~ happening of such ~~number~~ event. If any dividend or distribution of ~~shares and~~ the ~~total number of shares constituting~~ type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or ~~other distribution, such increase~~ distribution had not been declared. An adjustment made pursuant to this Section 4.06 shall become effective immediately after the ~~opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of~~ Common Stock ~~at any time outstanding shall not include shares held~~ Record Date in the ~~treasury~~ case of a dividend and shall become effective immediately after the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held effective date in the ~~treasury~~ case of ~~the Company~~subdivision or combination. (2b) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of any class or series of its Common Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase ~~shares of~~ Common Stock at a price per share less than the ~~current market price~~ Sale Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4)~~ Common Stock on the day preceding the date of announcement of the Common Stock ~~on the date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening of business on~~ same shall equal the ~~day following~~ Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date ~~fixed for~~ of the issuance of such ~~determination shall be increased by dividing such Conversion Rate~~ rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of additional shares of Common Stock ~~which the aggregate of the offering price of the total number of shares of Common Stock so~~ offered for subscription or ~~purchase would purchase at such current market price~~ purchase, and of which the denominator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of shares which the aggregate offering price of ~~Common Stock~~ the total number of shares so offered ~~for subscription~~ would purchase at such Sale Price. Such adjustment shall be made successively whenever any such rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Common Stock Record Date for the determination of the stockholders entitled to receive such ~~determination~~rights or warrants. ~~However, upon~~ To the extent that shares of Common Stock are not delivered after the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2)~~are not so issued, the ~~number~~ Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Common Stock Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at ~~any time outstanding shall not include shares held~~ less than such Sale Price, and in determining the ~~treasury~~ aggregate offering price of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of such shares of Common Stock, ~~the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective~~ there shall be ~~proportionately increased and, conversely, in case at~~ taken into account any ~~time after~~ consideration received by the ~~date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock~~Company for such rights or warrants, the ~~Conversion Rate in effect at the opening~~ value of ~~business on the day following the day upon which~~ such ~~combination becomes effective shall be proportionately reduced~~consideration, ~~such increase or reduction, as the case may be~~if other than cash, to ~~become effective immediately after~~ be determined by the ~~opening~~ Board of ~~business on the day following the day upon which such subdivision or combination becomes effective~~Directors. (4c) In case ~~at any time after the Closing Date,~~ the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets (~~including stock~~ other than Cash dividends or other ~~securities of~~ Cash distributions from the ~~Company~~ Company's current or ~~any other issuer, but excluding any~~ retained earnings) or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in ~~paragraph~~ Section 4.06(b)) (2) any of the foregoing hereinafter in this Section ~~15.4~~4.06(c) called the "Distributed Securities"), ~~any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)~~then, the Conversion Rate shall be adjusted so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ date of ~~business on the date fixed for the determination of stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the ~~date fixed for~~ Common Stock Record Date mentioned below, and the denominator shall be the Sale Price per share of the Common Stock on such ~~determination~~ Common Stock Record Date less ~~the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ the fair market value on such Common Stock Record Date (as determined by the Board of ~~Directors of the Company in good faith~~Directors, whose determination shall be conclusive, and described in a ~~Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of~~ certificate filed with the ~~adoption of the resolution~~Trustee) of the ~~portion of the assets or evidences of indebtedness~~ Distributed Securities so distributed applicable to one ~~(1)~~ share of Common ~~Stock and the denominator~~ Stock. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately ~~prior to~~ after the ~~opening of business on the day following the date fixed~~ Common Stock Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event (a) the then fair market value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Common Stock Record Date or (b) such Market Price exceeds the fair market value of such Distributed Securities by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Note on such Common Stock Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.06(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market on the same day used in computing the Sale Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 4.06(c), no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Note who converts such Note (or any portion thereof) after the Common Stock Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of Distributed Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Common Stock Record Date, converted such Note for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Note would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Note. (5d) In case ~~at any time after the Closing Date (A)~~ the Company shall, by dividend or otherwise, distribute to all holders of any class of its Common Stock ~~cash~~ Cash (excluding any ~~cash~~ Cash that is distributed upon a merger or consolidation to which Section ~~15.13 applies or as part of a distribution referred to~~ 4.07(f) applies) in ~~paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the~~ an aggregate amount ~~of such cash distribution~~that, combined together with (yi) the aggregate amount of any other such distributions to all holders of any class of its Common Stock made exclusively in ~~cash~~ Cash within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 4.06(d) ~~or paragraph (6) of this Section 15.4~~ has been ~~made~~ made, and (zii) the aggregate of any ~~cash~~ Cash plus the fair market value of other consideration (as so determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee) payable in respect of any tender ~~offers~~ offer by the Company ~~or any of its Subsidiaries~~ for all or any portion of ~~the~~ any class of its Common Stock concluded within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to ~~this paragraph (5~~Section 4.06(e) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock~~ Sale Price on the day preceding the date ~~for the determination~~ of ~~holders~~ declaration of ~~shares of Common Stock entitled to receive~~ such dividend or distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such ~~date for determination~~date, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ Common Stock Record Date by a fraction of which the numerator shall be such Sale Price of the Common Stock and the denominator shall be such Sale Price of the Common Stock less the amount of Cash and the fair market value (as so determined) of such other consideration so distributed (and not excluded as provided above) applicable to one share of Common Stock, such increase to be effective immediately prior to the opening of business on the ~~date fixed~~ day following the Common Stock Record Date; provided, however, that no adjustment will be made in respect of any such dividends and distributions that are paid during any period for ~~determination~~ which the Company is paying contingent interest to Holders; provided, further, that, if the portion of the ~~stockholders entitled~~ cash so distributed applicable to ~~receive such distribution by a fraction~~ one share of Common Stock is (i) equal to or greater than the ~~numerator~~ Market Price of ~~which~~ the Common Stock on the day preceding the date of declaration of such dividend or distribution or (ii) the Market Price of the Common Stock on the day preceding the date of declaration of such dividend or distribution is greater than the fair market value of the consideration distributed pursuant to Section 4.06(e) by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be ~~equal~~ made so that each Holder shall have the right to ~~such current market price per share on the date fixed for such determination less an amount equal~~ receive upon conversion, in addition to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock, Cash and other consideration the Holder would have received had such Holder converted such Note immediately prior to such Common Stock ~~purchased~~ Record Date. If such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such ~~tender offer~~ dividend or distribution had not been declared. If any adjustment is required to be made as set forth in this Section 4.06(d) as a result of a distribution that is a quarterly dividend, such adjustment shall be based upon the amount by which such distribution exceeds the amount of the ~~Expiration Time (~~quarterly cash dividend permitted to be excluded pursuant hereto. If an adjustment is required to be made as ~~hereinafter defined~~set forth in this Section 4.06(d) ~~for~~ above as a result of a distribution that is not a quarterly dividend, such ~~tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which~~ adjustment shall be ~~equal to such current market price per share on such date for determination~~based upon the full amount of the distribution. (6e) In case ~~at any time after the Closing Date (A)~~ a tender offer made by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the~~ any class of its Common Stock ~~shall expire~~ expires and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased ~~Shares~~ Shares) for an aggregate consideration having a fair market value (as ~~defined below))~~determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that, combined together with (ya) the aggregate of the ~~cash~~ Cash plus the fair market ~~value~~value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), as of the expiration of such tender offer, of consideration payable in respect of any other tender ~~offer~~offers, by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the~~ any class of its Common Stock expiring within the ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this ~~paragraph (6~~Section 4.06(e) ~~or paragraph (5) of this Section 15.4~~ has been ~~made~~ made, and (zb) the aggregate amount of any distributions to all holders of the ~~Company's~~ Common Stock made exclusively in ~~cash~~ Cash within ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to ~~this paragraph (6) or paragraph (5) of this~~ Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.4.06

Appears in 1 contract

Samples: First Supplemental Indenture (Masco Corp /De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, exclusively in shares of its capital stock, on its Common Stock; (b) subdivide its outstanding Common Stock into a greater number of shares; (c) combine its outstanding Common Stock into a smaller number of shares; or (d) reclassify its Common Stock, the Conversion Rate in effect immediately prior to the effective date for the adjustment pursuant to this Section 2.07(1), as described below, shall be adjusted so that the Holder of any Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock of the Company which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to such effective date. If any dividend or distribution of the type described in clause (a) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. An adjustment made pursuant to this Section 2.07(1) shall become effective immediately after the applicable Record Date in the case of a dividend and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Company's Common Stock. (2) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date of issuance of such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Market Price per share of ~~business~~ Common Stock on the ~~day following the date~~ Record Date fixed for ~~the~~ determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately after such Record Date shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately after such Record Date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at on such Record Date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such Record Date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Market Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such ~~determination~~rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (3) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in Section 2.07(2) hereof) (any of the foregoing hereinafter in this Section 2.07(3) called the "Distributed Assets or Securities") in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 2.07(3) has been made, exceeds 15% of the product of the Market Price on the Trading Day immediately preceding the declaration of such distribution and the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date mentioned below by a fraction of which the numerator shall be the Market Price per share of the Common Stock on such Record Date, and the denominator shall be the Market Price per share of the Common Stock on such Record Date less the Fair Market Value on such Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the Record Date for the determination of stockholders entitled to receive such distribution; provided, however, that no adjustment will be made in respect of any such dividends and distributions that result in the payment of any contingent interest to the Holders; provided, further, that, if (a) the Fair Market Value of the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Record Date or (b) the Market Price of the Common Stock on the Record Date is greater than the Fair Market Value of such Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights, warrants or options the Holder would have received had such Holder converted such Notes immediately prior to such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. (4) Notwithstanding the foregoing provisions of Section 2.07(2) or (3), no adjustment shall be made thereunder for any distribution described therein if the Company makes proper provision so that each Holder who converts its Notes (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of assets or securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such Notes for Common Stock; provided that, with respect to any Distributed Assets or Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Assets or Securities receivable upon conversion of such Notes would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Notes. (5) Upon conversion of the Notes, the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). No adjustment pursuant to this Section 2.07 shall be made in connection with such stockholder rights plans. (6) For ~~the~~ purposes of this ~~paragraph (1)~~Section 2.07, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Third Supplemental Indenture (Interpublic Group of Companies Inc)

Adjustments to Conversion Rate. ~~The~~ Notwithstanding anything in this Section 8 to the contrary, no change in the Conversion Rate shall be ~~subject~~ made until the cumulative effect of the adjustments called for by this Section 8 since the date of the last change in the Conversion Rate would change the Conversion Rate by more than 1%. However, once the cumulative effect would result in such a change, then the Conversion Rate shall be changed to reflect all adjustments called for by this Section 8 and not previously made. Subject to the foregoing, the Conversion Rate shall be adjusted from time to time as follows: (1a) In case at of any ~~time after the Closing Date the Company shall pay~~ consolidation or ~~make a dividend or other distribution on any class of Capital Stock~~ merger of the Company with any other corporation (other than a wholly owned subsidiary of the ~~Series C Preferred Stock)~~ Company), or in case of any sale or transfer of all or substantially all of the assets of the Company, or in case of any share exchange pursuant to which all of the outstanding shares of ~~its~~ Common ~~Stock~~Stock are converted into other securities or property, the ~~Conversion Rate in effect~~ Company shall, prior to or at the ~~opening~~ time of ~~business on~~ such transaction, make appropriate provision or cause appropriate provision to be made so that holders of each share of Preferred Stock then outstanding shall have the ~~day following~~ right thereafter to convert such share of Preferred Stock into the ~~date fixed for the determination~~ kind and amount of ~~stockholders entitled to receive~~ shares of stock and other securities and property receivable upon such ~~dividend~~ consolidation, merger, sale, transfer or ~~other distribution shall be increased by dividing such Conversion Rate~~ share exchange by a ~~fraction~~ holder of ~~which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ into which such share of Preferred Stock could have been converted immediately prior to the ~~close~~ effective date of ~~business~~ such consolidation, merger, sale, transfer or share exchange. If in connection with any such consolidation, merger, sale, transfer or share exchange, each holder of shares of Common Stock is entitled to elect to receive either securities, cash or other assets upon completion of such transaction, the Company shall provide or cause to be provided to each holder of Preferred Stock the right to elect the securities, cash or other assets into which the Preferred Stock held by such holder shall be convertible after completion of any such transaction on the same terms and subject to the same conditions applicable to holders of the Common Stock (including, without limitation, notice of the right to elect, limitations on the period in which such election shall be made and the effect of failing to exercise the election). (b) In case the Company shall (i) pay a dividend or make a distribution on its Common Stock in shares of its capital stock, (ii) subdivide its outstanding Common Stock into a greater number of shares, (iii) combine the shares of its outstanding Common Stock into a smaller number of shares, or (iv) issue by reclassification of its Common Stock any shares of its capital stock, then in each such case the Conversion Rate in effect immediately prior thereto shall be proportionately adjusted so that the holder of any Preferred Stock thereafter surrendered for conversion shall be entitled to receive, to the extent permitted by applicable law, the number and kind of shares of capital stock of the Company which such holder would have owned or have been entitled to receive after the happening of such event had such Preferred Stock been converted immediately prior to the record date ~~fixed~~ for such ~~determination and~~ event (or if no record date is established in connection with such event, the ~~denominator~~ effective date for such action). An adjustment pursuant to this subparagraph (b) shall ~~be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to~~ become effective immediately after the ~~opening~~ record date in the case of ~~business on~~ a stock dividend or distribution and shall become effective immediately after the ~~day following~~ effective date in the ~~date fixed for such determination. For~~ case of a subdivision, combination or reclassification. (c) In case the ~~purposes of this paragraph (1), the number of shares of Common Stock~~ Company shall at any time prior to February 23, 2001 (i), except pursuant to (A) 1,103,667 options and 3,634,208 warrants outstanding ~~shall not include shares held in the treasury~~ as of the ~~Company but shall include shares issuable in respect of scrip certificates~~ date hereof or (B) securities issued in ~~lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury~~ compliance with Section 9(d) of the ~~Company. (2) In case at any time after the Closing Date~~Stock Purchase Agreement, dated February 24, 1998, between the Company ~~shall~~ and Harvest States Cooperatives (the "Stock Purchase Agreement"), issue ~~rights~~ or ~~warrants to all holders~~ sell any shares of its Common Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe~~ for ~~or purchase shares of Common Stock at~~ a ~~price~~ consideration per share less than the ~~current market price per share~~ Conversion Price in effect immediately prior to the time of such issuance or sale, (~~determined as provided~~ ii), except for securities issued in ~~paragraph (8) of this~~ compliance with Section ~~15.4~~9(d) of the Stock Purchase Agreement, issue or sell any warrants, options or other rights to acquire shares of its Common Stock ~~on the date fixed for the determination of stockholders entitled to receive such rights or warrants,~~ at a purchase price less than the Conversion ~~Rate~~ Price in effect at immediately prior to the ~~opening~~ time of ~~business on the day following the date fixed for~~ such ~~determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of~~ issuance or sale, or (iii) issue or sell any other securities that are convertible into shares of Common Stock ~~outstanding at~~ for a purchase or exchange price less than the ~~close~~ Conversion Price in effect immediately prior to the time of ~~business on the date fixed for~~ such ~~determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription~~ issuance or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. Howeversale then, upon ~~the expiration of any right~~ such issuance or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedsale, the Conversion Rate shall ~~immediately upon such expiration be recomputed and effective immediately upon such expiration~~ be increased by reducing the Conversion Price to the price at which ~~it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of~~ such ~~rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of~~ shares of Common Stock ~~actually purchased upon the exercise of such rights~~ are being issued or ~~warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of~~ sold by the Company ~~but will include~~ or the price at which such other securities are exercisable or convertible into shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company's Common Stock, and then adjusting the Conversion Rate to $1,000.00 divided by the new Conversion Price. (3d) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including ~~stock or other securities of the Company or any other issuer~~securities, but excluding any rights or warrants to purchase securities of the Company referred to in ~~paragraph~~ subparagraph (2c) ~~of this Section 15.4~~above, any dividend or distribution paid ~~exclusively~~ in cash out of the retained earnings of the Company and any dividend or distribution referred to in ~~paragraph~~ subparagraph (1b) ~~of this Section 15.4~~above), then in each such case the Conversion Rate then in effect shall be adjusted ~~so that~~ in accordance with the ~~same shall equal~~ formula M C(1) = C x ----- M - F where C(1) = the ~~rate determined by dividing the~~ adjusted Conversion ~~Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be~~ Rate. C = the current ~~market price~~ Conversion Rate. M = the Current Market Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4) of the~~ Common Stock on the record date ~~fixed for~~ mentioned below. F = the amount of such ~~determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ cash dividend and/or the fair market value ~~as determined by~~ on the ~~Board of Directors~~ record date of the ~~Company in good faith~~assets, ~~whose determination shall~~ securities, rights or warrants to be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, divided by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on the record date. The Board of Directors of the Company shall determine in good faith such ~~date, then, and in each such case,~~ fair market value. Such adjustment shall become effective immediately after the ~~close of business on such~~ record date for ~~determination,~~ the ~~Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for~~ determination of ~~the stockholders~~ shareholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determinationdividend or distribution. (6e) ~~In case at any time after the Closing Date (A) a tender offer~~ All calculations hereunder shall be made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior nearest cent or to the ~~close~~ nearest 1/100 of ~~business on the date of the Expiration Time by~~ a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combinationshare, as the case may be. (f) In the event that at any time, as a result of an adjustment made pursuant to subparagraph (a) or (b) above, the holder of any Preferred Stock thereafter surrendered for conversion shall become entitled to receive securities, cash or assets other than Common Stock, the number or amount of such securities or property so receivable upon conversion shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Common Stock contained in subparagraphs (a) through (e) above. Except as otherwise provided above in this Section 8, no adjustment in the Conversion Rate shall be made in respect of any conversion for share distributions or dividends theretofore declared and paid or payable on the Common Stock. Whenever the Conversion Rate is adjusted, the Company shall give notice by mail at the time of, and together with, the next dividend payment to the holders of record of Preferred Stock, setting forth the adjustment and the new Conversion Rate. Notwithstanding the foregoing notice provisions, failure by the Company to give such notice or a defect in such notice shall not affect the binding nature of such corporate action of the ~~number~~ Company. Whenever the Company shall propose to take any of ~~shares~~ the actions specified in subparagraphs (a), (b), (c) or (d) of ~~Common Stock outstanding immediately~~ the first paragraph of this Section 8 which would result in any adjustment in the Conversion Rate, the Company shall cause a notice to be mailed at least 30 days prior to the date on which the books of the Company will close or on which a record will be taken for such ~~reclassification into~~ action to the ~~number~~ holders of ~~shares~~ record of ~~Common~~ the outstanding Preferred Stock ~~outstanding immediately thereafter (and~~ on the ~~effective~~ date of such ~~reclassification~~ notice. Such notice shall ~~be deemed~~ specify the action proposed to be "taken by the ~~day upon~~ Company and the date as of which holders of record of the Common Stock shall participate in any such ~~subdivision becomes effective"~~ actions or ~~"the day upon which such combination becomes effective"~~be entitled to exchange their Common Stock for securities or other property, as the case may be. Failure by the Company to give such notice or any defect in such notice shall not affect the validity of the transaction. Notwithstanding any other provision of this Section 8, ~~and "~~no adjustment in the ~~day upon which such~~ Conversion Rate need be made (A) for a change in par value of the Common Stock not involving a subdivision or combination ~~becomes effective" within~~ described in clause (ii) or (iii) of subparagraph (b) of the ~~meaning of~~ first paragraph ~~(3)~~ of this Section ~~15.4~~8 or (B) after the Preferred Stock becomes convertible solely into cash (and no interest shall accrue on the cash). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Stock Purchase Agreement (Harvest States Cooperatives)

Adjustments to Conversion Rate. The Conversion Rate ------------------------------ shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of ~~its~~ Common Stock or other Capital Stock, on Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect immediately prior thereto shall be adjusted so that the holder of any Note thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock which such holder would have owned or have been entitled to receive after the happening of any of the events described above had such Note been converted immediately prior to the happening of such event. An adjustment made pursuant to this Section 3.7 shall become effective immediately after the Common Stock Record Date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of subdivision, combination or reclassification. If any dividend or distribution of the type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend, distribution had not been declared. (b) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Sale Price per share of ~~business~~ Common Stock on the day ~~following~~ preceding the date ~~fixed~~ of announcement of the Common Stock Record Date for the determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately prior thereto shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of the issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed~~ of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Sale Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Common Stock Record Date for the determination of the stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Common Stock Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Sale Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such ~~determination~~rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (c) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets (other than Cash) or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in Section 3.7(b)) (any of the foregoing hereinafter in this Section 3.7 called the "Distributed Securities"), then, the Conversion Rate ----------- ---------- shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the Market Price per share of the Common Stock on the Common Stock Record Date mentioned below, and the denominator shall be the Sale Price per share of the Common Stock on such Common Stock Record Date less the Fair Market Value on such Common Stock Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee) of the Distributed Securities so distributed applicable to one share of Common Stock. ~~For~~ Such adjustment shall become effective immediately after the Common Stock Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event (a) the then Fair Market Value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Common Stock Record Date or (b) such Market Price exceeds the Fair Market Value of such Distributed Securities by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Note immediately prior to such Common Stock Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this ~~paragraph~~ Section 3.7(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market on the same day used in computing the Sale Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 3.7, no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Note who converts such Note (1or any portion thereof) after the Common Stock Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of Distributed Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Common Stock Record Date, converted such Note into Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Note would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Note. Upon conversion of the Notes the Holders shall receive, in addition to the Common Stock issuable upon such conversion, any rights issued under any existing or future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). (d) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock Cash (excluding any Cash that is distributed upon a merger or consolidation to which Section 3.8(f) applies) in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made exclusively in Cash within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 3.7 has been made, exceeds on a per share basis 15% of the Sale Price on the day preceding the date of declaration of such dividend or distribution, then, and in each such case, immediately after the close of business on such date, the Conversion Rate shall be increased so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the Common Stock Record Date by a fraction of which the numerator shall be such Sale Price of the Common Stock and the denominator shall be such Sale Price of the Common Stock less the amount of Cash and the Fair Market Value (as so determined) of such other consideration so distributed (and not excluded as provided above) applicable to one share of Common Stock, such increase to be effective immediately prior to the opening of business on the day following the Common Stock Record Date; provided, however, that no adjustment will be made in respect of any such dividends and distributions that are paid during any period for which we are paying contingent interest to Holders; provided, further, that, if the portion of the Cash so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the day preceding the date of declaration of such dividend or distribution then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, Cash and other consideration the Holder would have received had such Holder converted such Note immediately prior to such Common Stock Record Date. If such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. If any adjustment is required to be made as set forth in this Section 3.7(d) as a result of a distribution that is a quarterly dividend, such adjustment shall be based upon the amount by which such distribution exceeds the amount of the quarterly cash dividend permitted to be excluded pursuant hereto. If an adjustment is required to be made as set forth in this Section 3.7(d) above as a result of a distribution that is not a quarterly dividend, such adjustment shall be based upon the full amount of the distribution. (e) For purposes of this Section 3.7, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Third Supplemental Indenture (Electronic Data Systems Corp /De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, exclusively in shares of its Common Stock or other capital stock, on its Common Stock; (b) subdivide its outstanding Common Stock into a greater number of shares; (c) combine its outstanding Common Stock into a smaller number of shares; or (d) reclassify its Common Stock, the Conversion Rate in effect immediately prior to the effective date for the adjustment pursuant to this Section 2.07(1), as described below, shall be adjusted so that the Holder of any Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock of the Company which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to such effective date. If any dividend or distribution of the type described in clause (a) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. An adjustment made pursuant to this Section 2.07(1) shall become effective immediately after the applicable Record Date in the case of a dividend and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Company’s Common Stock. (2) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date of issuance of such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Market Price per share of ~~business~~ Common Stock on the ~~day following the date~~ Record Date fixed for ~~the~~ determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately after such Record Date shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately after such Record Date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at on such Record Date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such Record Date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Market Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such ~~determination~~rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (3) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in Section 2.07(2) or (4) hereof) (any of the foregoing hereinafter in this Section 2.07(3) called the “Distributed Assets or Securities”) in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 2.07(3) has been made, exceeds 15% of the product of the Market Price on the Trading Day immediately preceding the declaration of such distribution and the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date mentioned below by a fraction of which the numerator shall be the Market Price per share of the Common Stock on such Record Date, and the denominator shall be the Market Price per share of the Common Stock on such Record Date less the Fair Market Value on such Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the Record Date for the determination of stockholders entitled to receive such distribution; provided, however, that, if (a) the Fair Market Value of the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Record Date or (b) the Market Price of the Common Stock on the Record Date is greater than the Fair Market Value of such Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights, warrants or options the Holder would have received had such Holder converted such Notes immediately prior to such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. (4) In case the Company shall, by dividend or otherwise, distribute to all or substantially all holders of outstanding shares of its Common Stock distributions consisting of Cash, then the Conversion Rate shall be adjusted so that the same shall equal the rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date for such distribution by a fraction of which: (A) the numerator shall be the Market Price per share of Common Stock on such Record Date, and (B) the denominator of which shall be equal to the Market Price per share of Common Stock on such Record Date less the amount per share of such distribution. Such adjustment shall become effective immediately after the Record Date for such distribution. (5) Notwithstanding the foregoing provisions of Section 2.07(2), (3) or (4), no adjustment shall be made thereunder for any distribution described therein if the Company makes proper provision so that each Holder who converts its Notes (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of assets or securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such Notes for Common Stock; provided that, with respect to any Distributed Assets or Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Assets or Securities receivable upon conversion of such Notes would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Notes. (6) Upon conversion of the Notes, the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). No adjustment pursuant to this Section 2.07 shall be made in connection with such stockholder rights plans. (7) For ~~the~~ purposes of this ~~paragraph (1)~~Section 2.07, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: First Supplemental Indenture (Interpublic Group of Companies, Inc.)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of its ~~Common~~ Voting Stock, ~~the Conversion Rate in effect at the opening of business~~ on ~~the day following the date fixed for the determination of stockholders entitled to receive such dividend or other distribution shall be increased by dividing such Conversion Rate by~~ its Voting Stock, (b) subdivide its outstanding Voting Stock into a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company.greater number (2) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of any class or series of its ~~Common~~ Voting Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 45 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase ~~shares of Common~~ Voting Stock at a price per share less than the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4) of the~~ Common Stock on at the ~~date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening of business on~~ same shall equal the ~~day following~~ Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date ~~fixed for~~ of the issuance of such ~~determination shall be increased by dividing such Conversion Rate~~ rights or warrants by a fraction of which the numerator shall be the number of shares of ~~Common~~ Voting Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of additional shares of ~~Common~~ Voting Stock ~~which the aggregate of the offering price of the total number of shares of Common Stock so~~ offered for subscription or ~~purchase would purchase at such current market price~~ purchase, and of which the denominator shall be the number of shares of ~~Common~~ Voting Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of shares which the aggregate offering price of ~~Common Stock~~ the total number of shares so offered ~~for subscription~~ would purchase at such Market Price. Such adjustment shall be made successively whenever any such rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of the stockholders entitled to receive such ~~determination~~rights or warrants. ~~However, upon~~ To the extent that shares of Voting Stock are not delivered after the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2),~~ the number of shares of ~~Common~~ Voting Stock ~~at any time outstanding~~ actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not ~~include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock~~been fixed. ~~The Company will not issue~~ In determining whether any rights or warrants ~~in respect of shares of Common Stock held in~~ entitle the ~~treasury of the Company.~~holders to subscribe for or purchase (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its ~~Common~~ Voting Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any shares of any class of capital stock of the Company (other than Voting Stock) or evidences of its indebtedness or assets (~~including stock~~ other than Cash) or ~~other securities of the Company or any other issuer, but excluding any~~ rights or warrants to subscribe for or purchase any of its Debentures (excluding those referred to in ~~paragraph~~ Section 2.07(2) hereof) (2) any of the foregoing hereinafter in this Section ~~15.4~~2.07(3) called the "Distributed Securities"), ~~any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)~~then, the Conversion Rate shall be adjusted so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ date of ~~business on the date fixed for the determination of stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the ~~date fixed for~~ Record Date mentioned below, and the denominator shall be the Market Price per share of the Common Stock on such ~~determination~~ Record Date less ~~the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ the fair market value on such Record Date (as determined by the Board of Directors of the ~~Company in good faith~~Company, whose determination shall be conclusive, and described in a ~~Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of~~ certificate filed with the ~~adoption of the resolution~~Trustee) of the ~~portion of the assets or evidences of indebtedness~~ Distributed Securities so distributed applicable to one ~~(1)~~ share of ~~Common Stock and the denominator~~ Voting Stock. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately ~~prior to~~ after the ~~opening of business on the day following the date fixed~~ Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event the then fair market value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Voting Stock is equal to or greater than the Market Price of the Common Stock on the Record Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Debenture on such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 2.07(3) by reference to the actual or when issued trading market for any Debentures, it must in doing so consider the prices in such market over the same period used in computing the Market Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 2.07(3), no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Debenture who converts such Debenture (or any portion thereof) after the Record Date for In the event the Company implements a stockholder rights plan, such rights plan shall provide that upon conversion of the Debentures the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under such rights plan (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). (54) In case ~~at any time after the Closing Date (A)~~ the Company shall, by dividend or otherwise, distribute to all holders of any class of its ~~Common~~ Voting Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section ~~15.13~~ 2.08(6) applies or as part of a distribution referred to in ~~paragraph (4~~Section 2.07(3)) ~~of this Section 15.4) and (B)(I) the total of (x) the~~ in an aggregate amount ~~of such cash distribution~~that, combined together with (ya) the aggregate amount of any other such distributions to all holders of any class of its ~~Common~~ Voting Stock made exclusively in cash within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 2.07(4) ~~or paragraph (6) of this Section 15.4~~ has been ~~made~~ made, and (zb) the aggregate of any cash plus the fair market value (as determined by the Board of ~~other~~ Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) of consideration payable in respect of any tender ~~offers~~ offer by the Company ~~or any of its Subsidiaries~~ for all or any portion of ~~the Common~~ any class of its Voting Stock concluded within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to ~~this paragraph (5~~Section 2.07(5) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share~~ Market Price (determined as provided ~~in paragraph (8) of this Section 15.4~~herein) ~~of the Common Stock~~ on the ~~date for the determination of holders of shares of Common Stock entitled~~ Record Date with respect to ~~receive~~ such distribution times the number of shares of ~~Common~~ Voting Stock outstanding on such date, then, and in each such case, immediately after the close of business on such ~~date for determination~~date, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ record date by a fraction of which the numerator shall be such Market Price of the Common Stock and the denominator shall be the Market Price of the Common Stock on the record date less the amount of cash so distributed (and not excluded as provided above) applicable to one share of Voting Stock, such increase to be effective immediately prior to the opening of business on the day following the record date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph and (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case ~~at any time after the Closing Date (A)~~ a tender offer made by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the Common~~ any class of its Voting Stock ~~shall expire~~ expires and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased ~~Shares~~ Shares) of an aggregate consideration having a fair market value (as ~~defined below))~~determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that, combined together with (ya) the aggregate of the cash plus the fair market ~~value~~value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), as of the expiration of such tender offer, of consideration payable in respect of any other tender ~~offer~~offers, by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the Common~~ any class of its Voting Stock expiring within the ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this ~~paragraph (6~~Section 2.07(5) ~~or paragraph (5) of this Section 15.4~~ has been ~~made~~ made, and (zb) the aggregate amount of any distributions to all holders of the ~~Company's Common~~ Voting Stock made exclusively in cash within ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to ~~this paragraph (6~~Section 2.07(4) ~~or paragraph (5) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share of the Common Stock~~ Market Price (determined as provided ~~in paragraph (8) of this Section 15.4~~herein) ~~on the date~~ as of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of ~~Common~~ Voting Stock outstanding (including any tendered shares) on at the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be ~~adjusted~~ increased so that the same shall equal the ~~price~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to ~~the close of business on the date of~~ -27- 29 the Expiration Time by a fraction ~~(i)~~ of which the numerator ~~of which~~ shall be ~~equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II)~~ the number of shares of ~~Common~~ Voting Stock outstanding (including any tendered or exchanged shares) ~~as of~~ on the Expiration Time ~~less (b)~~ multiplied by the ~~total~~ Market Price of the ~~amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share~~ Common Stock on the ~~date of~~ Trading Day next succeeding the Expiration Time and the denominator shall be the sum of (bx) the ~~number of shares of Common Stock outstanding~~ fair market value (~~including any tendered shares~~determined as aforesaid) as of the ~~Expiration Time less~~ aggregate consideration payable to stockholders based on the ~~number~~ acceptance (up to an maximum specified in the terms of the tender or exchanged offer) of all shares validly tendered or exchanged and not withdrawn as of the Expiration Time (the shares deemed so ~~accepted~~ accepted, up to any such maximum, being referred to as the "Purchased Shares"~~). (7~~) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (by) ~~a subdivision or combination, as~~ the ~~case may be,~~ product of the number of shares of Voting Stock outstanding (less any Purchased Shares) on the Expiration Time and the Market Price of the Common Stock ~~outstanding~~ on the Trading Day next succeeding the Expiration Time such reduction (if any) to become effective immediately prior to the opening of business on the day following the Expiration Time. If the Company is obligated to purchase shares pursuant to any such ~~reclassification into~~ tender offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such tender offer had not been made. (6) For purposes of this Section 2.07, the number of shares of ~~Common~~ Voting Stock at any time outstanding ~~immediately thereafter (and~~ shall not include shares held in the ~~effective date~~ treasury of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company ~~and be deemed to be the average~~ but shall include shares issuable in respect of ~~the daily Closing Price per share~~ scrip certificates issued in lieu of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders fractions of shares of ~~Common Stock resulting from~~ Voting Stock. The Company shall not pay any dividend or make any distribution on shares of ~~stock or issuance~~ Voting Stock held in the treasury of ~~rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons~~the Company.

Appears in 1 contract

Samples: First Supplemental Indenture (Lennar Corp /New/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of ~~its~~ Common Stock or other capital stock, on Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on the day following the date fixed~~ any Note thereafter surrendered for ~~the determination of stockholders~~ conversion shall be entitled to receive ~~such dividend or other distribution shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ of the ~~close~~ Company which such holder would have owned or have been entitled to receive after the happening of ~~business on~~ any of the ~~date fixed for~~ events described above had such ~~determination and~~ Note been converted immediately prior to the ~~denominator shall be the sum~~ happening of such ~~number~~ event. If any dividend or distribution of ~~shares and~~ the ~~total number of shares constituting~~ type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or ~~other distribution, such increase~~ distribution had not been declared. An adjustment made pursuant to this Section 4.06 shall become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held Record Date in the ~~treasury~~ case of a dividend and shall become effective immediately after the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held effective date in the ~~treasury~~ case of ~~the Company~~subdivision or combination. (2b) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of any class or series of its ~~Common~~ Voting Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase ~~shares of Common~~ Voting Stock at a price per share less than the ~~current market price~~ Sale Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4) of the~~ Common Stock on at the ~~date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening of business on~~ same shall equal the ~~day following~~ Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date ~~fixed for~~ of the issuance of such ~~determination shall be increased by dividing such Conversion Rate~~ rights or warrants by a fraction of which the numerator shall be the number of shares of ~~Common~~ Voting Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of additional shares of ~~Common~~ Voting Stock ~~which the aggregate of the offering price of the total number of shares of Common Stock so~~ offered for subscription or ~~purchase would purchase at such current market price~~ purchase, and of which the denominator shall be the number of shares of ~~Common~~ Voting Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of shares which the aggregate offering price of ~~Common Stock~~ the total number of shares so offered ~~for subscription~~ would purchase at such Sale Price. Such adjustment shall be made successively whenever any such rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of the stockholders entitled to receive such ~~determination~~rights or warrants. ~~However, upon~~ To the extent that shares of Voting Stock are not delivered after the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2),~~ the number of shares of ~~Common~~ Voting Stock ~~at any time outstanding~~ actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not ~~include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock~~been fixed. ~~The Company will not issue~~ In determining whether any rights or warrants ~~in respect of~~ entitle the holders to subscribe for or purchase shares of ~~Common~~ Voting Stock ~~held~~ at less than such Sale Price, and in determining the ~~treasury~~ aggregate offering price of such shares of Voting Stock, there shall be taken into account any consideration received by the ~~Company~~Company for such rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (3c) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its ~~Common~~ Voting Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any shares of any class of capital stock of the Company (other than Voting Stock) or evidences of its indebtedness or assets (~~including stock~~ other than Cash) or ~~other securities of the Company or any other issuer, but excluding any~~ rights or warrants to subscribe for or purchase any of its Notes (excluding those referred to in ~~paragraph~~ Section 4.06(b) hereof) (2) any of the foregoing hereinafter in this Section ~~15.4~~4.06(c) called the "Distributed Securities"), ~~any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)~~then, the Conversion Rate shall be adjusted so ----------------------- that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ date of ~~business on the date fixed for the determination of stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the ~~date fixed for~~ Record Date mentioned below, and the denominator shall be the Market Price per share of the Common Stock on such ~~determination~~ Record Date less ~~the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ the fair market value on such Record Date (as determined by the Board of ~~Directors of the Company in good faith~~Directors, whose determination shall be conclusive, and described in a ~~Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of~~ certificate filed with the ~~adoption of the resolution~~Trustee) of the ~~portion of the assets or evidences of indebtedness~~ Distributed Securities so distributed applicable to one ~~(1)~~ share of ~~Common Stock and the denominator~~ Voting Stock. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately ~~prior to~~ after the ~~opening of business on the day following the date fixed~~ Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event the then fair market value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Voting Stock is equal to or greater than the Market Price of the Common Stock on the Record Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Note on such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.06(c) by reference to the actual or when issued trading market for any Notes, it must in doing so consider the prices in such market over the same period used in computing the Market Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 4.06(c), no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Note who converts such Note (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of Distributed Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such Note for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Note would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Note. Upon conversion of the Notes the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under the Company's existing stockholder rights plan and any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). (5d) In case ~~at any time after the Closing Date (A)~~ the Company shall, by dividend or otherwise, distribute to all holders of any class of its ~~Common~~ Voting Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section ~~15.13~~ 4.07(f) applies or as part of a distribution referred to in ~~paragraph (4~~Section 4.06(c)) ~~of this Section 15.4) and (B)(I) the total of (x) the~~ in an aggregate amount ~~of such cash distribution~~that, combined together with (yi) the aggregate amount of any other such distributions to all holders of any class of its ~~Common~~ Voting Stock made exclusively in cash within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 4.06(d) ~~or paragraph (6) of this Section 15.4~~ has been ~~made~~ made, and (zii) the aggregate of any cash plus the fair market value of ~~other~~ consideration payable in respect of any tender ~~offers~~ offer by the Company ~~or any of its Subsidiaries~~ for all or any portion of ~~the Common~~ any class of its Voting Stock concluded within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to ~~this paragraph (5~~Section 4.06(c) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share~~ Market Price (determined as provided ~~in paragraph (8) of this Section 15.4~~herein) ~~of the Common Stock~~ on the ~~date for the determination of holders of shares of Common Stock entitled~~ Record Date with respect to ~~receive~~ such distribution times the number of shares of ~~Common~~ Voting Stock outstanding on such date, then, and in each such case, immediately after the close of business on such ~~date for determination~~date, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ record date by a fraction of which the numerator shall be such Market Price of the Common Stock and the denominator shall be the Market Price of the Common Stock on the record date less the amount of cash so distributed (and not excluded as provided above) applicable to one share of Voting Stock, such increase to be effective immediately prior to the opening of business on the day following the record date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of ~~Common~~ Voting Stock outstanding on the Record Date; provided, however, that no adjustment will -------- ------- be made in respect of any such ~~date for determination~~ dividends and distributions that result in the payment of any contingent interest to the Holders; provided, further, -------- ------- that, if the portion of the cash so distributed applicable to one share of Voting Stock is (i) equal to or greater than the Market Price of the Common Stock on the Record Date or (ii) the ~~denominator~~ Market Price of ~~which~~ the Common Stock on the Record Date is greater than the fair market value of the evidences of indebtedness, assets, rights and warrants distributed pursuant to Section 4.06(c) by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be ~~equal~~ made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights warrants or options the Holder would have received had such Holder converted such Note immediately prior to such ~~current market price per share on~~ Record Date. If such ~~date for determination~~dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. If any adjustment is required to be made as set forth in this Section 4.06(d) as a result of a distribution that is a quarterly dividend, such adjustment shall be based upon the amount by which such distribution exceeds the amount of the quarterly cash dividend permitted to be excluded pursuant hereto. If an adjustment is required to be made as set forth in this Section 4.06(d) above as a result of a distribution that is not a quarterly dividend, such adjustment shall be based upon the full amount of the distribution. (6e) In case ~~at any time after the Closing Date (A)~~ a tender offer made by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the Common~~ any class of its Voting Stock ~~shall expire~~ expires and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased ~~Shares~~ Shares) of an aggregate consideration having a fair market value (as ~~defined below))~~determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that, combined together with (ya) the aggregate of the cash plus the fair market ~~value~~value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), as of the expiration of such tender offer, of consideration payable in respect of any other tender ~~offer~~offers, by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the Common~~ any class of its Voting Stock expiring within the ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this ~~paragraph (6~~Section 4.06(e) ~~or paragraph (5) of this Section 15.4~~ has been ~~made~~ made, and (zb) the aggregate amount of any distributions to all holders of the ~~Company's Common~~ Voting Stock made exclusively in cash within ~~twelve (12)~~ 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to ~~this paragraph (6~~Section 4.06(d) ~~or paragraph (5) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share of the Common Stock~~ Market Price (determined as provided ~~in paragraph (8) of this Section 15.4~~herein) ~~on the date~~ as of the last time (the "Expiration Time") tenders could have been made pursuant to such --------------- tender offer (as it may be amended) times the number of shares of ~~Common~~ Voting Stock outstanding (including any tendered shares) on at the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be ~~adjusted~~ increased so that the same shall equal the ~~price~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to ~~the close of business on the date of~~ the Expiration Time by a fraction ~~(i)~~ of which the numerator ~~of which~~ shall be ~~equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II)~~ the number of shares of ~~Common~~ Voting Stock outstanding (including any tendered or exchanged shares) ~~as of~~ on the Expiration Time ~~less (b)~~ multiplied by the ~~total~~ Market Price of the ~~amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share~~ Common Stock on the ~~date of~~ Trading Day next succeeding the Expiration Time and the denominator shall be the sum of (bx) the ~~number of shares of Common Stock outstanding~~ fair market value (~~including any tendered shares~~determined as aforesaid) as of the ~~Expiration Time less~~ aggregate consideration payable to stockholders based on the ~~number~~ acceptance (up to an maximum specified in the terms of the tender or exchanged offer) of all shares validly tendered or exchanged and not withdrawn as of the Expiration Time (the shares deemed so ~~accepted~~ accepted, up to any such maximum, being referred to as the "Purchased Shares"~~). (7~~) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (by) ~~a subdivision or combination, as~~ the ~~case may be,~~ ---------------- product of the number of shares of Voting Stock outstanding (less any Purchased Shares) on the Expiration Time and the Market Price of the Common Stock ~~outstanding~~ on the Trading Day next succeeding the Expiration Time such reduction (if any) to become effective immediately prior to the opening of business on the day following the Expiration Time. If the Company is obligated to purchase shares pursuant to any such ~~reclassification into~~ tender offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such tender offer had not been made. (f) For purposes of this Section 4.06, the number of shares of ~~Common~~ Voting Stock at any time outstanding ~~immediately thereafter (and~~ shall not include shares held in the ~~effective date~~ treasury of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company ~~and be deemed to be the average~~ but shall include shares issuable in respect of ~~the daily Closing Price per share~~ scrip certificates issued in lieu of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders frac- tions of shares of ~~Common Stock resulting from~~ Voting Stock. The Company shall not pay any dividend or make any distribution on shares of ~~stock or issuance~~ Voting Stock held in the treasury of ~~rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons~~the Company.

Appears in 1 contract

Samples: Eleventh Supplemental Indenture (Horton D R Inc /De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, exclusively in shares of its Common Stock or other capital stock, on its Common Stock; (b) subdivide its outstanding Common Stock into a greater number of shares; (c) combine its outstanding Common Stock into a smaller number of shares; or (d) reclassify its Common Stock, the Conversion Rate in effect immediately prior to the effective date for the adjustment pursuant to this Section 2.07(1), as described below, shall be adjusted so that the Holder of any Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock of the Company which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to such effective date. If any dividend or distribution of the type described in clause (a) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. An adjustment made pursuant to this Section 2.07(1) shall become effective immediately after the applicable Record Date in the case of a dividend and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Company’s Common Stock. (2) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date of issuance of such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Market Price per share of ~~business~~ Common Stock on the ~~day following the date~~ Record Date fixed for ~~the~~ determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately after such Record Date shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately after such Record Date by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at on such Record Date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such Record Date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Market Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed Record Date for the determination of stockholders entitled to receive such rights or warrants, . To the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of extent that shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately are not delivered after ~~the opening of business on the day following the date fixed for such determination. However, upon~~ the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2)~~are not so issued, the ~~number~~ Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at ~~any time outstanding shall not include shares held~~ less than such Market Price, and in determining the ~~treasury~~ aggregate offering price of ~~the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of~~ such shares of Common Stock~~. The~~ , there shall be taken into account any consideration received by the Company ~~will not issue any~~ for such rights or ~~warrants in respect~~ warrants, the value of ~~shares~~ such consideration, if other than cash, to be determined by the Board of ~~Common Stock held in the treasury of the Company~~Directors. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets ~~(including stock~~ or ~~other securities of the Company or any other issuer, but excluding any~~ rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in ~~paragraph~~ Section 2.07(2) or (24) hereof) (any of the foregoing hereinafter in this Section 2.07(3) called the “Distributed Assets or Securities”) in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 2.07(3) has been made, exceeds 15% of the product of the Market Price on the Trading Day immediately preceding the declaration of such distribution and the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the Record Date mentioned below by a fraction of which the numerator shall be the Market Price per share of the Common Stock on such Record Date, and the denominator shall be the Market Price per share of the Common Stock on such Record Date less the Fair Market Value on such Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of ~~this Section 15.4~~the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the Record Date for the determination of stockholders entitled to receive such distribution; provided, ~~any~~ however, that, if (a) the Fair Market Value of the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Record Date or (b) the Market Price of the Common Stock on the Record Date is greater than the Fair Market Value of such Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights, warrants or options the Holder would have received had such Holder converted such Notes immediately prior to such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. (4) In case the Company shall, by dividend or ~~distribution paid exclusively in cash and any dividend~~ otherwise, distribute to all or ~~distribution referred to in paragraph (1)~~ substantially all holders of ~~this Section 15.4)~~outstanding shares of its Common Stock distributions consisting of Cash, then the Conversion Rate shall be adjusted so that the same shall equal the rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the close of business on the ~~date fixed~~ Record Date for ~~the determination of stockholders entitled to receive~~ such distribution by a fraction of ~~which~~ which: (A) the numerator shall be the ~~current market price~~ Market Price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6)Record Date, and (iiB) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price Market Price per share of Common Stock on ~~any date shall be calculated by~~ such Record Date less the ~~Company and be deemed to be the average of the daily Closing Price~~ amount per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.such

Appears in 1 contract

Samples: Second Supplemental Indenture (Interpublic Group of Companies, Inc.)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1) In case ~~at any time after the Closing Date~~ the Company shall (a) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of its capital stock, on its Common Stock; (b) subdivide its outstanding Common Stock into a greater number of shares; (c) combine its outstanding Common Stock into a smaller number of shares; or (d) reclassify its Common Stock, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on~~ any Notes thereafter surrendered for conversion shall be entitled to receive the ~~day following~~ number of shares of Common Stock of the Company which such holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to the happening of such event. If any dividend or distribution of the type described in clause (a) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or distribution had not been declared. An adjustment made pursuant to this Section 2.07(1) shall become effective immediately after the applicable Record Date in the case of a dividend and shall become effective immediately after the applicable effective date in the case of subdivision, combination or reclassification of the Company's Common Stock. (2) In case the Company shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the Sale Price per share of Common Stock at the Record Date for the determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately prior thereto shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of the issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed~~ of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and of which the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at such ~~dividend~~ Sale Price. Such adjustment shall be made successively whenever any such rights or ~~other distribution~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of the stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate which would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Sale Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such ~~determination~~rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (3) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in Section 2.07(2) hereof) (any of the foregoing hereinafter in this Section 2.07(3) called the "Distributed Assets or Securities") in an aggregate amount that, combined together with the aggregate amount of any other such distributions to all holders of its Common Stock made within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 2.07(3) has been made, exceeds 15% of the product of the Market Price on the day preceding the declaration of such distribution times the number of shares of Common Stock outstanding on such date, then, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the Market Price per share of the Common Stock on the Record Date mentioned below, and the denominator shall be the Market Price per share of the Common Stock on such Record Date less the fair market value on such Record Date (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Paying Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the Record Date for the determination of stockholders entitled to receive such distribution; provided, however, that no adjustment will be made in respect of any such dividends and distributions that result in the payment of any contingent interest to the Holders; provided, further, that, if the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is (a) equal to or greater than the Sale Price of the Common Stock on the Record Date or (b) the Sale Price of the Common Stock on the Record Date is greater than the fair market value of the Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, or rights warrants or options the Holder would have received had such Holder converted such Notes immediately prior to such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. Notwithstanding the foregoing provisions of Section 2.07(2) or (3), no adjustment shall be made thereunder for any distribution described therein if the Company makes proper provision so that each Holder of Notes who converts such Notes (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of assets or Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such Notes for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Notes would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Notes. Upon conversion of the Notes the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under the Company's existing stockholder rights plan and any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). No adjustment pursuant to this Section 2.07 shall be made in connection with such stockholder rights plans. (4) For ~~the~~ purposes of this ~~paragraph (1)~~Section 2.07, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Second Supplemental Indenture (Interpublic Group of Companies Inc)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of ~~its~~ Common Stock or other capital stock, on Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on the day following the date fixed~~ any Note thereafter surrendered for ~~the determination of stockholders~~ conversion shall be entitled to receive ~~such dividend or other distribution shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ which such holder would have owned or have been entitled to receive after the ~~close~~ happening of ~~business on~~ any of the ~~date fixed for~~ events described above had such ~~determination and~~ Note been converted immediately prior to the ~~denominator shall be the sum~~ happening of such ~~number~~ event. If any dividend or distribution of ~~shares and~~ the ~~total number of shares constituting~~ type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or ~~other distribution, such increase~~ distribution had not been declared. An adjustment made pursuant to this Section 4.06 shall become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held Record Date in the ~~treasury~~ case of a dividend and shall become effective immediately after the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held effective date in the ~~treasury~~ case of ~~the Company~~subdivision or combination. (2b) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of any class or series of its Common Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase ~~shares of~~ Common Stock at a price per share less than the ~~current market price~~ Sale Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4) of the~~ Common Stock on the day preceding the date ~~fixed~~ of announcement of the Record Date for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening of business on~~ same shall equal the ~~day following~~ Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date ~~fixed for~~ of the issuance of such ~~determination shall be increased by dividing such Conversion Rate~~ rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of additional shares of Common Stock ~~which the aggregate of the offering price of the total number of shares of Common Stock so~~ offered for subscription or ~~purchase would purchase at such current market price~~ purchase, and of which the denominator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of shares which the aggregate offering price of ~~Common Stock~~ the total number of shares so offered ~~for subscription~~ would purchase at such Sale Price. Such adjustment shall be made successively whenever any such rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Record Date for the determination of the stockholders entitled to receive such ~~determination~~rights or warrants. ~~However, upon~~ To the extent that shares of Common Stock are not delivered after the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2)~~are not so issued, the ~~number~~ Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at ~~any time outstanding shall not include shares held~~ less than such Sale Price, and in determining the ~~treasury~~ aggregate offering price of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of such shares of Common Stock, ~~the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective~~ there shall be ~~proportionately increased and, conversely, in case at~~ taken into account any ~~time after~~ consideration received by the ~~date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock~~Company for such rights or warrants, the ~~Conversion Rate in effect at the opening~~ value of ~~business on the day following the day upon which~~ such ~~combination becomes effective shall be proportionately reduced~~consideration, ~~such increase or reduction, as the case may be~~if other than cash, to ~~become effective immediately after~~ be determined by the ~~opening~~ Board of ~~business on the day following the day upon which such subdivision or combination becomes effective~~Directors. (4c) In case ~~at any time after the Closing Date,~~ the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) evidences of its indebtedness or assets (~~including stock~~ other than Cash) or ~~other securities of the Company or any other issuer, but excluding any~~ rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in ~~paragraph~~ Section 4.06(b)) (2) any of the foregoing hereinafter in this Section ~~15.4~~4.06(c) called the "Distributed ----------- Securities"), ~~any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)~~then, the Conversion Rate shall be adjusted so that the same ---------- shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ date of ~~business on the date fixed for the determination of stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the ~~date fixed for~~ Record Date mentioned below, and the denominator shall be the Market Price per share of the Common Stock on such ~~determination~~ Record Date less ~~the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ the fair market value on such Record Date (as determined by the Board of ~~Directors of the Company in good faith~~Directors, whose determination shall be conclusive, and described in a ~~Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of~~ certificate filed with the ~~adoption of the resolution~~Trustee) of the ~~portion of the assets or evidences of indebtedness~~ Distributed Securities so distributed applicable to one ~~(1)~~ share of Common ~~Stock and the denominator~~ Stock. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately ~~prior to~~ after the ~~opening of business on the day following the date fixed~~ Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event (a) the then fair market value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Record Date or (b) such Market Price exceeds the fair market value of such Distributed Securities by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Note on such Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.06(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market on the same day used in computing the Sale Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 4.06(c), no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Note who converts such Note (or any portion thereof) after the Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of Distributed Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Record Date, converted such Note for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Note would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Note. Upon conversion of the Notes the Holders shall receive, in addition to the Common Stock issuable upon such conversion, any rights issued under any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). (5d) In case ~~at any time after the Closing Date (A)~~ the Company shall, by dividend or otherwise, distribute to all holders of any class of its Common Stock ~~cash~~ Cash (excluding any ~~cash~~ Cash that is distributed upon a merger or consolidation to which Section ~~15.13~~ 4.07(f) applies ~~or as part of a distribution referred to~~ in ~~paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the~~ an aggregate amount ~~of such cash distribution~~that, combined together with (yi) the aggregate amount of any other such distributions to all holders of any class of its Common Stock made exclusively in ~~cash~~ Cash within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 4.06(d) ~~or paragraph (6) of this Section 15.4~~ has been ~~made~~ made, and (zii) the aggregate of any ~~cash~~ Cash plus the fair market value of other consideration (as so determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee) payable in respect of any tender ~~offers~~ offer by the Company ~~or any of its Subsidiaries~~ for all or any portion of ~~the~~ any class of its Common Stock concluded within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to ~~this paragraph (5~~Section 4.06(e) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock~~ Sale Price on the day preceding the date ~~for the determination~~ of ~~holders~~ declaration of ~~shares of Common Stock entitled to receive~~ such dividend or distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such ~~date for determination~~date, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ Record Date by a fraction of which the numerator shall be such Sale Price of the Common Stock and the denominator shall be such Sale Price of the Common Stock less the amount of Cash so distributed (and not excluded as provided above) applicable to one share of Common Stock, such increase to be effective immediately prior to the opening of business on the ~~date fixed for determination~~ day following the Record Date; provided, however, that no adjustment will be made in respect -------- ------- of any such dividends and distributions that result in the payment of any contingent interest to the Holders; provided, further, that, if the portion -------- ------- of the ~~stockholders entitled~~ cash so distributed applicable to ~~receive such distribution by a fraction~~ one share of Common Stock is (i) equal to or greater than the ~~numerator~~ Market Price of ~~which~~ the Common Stock on the day preceding the date of declaration of such dividend or distribution or (ii) the Market Price of the Common Stock on the day preceding the date of declaration of such dividend or distribution is greater than the fair market value of the consideration distributed pursuant to Section 4.06(e) by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be ~~equal~~ made so that each Holder shall have the right to ~~such current market price per share on the date fixed for such determination less an amount equal~~ receive upon conversion, in addition to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common ~~Stock purchased~~ Stock, the cash and other consideration the Holder would have received had such Holder converted such Note immediately prior to such Record Date. If such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such ~~tender offer~~ dividend or distribution had not been declared. If any adjustment is required to be made as set forth in this Section 4.06(d) as a result of a distribution that is a quarterly dividend, such adjustment shall be based upon the amount by which such distribution exceeds the amount of the ~~Expiration Time (~~quarterly cash dividend permitted to be excluded pursuant hereto. If an adjustment is required to be made as ~~hereinafter defined~~set forth in this Section 4.06(d) ~~for~~ above as a result of a distribution that is not a quarterly dividend, such ~~tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which~~ adjustment shall be ~~equal to such current market price per share on such date for determination~~based upon the full amount of the distribution. (6e) In case ~~at any time after the Closing Date (A)~~ a tender offer made by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the~~ any class of its Common Stock ~~shall expire~~ expires and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.on

Appears in 1 contract

Samples: Eleventh Supplemental Indenture (Horton D R Inc /De/)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend, or make a ~~dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock)~~ distribution, in shares of ~~its~~ Common Stock or other capital stock, on Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening~~ holder of ~~business on the day following the date fixed~~ any Note thereafter surrendered for ~~the determination of stockholders~~ conversion shall be entitled to receive ~~such dividend or other distribution shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ which such holder would have owned or have been entitled to receive after the ~~close~~ happening of ~~business on~~ any of the ~~date fixed for~~ events described above had such ~~determination and~~ Note been converted immediately prior to the ~~denominator shall be the sum~~ happening of such ~~number~~ event. If any dividend or distribution of ~~shares and~~ the ~~total number of shares constituting~~ type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such dividend or ~~other distribution, such increase~~ distribution had not been declared. An adjustment made pursuant to this Section 4.06 shall become effective immediately after the ~~opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of~~ Common Stock ~~at any time outstanding shall not include shares held~~ Record Date in the ~~treasury~~ case of a dividend and shall become effective immediately after the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held effective date in the ~~treasury~~ case of ~~the Company~~subdivision or combination. (2b) In case ~~at any time after the Closing Date,~~ the Company shall issue rights or warrants to all holders of any class or series of its Common Stock ~~(not being available on an equivalent basis to holders of the Debentures upon conversion)~~ entitling them (for a period expiring within 60 days after the date fixed for determination of stockholders entitled to receive such rights or warrants) to subscribe for or purchase ~~shares of~~ Common Stock at a price per share less than the ~~current market price~~ Sale Price per share ~~(determined as provided in paragraph (8)~~ of ~~this Section 15.4)~~ Common Stock on the day preceding the date of announcement of the Common Stock ~~on the date fixed~~ Record Date for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at immediately prior thereto shall be adjusted so that the ~~opening of business on~~ same shall equal the ~~day following~~ Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the date ~~fixed for~~ of the issuance of such ~~determination shall be increased by dividing such Conversion Rate~~ rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of additional shares of Common Stock ~~which the aggregate of the offering price of the total number of shares of Common Stock so~~ offered for subscription or ~~purchase would purchase at such current market price~~ purchase, and of which the denominator shall be the number of shares of Common Stock outstanding ~~at the close of business~~ on the date ~~fixed for~~ of issuance of such ~~determination~~ rights or warrants plus the number of shares which the aggregate offering price of ~~Common Stock~~ the total number of shares so offered ~~for subscription~~ would purchase at such Sale Price. Such adjustment shall be made successively whenever any such rights or ~~purchase~~warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the ~~date fixed~~ Common Stock Record Date for the determination of the stockholders entitled to receive such ~~determination~~rights or warrants. ~~However, upon~~ To the extent that shares of Common Stock are not delivered after the expiration of ~~any right~~ such rights or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercisedwarrants, the Conversion Rate shall ~~immediately upon such expiration~~ be ~~recomputed and effective immediately upon such expiration be increased~~ readjusted to ~~the price which it would have been (but reflecting any other adjustments in~~ the Conversion Rate ~~made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants)~~ which would then be in effect had the ~~adjustment of the Conversion Rate~~ adjustments made upon the issuance of such rights or warrants been made on the basis of ~~offering for subscription or purchase~~ delivery of only ~~that~~ the number of shares of Common Stock actually ~~purchased upon the exercise of~~ delivered. If such rights or warrants ~~actually exercised. For the purposes of this paragraph (2)~~are not so issued, the ~~number~~ Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such Common Stock Record Date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at ~~any time outstanding shall not include shares held~~ less than such Sale Price, and in determining the ~~treasury~~ aggregate offering price of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of such shares of Common Stock, ~~the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective~~ there shall be ~~proportionately increased and, conversely, in case at~~ taken into account any ~~time after~~ consideration received by the ~~date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock~~Company for such rights or warrants, the ~~Conversion Rate in effect at the opening~~ value of ~~business on the day following the day upon which~~ such ~~combination becomes effective shall be proportionately reduced~~consideration, ~~such increase or reduction, as the case may be~~if other than cash, to ~~become effective immediately after~~ be determined by the ~~opening~~ Board of ~~business on the day following the day upon which such subdivision or combination becomes effective~~Directors. (4c) In case ~~at any time after the Closing Date,~~ the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock (excluding any distribution in connection with the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary) any evidences of its indebtedness or assets (~~including stock~~ other than Cash) or ~~other securities of the Company or any other issuer, but excluding any~~ rights or warrants to subscribe for or purchase any of its securities (excluding those referred to in ~~paragraph~~ Section 4.06(b)) (2) any of the foregoing hereinafter in this Section ~~15.4~~4.06(c) called the "Distributed Securities"), ~~any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4)~~then, the Conversion Rate shall be adjusted so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ date of ~~business on the date fixed for the determination of stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the ~~current market price~~ Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the ~~date fixed for~~ Common Stock Record Date mentioned below, and the denominator shall be the Sale Price per share of the Common Stock on such ~~determination~~ Common Stock Record Date less ~~the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean~~ the fair market value on such Common Stock Record Date (as determined by the Board of ~~Directors of the Company in good faith~~Directors, whose determination shall be conclusive, and described in a ~~Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of~~ certificate filed with the ~~adoption of the resolution~~Trustee) of the ~~portion of the assets or evidences of indebtedness~~ Distributed Securities so distributed applicable to one ~~(1)~~ share of Common ~~Stock and the denominator~~ Stock. Such adjustment shall ~~be such current market price per share of the Common Stock, such adjustment to~~ become effective immediately ~~prior to~~ after the ~~opening of business on the day following the date fixed~~ Common Stock Record Date for the determination of stockholders entitled to receive such distribution. Notwithstanding the foregoing, in the event (a) the then fair market value (as so determined) of the portion of the Distributed Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the Common Stock Record Date or (b) such Market Price exceeds the fair market value of such Distributed Securities by less than $1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion the amount of Distributed Securities such Holder would have received had such Holder converted each Note on such Common Stock Record Date. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect if such distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.06(c) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market on the same day used in computing the Sale Price of the Common Stock. Notwithstanding the foregoing provisions of this Section 4.06(c), no adjustment shall be made thereunder for any distribution of Distributed Securities if the Company makes proper provision so that each Holder of a Note who converts such Note (or any portion thereof) after the Common Stock Record Date for such distribution shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of Distributed Securities that such Holder would have been entitled to receive if such Holder had, immediately prior to such Common Stock Record Date, converted such Note for Common Stock; provided that, with respect to any Distributed Securities that are convertible, exchangeable or exercisable, the foregoing provision shall only apply to the extent (and so long as) the Distributed Securities receivable upon conversion of such Note would be convertible, exchangeable or exercisable, as applicable, without any loss of rights or privileges for a period of at least 60 days following conversion of such Note. Upon conversion of the Notes the Holders shall receive, in addition to the Common Stock issuable upon such conversion, any rights issued under any future stockholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion). (5d) In case ~~at any time after the Closing Date (A)~~ the Company shall, by dividend or otherwise, distribute to all holders of any class of its Common Stock ~~cash~~ Cash (excluding any ~~cash~~ Cash that is distributed upon a merger or consolidation to which Section ~~15.13 applies or as part of a distribution referred to~~ 4.07(f) applies) in ~~paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the~~ an aggregate amount ~~of such cash distribution~~that, combined together with (yi) the aggregate amount of any other such distributions to all holders of any class of its Common Stock made exclusively in ~~cash~~ Cash within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 4.06(d) ~~or paragraph (6) of this Section 15.4~~ has been ~~made~~ made, and (zii) the aggregate of any ~~cash~~ Cash plus the fair market value of other consideration (as so determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee) payable in respect of any tender ~~offers~~ offer 33 -30- by the Company ~~or any of its Subsidiaries~~ for all or any portion of ~~the~~ any class of its Common Stock concluded within the ~~twelve (12)~~ 12 months preceding the date of payment of such ~~distribution~~ distribution, and in respect of which no adjustment pursuant to ~~this paragraph (5~~Section 4.06(e) ~~or paragraph (6) of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (~~10%) % of the product of the ~~current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock~~ Sale Price on the day preceding the date ~~for the determination~~ of ~~holders~~ declaration of ~~shares of Common Stock entitled to receive~~ such dividend or distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such ~~date for determination~~date, the Conversion Rate shall be increased so that the same shall equal the ~~rate~~ Conversion Rate determined by ~~dividing~~ multiplying the Conversion Rate in effect immediately prior to the ~~close~~ Common Stock Record Date by a fraction of which the numerator shall be such Sale Price of the Common Stock and the denominator shall be such Sale Price of the Common Stock less the amount of Cash and the fair market value (as so determined) of such other consideration so distributed (and not excluded as provided above) applicable to one share of Common Stock, such increase to be effective immediately prior to the opening of business on the ~~date fixed~~ day following the Common Stock Record Date; provided, however, that no adjustment will be made in respect of any such dividends and distributions that are paid during any period for ~~determination~~ which we are paying contingent interest to Holders; provided, further, that, if the portion of the ~~stockholders entitled~~ cash so distributed applicable to ~~receive such distribution by a fraction~~ one share of Common Stock is (i) equal to or greater than the ~~numerator~~ Market Price of ~~which~~ the Common Stock on the day preceding the date of declaration of such dividend or distribution or (ii) the Market Price of the Common Stock on the day preceding the date of declaration of such dividend or distribution is greater than the fair market value of the consideration distributed pursuant to Section 4.06(e) by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be ~~equal~~ made so that each Holder shall have the right to ~~such current market price per share on the date fixed for such determination less an amount equal~~ receive upon conversion, in addition to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock, Cash and other consideration the Holder would have received had such Holder converted such Note immediately prior to such Common Stock ~~purchased~~ Record Date. If such dividend or distribution is not so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such ~~tender offer~~ dividend or distribution had not been declared. If any adjustment is required to be made as set forth in this Section 4.06(d) as a result of a distribution that is a quarterly dividend, such adjustment shall be based upon the amount by which such distribution exceeds the amount of the ~~Expiration Time (~~quarterly cash dividend permitted to be excluded pursuant hereto. If an adjustment is required to be made as ~~hereinafter defined~~set forth in this Section 4.06(d) ~~for~~ above as a result of a distribution that is not a quarterly dividend, such ~~tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which~~ adjustment shall be ~~equal to such current market price per share on such date for determination~~based upon the full amount of the distribution. (6e) In case ~~at any time after the Closing Date (A)~~ a tender offer made by the Company or any ~~Subsidiary~~ of its subsidiaries for all or any portion of ~~the~~ any class of its Common Stock ~~shall expire~~ expires and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased ~~Shares (as defined below)), (y~~Shares) ~~the~~ of an aggregate ~~of the cash plus the~~ consideration having a fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve value (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.as

Appears in 1 contract

Samples: First Supplemental Indenture (Masco Corp /De/)

Adjustments to Conversion Rate. ~~The~~ Notwithstanding anything in ------------------------------ this Section 8 to the contrary, no change in the Conversion Rate shall be ~~subject~~ made until the cumulative effect of the adjustments called for by this Section 8 since the date of the last change in the Conversion Rate would change the Conversion Rate by more than 1%. However, once the cumulative effect would result in such a change, then the Conversion Rate shall be changed to reflect all adjustments called for by this Section 8 and not previously made. Subject to the foregoing, the Conversion Rate shall be adjusted from time to time as follows: (1a) In case at of any ~~time after the Closing Date the Company shall pay~~ consolidation or ~~make a dividend or other distribution on any class of Capital Stock~~ merger of the ~~Company~~ Corporation with any other corporation (other than a wholly owned subsidiary of the ~~Series C Preferred Stock)~~ Corporation), or in case of any sale or transfer of all or substantially all of the assets of the Corporation, or in case of any share exchange pursuant to which all of the outstanding shares of ~~its~~ Common ~~Stock~~Stock are converted into other securities or property, the ~~Conversion Rate in effect~~ Corporation shall, prior to or at the ~~opening~~ time of ~~business on~~ such transaction, make appropriate provision or cause appropriate provision to be made so that holders of each share of Convertible Preferred Stock then outstanding shall have the ~~day following~~ right thereafter to convert such share of Convertible Preferred Stock into the ~~date fixed for the determination~~ kind and Exhibit D amount of ~~stockholders entitled to receive~~ shares of stock and other securities and property receivable upon such ~~dividend~~ consolidation, merger, sale, transfer or ~~other distribution shall be increased by dividing such Conversion Rate~~ share exchange by a ~~fraction~~ holder of ~~which the numerator shall be~~ the number of shares of Common Stock ~~outstanding at~~ into which such share of Convertible Preferred Stock could have been converted immediately prior to the ~~close of business on the~~ effective date ~~fixed for such determination and the denominator shall be the sum~~ of such ~~number of shares and the total number of shares constituting~~ consolidation, merger, sale, transfer or share exchange. If in connection with any such ~~dividend~~ consolidation, merger, sale, transfer or ~~other distribution~~share exchange, ~~such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number~~ each holder of shares of Common Stock ~~at any time outstanding~~ is entitled to elect to receive either securities, cash or other assets upon completion of such transaction, the Corporation shall ~~not include shares held in~~ provide or cause to be provided to each holder of Convertible Preferred Stock the ~~treasury of~~ right to elect the ~~Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend~~ securities, cash or ~~make any distribution on shares of Common~~ other assets into which the Convertible Preferred Stock held in by such holder shall be convertible after completion of any such transaction on the ~~treasury of~~ same terms and subject to the ~~Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis~~ same conditions applicable to holders of the ~~Debentures upon conversion) entitling them to subscribe for or purchase shares of~~ Common Stock ~~at a price per share less than the current market price per share~~ (~~determined as provided in paragraph (8) of this Section 15.4)~~ including, without limitation, notice of the ~~Common Stock~~ right to elect, limitations on the ~~date fixed for the determination of stockholders entitled to receive~~ period in which such ~~rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination~~ election shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price made and the ~~denominator shall be~~ effect of failing to exercise the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2election), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3b) In case ~~at any time after~~ the ~~Closing Date, outstanding~~ Corporation shall (i) pay a dividend or make a distribution on its Common Stock in shares of its capital stock, (ii) subdivide its outstanding Common Stock ~~shall be subdivided~~ into a greater number of shares, (iii) combine the shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, its outstanding ~~shares of~~ Common Stock ~~shall each be combined~~ into a smaller number of ~~shares of Common Stock~~shares, ~~the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase~~ or ~~reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective.~~ (4iv) ~~In case at any time after the Closing Date, the Company shall,~~ issue by ~~dividend or otherwise, distribute to all holders~~ reclassification of its Common Stock ~~evidences~~ any shares of its ~~indebtedness or assets (including stock or other securities of the Company or any other issuer~~capital stock, ~~but excluding any rights or warrants referred to~~ then in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing each such case the Conversion Rate in effect immediately prior thereto shall be proportionately adjusted so that the holder of any Convertible Preferred Stock thereafter surrendered for conversion shall be entitled to receive, to the ~~close~~ extent permitted by applicable law, the number and kind of ~~business on~~ shares of capital stock of the ~~date fixed for the determination of stockholders~~ Corporation which such holder would have owned or have been entitled to receive after the happening of such ~~distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common~~ event had such Convertible Preferred Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective been converted immediately prior to the ~~opening of business on~~ record date for such event (or if no record date is established in connection with such event, the ~~day following the~~ effective date ~~fixed~~ for ~~the determination of stockholders entitled to receive~~ such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no action). An adjustment pursuant to this ~~paragraph~~ subparagraph (5b) shall become effective immediately after the record date in the case of a stock dividend or ~~paragraph~~ distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. (6i) In case the Corporation shall issue Additional Shares of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock ~~concluded within~~ (as defined herein) (including, without limitation, Additional Shares of Common Stock deemed to be issued pursuant to Section 8(c)(iii)) without consideration or for a consideration per share less than the ~~twelve~~ Current Market Price (12as defined herein) ~~months preceding~~ calculated as provided herein as of the date of ~~payment of~~ and immediately prior to such ~~distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made~~issue, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and then in each such ~~case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing~~ case the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such issue date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted ~~so that~~ in accordance with the ~~same shall equal~~ formula Exhibit D O + N C\\1\\ = C x O + N x P ----- M where C\\1\\ = the ~~price determined by dividing~~ adjusted Conversion Rate. C = the current Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of Rate. O = the number of shares of Common Stock outstanding immediately prior to such ~~reclassification into~~ issue. N = the number of additional shares of Common Stock offered. P = the offering price per share of the additional shares. M = the Current Market Price per share of Common Stock immediately prior to such issue. For the purpose of such calculation, the number of shares of Common Stock outstanding immediately ~~thereafter~~ prior to such issue shall be calculated on a fully diluted basis, as if all shares of Convertible Preferred Stock and all Convertible Securities had been fully converted into shares of Common Stock immediately prior to such issuance and any outstanding warrants, options or other rights for the purchase of shares of stock or convertible securities had been fully exercised immediately prior to such issuance (and the ~~effective date~~ resulting securities fully converted into shares of Common Stock, if so convertible) as of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4)date. (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) ~~the day before the "ex" date with respect to the issuance or distribution requiring such computation.~~ For purposes of this ~~paragraph~~Section 8(c), the ~~term~~ following definitions shall apply: (A) "~~'ex' date"~~Options" shall mean rights, ~~when used with respect~~ options or warrants to ~~any issuance~~ subscribe ------- for, purchase or ~~distribution, means the first date on which the~~ otherwise acquire either Common Stock ~~trades regular way on~~ or Convertible Securities; (B) "Convertible Securities" shall mean any evidences of ---------------------- indebtedness, shares or other securities convertible into or exchangeable for Common Stock; (C) "Additional Shares of Common Stock" shall mean all shares of --------------------------------- Common Stock issued (or, pursuant to Section 8(c)(iii), deemed to be issued) by the ~~applicable securities exchange or in~~ Corporation after the ~~applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term~~ [issue date of the ~~Debentures or any shorter term~~Convertible Preferred Stock], ~~in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of~~ other than shares of Common Stock ~~resulting from any dividend~~ issued or ~~distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.~~issuable:

Appears in 1 contract

Samples: Preferred Stock Purchase Agreement (New Century Financial Corp)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1i) In case ~~at any time after the Closing Date~~ the Company shall pay or make a dividend or other distribution on ~~any class of Capital~~ the Common Stock ~~of the Company (other than the Series C Preferred Stock)~~ in ~~shares of its~~ Common Stock, the Conversion ~~Rate~~ Rate, as in effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or other ~~distribution~~ distribution, shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this ~~paragraph (1~~Section 1.10(g)(i), the number of shares of Common Stock at any time outstanding shall not include shares held in ~~the~~ treasury of by the Company but shall include any shares issuable in respect of any scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in ~~the~~ treasury of by the Company. (2ii) In case ~~at any time after the Closing Date,~~ the Company shall issue ~~rights~~ rights, options or warrants (other than pursuant to any dividend reinvestment or share purchase plans) to all ~~holders~~ Holders of its Common Stock (not being available on an equivalent basis to ~~holders~~ Holders of the ~~Debentures~~ Senior Convertible Notes upon ~~conversion~~conversion of such Senior Convertible Notes) entitling ~~them~~ them, for a period expiring within 60 days after the record date for the determination of stockholders entitled to receive such rights, options or warrants, to subscribe for or purchase shares of Common Stock at a price per share less than the ~~current market price~~ Current Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the date fixed for the determination of stockholders entitled to receive such ~~rights~~ rights, options or ~~warrants~~warrants (other than pursuant to a dividend reinvestment plan or share purchase plan), the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate ~~of the~~ offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such ~~current market price~~ Current Market Price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or ~~purchase~~purchase at such below Current Market Price, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this ~~paragraph (2~~Section 1.10(g)(ii), the number of shares of Common Stock at any time outstanding shall not include shares held in ~~the~~ treasury of by the Company but ~~will~~ shall include any shares issuable in respect of any scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not issue any ~~rights~~ such rights, options or warrants in respect of shares of Common Stock held in ~~the~~ treasury of by the Company. (3iii) In case ~~at any time after the Closing Date,~~ outstanding shares of Common Stock shall be subdivided or split into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision or split becomes effective shall be proportionately ~~increased~~ increased, and, conversely, in case ~~at any time after the date hereof,~~ outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such ~~subdivision~~ subdivision, split or combination becomes effective. (4iv) In case ~~at any time after the Closing Date,~~ the Company shall, by dividend or otherwise, distribute to all ~~holders~~ Holders of its Common Stock evidences of its ~~indebtedness or assets (including stock~~ indebtedness, shares of capital stock, securities, cash or other ~~securities of the Company or any other issuer,~~ property (but excluding any ~~rights~~ rights, options or warrants referred to in ~~paragraph (2~~Section 1.10(g)(ii) of this ~~Section 15.4~~Section, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in ~~paragraph (1) of this~~ Section ~~15.4~~1.10(g)(i)), the Conversion Rate shall be adjusted ~~so that the same shall equal the rate determined~~ by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the ~~current market price~~ Current Market Price per share ~~(determined as provided in paragraph (8) of this Section 15.4)~~ of the Common Stock on the date fixed for such determination less the then fair market value (~~each reference to "fair market value" in this Section 15.4 shall mean the fair market value~~ as determined by the Board of ~~Directors of the Company in good faith~~Directors, whose determination shall be conclusive and described in a Board Resolution~~, a copy of which shall be delivered to each holder of Debentures within ten (10~~) ~~days of the adoption of the resolution)~~ on such date of the portion of the ~~assets or~~ evidences of ~~indebtedness~~ indebtedness, shares of capital stock, securities, cash or other property so distributed applicable to one ~~(1)~~ share of Common Stock and the denominator shall be such ~~current market price~~ Current Market Price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution; provided, however, that in the event that the Company makes a distribution to all Holders of its Common Stock consisting of capital stock of, or similar equity interests in, a subsidiary of the Company, the Conversion Rate shall be adjusted by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the Spin-off Market Price per share of the Common Stock on the date fixed for such determination less the Spin-off Market Price per share or similar equity interest of the subsidiary of the Company on such date and the denominator shall be the Spin-off Market Price per share of the Common Stock, such adjustment to become effective 10 trading days after the effective date of such distribution of capital stock of, or similar equity interest in, a subsidiary or other business unit of the Company. In any case in which this Section 1.10(g)(iv) is applicable, Sections 1.10(g)(i) and (ii) shall not be applicable. (5v) In case ~~at any time after the Closing Date (A)~~ the Company shall, (I) by dividend or otherwise, distribute to all ~~holders~~ Holders of its Common Stock cash (excluding (i) any cash that is distributed ~~upon a merger or consolidation~~ in an event to which Section ~~15.13~~ 1.10(h)(iv) applies or (ii) cash that is distributed as part of a distribution referred to in ~~paragraph (4~~Section 1.10(g)(iv)) ~~of this Section 15.4) and (B)(I) the total of (x) the~~ in an aggregate amount ~~of such cash distribution~~that, combined together with (yII) the aggregate amount of any other distributions to all ~~holders~~ Holders of its Common Stock made exclusively in cash within the ~~twelve (12) months preceding~~ quarterly fiscal period containing the date of payment of such distribution and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 1.10(g)(v) or ~~paragraph (6~~Section 1.10(g)(vi) ~~of this Section 15.4~~ has been made and (zIII) the aggregate of any cash plus the fair market value of any securities or other property, as of the expiration of the applicable tender or exchange offer referred to below (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), of consideration payable in respect of any tender ~~offers~~ or exchange offer (other than consideration payable in respect of any odd-lot tender offer) by the Company or any of its ~~Subsidiaries~~ subsidiaries for all or any portion of the Common Stock concluded within the ~~twelve (12) months preceding~~ quarterly fiscal period containing the date of payment of ~~such~~ the distribution described in clause (I) above and in respect of which no adjustment pursuant to this ~~paragraph (5~~Section 1.10(g)(v) or ~~paragraph (6~~Section 1.10(g)(vi) ~~of this Section 15.4~~ has been made, exceeds ~~(II) ten percent (10%) of~~ the product of ~~the current market price per share~~ $0.13 (~~determined as provided in paragraph (8) of this Section 15.4) of the Common Stock~~ appropriately adjusted from time to time for any stock dividends on ~~the date for the determination of holders of shares~~ or subdivisions or combinations of Common ~~Stock entitled to receive such distribution times~~ Stock) multiplied by the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to ~~such current market price~~ the Current Market Price per share of the Common Stock on the date fixed for such determination plus $0.13 (appropriately adjusted from time to time for any stock dividends on or subdivisions or combination of Common Stock) less an amount equal to the quotient of (Xx) the ~~sum of~~ combined amount distributed or payable in the transactions described in clauses (I~~) the total of the amounts referred to in subclauses~~ ), (~~B)(I)(x~~II) and (yIII) ~~of this paragraph (5)~~ above and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Yy) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to ~~such current market price~~ the Current Market Price per share of the Common Stock on such date for determination. (6vi) In case ~~at any time after the Closing Date~~ (AI) a tender or exchange offer made by the Company or any ~~Subsidiary~~ subsidiary of the Company for all or any portion of the Common Stock (other than consideration payable in respect of any odd-lot tender offer) shall expire and ~~(B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to~~ such tender or exchange offer (as amended upon the expiration thereof) shall require the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of Purchased ~~Shares~~ Shares) of an aggregate consideration having a fair market value (as ~~defined below))~~determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) that combined together with (yII) the aggregate of the cash plus the fair market ~~value~~value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), as of the expiration of such tender or exchange offer, of consideration payable in respect of any other tender or exchange offer (other than consideration payable in respect of any odd-lot tender offer, ) by the Company or any ~~Subsidiary~~ subsidiary of the Company for all or any portion of the Common Stock expiring within the ~~twelve (12) months preceding~~ quarterly fiscal period containing the expiration of such tender or exchange offer and in respect of which no adjustment pursuant to ~~this paragraph (6~~Section 1.10(g)(v) or ~~paragraph (5) of~~ this Section ~~15.4~~ 1.10(g)(vi) has been made and (zIII) the aggregate amount of any distributions to all ~~holders~~ Holders of the Company's Common Stock made exclusively in cash within ~~twelve (12) months preceding~~ the quarterly fiscal period containing the expiration of such tender or exchange offer and in respect of which no adjustment pursuant to ~~this paragraph (6~~Section 1.10(g)(v) or ~~paragraph (5) of~~ this Section ~~15.4~~ 1.10(g)(vi) has been made, exceeds ~~(II) ten percent (10%) of~~ the ~~product of the current market price~~ Current Market Price per share of ~~the~~ Common Stock ~~(determined as provided in paragraph (8) of this Section 15.4)~~ on the ~~date of~~ Trading Day next succeeding the last time (the "Expiration Time") tenders could have been made pursuant to such tender or exchange offer (as it may be amended~~) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time~~), then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the ~~price~~ rate determined by dividing the Conversion Rate immediately prior to the close of business ~~on the date~~ as of the Expiration Time by a fraction (i) the numerator of which shall be equal to (aA) the product of (I1) ~~such current market price~~ the Current Market Price per share on of the ~~date~~ Common Stock as of the Expiration Time and (II2) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (bB) the ~~total~~ amount of cash plus the fair market value (determined as aforesaid) of the ~~amounts referred~~ aggregate consideration payable to stockholders based on the transactions described in ~~Clause~~ clauses (~~B)(I~~I), (II) and (III) above (assuming in the case of ~~this paragraph~~ clause (6I) the acceptance, up to any maximum specified in the terms of the tender or exchange offer, of Purchased Shares), and (ii) the denominator of which shall be equal to the product of (aA) ~~such current market price~~ the Current Market Price per share on of the ~~date~~ Common Stock as of the Expiration Time and (bB) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so ~~accepted~~ accepted, up to any such maximum, being referred to as the "Purchased Shares"). (7vii) ~~The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger~~ All adjustments to ~~which Section 15.13 applies)~~ the Conversion Rate, shall be ~~deemed~~ calculated to ~~involve (a)~~ the nearest 1/10,000th of a ~~distribution of such securities other than Common Stock to all holders~~ share of Common Stock (~~and~~ or if there is not a nearest 1/10,000th of a share to the ~~effective date~~ next lower 1/10,000th of ~~such reclassification~~ a share). No adjustment in the Conversion Rate shall be ~~deemed~~ required unless such adjustment would require an increase or decrease of at least one percent therein; provided, however, that any adjustments which by reason of this subparagraph are not required to be ~~"the date fixed for the determination~~ made because they would have required an increase 26 or decrease of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification less than one percent shall be ~~deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be,~~ carried forward and ~~"the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4)~~taken into account in any subsequent adjustment. (~~8) For~~ viii) Notwithstanding the ~~purpose~~ foregoing provisions of ~~any computation under paragraph (2), (4), (5~~Section 1.10(g)(ii) or (6iv), no adjustment shall be made thereunder, nor shall an adjustment be made to the ability of a Holder of a Note to convert, for any distribution described therein if the Holder will otherwise participate in the distribution without conversion of such Holder's Senior Convertible Notes. (ix) of No adjustment pursuant to the Conversion Rate or a Holder's ability to convert pursuant to this Section ~~15.4~~1.10(g) shall be made in connection with the issuance of rights, the ~~current market price per share~~ distribution of ~~Common Stock on~~ separate certificates representing rights or the exercise, redemption, termination or invalidation of rights pursuant to any ~~date shall be calculated~~ stockholder rights plan implemented by the Company ~~and be deemed to be the average~~ which provides that, upon conversion of the ~~daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than~~Senior Convertible Notes, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter termHolders shall receive, in addition to ~~those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of~~ the Common Stock ~~resulting~~ issuable upon such conversion, the rights issued under such stockholder rights plan (notwithstanding the occurrence of an event causing such rights to separate from ~~any dividend~~ the Common Stock at or ~~distribution~~ prior to the time of ~~stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons~~conversion).

Appears in 1 contract

Samples: Fifth Supplemental Indenture (Bausch & Lomb Inc)

Adjustments to Conversion Rate. The Conversion Rate shall be ~~subject to adjustments~~ adjusted from time to ~~time~~ time, without duplication, as follows: (1a) In case ~~at any time after the Closing Date~~ the Company shall (i) pay a dividend or make a ~~dividend or other~~ distribution on ~~any class of Capital~~ its Common Stock ~~of the Company (other than the Series C Preferred Stock)~~ exclusively in shares of its Common Stock; (ii) subdivide its outstanding Common Stock into a greater number of shares; or (iii) combine its outstanding Common Stock into a smaller number of shares, the Conversion Rate in effect immediately prior to the record date or effective date, as the case may be, for the adjustment pursuant to this Section 7.06(a) as described below, shall be adjusted so that the Holder of any Notes thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock of the Company which such Holder would have owned or have been entitled to receive after the happening of any of the events described above had such Notes been converted immediately prior to such record date or effective date, as the case may be. An adjustment made pursuant to this Section 7.06(a) shall become effective immediately after the applicable record date in the case of a dividend or distribution and shall become effective immediately after the applicable effective date in the case of subdivision or combination of the Company's Common Stock. If any dividend or distribution of the type described in clause (i) above is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. (b) In case the Company shall issue rights or warrants to all holders of the Common Stock entitling them (for a period expiring within 60 days after the date of issuance of such rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the ~~opening~~ Market Price per share of ~~business~~ Common Stock on the ~~day following the~~ record date fixed for ~~the~~ determination of stockholders entitled to receive such ~~dividend~~ rights or ~~other distribution~~ warrants, the Conversion Rate in effect immediately after such record date shall be ~~increased by dividing such~~ adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately after such record date by a fraction of which (i) the numerator shall be the number of shares of Common Stock outstanding at on such record date plus the ~~close~~ number of ~~business on the date fixed~~ additional shares of Common Stock offered for ~~such determination~~ subscription or purchase, and (ii) the denominator shall be the ~~sum of such~~ number of shares ~~and~~ of Common Stock outstanding on such record date plus the number of shares which the aggregate offering price of the total number of shares ~~constituting~~ so offered would purchase at the Market Price per share of Common Stock on the earlier of such ~~dividend~~ record date or ~~other distribution~~the Trading Day immediately preceding the ex-date for such issuance of rights or warrants. Such adjustment shall be made successively whenever any such rights or warrants are issued, ~~such increase to~~ and shall become effective immediately after the opening of business on the day following the record date for the determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in effect if such record date for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at less than such Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights or warrants, the value of such consideration, if other than cash, to be determined by the Board of Directors. (c) In case the Company shall, by dividend or otherwise, distribute to all holders of Common Stock any assets, debt securities, shares of any class of capital stock of the Company or rights or warrants to purchase any of its securities (excluding (i) any dividend, distribution or issuance covered by those referred to in Section 7.06(a) or 7.06(b) hereof and (ii) any dividend or distribution paid exclusively in cash) (any of the foregoing hereinafter in this Section 7.06(c) called the "Distributed Assets or Securities"), then, in each case, the Conversion Rate shall be adjusted (unless Section 7.06(e) applies, in which case the adjustment shall be made as provided therein) so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date mentioned below by a fraction of which (A) the numerator shall be the Market Price per share of the Common Stock on the earlier of the record date or the Trading Day immediately preceding the ex- date for such dividend or distribution, and (B) the denominator shall be (1) the Market Price per share of the Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex-date for such dividend or distribution less (2) the Fair Market Value on the earlier of such record date or the Trading Day immediately preceding the ex-date for such dividend or distribution (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Conversion Agent) of the Distributed Assets or Securities so distributed applicable to one share of Common Stock. Such adjustment shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution; provided, however, that, if (i) the Fair Market Value of the portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the record date for the determination of stockholders entitled to receive such distribution or (ii) the Market Price of the Common Stock on the record date for the determination of stockholders entitled to receive such distribution is greater than the Fair Market Value per share of such Distributed Assets or Securities by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the kind and amount of assets, debt securities, shares of our capital stock or rights or warrants comprising the Distributed Assets or Securities the Holder would have received had such Holder converted such Notes immediately prior to the record date for the determination of stockholders entitled to receive such distribution. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such distribution had not been declared. (d) In case the Company shall make any distributions, by dividend or otherwise, consisting exclusively of cash to all holders of Common Stock, other than cash dividends on Common Stock in amounts up to $0.25 aggregate cash dividends per share of Common Stock in any six month period (the "Dividend Threshold Amount"), then, in such case, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive such ~~determination~~distribution by a fraction of which (A) the numerator shall be the Market Price per share of the Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex-date for such dividend or distribution and (B) the denominator shall be (1) the Market Price per share of Common Stock on the earlier of such record date or the Trading Day immediately preceding the ex-date for such dividend or distribution less (2) the amount of cash so distributed applicable to one share of Common Stock (in the case of cash dividends, that amount in excess of the Dividend Threshold Amount). Such adjustment shall become effective immediately after the record date for the determination of stockholders entitled to receive such distribution; provided that if (i) the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Market Price of the Common Stock on the record date for the determination of stockholders entitled to receive such distribution or (ii) the Market Price of the Common Stock on the record date for the determination of stockholders entitled to receive such distribution is greater than the portion of the cash so distributed applicable to one share of Common Stock by less than $1.00, then, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion, in addition to the shares of Common Stock, the amount of cash such Holder would have received had such Holder converted such Notes immediately prior to the record date for the determination of stockholders entitled to receive such distribution. In the event that such distribution is not so paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate that would then be in effect if such distribution had not been declared. If any adjustment is required to be made by this Section 7.06(d) as a result of a distribution of a dividend in any six month period that exceeds the Dividend Threshold Amount, such adjustment shall be based upon the amount by which such distribution exceeds the Dividend Threshold Amount. If an adjustment is otherwise required to be made by this Section 7.06(d), such adjustment shall be based upon the full amount of the distribution. (e) With respect to Section 7.06(c) above, in the event that the Company makes any distribution to all holders of Common Stock for which an adjustment is required by Section 7.06(c) consisting of Equity Interests in a Subsidiary or other business unit of the Company, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive such distribution by a fraction of which (i) the numerator shall be (x) the Spin-off Market Price per share of the Common Stock on such record date plus (y) the Spin-off Market Price per Equity Interest of the Subsidiary or other business unit of the Company on such record date and (ii) the denominator shall be the Spin-off Market Price per share of the Common Stock on such record date, such adjustment to become effective immediately after the effective date of such distribution of Equity Interests in a Subsidiary or other business unit of the Company. (f) In case a tender or exchange offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and such tender or exchange offer (as amended upon the expiration thereof) shall require the payment to stockholders of consideration per share of Common Stock having a Fair Market Value (as determined by the Board of Directors, whose determination shall be conclusive, and described in a certificate filed with the Trustee and the Conversion Agent) that as of the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it may be amended) exceeds the Last Reported Sale Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the Conversion Rate determined by multiplying the Conversion Rate in effect immediately prior to the Expiration Time by a fraction, of which (i) the numerator shall be the sum of (x) the Fair Market Value (determined as aforesaid) of the aggregate consideration payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of all shares validly tendered or exchanged and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares") and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) at the Expiration Time and the Last Reported Sale Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time, and (ii) the denominator shall be the product of the number of shares of Common Stock outstanding (including any Purchased Shares) at the Expiration Time and the Last Reported Sale Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time. Such adjustment shall become effective immediately prior to the opening of business on the day following the Expiration Time. If the Company is obligated to purchase shares pursuant to any such tender or exchange offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in effect if such tender or exchange offer had not been made. (g) Upon conversion of the Notes, the Holders shall receive, in addition to the Common Stock issuable upon such conversion, the rights issued under any future shareholder rights plan the Company implements (notwithstanding the occurrence of an event causing such rights to separate from the Common Stock at or prior to the time of conversion) unless, prior to conversion, such rights have expired, terminated or been redeemed or exchanged in accordance with such future shareholders rights plan. If, and only if, the Holders of Notes receive rights under such shareholder rights plan as described in the preceding sentence upon conversion of their Notes, then no other adjustment pursuant to this Section 7.06 shall be made in connection with such shareholder rights plan, but an adjustment to the Conversion Rate shall be made pursuant to Section 7.06(c) hereof upon the separation of the rights from the Common Stock. (h) For ~~the~~ purposes of this ~~paragraph (1)~~Section 7.06, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company ~~will~~ shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2i) ~~In case at any time after~~ Notwithstanding the ~~Closing Date~~foregoing, ~~the Company~~ in no event shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate ~~in effect at~~ exceed the ~~opening~~ maximum conversion rate specified under this Section 7.06(i) (the "Maximum Conversion Rate") as a result of ~~business on the day following the date fixed for such determination shall be increased by dividing such~~ an adjustment pursuant to Section 7.06(d) and Section 7.06(f) hereof. The Maximum Conversion Rate ~~by a fraction of which~~ shall initially be 47.3934. The Maximum Conversion Rate is subject to the ~~numerator shall be~~ same proportional adjustments made to the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription Conversion Rate pursuant to Section 7.06(a), (b), (c) or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription (e) hereof. (j) If any adjustment or ~~purchase, such increase~~ readjustment is made to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this ~~subsection~~ Section 7.06 (2other than pursuant to Section 7.06(d)), ~~if any such right or warrant~~ the same proportional adjustment shall ~~expire and~~ be made to the Dividend Threshold Amount; provided that the Dividend Threshold Amount shall ~~not have been exercised,~~ be decreased whenever the Conversion Rate ~~shall immediately upon such expiration be recomputed~~ is increased and ~~effective immediately upon such expiration be~~ increased ~~to the price which it would have been (but reflecting any other adjustments in~~ whenever the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Companyis decreased. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case at any time after the Closing Date, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate shall be adjusted so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9) The Company may make such increases in the Conversion Rate, for the remaining term of the Debentures or any shorter term, in addition to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 15.4, as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons.

Appears in 1 contract

Samples: Fifth Supplemental Indenture (Eastman Kodak Co)

Adjustments to Conversion Rate. The Conversion Rate of each series of Securities shall be ~~subject to adjustments~~ adjusted from time to time by the Company as follows: (1a) ~~In case~~ If the Company shall at any time ~~after~~ prior to the ~~Closing Date~~ Stated Maturity subdivide the ~~Company shall pay or make a dividend or other distribution on any class of Capital Stock of the Company (other than the Series C Preferred Stock) in~~ shares of ~~its~~ Common Stock, by split-up or otherwise, or combine the shares of Common Stock, or issue additional shares of Common Stock as a dividend, the Conversion Rate for each series of Securities shall be adjusted by multiplying the Conversion Rate in effect ~~at the opening of business on the day following the date fixed for the determination of stockholders entitled~~ immediately prior to ~~receive~~ such ~~dividend or other distribution shall be increased by dividing such Conversion Rate~~ event by a ~~fraction~~ fraction, the numerator of which ~~the numerator~~ shall be the number of shares of Common Stock outstanding ~~at the close of business on the date fixed for~~ immediately after such ~~determination~~ event, and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case at any time after the Closing Date, the Company shall issue rights or warrants to all holders of its Common Stock (not being available on an equivalent basis to holders of the Debentures upon conversion) entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Conversion Rate by a fraction of which ~~the numerator~~ shall be the number of shares of Common Stock ~~outstanding~~ immediately prior to such event. Any adjustment under this Section 12.2(a) shall become effective at the close of business on the date ~~fixed for such determination plus~~ the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. However, upon the expiration of any right or warrant to purchase Common Stock the issuance of which resulted in an adjustment in the Conversion Rate pursuant to this subsection (2), if any such right or warrant shall expire and shall not have been exercised, the Conversion Rate shall immediately upon such expiration be recomputed and effective immediately upon such expiration be increased to the price which it would have been (but reflecting any other adjustments in the Conversion Rate made pursuant to the provisions of this Section 15.4 after the issuance of such rights or warrants) had the adjustment of the Conversion Rate made upon the issuance of such rights or warrants been made on the basis of offering for subscription or purchase only that number of shares of Common Stock actually purchased upon the exercise of such rights or warrants actually exercised. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but will include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case at any time after the Closing Date, outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased and, conversely, in case at any time after the date hereof, outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Conversion Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective, or as of the Dividend Record Date of such dividend, or in the event that no record date is fixed, upon the making of such dividend. (4b) ~~In case at any time after~~ Notwithstanding the ~~Closing Date~~foregoing, the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including stock or other securities of the Company or any other issuer, but excluding any rights or warrants referred to in paragraph (2) of this Section 15.4, any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 15.4), the Conversion Rate no adjustment shall be ~~adjusted so that the same~~ made hereunder, nor shall ~~equal the rate determined by dividing the Conversion Rate in effect immediately prior~~ an adjustment be made to the ~~close~~ ability of ~~business~~ a Holder of a Security to convert, for any distribution described herein if the Holder will otherwise participate on an as-converted basis in the ~~date fixed for the determination~~ distribution without conversion of ~~stockholders entitled to receive~~ such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date fixed for such determination less the then fair market value (each reference to "fair market value" in this Section 15.4 shall mean the fair market value as determined by the Board of Directors of the Company in good faith, whose determination shall be described in a Board Resolution, a copy of which shall be delivered to each holder of Debentures within ten (10) days of the adoption of the resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one (1) share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distributionHolder’s Securities. (5) In case at any time after the Closing Date (A) the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock cash (excluding any cash that is distributed upon a merger or consolidation to which Section 15.13 applies or as part of a distribution referred to in paragraph (4) of this Section 15.4) and (B)(I) the total of (x) the aggregate amount of such cash distribution, (y) the aggregate amount of any other distributions to all holders of its Common Stock made exclusively in cash within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made and (z) the aggregate of any cash plus the fair market value of other consideration payable in respect of any tender offers by the Company or any of its Subsidiaries for all or any portion of the Common Stock concluded within the twelve (12) months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share (determined as provided in paragraph (8) of this Section 15.4) of the Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Conversion Rate shall be increased so that the same shall equal the rate determined by dividing the Conversion Rate in effect immediately prior to the close of business on the date fixed for determination of the stockholders entitled to receive such distribution by a fraction (i) the numerator of which shall be equal to such current market price per share on the date fixed for such determination less an amount equal to the quotient of (X) the sum of (I) the total of the amounts referred to in subclauses (B)(I)(x) and (y) of this paragraph (5) and (II) the aggregate of the excess of the amount referred to in subclause (B)(I)(z) of this paragraph (5) for each tender offer so referred to over the aggregate current market price of the shares of Common Stock purchased in such tender offer as of the Expiration Time (as hereinafter defined) for such tender offer divided by (Y) the number of shares of Common Stock outstanding on such date for determination and (ii) the denominator of which shall be equal to such current market price per share on such date for determination. (6) In case at any time after the Closing Date (A) a tender offer made by the Company or any Subsidiary for all or any portion of the Common Stock shall expire and (B)(I) the total of (x) the fair market value of the aggregate consideration required to be paid pursuant to such tender offer (as amended upon the expiration thereof) to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)), (y) the aggregate of the cash plus the fair market value, as of the expiration of such tender offer, of consideration payable in respect of any other tender offer, by the Company or any Subsidiary for all or any portion of the Common Stock expiring within the twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made and (z) the aggregate amount of any distributions to all holders of the Company's Common Stock made exclusively in cash within twelve (12) months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this paragraph (6) or paragraph (5) of this Section 15.4 has been made, exceeds (II) ten percent (10%) of the product of the current market price per share of the Common Stock (determined as provided in paragraph (8) of this Section 15.4) on the date of the last time (the "Expiration Time") tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to the opening of business on the day after the date of the Expiration Time, the Conversion Rate shall be adjusted so that the same shall equal the price determined by dividing the Conversion Rate immediately prior to the close of business on the date of the Expiration Time by a fraction (i) the numerator of which shall be equal to (a) the product of (I) such current market price per share on the date of the Expiration Time and (II) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less (b) the total of the amounts referred to in Clause (B)(I) of this paragraph (6), and (ii) the denominator of which shall be equal to the product of (a) such current market price per share on the date of the Expiration Time and (b) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities other than Common Stock (other than any reclassification upon a consolidation or merger to which Section 15.13 applies) shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section 15.4), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section 15.4). (8) For the purpose of any computation under paragraph (2), (4), (5) or (6) of this Section 15.4, the current market price per share of Common Stock on any date shall be calculated by the Company and be deemed to be the average of the daily Closing Price per share of Common Stock for the five (5) consecutive Trading Days before, and ending not later than, the earlier of (i) the day in question and (ii) the day before the "ex" date with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "'ex' date", when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the applicable securities exchange or in the applicable securities market without the right to receive such issuance or distribution. (9c) The Company may (but is not required to) make such increases in the Conversion Rate, ~~for the remaining term of the Debentures or any shorter term,~~ in addition to those required by ~~paragraphs (1), (2), (3), (4), (5~~Section 12.2(a) ~~and (6)~~ as the Board of ~~this Section 15.4, as it~~ Directors considers to be advisable ~~in order~~ to avoid or diminish any income tax to ~~any~~ holders ~~of shares~~ of Common Stock ~~resulting from any~~ or rights to purchase Common Stock in connection with a dividend or distribution of ~~stock~~ shares (or ~~issuance of~~ rights to acquire shares) or ~~warrants to purchase or subscribe for stock or from~~ any similar event treated as such for income tax ~~purposes or~~ purposes. To the extent permitted by applicable law, the Company from time to time may increase the Conversion Rate by any amount for any ~~other reasons~~period of at least 20 days if the Board of Directors shall have made a determination that such increase would be in the best interests of the Company, which determination shall be conclusive. (d) Except as stated herein, the Company will not adjust the Conversion Rate for the issuance of shares of Common Stock or any securities convertible into or exchangeable for shares of Common Stock or the right to purchase shares of Common Stock or such convertible or exchangeable securities. For the avoidance of doubt, no adjustment to the Conversion Rate need be made:

Appears in 1 contract

Samples: Indenture (Interstate Bakeries Corp/De/)

Common use of Adjustments to Conversion Rate Clause in Contracts