Common use of Conversion and Cancellation of Securities Clause in Contracts

Conversion and Cancellation of Securities. (a) At the Effective Time, each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than Excluded Shares described in Section 1.3(b) hereof), by virtue of the Merger and without any action on the part of the holder thereof, shall be converted into, and become exchangeable for, the right to receive (i) .1634 shares (the "EXCHANGE RATIO") of Parent Common Stock ("STOCK CONSIDERATION"); provided, however, (x) if the Effective Time shall not have occurred by June 1, 1999, the Exchange Ration shall be increased by .0005 shares, and (y) if the Company shall have entered into a binding agreement for the settlement of the litigation referred to in Part II, Item 1 of the Company's Form 10-Q for the Quarter Ended September 30, 1998 (the "SETTLEMENT AGREEMENT"), the cost of which to the Company is less than $10,000,000, the Exchange Ratio shall be increased by a number of shares equal to .00027 times the quotient of (A) $10,000,000 less such cost of such settlement by the Company, divided by (B) 1,000,000. The consideration to be received by the holders of Company Common Stock pursuant to this Section 1.3(a) is hereinafter referred to as the "MERGER CONSIDERATION." (b) At the Effective Time, each share of Company Common Stock owned by Parent, Merger Sub or any other direct or indirect subsidiary of Parent and each share of Company Common Stock owned by the Company or any direct or indirect subsidiary of the Company and in each case not held on behalf of third parties (collectively, "EXCLUDED SHARES"), shall by virtue of the Merger and without any action on the part of the holder thereof, be automatically canceled and retired and cease to exist, and no cash, securities or other property shall be payable in respect thereof. (c) At the Effective Time, each share of Merger Sub common stock, par value $.01 per share ("MERGER SUB COMMON STOCK"), issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action by the holder thereof, be converted into one validly issued, fully paid and nonassessable common share, no par value, of the Surviving Corporation ("SURVIVING CORPORATION COMMON STOCK"). (d) If between the date of this Agreement and the Effective Time, the outstanding shares of Company Common Stock shall be changed into a different number of shares by reason of any reclassification, recapitalization, split-up, combination or exchange of shares, or any dividend payable in stock shall be declared thereon with a record date within such period, the Merger Consideration shall be adjusted accordingly to provide to the holders of Company Common Stock the same economic effect as contemplated by this Agreement.

Conversion and Cancellation of Securities. (a) 6.1 At the First Blocker 1 Merger Effective Time, each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than Excluded Shares described in Section 1.3(b) hereof), by virtue of the First Blocker 1 Merger and without any action on the part of any party: (a) all membership interests in New Blocker 1 issued and outstanding immediately prior to the holder thereof, First Blocker 1 Merger Effective Time shall be converted intointo the right to receive, in the aggregate, the applicable Merger Consideration and become exchangeable foreach holder of a certificate formerly representing any such membership interests will cease to have any rights with respect thereto, except the right to receive (i) .1634 shares (the "EXCHANGE RATIO") of Parent Common Stock ("STOCK CONSIDERATION"); provided, however, (x) if the Effective Time shall not have occurred by June 1, 1999, the Exchange Ration shall be increased by .0005 shares, and (y) if the Company shall have entered into a binding agreement for the settlement of the litigation referred to applicable Merger Consideration in Part II, Item 1 of the Company's Form 10-Q for the Quarter Ended September 30, 1998 (the "SETTLEMENT AGREEMENT"), the cost of which to the Company is less than $10,000,000, the Exchange Ratio shall be increased by a number of shares equal to .00027 times the quotient of (A) $10,000,000 less such cost of such settlement by the Company, divided by (B) 1,000,000. The consideration to be received by the holders of Company Common Stock pursuant to accordance with this Section 1.3(a) is hereinafter referred to as the "MERGER CONSIDERATION."Agreement; (b) all membership interests in New Blocker 1 will no longer be outstanding and all membership interests in New Blocker 1 will be cancelled and will cease to exist, and each holder of a certificate formerly representing any such membership interests will cease to have any rights with respect thereto, except the right to receive the applicable Merger Consideration in accordance with this Agreement; and (c) all shares of common stock, par value $0.01 per share, of Merger Sub 1 issued and outstanding immediately prior to the First Blocker 1 Merger Effective Time shall be converted into and become 100% of the membership interests in the First Blocker 1 Merger Surviving Company, which shall be held by Parent. 6.2 At the First Blocker 2 Merger Effective Time, each share of Company Common Stock owned by Parent, Merger Sub or any other direct or indirect subsidiary of Parent and each share of Company Common Stock owned by the Company or any direct or indirect subsidiary of the Company and in each case not held on behalf of third parties (collectively, "EXCLUDED SHARES"), shall by virtue of the First Blocker 2 Merger and without any action on the part of the holder thereof, be automatically canceled and retired and cease to exist, and no cash, securities or other property shall be payable in respect thereof.any party: (ca) At the Effective Time, each share of Merger Sub common stock, par value $.01 per share ("MERGER SUB COMMON STOCK"), all membership interests in New Blocker 2 issued and outstanding immediately prior to the First Blocker 2 Merger Effective Time shall, by virtue of the Merger and without any action by the holder thereof, shall be converted into one validly issuedthe right to receive, fully paid in the aggregate, the applicable Merger Consideration and nonassessable each holder of a certificate formerly representing any such membership interests will cease to have any rights with respect thereto, except the right to receive the applicable Merger Consideration in accordance with this Agreement; (b) all membership interests in New Blocker 2 will no longer be outstanding and all membership interests in New Blocker 2 will be cancelled and will cease to exist, and each holder of a certificate formerly representing any such membership interests will cease to have any rights with respect thereto, except the right to receive the applicable Merger Consideration in accordance with this Agreement; and (c) all shares of common stock, par value $0.01 per share, no par value, of Merger Sub 2 issued and outstanding immediately prior to the First Blocker 1 Merger Effective Time shall be converted into and become 100% of the membership interests in the First Blocker 2 Merger Surviving Corporation ("SURVIVING CORPORATION COMMON STOCK"). (d) If between the date of this Agreement and the Effective TimeCompany, the outstanding shares of Company Common Stock which shall be changed into a different number of shares held by reason of any reclassification, recapitalization, split-up, combination or exchange of shares, or any dividend payable in stock shall be declared thereon with a record date within such period, the Merger Consideration shall be adjusted accordingly to provide to the holders of Company Common Stock the same economic effect as contemplated by this AgreementParent.

Conversion and Cancellation of Securities. (a) At the Effective TimeTime and subject to Section 1.5 hereof, each share all (i) shares of Company IDRC Common Stock and (ii) options, warrants and other rights (the "Options") exercisable for, or providing the right to acquire, IDRC Common Stock -------- that are issued and outstanding immediately prior to the Effective Time (other than Excluded Shares any shares of IDRC Common Stock described in Section 1.3(b1.3(c) hereof)) shall, by virtue of the Merger and without any action on the part of the holder thereof, shall be converted into, and become exchangeable for, into the right to receive (i) .1634 an aggregate of 9,200,000 shares (the "EXCHANGE RATIOMerger Shares") of Parent TeleSpectrum Common Stock and warrants (the "STOCK CONSIDERATIONWarrants"); provided, however) ------------- -------- exercisable for an aggregate of 3,000,000 shares (the "Warrant Shares") of -------------- TeleSpectrum Common Stock. The Warrants shall contain such other terms and conditions set forth in the form attached as Exhibit C hereto. Notwithstanding --------- the foregoing, (xi) if the Effective Time shall not have occurred by June 1, 1999, the Exchange Ration no fractional shares of TeleSpectrum Common Stock shall be increased by .0005 sharesissued and, in lieu thereof, a cash payment shall be made pursuant to Section 1.4(g) hereof, and (yii) if the Company number of Merger Shares and Warrants issuable pursuant to Section 1.3(a) shall be reduced on a proportional basis in an aggregate amount equal to the number of Merger Shares and Warrants that would have entered into a binding agreement for the settlement been received by holders of any Appraisal Shares (as such term is defined in Section 1.3(c) hereof). The effect of the litigation referred to in Part II, Item 1 of the Company's Form 10-Q for the Quarter Ended September 30, 1998 (the "SETTLEMENT AGREEMENT"), the cost of which to the Company is less than $10,000,000, the Exchange Ratio shall be increased by a number of shares equal to .00027 times the quotient of foregoing means that (A) $10,000,000 less such cost of such settlement by the Company, divided by (B) 1,000,000. The consideration to be received by the holders of Company Common Stock pursuant to this Section 1.3(a) is hereinafter referred to as the "MERGER CONSIDERATION." (b) At the Effective Time, each share of Company IDRC Common Stock owned by Parent, Merger Sub or any other direct or indirect subsidiary of Parent and each share of Company Common Stock owned by the Company or any direct or indirect subsidiary of the Company and in each case not held on behalf of third parties (collectively, "EXCLUDED SHARES"), shall by virtue of the Merger and without any action on the part of the holder thereof, be automatically canceled and retired and cease to exist, and no cash, securities or other property shall be payable in respect thereof. (c) At the Effective Time, each share of Merger Sub common stock, par value $.01 per share ("MERGER SUB COMMON STOCK"), that is issued and outstanding immediately prior to the Effective Time shall, by virtue (other than any shares of the IDRC Common Stock described in Section 1.3(c) hereof) will be convertible into (i) that number of Merger and without any action Shares equal to 9,200,000 divided by the holder thereofTotal IDRC Shares Outstanding, be converted into one validly issuedthe product being rounded, fully paid if necessary, up or down, to the nearest whole share and nonassessable common (ii) a Warrant exercisable for that number of Warrant Shares equal to 3,000,000 divided by the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share, no par valueand (B), subject to Sections 1.5 and 1.6 hereto, a holder of Options will be entitled to receive, upon exercise, on account of each share of IDRC Common Stock (i) that number of Merger Shares equal to 9,200,000 divided by the Surviving Corporation Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share and (ii) a Warrant exercisable for that number of Warrant Shares equal to 3,000,000 divided by the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share. As used herein, the term "SURVIVING CORPORATION COMMON STOCK"). (d) If between Total IDRC Shares Outstanding" means the date total number of this Agreement shares of IDRC Common Stock and the total number of shares of IDRC Common Stock issuable upon exercise of Options that are issued and outstanding immediately prior to the Effective Time, the outstanding shares of Company Common Stock shall be changed into a different number of shares by reason of any reclassification, recapitalization, split-up, combination or exchange of shares, or any dividend payable in stock shall be declared thereon with a record date within such period, the Merger Consideration shall be adjusted accordingly to provide to the holders of Company Common Stock the same economic effect as contemplated by this Agreement.

Conversion and Cancellation of Securities. (a) At the Effective TimeTime and subject to Section 1.5 hereof, each share all (i) shares of Company IDRC Common Stock and (ii) options, warrants and other rights (the "Options") exercisable for, or providing the right to acquire, IDRC Common Stock ------- that are issued and outstanding immediately prior to the Effective Time (other than Excluded Shares any shares of IDRC Common Stock described in Section 1.3(b1.3(c) hereof)) shall, by virtue of the Merger and without any action on the part of the holder thereof, shall be converted into, and become exchangeable for, into the right to receive (i) .1634 an aggregate of 9,200,000 shares (the "EXCHANGE RATIOMerger Shares") of Parent TeleSpectrum Common Stock and warrants (the "STOCK CONSIDERATIONWarrants"); provided, however) ------------- -------- exercisable for an aggregate of 3,000,000 shares (the "Warrant Shares") of -------------- TeleSpectrum Common Stock. The Warrants shall contain such other terms and conditions set forth in the form attached as Exhibit C hereto. Notwithstanding --------- the foregoing, (xi) if the Effective Time shall not have occurred by June 1, 1999, the Exchange Ration no fractional shares of TeleSpectrum Common Stock shall be increased by .0005 sharesissued and, in lieu thereof, a cash payment shall be made pursuant to Section 1.4(g) hereof, and (yii) if the Company number of Merger Shares and Warrants issuable pursuant to Section 1.3(a) shall be reduced on a proportional basis in an aggregate amount equal to the number of Merger Shares and Warrants that would have entered into a binding agreement for the settlement been received by holders of any Appraisal Shares (as such term is defined in Section 1.3(c) hereof). The effect of the litigation referred to in Part II, Item 1 of the Company's Form 10-Q for the Quarter Ended September 30, 1998 (the "SETTLEMENT AGREEMENT"), the cost of which to the Company is less than $10,000,000, the Exchange Ratio shall be increased by a number of shares equal to .00027 times the quotient of foregoing means that (A) $10,000,000 less such cost of such settlement by the Company, divided by (B) 1,000,000. The consideration to be received by the holders of Company Common Stock pursuant to this Section 1.3(a) is hereinafter referred to as the "MERGER CONSIDERATION." (b) At the Effective Time, each share of Company IDRC Common Stock owned by Parent, Merger Sub or any other direct or indirect subsidiary of Parent and each share of Company Common Stock owned by the Company or any direct or indirect subsidiary of the Company and in each case not held on behalf of third parties (collectively, "EXCLUDED SHARES"), shall by virtue of the Merger and without any action on the part of the holder thereof, be automatically canceled and retired and cease to exist, and no cash, securities or other property shall be payable in respect thereof. (c) At the Effective Time, each share of Merger Sub common stock, par value $.01 per share ("MERGER SUB COMMON STOCK"), that is issued and outstanding immediately prior to the Effective Time shall, by virtue (other than any shares of the IDRC Common Stock described in Section 1.3(c) hereof) will be convertible into (i) that number of Merger and without any action Shares equal to 9,200,000 divided by the holder thereofTotal IDRC Shares Outstanding, be converted into one validly issuedthe product being rounded, fully paid if necessary, up or down, to the nearest whole share and nonassessable common (ii) a Warrant exercisable for that number of Warrant Shares equal to 3,000,000 divided by the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share, no par valueand (B), subject to Sections 1.5 and 1.6 hereto, a holder of Options will be entitled to receive, upon exercise, on account of each share of IDRC Common Stock (i) that number of Merger Shares equal to 9,200,000 divided by the Surviving Corporation Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share and (ii) a Warrant exercisable for that number of Warrant Shares equal to 3,000,000 divided by the Total IDRC Shares Outstanding, the product being rounded, if necessary, up or down, to the nearest whole share. As used herein, the term "SURVIVING CORPORATION COMMON STOCK"). (d) If between Total IDRC Shares Outstanding" means the date total number of this Agreement shares of IDRC Common Stock and the total number of shares of IDRC Common Stock issuable upon exercise of Options that are issued and outstanding immediately prior to the Effective Time, the outstanding shares of Company Common Stock shall be changed into a different number of shares by reason of any reclassification, recapitalization, split-up, combination or exchange of shares, or any dividend payable in stock shall be declared thereon with a record date within such period, the Merger Consideration shall be adjusted accordingly to provide to the holders of Company Common Stock the same economic effect as contemplated by this Agreement.