Conversion Ratio Adjustments. (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then, following the record date for the determination of holders of Common Stock entitled to receive such Common Stock pursuant to such stock dividend, stock split, subdivision or split-up, the Conversion Ratio shall be proportionately adjusted so that the number of shares of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be increased to the number of shares of Common Stock the holder of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof. (ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that the number of shares of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the number of shares of Common Stock the holder of each such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof. (iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares). Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply. (iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such adjustment shall become effective immediately after the record date of the event triggering the adjustment. The Company shall mail such notice, by first class mail, postage prepaid, at least ten (10) days before such date. However, failure to mail the notice or any defect in it shall not affect the validity of any such action.
Appears in 2 contracts
Samples: Agreement and Plan of Merger (Johns Manville Corp /New/), Agreement and Plan of Merger (Manville Personal Injury Settlement Trust)
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the "Reference Date"), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) "the record date in the case of a dividend or other distribution," and (b) "the record date for the determination of shareholders entitled to receive such rights or warrants," and (c) "the date fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the "Current Market Price" per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the "ex" date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term "ex" date, (i) when used with respect to any issuance or distribution, means the first class maildate on which the Common Stock trades regular way on The Nasdaq National Market(SM) or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Samples: Indenture (Ifc Capital Trust Ii)
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Corporation shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Corporation, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Corporation which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this section 4.3
(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Corporation, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Corporation shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCorporation. The Company Corporation shall not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Corporation. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Corporation, the Conversion Ratio shall be readjusted at the time of such expiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Corporation shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the "Reference Date"), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) "the record date in the case of a dividend or other distribution," and (b) "the record date for the determination of shareholders entitled to receive such rights or warrants," and (c) "the date fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Corporation shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Corporation), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Corporation or any subsidiary of the Corporation for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Corporation or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the "Current Market Price" per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the ten consecutive Trading Days selected by the Corporation commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the "ex" date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term "ex" date, (i) when used with respect to any issuance or distribution, means the first date on which the Common Stock trades in a regular way on The Nasdaq National Market(s) or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, and (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades in a regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Corporation may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Corporation from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Corporation, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Corporation shall mail such notice, by first class mail, postage prepaid, to Debentureholders of record a notice of the increase at least ten (10) fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the "Reference Date"), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) "the record date in the case of a dividend or other distribution," and (b) "the record date for the determination of shareholders entitled to receive such rights or warrants," and (c) "the date fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the "Current Market Price" per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the "ex" date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term "ex" date, (i) when used with respect to any issuance or distribution, means the first class maildate on which the Common Stock trades regular way on The Nasdaq National Market(sm) or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the "Reference Date"), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) "the record date in the case of a dividend or other distribution," and (b) "the record date for the determination of shareholders entitled to receive such rights or warrants," and (c) "the date fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the "Current Market Price" per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the "ex" date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term "ex" date, (i) when used with respect to any issuance or distribution, means the first class maildate on which the Common Stock trades regular way on The Nasdaq National Market or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which they would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Indenture Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the “Reference Date”), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) the record date in the case of a dividend or other distribution, and (b) the record date for the determination of shareholders entitled to receive such rights or warrants, and (c) the date fixed for such determination within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the “Expiration Time”) tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the Current Market Price per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices (as defined in Section 4.7) for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the ex date (defined below) with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term ex date, (i) when used with respect to any issuance or distribution, means the first class maildate on which the Common Stock trades regular way on The Nasdaq Global Select Market or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Samples: Indenture (Bridge Bancorp Inc)
Conversion Ratio Adjustments. (a) The Floor shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Floor in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event) If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Floor for the Debentures shall be adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be proportionately adjusted so that the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Floor shall be readjusted at the time of such noticeexpiration to the Floor that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Floor shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Floor increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the “Reference Date”), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Floor shall again be adjusted to be the Floor which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Floor increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any farther Floor increase required by Section 4.3(a) or 4.3(b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c)) shall be substituted as (a) “the record date in the case of a dividend or other distribution,” and (b) “the record date for the determination of shareholders entitled to receive such rights or warrants,” and “the date fixed for such determination” within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Floor in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Floor shall be increased so that the same shall equal the ratio determined by multiplying the Floor in effect immediately prior to the effectiveness of the Floor increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Floor shall again be adjusted to be the Floor which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the “Expiration Time”) tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Floor shall be increased so that the same shall equal the ratio determined by multiplying the Floor in effect immediately prior to the effectiveness of the Floor increase contemplated by Section 4.3(c) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders based on the acceptance (up to any maximum specified in the terns 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), 4.3(c), 4.3(d) or 4.3(e), the “Current Market Price” per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the “ex” date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through 4.3(e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term “ex” date, (i)-when used with respect to any issuance or distribution, means the first class maildate on which the Common Stock trades regular way on the NYSE Amex or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Floor, in addition to those required by Sections 4.3(a) through 4.3(e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Floor by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Floor is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Floor takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Floor and the period it shall be in effect.
(h) No adjustment in the Floor shall be required unless such adjustment would require an increase or decrease of at least 1% in the Floor; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Floor will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Floor pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
Samples: Indenture (Tompkins Financial Corp)
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by first class maildividend or otherwise, postage prepaiddistribute to all holders of its Common Stock evidences of its indebtedness, at least ten (10) days before such date. However, failure to mail the notice or any defect in it shall not affect the validity shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such action.distribution (the Reference Date), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not
Appears in 1 contract
Samples: Indenture (American Bank Inc)
Conversion Ratio Adjustments. The Conversion Ratio shall be subject to adjustment (without duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are outstanding, (i) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of the pay a dividend or make a distribution with respect to its Common Stock shall be increased by a stock dividend payable in shares of Common Stock or by a stock split, subdivision or split-up of shares of Common Stock, then(ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Company, then the Conversion Ratio in effect immediately prior to such action shall be adjusted so that the holders of any Debentures thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Company which he would have owned immediately following such action had such Debentures been converted immediately prior thereto. An adjustment made pursuant to this Section 4.3(a) shall become effective immediately after the record date in the case of a dividend or other distribution and shall become effective immediately after the effective date in case of a subdivision, combination or reclassification (or immediately after the record date if a record date shall have been established for such event). If, as a result of an adjustment made pursuant to this Section 4.3(a), the holder of any Debenture thereafter surrendered for conversion shall become entitled to receive shares of two or more classes or series of capital stock of the Company, the Board of Directors (whose determination shall be conclusive and shall be described in a Board Resolution filed with the Trustee) shall determine the allocation of the adjusted Conversion Ratio between or among shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are outstanding, issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common Stock entitled to receive such at a price per share less than the Current Market Price (as defined below) per share of Common Stock pursuant to on such stock dividendrecord date, stock split, subdivision or split-up, then the Conversion Ratio for the Debentures shall be proportionately adjusted so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock issuable upon conversion outstanding on the date of each share issuance of Junior Preferred such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase, and of which the denominator shall be increased to the number of shares of Common Stock outstanding on the holder date of each such share of Junior Preferred Stock would have held after such stock dividend, stock split, subdivision or split-up, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(ii) If, at any time after the issuance of the Junior Preferred Stock, the outstanding shares of Common Stock shall be decreased by a combination (including, without limitation, any reverse stock split) of the outstanding shares of Common Stock, then, following the record date for such combination, the Conversion Ratio shall be proportionately adjusted so that rights or warrants plus the number of shares which the aggregate offering price of Common Stock issuable upon conversion of each share of Junior Preferred Stock shall be decreased to the total number of shares of Common Stock the holder of each so offered for subscription or purchase would purchase at such share of Junior Preferred Stock would have held after such combination, if such holder had converted each such share of Junior Preferred Stock immediately prior thereto, in accordance with the provisions hereof.
(iii) In the case of any consolidation of the Company, the merger of the Company with or into any other entity, statutory share exchange or other reorganization or similar transaction or the sale or transfer of all or substantially all the assets of the Company, in any such case pursuant to which the Common Stock is converted into other securities, cash or assets, then, upon consummation of such transaction, each share of Junior Preferred Stock shall automatically become convertible into the kind or amount of securities, cash and other assets receivable upon the consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction, by a holder of the number of shares of Common Stock into which such share of Junior Preferred Stock would have been converted if such share of Junior Preferred Stock was converted immediately prior to such consolidation, merger, statutory share exchange or other reorganization, sale, transfer or similar transaction (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount of consideration receivable per share by a plurality of non-electing shares)Current Market Price. Appropriate adjustment (as determined in good faith by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Junior Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to changes in and other adjustment of the Conversion Ratio) shall thereafter be applicable, as nearly as reasonably possible, in relation to any shares of stock or other securities or property thereafter deliverable upon the conversion of Junior Preferred Stock. If this Section 7(d)(iii) applies, Sections 7(d)(i) and 7(d)(ii) do not apply.
(iv) If the Company takes any action that would require an adjustment in the Conversion Ratio pursuant to Section 7(d)(i), (ii) or (iii) above, the Company shall mail to the holders of Junior Preferred Stock a notice stating the proposed record or effective date, as the case may be, and such Such adjustment shall become effective immediately after the record date for the determination of shareholders entitled to receive such rights or warrants. For the purposes of this Section 4.3(b), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the event triggering the adjustmentCompany. The Company shall mail not issue any rights or warrants in respect of the shares of Common Stock held in the treasury of the Company. In case any rights or warrants referred to in this Section 4.3(b) in respect of which an adjustment shall have been made shall expire unexercised within 45 days after the same shall have been distributed or issued by the Company, the Conversion Ratio shall be readjusted at the time of such noticeexpiration to the Conversion Ratio that would have been in effect if no adjustment had been made on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness, shares of any class or series of capital stock, cash or assets (including securities, but excluding any rights or warrants referred to in Section 4.3(b), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in Section 4.3(a)), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(c) by a fraction of which the numerator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution (the "Reference Date"), and of which the denominator shall be, the Current Market Price per share of the Common Stock on the Reference Date less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on the Reference Date, of the portion of the evidences of indebtedness, shares of capital stock, cash and assets so distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the opening of business on the day following the Reference Date. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such dividend or distribution had not occurred. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 4.3(c) by reference to the actual or when issued trading market for any securities comprising such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price per share of Common Stock. For purposes of this Section 4.3(c), any dividend or distribution that includes shares of Common Stock or rights or warrants to subscribe for or purchase shares of Common Stock shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, shares of capital stock, cash or assets other than such shares of Common Stock or such rights or warrants (making any Conversion Ratio increase required by this Section 4.3(c)) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (making any further Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the Reference Date of such dividend or distribution as defined in this Section 4.3(c) shall be substituted as (a) "the record date in the case of a dividend or other distribution," and (b) "the record date for the determination of shareholders entitled to receive such rights or warrants," and (c) "the date fixed for such determination" within the meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed outstanding for purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other distribution on its Common Stock exclusively in cash (excluding all cash dividends paid out of the retained earnings of the Company), then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(d) by a fraction of which the numerator shall be the Current Market Price per share of the Common Stock, and of which the denominator shall be the Current Market Price per share of Common Stock on the date fixed for the payment of such distribution less the amount of cash so distributed and not excluded as provided applicable to one share of Common Stock on the date fixed for the payment of such distribution, such increase to become effective immediately prior to the opening of business on the day following the date fixed for the payment of such distribution; provided, however, that in the event the portion of the cash so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price per share of the Common Stock on the record date mentioned above, in lieu of the foregoing adjustment, adequate provision shall be made so that each Debentureholder shall have the right to receive upon conversion the amount of cash such Debentureholder would have received had such Debentureholder converted each Debenture immediately prior to the record date for the distribution of the cash. In the event that such dividend or distribution is not so paid or made, the Conversion Ratio shall again be adjusted to be the Conversion Ratio which would then be in effect if such record date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer) made by the Company or any subsidiary of the Company for all or any portion of the Common Stock shall expire and such tender or exchange offer shall involve the payment by the Company or such subsidiary of consideration per share of Common Stock having a fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) at the last time (the "Expiration Time") tenders or exchanges may be made pursuant to such tender or exchange offer (as it shall have been amended) that exceeds 110% of the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, then the Conversion Ratio shall be increased so that the same shall equal the ratio determined by multiplying the Conversion Ratio in effect immediately prior to the effectiveness of the Conversion Ratio increase contemplated by this Section 4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders 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 Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, and of which the denominator shall be the number of shares of Common Stock outstanding (including any tendered or exchanged shares) at the Expiration Time multiplied by the Current Market Price per share of Common Stock on the Trading Day next succeeding the Expiration Time, such increase to become effective immediately prior to the opening of business on the day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c), (d) or (e), the "Current Market Price" per share of Common Stock on any date in question shall be deemed to be the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 20 Trading Days before, and ending not later than the earlier of the day in question or, if applicable, the day before the "ex" date with respect to the issuance or distribution requiring such computation; provided, however, that if another event occurs that would require an adjustment pursuant to Sections 4.3(a) through (e), inclusive, the Board of Directors may make such adjustments to the Closing Prices during such five Trading Day period as it deems appropriate to effectuate the intent of the adjustments in this Section 4.3, in which case any such determination by the Board of Directors shall be set forth in a Board Resolution and shall be conclusive. For purposes of this Section 4.3(f), the term "ex" date, (i) when used with respect to any issuance or distribution, means the first class maildate on which the Common trades regular way on The New York Stock Exchange or on such successor securities quotation system as the Common Stock may be listed or in the relevant market from which the Closing Prices were obtained without the right to receive such issuance or distribution, postage prepaidand (ii) when used with respect to any tender or exchange offer, means the first date on which the Common Stock trades regular way on such securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in addition to those required by Sections (a) through (e), as it considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes. The Company from time to time may increase the Conversion Ratio by any amount for any period of time if the period is at least ten (10) 20 days, the increase is irrevocable during the period, and the Board of Directors shall have made a determination that such increase would be in the best interest of the Company, which determination shall be conclusive. Whenever the Conversion Ratio is increased pursuant to the preceding sentence, the Company shall mail to Debentureholders of record a notice of the increase at least fifteen days before prior to the date the increased Conversion Ratio takes effect, and such date. However, failure to mail notice shall state the notice or any defect in increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Ratio; provided, however, that any adjustments which by reason of this Section 4.3(h) are not affect required to be made shall be carried forward and taken into account in determining whether any subsequent adjustment shall be required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the validity Conversion Ratio pursuant to more than one of any the provisions described above, only one adjustment shall be made and such actionadjustment shall be the amount of adjustment that has the highest absolute value to the Debentureholders.
Appears in 1 contract
