A change in the conversion right such as this could substantially lessen or eliminate the
value of the conversion right. For example, if a third party acquires us in a cash merger, each note would be convertible solely into cash and would no longer be potentially convertible into securities whose value could increase depending on our
future financial performance, prospects and other factors. There is no precise, established definition of the phrase all or substantially all of our and our subsidiaries consolidated property or assets, taken as a whole under
applicable law. Accordingly, there may be uncertainty as to whether the provisions above would apply to a sale, transfer, lease, conveyance or other disposition of less than all of our and our subsidiaries consolidated property or assets.
Adjustment to the Conversion Rate Upon the Occurrence of a Make-whole Fundamental Change
If, prior to the maturity date, a make-whole fundamental change (as defined below) occurs, then, as described below under
Conversion RightsThe Increase in the Conversion Rate, we will increase the conversion rate applicable to notes that are surrendered for conversion at any time from, and including, the effective date of the make-whole
fundamental change (A) if such make-whole fundamental change does not also constitute a fundamental change, to, and including, the close of business on the date that is thirty (30) business days after the later of (i) the actual
effective date of the make-whole fundamental change and (ii) the date we send to holders of the notes the relevant notice of the effective date of any make-whole fundamental change, as described below or (B) if the make-whole fundamental
change also constitutes a fundamental change, as described under Holders May Require Us to Repurchase Their Notes Upon a Fundamental Change, to, and including, the close of business on the fundamental change repurchase
date corresponding to such fundamental change. We refer to this period as the make-whole conversion period.
A
make-whole fundamental change means an event described in the definition of change in control set forth below under Holders May Require Us to Repurchase Their Notes Upon a Fundamental Change after giving
effect to any exceptions to or exclusions from such definition (including, without limitation, the exception described in the paragraph following such bullets), but without regard to the exclusion set forth in the third bullet of such definition. We
will send to each holder written notice of the effective date of any make-whole fundamental change within 10 days after such effective date. We will indicate in such notice, among other things, the last day of the make-whole conversion period.
The Increase in the Conversion Rate
In connection with the make-whole fundamental change, we will increase the conversion rate by reference to the table below, based on the date
when the make-whole fundamental change becomes effective, which we refer to as the effective date, and the applicable price. If the make-whole fundamental change is a transaction or series of related transactions described in
the third bullet of the change in control definition set forth under Holders May Require Us to Repurchase Their Notes Upon a Fundamental Change and the consideration (excluding cash payments for fractional shares or
pursuant to statutory appraisal rights) for our common stock in the make-whole fundamental change consists solely of cash, then the applicable price will be the cash amount paid per share of common stock in the make-whole fundamental
change. In all other cases, the applicable price will be the average of the closing sale prices per share of common stock for the five consecutive trading days immediately preceding, but excluding, the relevant effective date. Our board
of directors will make appropriate adjustments, in its good faith determination, to account for any adjustment to the conversion rate that becomes effective, or any event requiring an adjustment to the conversion rate in accordance with the
indenture where the ex date of the event occurs, at any time during those five consecutive trading days.
Subject to the provisions set
forth under Conversion RightsChange in the Conversion Right Upon Certain Reclassifications, Business Combinations and Asset Sales, upon surrender of notes for conversion in connection with a make-whole fundamental change, we
shall, at our option, satisfy the related conversion obligation by physical settlement, cash settlement or combination settlement in accordance with the indenture. However, if the consideration for our common shares in any make-whole fundamental
change described in the
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