Windstream 2015 Annual Report Download - page 62

60 |
acquires beneficial ownership of one or more additional shares of common stock (other than pursuant to a dividend
or distribution paid or made by Windstream on the outstanding shares of common stock or pursuant to a split or
subdivision of the outstanding shares of common stock) or (B) the beneficial owner of 5.01% or more of common
stock outstanding unless and until such Existing Holder acquires beneficial ownership of 1% or more of additional
shares of common stock (other than pursuant to a dividend or distribution paid or made by Windstream on the
outstanding shares of common stock or pursuant to a split or subdivision of the outstanding shares of common stock).
The Rights Agreement provides that a Person shall not become an Acquiring Person for purpose of the Rights
Agreement in a transaction that the Board determines is exempt from the Rights Agreement, which determination
shall be made in the sole and absolute discretion of the Board, upon request by any Person prior to the date upon which
such Person would otherwise become an Acquiring Person, including, without limitation, if the Board determines
that (i) neither the beneficial ownership of shares of common stock by such Person, directly or indirectly, as a
result of such transaction nor any other aspect of such transaction would jeopardize or endanger the availability to
Windstream of the Tax Benefits or (ii) such transaction is otherwise in the best interests of Windstream.
Exercise of Rights; Distribution of Rights. Initially, the Rights will not be exercisable and will be attached
to all common stock representing shares then outstanding, and no separate Rights certificates will be distributed.
Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock
and become exercisable and a distribution date (a “Distribution Date”) will occur upon the earlier of (i) 15 business
days (or such later date as the Board shall determine) following a public announcement that a person or group of
affiliated or associated persons has become an Acquiring Person or (ii) 15 business days (or such later date as the
Board shall determine) following the commencement of a tender offer, exchange offer or other transaction that,
upon consummation thereof, would result in a person or group of affiliated or associated persons becoming an
Acquiring Person.
Until the Distribution Date, common stock held in book-entry form or, in the case of certificated shares, common
stock certificates will evidence the Rights and will contain a notation to that effect. Any transfer of shares of common
stock prior to the Distribution Date will constitute a transfer of the associated Rights. After the Distribution Date,
the Rights may be transferred on the books and records of the Rights Agent as provided in the Rights Agreement.
If on or after the Distribution Date, a person or group of persons is or becomes an Acquiring Person, each holder
of a Right, other than certain Rights including those beneficially owned by the Acquiring Person (which will have
become void), will have the right to receive upon exercise common stock (or, in certain circumstances, cash, property
or other securities of the Corporation) having a value equal to two times the Purchase Price.
Exchange. At any time following the Stock Acquisition Date (as defined the Rights Agreement), the Board may
exchange the Rights (other than Rights owned by such person or group that have become void), in whole or in part,
for common stock or Preferred Stock at an exchange ratio of one share of common stock, or one ten thousandth of a
share of Preferred Stock (or of a share of a class or series of Windstream’s preferred stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment).
Expiration. The Rights and the Rights Agreement will expire on the earliest of (i) 5:00 P.M. New York City time
on September 17, 2018, (ii) the time at which the Rights are redeemed or exchanged pursuant to the Rights Agreement,
(iii) the date on which the Board determines that the Rights Agreement is no longer necessary or is no longer in the
best interest of Windstream and its stockholders, (iv) September 17, 2016 if the affirmative vote of the majority of
the votes cast at the Annual Meeting has not been obtained with respect to the ratification of the Rights Agreement
or (v) the beginning of a taxable year to which the Board determines that no Tax Benefits may be carried forward.
Redemption. At any time until the earlier of (A) the Distribution Date or (B) the expiration date of the Rights,
Windstream may redeem the Rights in whole, but not in part, at a price of $0.0001 per Right. Immediately upon the
action of the Board ordering redemption of the Rights, the Rights will terminate and the only right of the holders of
Rights will be to receive the $0.0001 redemption price.
Anti-Dilution Provisions. The Purchase Price payable, and the number of Units of Preferred Stock or other
securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock; (ii) if holders of the Preferred Stock are granted certain rights or warrants to subscribe for Preferred Stock