WebMD Health (WBMD)

 

The holders of not less than a majority of the then outstanding shares of Class C preferred shall be entitled to request redemption of the Class C preferred (i) as of February 23 and August 23 of each year (each, a “Class C Election Date”), commencing February 23, 2006, and (ii) upon each Class C Redemption Event (as defined). Upon the written request of the holders of not less than a majority of the then outstanding shares of the Class C preferred (the “Class C Redemption Request”), the Company shall redeem all of the Class C preferred outstanding on the date of the Class C Redemption Event up to the maximum amount the Company may lawfully redeem out of funds legally available therefore, for each of the Class C preferred so redeemed, (a) an amount equal to the Class C Preferential Amount in cash and (b) the number of shares of common stock into which one share of the Class C preferred is convertible at such time (collectively, the “Class C Redemption Price”).

 

Upon the earliest to occur of (i) the fifth anniversary of the date of initial issuance of the Class B preferred (the “Class B Anniversary Date”), (ii) a Qualified Offering (as defined), (iii) a change of control (as defined) or (iv) the Class C Redemption Date (any of (i) through (iv), a “Class B Redemption Event”) and upon the written request of the holders of not less than two-thirds of the then outstanding shares of Class B preferred (the “Class B Redemption Request”), the Company shall redeem all of the Class B preferred stock outstanding on the Class B Redemption Date up to the maximum amount the Company may lawfully redeem out of funds legally available therefore. Since the fifth anniversary date of initial Class B issuance fell within 2005, this was not deemed the earliest to occur based upon the fact that Class B Preferred cannot be redeemed until after the Class C Redemption Date, as defined. The Class B Redemption Price shall be equal to the greater of (a) the Class B Preferential Amount or (b) the fair value of the shares of common stock that would be received upon conversion of each share of Class B preferred. The fair value applicable to Class A and B preferred shall mean the fair value of 100% of the outstanding common stock of the Company (on a fully diluted, as converted basis, including, without limitation, the shares of common stock into which all shares of preferred stock outstanding immediately prior to the Class A and B Redemption Date could be converted at the applicable conversion rate then in effect) based upon the sale of the Company as a going concern to a strategically motivated, financially able and unaffiliated third party buyer, without any discount for the non-liquidity ownership of the common stock, as determined by a qualified independent investment banker agreed to by the Company and the holders of Class A and B preferred, voting on an as-converted basis, provided, however, that the fair value calculation shall subtract the aggregate Class C Preferential Amount to be paid to the holders of the Class C preferred.

 

Upon the earliest to occur of (i) Class B Anniversary Date, (ii) a Qualified Offering (as defined), (iii) a change of control (as defined) or (iv) the Class C Redemption Date (any of (i) through (iv), a “Class A Redemption Event”) and upon the written request of the holders of not less than two-thirds of the then