Increasingly, companies are adopting Stockholder Rights Plans or NOL Protective Amendments to protect and preserve their NOLs. In fact, last week, both LiveWire Mobile, Inc. and TMNG Global announced plans to adopt and amend their plans, respectively.
This trend is quite interesting. It also presents a range of issues to consider, from both the company's and the shareholder's perspective.
Certainly, from the company's perspective, the bigger issue is the ability to protect NOLs that would otherwise be impaired, if Section 382 were triggered. Thus, a plan is put in place to prevent that from happening. Conversely, from the shareholder's perspective, the issues range from concerns about how such measures impact stock price, offers from potential acquirers, the duration of the plan, etc...
In fact, CMC Master Fund LP, a significant shareholder in Heska Corporation described its opposition to the company's plan. Read more!
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