HC2 Holdings Adopts Tax Benefits Preservation Plan to Protect Tax Attributes and Stockholder Value
The Tax Benefits Preservation Plan is similar to those adopted by other public companies with significant NOLs. The Tax Benefits Preservation Plan is designed not to limit any action that the Board determines to be in the best interest of HC2 and its stockholders, and will help to ensure that the Board remains in the best position to discharge its fiduciary duties and protect these valuable assets.
Under the Tax Benefits Preservation Plan, HC2 will distribute to holders of its common stock rights to purchase fractional shares of a new Series B Preferred Stock, with each fractional share functionally equivalent to one share of common stock. The rights will initially trade with the Company’s common stock and will generally become exercisable only if a person (or any persons acting as a group) acquires 4.9% or more of HC2’s outstanding common stock. If the rights become exercisable, all holders of rights (other than any triggering person) will be entitled to acquire shares of common stock at a discount or the Company may exchange each right held by such holders for one share of common stock. Under the Tax Benefits Preservation Plan, any person which currently owns 4.9% or more of the Company's common stock may continue to own its shares of common stock but may not acquire any additional shares without triggering the Rights Plan (other than acquiring a de minimis amount). The Company's Board of Directors has the discretion to exempt any person or group from the provisions of the Tax Benefits Preservation Plan.
Unless terminated early, the Tax Benefits Preservation Plan will terminate on
“Given the change over in HC2’s stock over the past several years, we were getting close to putting our tax attributes in jeopardy,” said
Additional information about the Tax Benefits Preservation Plan will be available on a Form 8-K to be filed by HC2 with the
Cautionary Statement Regarding Forward-Looking Statements
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release contains, and certain oral statements made by our representatives from time to time may contain, forward-looking statements, including those that may be identified by words such as “will,” “intend,” “expect,” “anticipate,” “should,” “could” and similar expressions, all of which involve risks, assumptions and uncertainties, many of which are outside of the Company’s control, and are subject to change. All forward-looking statements speak only as of the date made, and unless legally required, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The Company’s actual results could differ materially from those expressed or implied in any forward-looking statements due to a variety of important factors, both positive and negative, that may be revised or supplemented in subsequent statements and reports filed with the
Source: HC2 Holdings, Inc.