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TOPIC: NCMV - NCM Services, Inc.

NCMV - NCM Services, Inc. 6 years 6 months ago #1591

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As non-specialist for tax legislation nor attorney , can please somebody translate NCMV message into normal, ordinary language ? TIA..
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NCMV - NCM Services, Inc. 6 years 6 months ago #1587

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NCMV behind the scenes activity to preserve their $123,000,000 tax loss carryforward. This information was distributed to shareholders via mail 9/29/2011.

NCM Services Inc.
200 Crescent Court, Suite 1400
Dallas, Texas 75201

On September 2, 2011, NCM Services Inc. re-adopted a Shareholder Rights Plan. The purpose of the Shareholder Rights Plan and the 4.99% threshold thereunder is to seek to prevent possible limitations on the Company's use of its Federal net operating loss carryforwards and certain income tax credits.

SUMMARY OF RIGHTS AGREEMENT

The summary below sets forth certain principal terms of the Rights only and is qualified in its entirety by reference to the detailed terms of the Shareholder Rights Plan dated September 2, 2011, between NCM Services Inc. and The Bank of New York Mellon Trust Company, N.A., as Rights Agent.

The Shareholder Rights Plan is in substantially the same form as the Company’s prior rights plan that was filed as an exhibit to the Company's Registration Statement on Form 8-A12G with the Securities and Exchange Commission on March 12, 2001, together with the amendment thereto filed as an exhibit the Company's Registration Statement on Form 8-A12G/A with the Securities and Exchange Commission on May 19, 2003, except that (1) the exercise price per Right has been changed to $10 (from $20 in the prior plan), (2) the applicable fraction of a share of Series A Preferred Stock into which a Right would become exercisable in accordance with the plan is one ten-thousandth (1/10,000) of a share of Series A Preferred Stock (as opposed to one one-thousandth, or 1/1000, in the prior plan), (3) the redemption price is $0.00005 per Right (as opposed to $.005 per Right in the prior plan) and (4) the close of business, for purposes of certain actions under the plan, is determined with reference to Central Time (as opposed to Pacific Time in the prior plan). The Securities and Exchange Commission maintains an Internet web site at www.sec.gov where the text of the prior Shareholder Rights Plan may be viewed and/or downloaded.

Distribution Date

Holders of record of shares of the Company's Common Stock on September 2, 2011 will receive a distribution of one "Right" for each shares of Common Stock they hold. Prior to the Distribution Date referred to below, the Rights will trade with the Common Stock and will not be in separate certificate form. After the Distribution Date, the Company will mail separate Rights certificates to the Company's stockholders and the Rights will become transferable apart from the Common Stock. Generally, the Rights will separate from the Common Stock and become exercisable on the Distribution Date, which is the date following the earlier of (a) the public announcement that an Acquiring Person has become such ("Stock Acquisition Date") or (b) a date determined by the Board of Directors after a person or group announces a bona fide tender or exchange offer, the consummation of which would result in ownership by a person or group of 4.99% or more of the Company's outstanding Common Stock.

Preferred Stock Purchasable Upon Exercise of Rights

After the Distribution Date, each Right will entitle the holder to purchase for $10 (the "Exercise Price"), a fraction of a share of the Company's Series A Preferred Stock with economic terms similar to that of one share of the Company's Common Stock.

Flip-In Events

If an acquiror obtains 4.99% or more of the Company's Common Stock (an "Acquiring Person"), then each Right (other than Rights owned by an Acquiring Person or its affiliates) will entitle the holder thereof to purchase, for the Exercise Price, a number of shares of the Company's Common Stock having a then current market value of twice the Exercise Price.

Flip-Over Events

If, after an Acquiring Person obtains 4.99% or more of the Company's Common Stock, (a) the Company merges into another entity, (b) an acquiring entity merges into the Company or (c) the Company sells more than 50% or more of the Company's assets or earning power, then each Right (other than Rights owned by an Acquiring Person or its affiliates or associates) will entitle the holder thereof to purchase, for the Exercise Price, a number of shares of Common Stock of the Person engaging in the transaction having a then-current market value of twice the Exercise Price.

Exchange Provision

At any time after the date an Acquiring Person obtains 4.99% or more of the Company's Common Stock and prior to the acquisition by the Acquiring Person of 50% of the outstanding Common Stock, the Board of Directors of the Company may exchange the Rights (other than Rights owned by the Acquiring Person or its affiliates), in whole or in part, for shares of Common Stock of the Company at an exchange ratio of one share of Common Stock per Right (subject to adjustment).

Redemption of the Rights

Rights will be redeemable at the Company's option for $0.00005 per Right at any time on or prior to the earlier to occur of (i) the Shares Acquisition Date, and (ii) the final expiration of the Rights.

Expiration of the Rights

The Rights expire on the earliest of (a) September 1, 2021, (b) exchange or redemption of the Rights as described above, or (c) consummation of a merger or consolidation resulting in expiration of the Rights as described above.

Amendment of Terms of Rights

The terms of the Rights and the Rights Agreement may be amended in any respect without the consent of the Rights holders on or prior to the Distribution Date; thereafter, the terms of the Rights and the Rights Agreement may be amended without the consent of the Rights holders in order to cure any ambiguities or to make changes which do not adversely affect the interests of Rights holders (other than the Acquiring Person).

Voting Rights

Rights will not have any voting rights.

Anti-Dilution Provisions

Rights will have the benefit of certain customary anti-dilution provisions.

Taxes

The Rights distribution should not be taxable for federal income tax purposes. However, following an event which renders the Rights exercisable or upon redemption of the Rights, shareholders may recognize taxable income.

Committee Review

A committee of the Company's Directors who are neither officers, employees nor affiliates of the Company will review the Rights Plan at least every other year and, if a majority of these Directors deems it appropriate, may recommend a modification or termination of the Rights Plan.

www.shareholdervote.info/NCMRightsSummary.pdf

I OWN SHARES IN NCMV PURCHASED IN THE OPEN MARKET.
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