Overland Storage, Inc. Adopts Shareholder Rights Plan
August 22 2005 - 5:45PM
PR Newswire (US)
SAN DIEGO, Aug. 22 /PRNewswire-FirstCall/ -- Overland Storage, Inc.
(NASDAQ:OVRL) announced today that its Board of Directors has
adopted a Shareholder Rights Plan (the Rights Plan). The Rights
Plan is similar to those adopted by many other public companies and
is designed to protect the company's shareholders against abusive
or coercive takeover tactics. The Rights Plan is designed to
protect the company's shareholders against abusive or coercive
takeover tactics and other takeover tactics not in the best
interests of the company and its shareholders, such as acquisitions
of control or large blocks in open market or private transactions
without paying all shareholders a fair premium, coercive tender
offers and inadequate offers. The Rights Plan is also designed to
provide the Board with an adequate opportunity to evaluate any
offer and maximize shareholder value. It is not intended to prevent
an offer that the Board of Directors concludes is in the best
interest of the company and its shareholders, but is intended to
encourage anyone seeking to acquire the company to negotiate
directly with the Board of Directors. The company will make a
dividend distribution of one Common Share Purchase Right (the
Rights) for each outstanding share of the company's common stock.
Each Right represents the right to purchase, under certain
circumstances, one-third of a share of the company's common stock.
The rights will become exercisable upon the earlier to occur of a
public announcement of the acquisition by a person or group of 15
percent or more of the company's common stock, and 10 days after
the commencement of, or announcement of an intention to make, a
tender or exchange offer for the company's common stock that would
upon consummation result in the acquisition of 15 percent or more
of the company's common stock (the earlier of such dates is
referred to as the Distribution Date). The Rights expire after 10
years unless redeemed or exchanged earlier by the Board of
Directors. The Rights distribution will not be taxable to
shareholders. If any person or group becomes the beneficial owner
of 15 percent or more of the company's common stock (with certain
limited exceptions), then each Right not owned by the 15 percent
shareholder will entitle its holder to purchase, at a per share
exercise price equal to one-half of the market value of the
company's common stock, one-third of a share of the company's
common stock. In addition, if after any person has become a 15
percent shareholder, the company is involved in a merger or other
business combination with any other person, each Right will entitle
its holder (other than the 15 percent shareholder) to purchase, at
the Right's initial exercise price, common shares of the acquiring
company or its parent having a value of twice the Right's initial
exercise price. A complete copy of the Rights Plan will be included
in a Form 8-K that the company plans to file shortly with the
Securities and Exchange Commission. About Overland Storage Now in
its 25th year, Overland Storage is a market leader and innovative
provider of simply protected storage solutions -- smart data
protection appliances and software modules designed to work
together, affordably, to ensure that information is automatically
safe, readily available and always there. Overland's award-winning
data protection solutions include the REO SERIES(TM) of disk-based
backup and recovery appliances and the NEO SERIES(TM) of tape
libraries. Overland sells its products through leading OEMs,
commercial distributors, storage integrators and value-added
resellers. For more information, visit Overland's web site at
http://www.overlandstorage.com/. Overland, Overland Storage, REO
SERIES and NEO SERIES are trademarks of Overland Storage, Inc.
Except for the factual statements made herein, the information
contained in this news release consists of forward-looking
statements that involve risks, uncertainties and assumptions that
are difficult to predict. Words such as "believe," "intends,"
"expects," "plans," "anticipates" and variations thereof, identify
forward-looking statements, but their absence does not mean that a
statement is not forward looking. Such forward-looking statements
are not guarantees of performance and the company's and its
shareholders' actual results could differ materially from those
contained in such statements. Factors that could cause or
contribute to such differences include risks and uncertainties
associated with the impact of the shareholders' rights plan on
potential acquirers and its validity under California law.
Reference is also made to other factors set forth in the company's
filings with the Securities and Exchange Commission, including the
"Risk Factors," "Management's Discussion and Analysis" and other
sections of the company's Form 10-K currently on file with the SEC.
These forward-looking statements speak only as of the date of this
release and the company undertakes no obligation to publicly update
any forward-looking statements to reflect new information, events
or circumstances after the date of this release. DATASOURCE:
Overland Storage, Inc. CONTACT: Vernon A. LoForti, CFO, , or
Cynthia A. Bond, Director of Corporate Communications, , both of
Overland Storage, Inc., +1-858-571-5555 Web site:
http://www.overlandstorage.com/
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