Satcon Adopts Stockholder Rights Plan
January 07 2011 - 7:30AM
Business Wire
Satcon Technology Corporation® (NASDAQ CM:SATC), a leading
provider of utility scale power conversion solutions for the
renewable energy market, announced today that its Board of
Directors adopted a stockholder rights plan (the “Rights Plan”)
designed to preserve the value of significant tax assets associated
with the Company’s tax net operating loss carryforwards (“NOLs”)
under Section 382 of the Internal Revenue Code.
United States federal income tax rules, and Section 382 of the
Internal Revenue Code in particular, substantially limit the use of
NOLs if a company experiences an “ownership change.” Ownership
changes under Section 382 generally relate to a cumulative change
in ownership among stockholders with at least a 5% ownership
interest (as determined under the rules of Section 382) of more
than 50% over a rolling three-year period. The purpose of the
Rights Plan is to protect the NOLs by reducing the likelihood of an
“ownership change” occurring as a result of transactions in the
Company’s common stock.
“Our NOLs are an important asset of the Company, an asset that
we believe we should make every effort to protect,” said Steve
Rhoades, Satcon’s President and Chief Executive Officer. “The
Rights Plan protects the interests of all stockholders and
preserves these substantial tax benefits for the Company.”
Under the Rights Plan, one right will be distributed for each
outstanding share of the Company’s common stock held by
stockholders of record as of the close of business on January 18,
2011. Pursuant to the Rights Plan, if any person or group (subject
to certain exceptions) acquires 4.99% or more of the outstanding
shares of the Company’s common stock, without approval of the Board
of Directors, a substantial dilution in the voting and economic
ownership of such person or group would occur.
The Rights Plan will continue in effect until January 6, 2014
unless earlier terminated or redeemed by the Board of Directors at
any time prior to the rights being triggered or certain other
events occur. Additional information regarding the Rights Plan will
be contained in a Current Report on Form 8-K and a Registration
Statement on Form 8-A to be filed by the Company with the
Securities and Exchange Commission.
About Satcon
Satcon Technology Corporation is a leading provider of
utility-grade power conversion solutions for the renewable energy
market, enabling the industry's most advanced, reliable, and proven
clean energy alternatives. For more than ten years, Satcon has
designed and delivered advanced power conversion products that
enable large-scale producers of renewable energy to convert the
clean energy they produce into grid-connected efficient and
reliable power. To learn more about Satcon, please visit
http://www.Satcon.com.
Safe Harbor
This press release contains “forward-looking statements” that
represent our expectations or beliefs concerning future events.
These forward-looking statements are identified by the use of terms
and phrases such as “will,” “intends,” “believes,” “expects,”
“plans,” “anticipates” and similar expressions, and include
statements regarding the ability of the Company to preserve and
utilize its tax assets and the effect of the adoption of the Rights
Plan on changes in ownership in the Company’s common stock. Such
forward looking statements are subject to a variety of risks and
uncertainties and other factors that could cause actual results to
differ materially from the company’s expectation. Such factors
include, but are not limited to, the inability of the Rights Plan
to dissuade an investor from effecting an “ownership change” by
either increasing or reducing their ownership of shares of the
Company’s common stock; the potential loss of the Company’s NOLs
notwithstanding the implementation of the Rights Plan; the
Company’s ability to forecast its tax attributes, which are based
upon various facts and assumptions; the Company’s ability to
protect and use its NOLs to offset taxable income; and the
Company’s ability to generate taxable income in the future.
Additional information concerning risk factors is contained from
time to time in the company’s SEC filings, including its Annual
Report on Form 10-K and other periodic reports filed with the SEC.
Forward-looking statements contained in this press release speak
only as of the date of this release. Subsequent events or
circumstances occurring after such date may render these statements
incomplete or out of date. The Company expressly disclaims any
obligation to update the information contained in this release.
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