Coastal Board Approves Shareholder Rights Plan.DURHAM, N.C.--(BUSINESS WIRE)--Jan. 20, 1995--Coastal Healthcare Group, Inc. (NYSE NYSE See: New York Stock Exchange : DR) announced today that its Board of Directors has adopted a Shareholders Rights Plan designed to protect stockholders against certain hostile takeover Hostile Takeover A takeover attempt that is strongly resisted by the target firm. Notes: Hostile takeovers are usually bad news, as the employee moral of the target firm can quickly turn to animosity against the acquiring firm. activities. Under the plan the Company will distribute a dividend of one Preferred Share Purchase Right for each outstanding share of Coastal's common stock. A summary of the Shareholders Rights Plan will be mailed to stockholders in February. Dr. Steven M. Scott, Coastal's President and Chief Executive Officer, said, "The Rights are intended to ensure that all of Coastal's stockholders receive fair and equal treatment in the event of any proposed takeover, and to guard against partial tender offers, squeeze-outs and other hostile tactics to gain control of the Company without paying all stockholders a fair price." Dr. Scott emphasized that the Board is not aware of any plan or attempt to gain control of the Company. The Rights Plan allows for and encourages an orderly process for takeovers that would increase stockholder value, while protecting stockholder investment from takeover tactics that do not respect the rights of all stockholders, Scott said. The Rights would not prevent a takeover, Scott said, but are designed to encourage anyone seeking to acquire the Company to negotiate with the Board to ensure that the terms are fair to all stockholders. The record date for the Rights distribution is February 3, 1995, and the Rights will expire ten years later unless earlier redeemed by the Company. The Rights distribution is not taxable to stockholders. The Rights would be exercise only if a person or group acquires 15% or more of Coastal's common stock or announces a tender offer that would lead to ownership by a person or group of 15% or more of the common stock. Each of the Rights will entitle stockholders to buy one one-hundredth of a share of a new series of preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. at an exercise price of $120.00. In addition, under the Right's "flip-in" feature, if any person or group becomes the beneficial owner Beneficial Owner A person who enjoys the benefits of ownership even though title is in another name. Notes: For example, when shares of a mutual fund are held by a custodian bank or when securities are held by a broker in street name, the true owner is the beneficial of 15% or more of the Company's common stock, then each Right not owned by such person or group will entitle its holder to purchase, at the Right's then current exercise price, shares of the Company's common stock having a value of twice the Right's exercise price. If Coastal is acquired in a merger or other business combination transaction after a person has acquired 15% or more of its common stock, under certain circumstances holders of rights will be entitled to purchase a number of the acquiring Company's common shares having a market value equal to twice the exercise price of the Rights. Prior to the acquisition by a person or group of beneficial ownership of 15% or more of Coastal's outstanding common stock, the Rights are redeemable for one cent per Right at the option of the board of directors. In a related matter Coastal also announced that its board of directors has amended the Company's bylaws The rules and regulations enacted by an association or a corporation to provide a framework for its operation and management. Bylaws may specify the qualifications, rights, and liabilities of membership, and the powers, duties, and grounds for the dissolution of an to require that (1) stockholders provide advance notice to the Company before nominating a candidate for election to the board or proposing business before a meeting of stockholders, (2) any increase or decrease in the size of the board be apportioned ap·por·tion tr.v. ap·por·tioned, ap·por·tion·ing, ap·por·tions To divide and assign according to a plan; allot: "The tendency persists to apportion blame as suits the circumstances" as equally as possible among the existing classes of the board and (3) the holders of 75% of the stock entitled to vote approve any amendments to the bylaws which alter the foregoing and certain other corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. provisions. The Company indicated that the decision to implement these provisions, which are common provisions in the governing documents of other public companies, was intended to provide stability and continuity in management, which the Company believes will facilitate long-range strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. and enhance the board's ability to act in the best interests of all stockholders in the event, among other things, of a potential takeover bid Noun 1. takeover bid - an offer to buy shares in order to take over the company two-tier bid - a takeover bid where the acquirer offers to pay more for the shares needed to gain control than for the remaining shares . Coastal Healthcare Group, Inc. - The Physician Company, provides a broad range of health care and administrative services to physicians, hospitals, managed care programs and other health care providers. CONTACT: Coastal Healthcare Group, Inc., Durham Joseph G. Piedmont, 919/383-0355 or Kenneth S. Dennard, 919/383-0355 KEYWORDS: NORTH CAROLINA North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. INDUSTRY KEYWORD: MEDICINE REPEATS: New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of 212-575-8822 or 800-221-2462; Boston 617-330-5311 or 80 |
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