According to the Atlanta Business Chronicle, Cumulus said Monday its board adopted a rights agreement "designed to protect the Company’s substantial net operating loss carryforwards in order to preserve the Company’s long-term value and maintain the integrity of the Company’s ongoing restructuring process. The Rights Agreement is also intended to promote the fair and equal treatment of all stockholders of the Company and to ensure that the Board remains in the best position to discharge its fiduciary duties. The Rights Agreement is not intended to prevent any action that the Board determines to be in the best interests of the Company and is not being adopted in response to any specific action or proposal."
Cumulus said the rights will generally become exercisable only if any person (or any persons acting in concert or as a group) acquires a voting or economic position in 4.99 percent or more of the company’s outstanding Class A common stock.
The Atlanta-based company, the nation’s second largest radio network with 447 owned-and-operated radio stations, lost $510 million in 2016 and is carrying $2.4 billion in debt. Its stock is trading at 48 cents a share.
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