JCPenney Extends Stockholder Rights Plan to Protect Tax Benefits
January 23 2017 - 4:15PM
PLANO, Texas
(Jan. 23, 2017) - J. C. Penney Company, Inc. (NYSE: JCP) (the
"Company") today announced that it has extended its existing
stockholder rights plan for an additional three years to continue
protecting the Company's valuable net operating loss carryforwards
("NOLs").
As of the end of fiscal 2015, the
Company had approximately $2.6 billion in NOLs, which can be used
in certain circumstances to offset future taxable income and reduce
federal income tax liability. The Company's ability to use
its NOLs would be substantially limited if an "ownership change"
under Section 382 of the Internal Revenue Code were to occur.
Ownership changes under Section 382 generally relate to the
cumulative change in ownership among stockholders with an ownership
interest of 5% or more (as determined under Section 382's rules)
over a rolling three year period. The rights plan was extended to
reduce the likelihood of an "ownership change" occurring.
As amended, the Company's rights
plan will expire on January 25, 2020, subject to earlier expiration
in specific circumstances. Under the plan, if any person or group
acquires 4.9% or more of the outstanding shares of common stock of
the Company without the approval of the Board of Directors, a
triggering event would occur causing significant dilution in the
ownership interest of such person or group.
The purpose of the rights plan is
to protect stockholder value by preserving the Company's ability to
fully utilize its NOLs. The rights plan is similar to plans adopted
by other public companies with significant net operating
losses.
The Company expects to submit the
extension of the plan to a vote at the next annual meeting of
stockholders in May 2017. If stockholders do not approve the
extension, the plan will terminate.
Media
Relations:
(972) 431-3400 or jcpnews@jcp.com and follow us at @jcpnews on
Twitter.
Investor
Relations:
(972) 431-5500 or jcpinvestorrelations@jcpenney.com
About
JCPenney:
J. C. Penney Company, Inc. (NYSE:JCP), one of the nation's largest
apparel and home furnishings retailers, is on a mission to ensure
every customer's shopping experience is worth her time, money and
effort. Whether shopping jcp.com or visiting one of over 1,000
store locations across the United States and Puerto Rico, she will
discover a broad assortment of products from a leading portfolio of
private, exclusive and national brands. Supporting this value
proposition is the warrior spirit of over 100,000 JCPenney
associates worldwide, who are focused on the Company's three
strategic priorities of strengthening private brands, becoming a
world-class omnichannel retailer and increasing revenue per
customer. For additional information, please visit jcp.com.
Forward-Looking
Statements
This release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Words such as "expect" and similar expressions identify
forward-looking statements, which include, but are not limited to,
statements regarding sales, gross margin, selling, general and
administrative expenses, earnings and cash flows. Forward-looking
statements are based only on the Company's current assumptions and
views of future events and financial performance. They are subject
to known and unknown risks and uncertainties, many of which are
outside of the Company's control that may cause the Company's
actual results to be materially different from planned or expected
results. Those risks and uncertainties include, but are not limited
to, general economic conditions, including inflation, recession,
unemployment levels, consumer confidence and spending patterns,
credit availability and debt levels, changes in store traffic
trends, the cost of goods, more stringent or costly payment terms
and/or the decision by a significant number of vendors not to sell
us merchandise on a timely basis or at all, trade restrictions, the
ability to monetize non-core assets on acceptable terms, the
ability to implement our strategic plan including our omnichannel
initiatives, customer acceptance of our strategies, our ability to
attract, motivate and retain key executives and other associates,
the impact of cost reduction initiatives, our ability to generate
or maintain liquidity, implementation of new systems and platforms
including EMV chip technology, changes in tariff, freight and
shipping rates, changes in the cost of fuel and other energy and
transportation costs, disruptions and congestion at ports through
which we import goods, increases in wage and benefit costs,
competition and retail industry consolidations, interest rate
fluctuations, dollar and other currency valuations, the impact of
weather conditions, risks associated with war, an act of terrorism
or pandemic, the ability of the federal government to fund and
conduct its operations, a systems failure and/or security breach
that results in the theft, transfer or unauthorized disclosure of
customer, employee or Company information, legal and regulatory
proceedings and the Company's ability to access the debt or equity
markets on favorable terms or at all. There can be no assurances
that the Company will achieve expected results, and actual results
may be materially less than expectations. Please refer to the
Company's most recent Form 10-Q for a further discussion of risks
and uncertainties. Investors should take such risks into account
and should not rely on forward-looking statements when making
investment decisions. Any forward-looking statement made by us in
this press release is based only on information currently available
to us and speaks only as of the date on which it is made. We do not
undertake to update these forward-looking statements as of any
future date.
###
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: J. C. Penney Company, Inc. via Globenewswire
J C Penney (NYSE:JCP)
Historical Stock Chart
From Aug 2024 to Sep 2024
J C Penney (NYSE:JCP)
Historical Stock Chart
From Sep 2023 to Sep 2024