MakeMusic Adopts Tax Asset Protection Plan
February 21 2012 - 6:06PM
Business Wire
MakeMusic, Inc. (NASDAQ: MMUS) today announced that its Board of
Directors has adopted a Tax Asset Protection Plan (the “Plan”). The
Plan is intended to protect MakeMusic’s substantial tax assets and
to allow all of its shareholders to realize the long-term value of
their investment in MakeMusic. As of December 31, 2010, MakeMusic
had cumulative federal net operating loss carryforwards of
approximately $14.7 million, which can be utilized in certain
circumstances to offset future U.S. taxable income. For the year
ended December 31, 2011, MakeMusic anticipates utilizing additional
net operating losses. The Plan is similar to tax asset protection
plans adopted by many other public companies with significant tax
assets.
"Our net operating loss carryforwards are an important and
valuable asset of MakeMusic, we believe we should make every effort
to protect this asset. This Plan protects the interests of our
shareholders and preserves these substantial tax benefits for our
company," said Karen van Lith, MakeMusic's President and Chief
Executive Officer.
MakeMusic's use of certain tax assets could be substantially
limited if the company experiences an "ownership change," as
defined by Section 382 of the Internal Revenue Code. In general, an
ownership change for this purpose would occur when the percentage
of the company’s ownership (by value) of one or more “5 percent
shareholders” (as defined in the Code) increased by more than 50
percent over the lowest percentage owned by such shareholders at
any time during the prior three years (calculated on a rolling
basis).
The Plan is designed to reduce the likelihood that MakeMusic
experiences such an ownership change by discouraging any person or
group from becoming a 5-percent shareholder and dissuading existing
5-percent or greater shareholders from acquiring additional shares
of MakeMusic's common stock.
As part of the Plan, MakeMusic’s Board of Directors, today
declared a dividend of one preferred share purchase right (a
“Right”) for each outstanding share of the company’s common stock,
par value $.01 per share. The Rights will be distributable to
shareholders of record as of the close of business on March 2,
2012, as well as to holders of common stock issued after that
date.
Rights will be triggered if any person or group acquires 4.95%
or more of the outstanding shares of MakeMusic's common stock or if
any existing investor currently owning more than 4.95% acquires
additional shares, (each an "Acquiring Person" under the Plan). If
triggered, each Right would become exercisable in a manner that
could cause significant economic and voting dilution to any
Acquiring Person, because the Rights of any Acquiring Person would
become void and not exercisable. Subject to certain limitations in
the Plan, if the Rights are triggered, MakeMusic's Board of
Directors may decide to exchange all or part of the Rights (other
than those held by any Acquiring Person or any transferee of any
Acquiring Person) for shares of the company’s preferred stock,
common stock, or other securities at no cost.
The Plan will expire and terminate on the earliest of February
20, 2015 (unless that date is advanced or extended) or if the Board
of Directors determines that the Plan is no longer necessary for
the preservation of the company’s tax benefits.
Details of the Plan will be contained in a Form 8-K and in a
Registration Statement on Form 8-A that MakeMusic is filing with
the Securities and Exchange Commission and will be accessible via
the EDGAR database on the SEC's website at www.sec.gov.
About MakeMusic, Inc.MakeMusic®, Inc. is a world leader
in music technology whose mission is to develop and market
solutions that transform how music is composed, taught, learned and
performed. For more than 20 years, Finale® has been the
industry standard in music notation software, enabling composers,
arrangers, musicians, teachers, students and publishers to create,
edit, audition, print and publish musical scores. MakeMusic is also
the creator of SmartMusic® education software that is
transforming the way students practice. With SmartMusic, students
and teachers have access to thousands of band, orchestra and vocal
pieces allowing students to practice with background accompaniment
and get immediate feedback on their performance. SmartMusic allows
teachers to individualize instruction and document the progress of
every student. The SmartMusic® Inbox™, an Android™ and
Apple® mobile application, provides additional access for teachers
to review, grade and comment on student assignments.
MusicXML™ is an Internet-friendly way to publish musical
scores, enabling musicians to distribute interactive sheet music
online and to use sheet music files with a wide variety of musical
applications. Garritan sound libraries provide musicians
with state-of-the-art virtual instruments with the playback quality
of a live performance. Additional information about this Minnesota
company can be found at www.makemusic.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, including
statements regarding MakeMusic’s expectations regarding its future
strategic direction. All statements other than statements of
historical fact contained in this press release are forward-looking
statements. In some cases, you can identify forward-looking
statements by terminology such as “may,” “will,” “should,”
“expects,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “potential” or “continue” or the negative of these
terms or other comparable terminology. These statements are only
current predictions and are subject to known and unknown risks,
uncertainties and other factors that may cause MakeMusic’s actual
results, levels of activity, performance or achievements to be
materially different from those anticipated by the forward-looking
statements. These forward-looking statements are subject to a
number of risks, including the ability of MakeMusic to realize
anticipated results of its strategy, the ability of MakeMusic to
use its NOLs to offset income, the ability of MakeMusic to prevent
an ownership change under the Internal Revenue Code, the ability of
MakeMusic to deliver and capitalize on the opportunities of its
strategy, the ability of MakeMusic to execute its strategy as well
as those risk factors discussed in filings with the U.S. Securities
and Exchange Commission (“SEC”), including but not limited to the
Company’s Annual Report on Form 10-K filed on March 4, 2011, and
any subsequently filed reports on Forms 10-Q and 8-K. MakeMusic
undertakes no duty to update or revise any of the forward-looking
statements, whether as a result of new information, future events
or otherwise, after the date of this press release.
Makemusic (NASDAQ:MMUS)
Historical Stock Chart
From Sep 2024 to Oct 2024
Makemusic (NASDAQ:MMUS)
Historical Stock Chart
From Oct 2023 to Oct 2024