Greektown Superholdings, Inc. Adopts a Shareholder Rights Plan
DETROIT, Dec. 31, 2012 /PRNewswire/ -- Greektown
Superholdings, Inc. ("Greektown" or the "Company") announced today
that its Board of Directors has adopted a Shareholder Rights
Plan.
The Rights Plan is intended to protect Greektown and its
stockholders from efforts to obtain control of Greektown that the
Board of Directors determines are not in the best interests of
Greektown and its stockholders, and to enable all stockholders to
realize the long-term value of their investment in Greektown.
In general terms, it works by imposing a significant penalty upon
any person or group that acquires 25% or more of the voting capital
stock of the Company without approval of the Board of Directors or
without entering a Minority Shareholder Protection Agreement
(described below).
Under the Shareholder Rights Plan, common share purchase rights
will be distributed as a dividend at the rate of one Right for (a)
each share of capital stock issued and outstanding on the record
date, which will be the close of business on January 15, 2013, (b) each share of preferred
stock issuable upon exercise of the Company's outstanding warrants
to purchase preferred stock and (c) each share of preferred stock
that has been accrued as a dividend upon the Company's outstanding
preferred stock. The distribution/payment date of the Rights
dividend will be January 24, 2013, but such distribution/payment
date may be delayed or suspended if required by the Michigan Gaming
Control Board.
The Company believes that the distribution/payment of the Rights
dividend does not contravene any Michigan Gaming Control Board
order or any regulation, but has requested guidance from the staff
of the Michigan Gaming Control Board.
Each Right entitles the holder to purchase from the Company
three-quarters (0.75) of a share of Series A-1 Common Stock of the
Company initially at a price equal to the current market value of
three-quarters of a share of Series A-1 Common Stock. The
Rights will continue to be represented by, and trade with, the
Company's capital stock certificates unless the Rights become
exercisable.
The Rights generally will be exercisable only if a person or
group acquires beneficial ownership of 25% or more of the Company's
voting stock, or commences a tender or exchange offer that, upon
consummation, would result in a person or group owning 25 percent
or more of the Company's voting stock. A person that
otherwise would cause the Rights to become exercisable by exceeding
these thresholds can avoid causing the Rights to become exercisable
by signing a Minority Shareholder Protection Agreement in the form
attached to the Shareholder Rights Plan. Existing
shareholders that hold more than the 25% threshold may avoid
triggering the exercisability of the Rights by complying with the
covenants in the Minority Shareholder Protection Agreement.
The Minority Shareholder Protection Agreement provides that the
signing shareholder and its affiliates (1) is only entitled to
nominate, whether directly or indirectly, less than 50% of the
board of directors of the Company and with respect to votes for
directors other than their nominees for less than 50% of the board
of directors the signing shareholder must cast its votes in the
same proportion as the votes not controlled by the signing
shareholder, (2) may not engage in transactions with the Company
(including mergers and other transactions to extract value from its
relationship with the Company) without approval of the majority of
the members of the board of directors who are not nominated by the
signing shareholder and its affiliates and approval of 2/3rds of
the votes of shareholders other than the signing shareholder and
its affiliates, and (3) will only be allowed to cast 29.9% of the
total votes of the Company's capital stock with respect to any
matter other than the election of directors (votes above 29.9%
controlled by the signing shareholder and its affiliates would be
cast in the same proportion as the votes not controlled by the
signing shareholder). Additionally, the Minority Shareholder
Protection Agreement provides for a standstill to prevent the
acquisition of additional shares by the signing shareholder and its
affiliates.
Under certain circumstances, the Rights may be redeemed for
$0.00001 per right at the option of
the Board of Directors. If not redeemed, the Rights will expire on
December 30, 2015.
Generally, if the Rights become exercisable, then each
stockholder, other than the stockholder whose acquisition has
caused the rights to become exercisable, is entitled to purchase
three-quarters of a share of a Series A-1 Common Stock for each
right owned, at a purchase price equal to 50% of the then current
market value of three-quarters of a share of Series A-1 Common
Stock. In addition, if, after the Rights become exercisable,
the Company is acquired in a merger or other business combination,
or 50% or more of its assets or earning power are sold, each Right
will entitle the holder to purchase, for a purchase price equal to
the then current market value of a share of Series A-1 Common
Stock, a number of shares of common stock of the entity engaging in
the transaction obtained by dividing the then current market value
for three-quarters of a share of Series A-1 Common Stock by 50% of
the then-current market value of the common stock of the entity
engaging in such transaction.
In addition to the adoption of the Shareholder Rights Plan, the
Greektown Board of Directors has adopted amendments to the
Company's bylaws adding certain procedural requirements to action
of stockholders by majority consents, providing that only the
chairman of the Board of Directors, the chief executive officer or
a majority of the Board of Directors have the right to call special
meetings of the stockholders, fixing the minimum number of
directors of the Board of Directors at seven, and providing that
bylaws may be amended only by action of a majority of the Board of
Directors or a vote of stockholders having at least two-thirds of
the voting power of the outstanding capital stock.
Details regarding the Shareholder Rights Plan and the bylaw
amendments will be contained in a Form 8-K to be filed by Greektown
with the U.S. Securities and Exchange Commission.
About Greektown Superholdings, Inc.
Greektown Superholdings, Inc. operates, through its
subsidiaries, the Greektown Casino-Hotel. Located in the heart of
Detroit's Greektown Dining and
Entertainment District, Greektown Casino-Hotel opened on
November 10, 2000. Greektown
Casino-Hotel offers such amenities as Asteria, The Fringe, Shotz
Sports Bar & Grill, Bistro 555, Brizola and a VIP lounge for
players. Greektown Casino-Hotel opened its 400-room hotel tower in
February 2009 and became the first
Michigan casino to debut a
smartphone application. For more information, visit
greektowncasinohotel.com.
SOURCE Greektown Superholdings, Inc.