Hudson (NYSE:HUD) Global, Inc. (NASDAQ:HSON), a company specializing in help supply services, has amended its shareholder rights agreement, according to a recent SEC filing. The amendment, made on Monday, extends the duration of the plan until October 15, 2027, to preserve the company's valuable U.S. net operating loss carryforwards (NOLs) and other tax benefits.
The rights agreement, initially established on October 15, 2018, and previously amended on September 28, 2021, aims to prevent an "ownership change" as defined by Section 382 of the Internal Revenue Code. Such a change could severely limit the company's ability to utilize its NOLs. An ownership change could occur if the ownership of "5-percent shareholders" increases by more than 50 percent over the lowest percentage owned by these shareholders during the previous three years.
Under the terms of the agreement, any person or group acquiring beneficial ownership of 4.99% or more of Hudson Global's common stock without board approval will face significant penalties. The rights held by any person or group surpassing this ownership threshold are considered void and cannot be exercised.
The extension of the rights agreement's term is contingent on shareholder approval during Hudson Global's 2024 annual meeting. If the amendment does not receive approval at or before this meeting, the rights agreement will expire.
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