CNET Networks rights plan encourages negotiation before takeover

By Lisa Kerner

Charlotte, N.C., Jan. 14 - The board of directors of CNET Networks, Inc. adopted a shareholder rights plan designed to deter "coercive takeover tactics."

Under the plan, one preferred stock purchase right will be distributed as a dividend on each common share held as of the close of business on Jan. 21, a company news release stated.

While the rights plan will not prevent a takeover, it should encourage interested parties to negotiate with CNET's board of directors prior to attempting a takeover, the company said.

Each right, when exercisable, allows the holder to buy one one-thousandth of a share of a new series of junior participating preferred stock for $35.

If any person or group acquires 15% or more of the company's shares, rights not owned by that investor will entitle the holder to purchase, at the right's then-current exercise price, common shares having a market value of twice the right's exercise price, according to the release.

If CNET is involved in a merger or "other business combination," then each right will entitle its holder - other than those holding a 15% stake or greater - to purchase, at the right's then-current exercise price, common shares of the acquiring company having a value of twice the right's exercise price.

CNET is a San Francisco-based interactive media company.

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