Furniture Brands announces new stockholder rights plan to protect NOLs

By Lisa Kerner

Charlotte, N.C., Aug. 3 - Furniture Brands International Inc.'s board of directors terminated its existing rights plan and adopted a new stockholder rights plan to protect the use of its net operating loss carryforwards in the event of an ownership change, as well as certain other tax benefits, under Section 382 of the Internal Revenue Code.

Stockholders will be asked to approve the new rights plan at the company's next annual meeting, a Furniture Brands news release said.

The company, in connection with the plan, declared a dividend of one preferred share purchase right for each outstanding share of common stock as of Aug. 13.

Each right initially represents the right to purchase 1/1,000th of a share of Furniture Brands preferred stock for $20.

The rights are triggered if any stockholder or group acquires beneficial ownership of 4.75% or more of the Hickory, N.C., furniture company's outstanding stock without the board's approval.

Stockholders currently holding 4.75% or more of Furniture Brands' common stock will not be considered acquiring persons unless they acquire additional shares, subject to certain exceptions, the company said.

Furniture Brands said the rights will expire on July 30, 2011 unless they are earlier redeemed or exchanged.

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