SCOTTSDALE, Ariz., June 21, 2013 (GLOBE NEWSWIRE) -- iGO, Inc. (Nasdaq:IGOI) (the "Company") announced today that it has amended and restated its stockholder rights agreement, which was originally entered on June 11, 2003 and was set to expire on June 23, 2013, to establish a tax benefits protection plan for the preservation of the Company's net operating losses and other similar tax attributes ("NOLs") from substantial limitations contained in Section 382 of the Internal Revenue Code ("IRC"). IRC Section 382 limits the amount of NOLs that can be used in any one year following an "ownership change," as defined under Section 382. In general, an "ownership change" occurs where there is a greater than 50-percentage point change within a rolling three-year period in the ownership of a company's stock by stockholders owning (or deemed to own under section 382), directly or indirectly, 5% or more of such company's stock.
The Rights granted under the amended and restated rights agreement are intended to deter any person from acquiring 4.9% or more of the outstanding shares of iGo's common stock, or any existing 4.9% or greater holder from acquiring any additional shares representing 1.0% or more of the then outstanding common stock, in each case, without the approval of iGo's Board of Directors ("Board"), thus mitigating the threat to the preservation of iGo's NOLs presented by stock ownership changes.
Under the amended and restated rights agreement, stockholders of record at the close of business on June 30, 2013 will receive one share purchase "Right" for each share of iGo Common Stock held on that date. The Rights, which will initially trade with the Common Stock and represent the right to purchase one one thousandth of a share of the new Preferred Stock at $0.01 per Right, become exercisable when a person or group acquires 4.9% or more of iGo Common Stock without prior Board approval. In that event, the Rights permit iGo stockholders, other than the acquiror, to purchase iGo Common Stock at a 50% discount to its market value in lieu of the Preferred Stock. Alternatively, when the Rights become exercisable, the Board may authorize the issuance of one share of iGo Common Stock in exchange for each Right that is then exercisable. In addition, in the event of certain business combinations, the Rights permit the purchase of the Common Stock of an acquiror at a 50% discount. Rights held by the acquiror will become null and void in each case. Prior to a person or group acquiring 4.9%, the Rights can be redeemed for $0.01 each by action of the Board.