Memorex 2010 Annual Report Download - page 81

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Note 13 — Shareholders’ Equity
Shareholder Rights Plan
In 2006, we adopted a shareholder rights plan under which we have issued one preferred share purchase right
(Right) for each share of our common stock. If it becomes exercisable, each Right will entitle its holder to purchase one
one-hundredth of a share of Series A Junior Participating Preferred Stock at an exercise price of $160, subject to
adjustment. The Rights are exercisable only if a person or group acquires beneficial ownership of 15 percent or more of
our outstanding common stock, or after the first public announcement relating to a tender offer or exchange offer that
would result in a person or group beneficially owning 15 percent or more of our outstanding shares of common stock
subject to certain exceptions. The Rights expire on July 1, 2016 and may be redeemed earlier by the Board of Directors
for $0.01 per Right.
The shareholder rights plan was amended effective July 30, 2007 to change the definition of acquiring person to
exclude TDK Corporation and its affiliates at any time during the period (TDK Standstill Period) beginning at the time, if
any, that TDK and its affiliates own 15 percent or more of the outstanding shares of common stock and ending at the
time, if any, that TDK and its affiliates cease to own at least 75 percent of the shares issued related to the acquisition of
the TDK Recording Media business or cease to be holders of record of at least 10 percent of the common stock as a
result of Imation issuing additional shares.
TDK cannot become the beneficial owner of more than 21 percent of the common stock outstanding at any time
during the TDK Standstill Period other than as a result of a reduction in the number of shares outstanding due to Imation
repurchasing shares of common stock and is limited to 22 percent in this event. TDK shall dispose of a sufficient number
of shares of common stock within 10 days after becoming aware that the percentage has been surpassed such that TDK
shall be the beneficial owner of no more than 21 percent of the common stock then outstanding.
Treasury Stock
Our Board of Directors has authorized the repurchase of a total of 3.0 million shares. As of December 31, 2010, we
have repurchased 0.7 million shares of common stock and have remaining authorization to repurchase up to 2.3 million
shares. We did not repurchase any shares during 2010 and 2009. As of December 31, 2010, we held, in total, 4.2 million
shares of treasury stock acquired at an average price of $25.68 per share.
78
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)