VIB Corp. (Nasdaq: VIBC) has announced its board of directors has adopted a rights plan designed to protect the company's shareholders in the event of any proposed takeover action.
The rights plan is designed to assure all shareholders of VIB Corp. receive fair and equal treatment in the event of any proposed takeover of the company and to guard against partial tender offers, squeeze-outs and other tactics to gain control of the company without majority stake in the company, but should encourage such person or persons to negotiate in advance with the board of directors, acting on behalf of all shareholders.
Adoption of rights plans are common practice utilized by public companies, including several bank holding companies, to protect their shareholders' interests.
Terms of the rights plan provide for a distribution of one right for each outstanding share of VIB Corp. common stock held by shareholders of record at the close of business Aug. 31. Each right entitles the holder to buy 1/1,000 of a share of the company's preferred stock for $40. Each preferred interest (1/1,000 of a share of preferred stock) has dividend, voting and liquidation preferences such that it is equivalent to a share of VIBC common stock.