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FrontLine Contact:
Jim Burnham/SVP, Finance
212-931-8024
[email protected]
FRONTLINE CAPITAL GROUP ADOPTS SHAREHOLDER RIGHTS PLAN
NEW YORK--October 24, 2000--FrontLine Capital Group (Nasdaq: FLCG) today
announced that its Board of Directors has adopted a Shareholder Rights Plan
and declared a dividend of one preferred share purchase right ("Right") to
shareholders of record for each outstanding share of the Company's common
stock as of the close of business on November 3, 2000.
The Rights Plan is designed to protect shareholders from various abusive
takeover actions, including attempts to acquire control of the Company at an
inadequate price which could deprive shareholders of the full value of their
investment. The Rights were not adopted in response to any specific event, nor
is FrontLine's Board of Directors aware of any person or group that is seeking
to acquire control of the Company. The Rights will expire on October 15, 2010.
"The Rights Plan was adopted in the interest of our shareholders in order to
ensure that the Board will be in the best position to protect their long-term
value," said Scott Rechler, Chairman and CEO of FrontLine. Mr. Rechler further
noted, "These types of protections are especially important at a time when we
believe the market is not recognizing the intrinsic value of our Company."
Each Right will entitle shareholders to purchase one one-hundredth of a share
of a new series of junior participating preferred stock of the Company for
$60.00. The Rights will be exercisable only if a person or group acquires or
announces their intent to acquire beneficial ownership of 15% or more of the
Company's common stock.
If the Company is acquired in a merger after such an acquisition, all Rights
holders except the acquiring person will also be entitled to purchase stock in
the buyer at a discount in accordance with the Plan. The Rights distribution
is not taxable to stockholders.
The Shareholder Rights Plan is being filed with the Securities and Exchange
Commission.
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About FrontLine Capital Group
FrontLine Capital Group (Nasdaq: FLCG) is a publicly-traded operating company
that develops and manages companies that service small and medium-size
enterprises and the mobile workforces of larger companies. FrontLine generally
acquires significant interests in companies to influence their long-term
direction and value creation and has committed $390 million in 12 companies,
including HQ Global Workplaces, OnSite Access, EmployeeMatters, RealtyIQ.com,
and UpShot.com. The company has two distinct operating units; one unit will
hold FrontLine's investment in HQ Global and the other unit will hold all
other assets. FrontLine allocates capital and management resources to maximize
the potential value of its Companies.
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