SCOTTSDALE, Ariz., July 8 /PRNewswire-FirstCall/ -- Rural/Metro Corporation (Nasdaq: RURL) issued another reminder today for current and potential holders of 5% or more of the Company's common stock in relation to its ongoing analysis of the impact of change-in-ownership rules under Section 382 of the U.S. Internal Revenue Code ("Section 382").
In general, Section 382 limits the use of a corporation's net operating losses and certain other tax benefits following a change in ownership of the corporation. Section 382 rules governing when a change in ownership occurs are complex and subject to interpretation; however, a change in ownership generally occurs when there has been a cumulative change in the stock ownership of the corporation held by 5% stockholders of more than 50 percentage points over an applicable three-year period.
To the extent the Company has not experienced a change in ownership, subsequent changes in the stock ownership of the Company could result in a change in ownership that would trigger the limitations of Section 382. If the Company were to experience a change in ownership under Section 382, the Company may be limited in its ability to fully utilize its net operating loss tax assets to offset future taxable income.
The Company recognizes that investment decisions are within the discretion of each investor; however, along with the other risk factors set forth in the Company's most recent Form 10-K and other public filings, the Company advises investors to consider the potential negative impact of Section 382 on the Company that can arise from any of the following trading transactions (either alone or in combination):
-- Any transfer of common stock by a 5% stockholder.
-- Any transfer of common stock to the extent that, as a result of the transfer (or any series of transfers of which such transfer is part), the percentage stock ownership of any person or group of persons that is not a 5% stockholder would exceed 4.9%.
For these purposes, a 5% stockholder is generally any person or group of persons that at any time during an applicable three-year period has owned 5% or more of the outstanding common stock of Rural/Metro Corporation. Under Section 382, stock ownership would be determined under complex attribution rules pursuant to the Tax Code and generally includes shares held directly, indirectly (through intervening entities) and constructively (by certain related parties and certain unrelated parties acting as a group).
Rural/Metro Corporation provides emergency and non-emergency ambulance services and private fire protection services in 23 states and approximately 400 communities throughout the United States. For more information, visit the company's web site at http://www.ruralmetro.com.
SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, among others, the Company's ability to accurately assess transactions in the Company's stock by its significant stockholders and the accuracy of the Company's assumptions surrounding its Section 382 analysis. Although Rural/Metro believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct.
Reference is made to a more complete discussion of forward-looking
statements and applicable risks that may cause actual results to differ
materially from those contemplated by such forward-looking statements
("Cautionary Statements") that include, among others, those identified
under the captions "Forward-Looking Statements" and "Risk Factors" in the
Company's annual report on Form 10-K for the fiscal year ended June 30,
2007, which is available free of charge on the website of the Securities
and Exchange Commission (the "SEC") at http://www.sec.gov or on the
Company's website at http://www.ruralmetro.com. All subsequent written and
oral forward-looking statements (or statements that may be attributed to
the Company) are expressly qualified by the Cautionary Statements. The
Company's forward-looking statements are based on information available
today, and it undertakes no obligation to update these statements, whether
as a result of new information, future events or otherwise, except as
required by the securities laws.
CONTACT: Liz Merritt, Rural/Metro Corporation
Sharrifah Al-Salem, FD Ashton Partners
|SOURCE Rural/Metro Corporation|
Copyright©2008 PR Newswire.
All rights reserved