LivePerson adopts tax benefits preservation plan

LivePerson has unanimously adopted a tax benefits preservation plan designed to help preserve the full availability of the company’s net operating loss carryforwards, or NOLs. As of December 31, 2023, the company estimates that its cumulative NOLs exceed $400M. These NOLs, most of which are not subject to any expiration date, are available to reduce the company’s future federal income tax expense. The purpose of the NOL Plan is to reduce the risk of substantial impairment to the company’s NOL assets that could result from inadvertent triggering of an “ownership change”. The Board has adopted the NOL Plan after determination that, as a result of a recently announced accumulation of more than 10% of the company’s common stock by a new stockholder, taken together with other changes in ownership of LivePerson common stock over the last three years, the company is significantly closer to triggering an “ownership change” within the meaning of Section 382, which would substantially impair its ability to utilize its NOLs. LivePerson intends to submit the NOL Plan for stockholder ratification at its 2024 Annual Meeting of Stockholders. The NOL Plan aims to preserve the company’s NOL assets by creating a disincentive for any stockholder to accumulate beneficial ownership of LivePerson common stock of 4.9% or more without the approval of the Board. In connection with its adoption of the NOL Plan, the Board declared a dividend of one “right” under the NOL Plan for each outstanding share of LivePerson common stock. The dividend will be made to holders of record as of the close of business on January 22. Any shares of LivePerson common stock issued after the record date will be issued together with a right. The rights will expire on January 21, 2027. However, if LivePerson stockholders do not ratify the NOL Plan at the Company’s 2024 Annual Meeting of Stockholders, the rights will expire on January 21, 2025.