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RAPAPORT... J. C. Penney Company Inc. adopted a stockholder rights plan, which has a term of one year and is designed to protect the retailer against any potential future use of coercive or abusive takeover techniques and to help it ensure that stockholders are not deprived of the fair value of their investment. The board of directors added that this plan was not adopted in response to any effort to acquire control of the company, and it will continue in effect until August 20, 2014 unless the rights are redeemed or exchanged for shares of common stock by the company on an earlier date. In addition, the board declared a dividend of one right for each share of common stock held by stockholders of record as of the close of business on September 3, 2013. These rights will generally be exercisable only if a person or group becomes an "acquiring person" by acquiring beneficial ownership of 10 percent or more of the company's common stock or, in the case of any person (including such person's affiliates and associates) that beneficially owns 10 percent or more of outstanding common stock, upon the acquisition of additional shares. The term "acquiring person" will not include certain affiliates of Pershing Square Capital Management, which is JCPenney's largest shareholder, or certain affiliates of Vornado Realty Trust so long as such party's beneficial ownership is permitted under such party's letter agreements with the company, according to the board. Stockholders are not required to take any action to receive the rights distribution.
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