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SNV > SEC Filings for SNV > Form 8-K on 24-Apr-2013All Recent SEC Filings

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Entry into a Material Definitive Agreement, Material Modification to Right

Item 1.01 Entry into a Material Definitive Agreement.

On April 24, 2013, Synovus Financial Corp. (the "Company") entered into Amendment No. 2 (the "Amendment") to the Shareholder Rights Plan, dated as of April 26, 2010, as amended as of September 6, 2011 (as so amended, the "Rights Plan") between the Company and American Stock Transfer & Trust Company, LLC (as successor to Mellon Investor Services LLC), as rights agent.

The board of directors of the Company adopted the Rights Plan in 2010 to protect the Company's ability to use certain tax assets, such as net operating loss carryforwards, capital loss carryforwards and certain built-in losses (the "Tax Benefits"), to offset future income. The Company's use of the Tax Benefits in the future would be substantially limited if it experiences an "ownership change" for U.S. federal income tax purposes. In general, an "ownership change" will occur if there is a cumulative change in the Company's ownership by "5-percent shareholders" (as defined under U.S. income tax laws) that exceeds 50 percentage points over a rolling three-year period.

The Rights Plan is designed to reduce the likelihood that the Company will experience an ownership change by discouraging (i) any person or group from becoming (a) a beneficial owner of 5% or more of the then outstanding common stock of the Company or (b) a "5-percent shareholder" (as defined under the U.S. income tax laws) with respect to the Company (in either case, a "Threshold Holder") and (ii) any existing Threshold Holder from acquiring any additional stock of the Company. There is no guarantee, however, that the Rights Plan will prevent the Company from experiencing an ownership change.

A corporation that experiences an ownership change will generally be subject to an annual limitation on certain of its pre-ownership change tax assets in an amount generally equal to the equity value of the corporation immediately before the ownership change, multiplied by the "long-term tax-exempt rate" (subject to certain adjustments).

Under the original terms of the Rights Plan, the Rights (as defined in the Rights Plan) were scheduled to expire on April 27, 2013. After careful consideration, the board of directors of the Company has concluded that that an extension of the expiration date under the Rights Plan is in the best interests of the Company and its shareholders.

The Amendment (i) extends the final expiration date from April 27, 2013 to the close of business on April 28, 2016 and (ii) updates certain contact information under the Notices section of the Rights Plan. Except for the foregoing changes, the Rights Plan otherwise remains unmodified.

The Company presently intends to seek shareholder ratification of the Amendment at its 2014 Annual Meeting of Shareholders.

The above description of the Amendment is qualified by the full text of the Amendment being filed as Exhibit 4.1 to this Current Report on Form 8-K and incorporated herein by reference in its entirety. The above description of the Rights Plan is qualified in its entirety by the full text of the Rights Plan, which was filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on April 26, 2010 and Amendment No. 1 to Shareholder Rights Plan, which was filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on September 6, 2011.

Item 3.01 Material Modification of Rights to Security Holders.

The information set forth under "Item 1.01 Entry into a Material Definitive Agreement" of this Current Report on Form 8-K is incorporated into this Item 3.01 by reference.

Item 9.01 Financial Statements and Exhibits

          (d)             Exhibits

          Exhibit No.     Description

          4.1             Amendment No. 2, dated April 24, 2013, to Shareholder
                          Rights Plan dated as of April 26, 2010 (as amended) by and
                          between Synovus Financial Corp. and American Stock
                          Transfer & Trust Company, LLC.

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