Colorado MEDtech, Inc. Adopts Shareholder Rights Plan

Business Wire, Dec 24, 1998

BOULDER, Colo.--(BW HealthWire)--Dec. 23, 1998--Colorado MEDtech, Inc. (NASDAQ:CMED), announced today that its Board of Directors has adopted a Shareholder Rights Plan.

The Rights provide protection against coercive or unfair takeover tactics, and should encourage anyone seeking to acquire the Company to first negotiate with the Company's Board of Directors. The Rights Plan is similar to plans adopted by many public companies and should provide a sound and reasonable means of safeguarding the interests of all shareholders should an effort be made to acquire the Company at a price not reflective of its fair value.

In connection with the adoption of the Rights Plan, the Board declared a dividend of one Preferred Stock Purchase Right for each outstanding share of the Company's Common Stock. Each Right, which is not presently exercisable, entitles the holder to purchase one one-hundredth of a share of Preferred Stock (the "Preferred Stock") at an exercise price of $55.00. In the event that any person acquires 15% or more of the outstanding shares of the Company's Common Stock, each holder of a Right (other than the acquiring person or group) will be entitled to receive, upon payment of the exercise price, that number of shares of Preferred Stock having a market value equal to two times the exercise price.

The distribution of the Rights will be made to shareholders of record on December 23, 1998. The Rights will expire on December 23, 2008. The Rights distribution is not taxable to shareholders.

Details of the Rights distribution are contained in a "Summary of Rights to Purchase Preferred Shares," which will be mailed to all shareholders of the Company.

Colorado MEDtech, Inc. is a leading full-service provider of advanced medical products and comprehensive outsourcing services.