PERFORMANCE TECHNOLOGIES, INCORPORATED
Filing Type: 8-K
Description: Current Report
Filing Date: November 9, 2000
Period End: October 27, 2000
Primary Exchange:NASDAQ - National Market
System
Ticker: PTIX
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Table of Contents
8-K OTHERDOC
Item 5..................................................................2
Item 7..................................................................6
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): October 27, 2000
Performance Technologies, Incorporated
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(Exact name of registrant as specified in charter)
Delaware 0-27460 16-1158413
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(State or other jurisdiction) (Commission File No.) (IRS Employer Identification
No. of Incorporation)
315 Science Parkway, Rochester, NY 14620
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (716) 256-0200)
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(Former Name or Former Address, if Changed Since last Report)
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Item 5. OTHER EVENTS.
On October 27, 2000, the Board of Directors of Performance
Technologies, Incorporated (the "Company") declared a dividend of one Right for
each outstanding share of the Company's Common Stock to stockholders of record
at the close of business on November 8, 2000 (the "Record Date"). Each Right
entitles the registered holder to purchase from the Company one one-thousandth
of a share of Series A Junior Participating Preferred Stock, $.01 par value per
share (the "Preferred Stock"), at an Exercise Price of $110 per Right in cash,
subject to adjustment. The description and terms of the Rights are set forth in
a Rights Agreement dated as of November 1, 2000 (the "Rights Agreement") between
the Company and American Stock Transfer & Trust Company, as Rights Agent.
Exercisability of Rights. Initially, the Rights will not be exercisable
or transferable apart from the shares of Common Stock with respect to which they
will be distributed, and will be evidenced only by the certificates representing
such shares of Common Stock. The Rights will become exercisable and transferable
apart from the Common Stock on a date (the "Separation Date") that is the
earlier of (i) the close of business on the tenth business day after a Stock
Acquisition Date, defined as the first date of a public announcement by the
Company that a person or group of affiliated or associated persons has become an
Acquiring Person or Adverse Person (each as described below), or (ii) the close
of business on the tenth business day following the commencement of, or first
public disclosure of an intention to commence, a tender or exchange offer by any
person (other than a Permitted Offer as described below) if, upon consummation
of that offer, such person would become an Acquiring Person (as described
below). The Rights will be exercisable from the Separation Date until the
Expiration Date, which is the earlier of (i) the close of business on the
ten-year anniversary of the date of the Rights Agreement (the "Final Expiration
Date"), (ii) the date the Rights are redeemed by the Company, (iii) the date the
Rights are exchanged by the Company, or (iv) immediately prior to the effective
time of a consolidation, merger or share exchange of the Company (A) into
another corporation or (B) with another corporation in which the Company is the
surviving corporation but Common Stock is converted into cash and/or securities
of another corporation, in each case pursuant to an agreement entered into by
the Company prior to a Stock Acquisition Date, at which time the Rights will
expire.
A person or group becomes an Acquiring Person under the Rights
Agreement when such person or group acquires or obtains the right to acquire
beneficial ownership of 15% or more of the then outstanding shares of the
Company's Common Stock, with certain exceptions described in the Rights
Agreement (including exceptions for shares owned by the Company or a subsidiary
or employee benefit plan of the Company, and for shares owned by any person who
the Board determines inadvertently reached such 15% beneficial ownership level
and who promptly divests sufficient shares such that 15% or greater beneficial
ownership ceases). An Adverse Person under the Rights Agreement is a person who
beneficially owns more than 10% of the then outstanding shares of the Company's
Common Stock and whose ownership of that stock, in the opinion of the Board, is
intended or reasonably likely to cause pressure on the Company to enter into a
transaction which would provide that person with short-term financial gain not
in the Company's best long-term interest or is causing or reasonably likely to
cause a material adverse impact on the Company's business or prospects.
A Permitted Offer under the Rights Agreement is a tender or exchange
offer for all outstanding shares of the Company's Common Stock at a price and on
terms determined, prior to the purchase of shares under such tender or exchange
offer, by at least a majority of the members of the Board who are not officers
of the Company and who are not Acquiring Persons or Adverse Persons to be
adequate and otherwise in the best interests of the Company and its
stockholders.
Transferability of Rights. Prior to the Separation Date, the Rights
will not be transferable apart from the shares of Common Stock to which they are
attached. Thus, the surrender or transfer of any Common Stock certificate prior
to that date will also constitute the transfer of the Rights associated with the
shares represented by such certificate. Until the Separation Date (or earlier
redemption, exchange or expiration of the Rights), new Common Stock certificates
issued after the Record Date, upon transfer or new issuance of shares of Common
Stock, will contain a notation incorporating the Rights Agreement by reference.
Until the Separation Date (or earlier redemption, exchange or expiration of the
Rights), the surrender for transfer of any certificates for shares of Common
Stock, outstanding as of the Record Date, even without such notation or a copy
of a Summary of Rights being attached thereto, will also constitute the transfer
of the Rights associated with the shares of Common Stock represented by such
certificate. As soon as practicable after a Separation Date, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to
each record holder of shares of Common Stock as of the close of business on such
Separation Date and, in certain circumstances, holders of certain shares issued
after such Separation Date. Until exercised, the holders of Rights will not have
any rights as holders of Preferred Stock, including any rights to vote or
receive dividends on the Preferred Stock.
Flip-In Rights. It is at the time that the "flip-in" right is triggered
that the Rights have a real economic value. Upon the tender for or the
acquisition of 15% of the Common Stock by an Acquiring Person or the
determination and announcement by the Board that a person has become an Adverse
Person (a "Flip-In Event"), each holder of a Right will thereafter have the
right (the "Flip-In Right") to receive, upon exercise and payment of the
Exercise Price, the number of shares of Preferred Stock having a market value
immediately prior to the Flip-In Event equal to two times the then current
Exercise Price of the Right. Any Right that is (or, in certain circumstances
specified in the Rights Agreement, was) beneficially owned by an Acquiring
Person or Adverse Person (or any of its affiliates or associates, as defined)
will become null and void upon the occurrence of the Flip-In Event. Cash will be
paid in lieu of fractional shares.
For example, at the Exercise Price of $110 per Right, if any person
becomes the Acquiring Person of 15% or more of the outstanding Common Stock of
the Company or is determined to be an Adverse Person, thereafter each Right
(other than Rights owned by such 15% Acquiring Person or Adverse Person or any
of its affiliates or associates, which will have become void) would entitle its
holder to purchase $220 worth of the Company's Preferred Stock for $110.
Assuming that each one one-thousandth share of Preferred Stock is the economic
equivalent of one share of Common Stock and further assuming that the Common
Stock had a per share value of $11.00 at such time, each Right would effectively
entitle its holder to purchase twenty one-thousandth shares of the Company's
Preferred Stock for $110.
Flip-Over Rights. If, at any time following a Flip-in Event, either (i)
the Company is acquired in a merger or other business combination transaction,
the Acquiring Person or Adverse Person controls the Board of the Company and
either (A) the investment of the shares owned by those other than the Acquiring
Person or Adverse Person are not identified to the shares owned by the Acquiring
Person or Adverse Person or (B) the transaction is with the Acquiring Person or
Adverse Person or a related party; or (ii) the Company sells or otherwise
transfers more than 50% of its aggregate assets or earning power to a related
party if approved by Company after the Acquiring Person or Adverse Person
controls the Board of the Company, each holder of a Right (except Rights
previously voided as described above) will thereafter have the right (the
"Flip-Over Right") to receive, upon exercise, shares of common stock of the
Acquiring Person or Adverse Person having a value equal to twice the Exercise
Price of the Right. The Flip-Over Right will be exercisable apart from, and
regardless of the exercise or surrender of, the Flip-In Right.
Again, as with the flip-in trigger, because the Acquiring Person or
Adverse Person is not able to exercise its rights, the Acquiring Person or
Adverse Person and (assuming that the Acquiring Person or Adverse Person is the
party acquiring the Company) its stockholders are significantly diluted as a
result of the triggering of the flip-over event.
Exercise Price for Rights. The Exercise Price is intended to represent
the Board's informed prediction as to the likely market price of one share of
the Company's Common Stock at the end of the term of the Rights Agreement, and
is not an expression as to what would be a fair or adequate price for the sale
of the Company.
Redemption of the Rights. At any time prior to the close of business on
the tenth business day following a public announcement that a party is an
Acquiring Person or Adverse Person, the Board may redeem the Rights in whole but
not in part at a Redemption Price of $.001 per Right. Immediately upon any
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
Exchange of the Rights. At any time after a Flip-in Event, the Board
may exchange the Rights (other than Rights owned by such Acquiring Person or
Adverse Person or any of its affiliates or associates which have become void),
in whole or in part, for Common Stock at an exchange ratio of one share of
Common Stock per Right.
Adjustments. The Exercise Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon exercise of the
Rights are subject to adjustment from time to time to prevent dilution (i) in
the event of a stock dividend on, or a subdivision, combination or
reclassification of the Preferred Stock, (ii) upon the grant to holders of the
Preferred Stock of certain rights, options or warrants to subscribe for or
purchase Common Stock at a price, or securities convertible into Preferred Stock
with a conversion price, less than the then current market price of the Common
Stock, or (iii) upon the distribution to holders of the Preferred Stock of
evidences of indebtedness or assets (excluding regular periodic cash dividends
paid out of earnings or retained earnings or dividends payable in shares of
Preferred Stock) or of subscription rights or warrants (other than those
referred to above). The number of Rights associated with each share of Common
Stock is also subject to adjustment in the event of a stock split of the Common
Stock or stock dividend on the Common Stock payable in Common Stock or
subdivisions, consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Separation Date.
Reserved Shares/Substitution of Assets. The Rights Agreement
contemplates that the Company will reserve a sufficient number of authorized but
unissued shares of Preferred Stock to permit the exercise of the right to
exchange the Rights should the Rights become exercisable. The Board may (and
under certain circumstances is obligated to) issue other equity securities or
assets upon the exercise of the Rights if sufficient shares of Preferred Stock
are not available for issuance should the Rights become exercisable. The Board
may make adequate provision to substitute for the shares of stock which are not
available for issuance upon exercise of such Rights either cash, other equity
securities of the Company (including, without limitation, shares of preferred
stock of the Company), debt securities of the Company, other assets, or a
combination of the foregoing, having an aggregate value (as determined by a
majority of the Board after receiving advice from a nationally recognized
investment banking firm) equal to the value of the shares of Preferred Stock
unavailable for issuance upon exercise of the Rights. In addition, the Board,
subject to certain limitations, may amend the Rights to change the Exercise
Price and therefore the number of shares of Preferred Stock issuable upon
exercise of the Rights. If the Company does not take such action within 30 days
following the later of a Flip-In Event or the date on which the Company's right
of redemption with respect to the Rights expires, then the Company will be
required to deliver cash as the substitute for the unavailable authorized shares
of Preferred Stock.
Amendment of the Rights Agreement. The terms of the Rights and the
Rights Agreement may be amended by the Board without the consent of the holders
of the Rights, except that from and after such time as any Person becomes an
Acquiring Person or Adverse Person no such amendment may adversely affect the
interests of the holders of the Rights (other than the Acquiring Person, the
Adverse Person or their Affiliates and Associates.
Independent Director Review. The Rights Agreement final expiration date
is ten years from the date of the Rights Agreement. However, a committee of the
Company's Directors who are neither officers, employees or affiliates of the
Company will review the Rights Plan at least every three years and, if a
majority of these Directors deems it appropriate, may recommend a modification
or termination of the Rights Agreement.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to the Company's Registration Statement on
Form 8-A dated November 8, 2000. A copy of the Rights Agreement is available
free of charge from the Company. This summary description of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by reference.
Item 7.FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
The exhibits listed in the Exhibit Index filed as part of this report
are filed as part of or included in this report.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: November 9, 2000
PERFORMANCE TECHNOLOGIES,
INCORPORATED
By:/s/ Donald L. Turrell
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Name: Donald L. Turrell
Title: Chief Executive Officer
EXHIBIT INDEX
Exhibit No. Description
4.1 Form of Rights Agreement, dated as of November 1, 2000,
between Performance Technologies, Incorporated and American
Stock Transfer & Trust Company which includes as Exhibit A the
Form of Rights Certificate, and as Exhibit B the Summary of
Rights to Purchase Preferred Stock.1
1 Incorporated by reference to the Registrant's Registration Statement on Form
8-A, dated November 8, 2000 and filed by the Registrant with the Commission.
