Prospectus Supplement
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES
THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
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COMPUTER HORIZONS CORP.
500,832 shares of Common Stock
($0.10 par value)
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The date of this Prospectus Supplement is August 30, 1999
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This Prospectus Supplement supplements the Prospectus dated March 30,
1998 (as so amended, the "Prospectus"), relating to the offer and sale of up to
504,860 shares of the common stock, $0.10 par value (the "Common Stock"), of
Computer Horizons Corp. (the "Company"). To the Company's knowledge, as of the
date hereof 465,961 shares of Common Stock continue to be offered for sale
pursuant to the registration statement to which the Prospectus relates.
On July 13, 1999, the Board of Directors of the Company declared a
dividend distribution of one preferred stock purchase right (a "Right") for each
outstanding share of Common Stock, payable to the stockholders of record on July
16, 1999 (the "Record Date"). The Board of Directors also authorized and
directed the issuance of one Right with respect to each Share of Common Stock
issued thereafter until the Distribution Date (as defined below) and, in certain
circumstances, with respect to shares of Common Stock issued after the
Distribution Date.
Except as set forth below, each Right, when it becomes exercisable,
entitles the registered holder to purchase one one-thousandth of a share of
Series B Junior Participating Preferred Stock, $.10 par value (the "Preferred
Stock"), at a price of $90, subject to adjustment (the "Purchase Price"). The
description and terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") between the Company and Registrar and Transfer Company, as
Rights Agent (the "Rights Agent"), dated as of July 13, 1999.
Initially, the Rights will be attached to all certificates
representing shares of Common Stock then outstanding, and no separate Right
Certificates will be distributed. The Rights will separate from the shares of
Common Stock upon the earliest to occur of (i) a person or entity (a "Person")
or group of affiliated or associated Persons (a "Group") having acquired
beneficial ownership of 20% or more of the outstanding shares of Common Stock
(except pursuant to a Permitted Offer, as hereinafter defined); or (ii) 10
business days (or such later date as the Board of Directors may determine)
following the commencement of, or announcement of an intention to make, a tender
offer or exchange offer the consummation of which would result in a Person or
Group becoming an Acquiring Person (as hereinafter defined) (the earliest of
such dates being called the "Distribution Date"). A Person or Group whose
acquisition of shares of Common
<PAGE>
Stock causes a Distribution Date pursuant to clause (i) above is an "Acquiring
Person." The date that a Person or Group becomes an Acquiring Person is the
"Stock Acquisition Date."
In addition, a Person who acquires shares of Common Stock pursuant to
a tender or exchange offer which is for all outstanding shares of Common Stock
at a price and on terms which the Board of Directors determines (prior to
acquisition) to be adequate and in the best interests of the Company and its
stockholders (other than such Person, its affiliates and associates) (a
"Permitted Offer") will not be deemed to be an Acquiring Person and such
Person's ownership will not constitute a Distribution Date.
The shares of Preferred Stock purchasable upon exercise of the Rights
will have a minimum preferential quarterly dividend of $1.00 per share, but will
be entitled to receive, in the aggregate, a dividend of one thousand times the
dividend declared on the shares of Common Stock. In the event of liquidation,
the holders of the shares of Preferred Stock will be entitled to receive a
minimum liquidation payment of $1,000 per share, but will be entitled to receive
an aggregate liquidation payment equal to one thousand times the payment made
per share of Common Stock. Each share of Preferred Stock will have one thousand
votes, voting together with the shares of Common Stock. In the event of any
merger, consolidation or other transaction in which shares of Common Stock are
exchanged, each share of Preferred Stock will be entitled to receive one
thousand times the amount and type of consideration received per share of Common
Stock. The rights of the shares of Preferred Stock as to dividends and
liquidation, and in the event of mergers and consolidation, are protected by
customary anti-dilution provisions.
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the shares of Common Stock. Until
the Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after the Record Date upon the transfer or new
issuance of shares of Common Stock will contain a notation incorporating the
Rights Agreement by reference. Until the Distribution Date (or earlier
redemption 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 this 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
following the Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the Common Stock
as of the close of business on the Distribution Date (and to each initial record
holder of certain shares of Common Stock issued after the Distribution Date),
and such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date, and will
expire at the close of business on July 15, 2009, unless earlier redeemed by the
Company as described below.
In the event that any person becomes an Acquiring Person, each holder
of Rights (other than Rights that have become null and void as described below)
will thereafter have the right (the
<PAGE>
"Flip-In Right") to receive, upon exercise of such Rights, the number of shares
of Common Stock (or, in certain circumstances, other securities of the Company)
having a value (immediately prior to such triggering event) equal to two times
the aggregate exercise price of such Rights. For example, if a Person became an
Acquiring person at a time when the current per share market price of the
Company's Common Stock was $18 and the Purchase Price was $90, each holder of a
Right (other than a Right which has become null and void as described herein)
would have the right to receive ten shares of Common Stock upon exercise of the
Right and payment of the Purchase Price of $90.
The Board, at its option, may exchange each Right (other than those
that have become null and void as described below) for one share of Common Stock
in lieu of the Flip-In Right, provided no Person is the beneficial owner of 50%
or more of the shares of Common Stock at the time of such exchange.
Notwithstanding the foregoing, following the occurrence of the event described
above, all Rights that are or (under certain circumstances specified in the
Rights Agreement) were beneficially owned by any Acquiring Person or any
affiliate or associate thereof or certain transferees thereof will be null and
void.
In the event that, at any time following the Stock Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction in which the holders of all of the outstanding shares of Common
Stock immediately prior to the consummation of the transaction are not the
holders of all of the surviving corporation's voting power, or (ii) more than
50% of the Company's assets or earning power is sold or transferred, then each
holder of Rights (except Rights which previously have been voided as set forth
above) shall thereafter have the right (the "Flip-Over Right") to receive, upon
exercise of such Rights, shares of Common Stock of the acquiring company (or in
certain circumstances, its parent) having a value equal to two times the
aggregate exercise price of the Rights. The Flip-Over Right shall not apply to
any transaction described in clause (i) if such transaction is with a Person or
Persons (or a wholly owned subsidiary of any such Person or Persons) that
acquired shares of Common Stock pursuant to a Permitted Offer and the price and
form of consideration offered in such transaction is the same as that paid to
all holders of Common Stock whose shares were purchased pursuant to the
Permitted Offer. The holder of a Right will continue to have the Flip-Over Right
whether or not such holder exercises or surrenders the Flip-In Right.
The Purchase Price payable, and the number of shares of Common Stock
or other securities 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 Common
Stock, (ii) upon the grant to holders of the Common Stock of certain rights or
warrants to subscribe for or purchase shares of Common Stock at a price, or
securities convertible into shares of Common 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 Common Stock of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
<PAGE>
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares of Common Stock will be issued and, in
lieu thereof, an adjustment in cash will be made based on the market price of
the Common Stock on the last trading day prior to the date of exercise.
At any time prior to the earlier to occur of (i) a person becoming an
Acquiring Person or (ii) the expiration of the Rights, the Company may redeem
the Rights in whole, but not in part, at a price of $.01 per Right (the
"Redemption Price"), which redemption shall be effective at such time, on such
basis and with such conditions as the Board of Directors may establish in its
sole discretion. The Company may, at its option, pay the Redemption Price in
Common Stock.
All of the provisions of the Rights Agreement may be amended by the
Board of Directors prior to the Distribution Date. After the Distribution Date,
the provisions of the Rights Agreement may be amended by the Board in order to
cure any ambiguity, defect or inconsistency, to make changes which do not
adversely affect the interests of holders of Rights (excluding the interests of
any Acquiring Person), or, subject to certain limitations, to shorten or
lengthen any time period under the Rights Agreement.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not
be taxable to stockholders of the Company, stockholders may, depending upon the
circumstances, recognize taxable income should the Rights become exercisable or
upon the occurrence of certain events thereafter.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A. 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.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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