SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
May 29, 1998
Date of Report (Date of earliest event reported)
CSX CORPORATION
(Exact name of registrant as specified in its charter)
Virginia 2-63273 62-1051971
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
One James Center, 901 East Cary Street,
Richmond, VA 23219
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (804) 782-1400
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Item 5. Other Events.
On May 29, 1998, the Board of Directors of CSX Corporation (the "Company")
declared a dividend of one preferred share purchase right (a "Right") for each
outstanding share of common stock of the Company, par value $1.00 per share (the
"Common Shares"). The dividend is payable on June 8, 1998 (the "Record Date") to
the stockholders of record on that date. Each Right entitles the registered
holder to purchase from the Company one one-hundredth of a share of Junior
Participating Preferred Stock, Series B of the Company, without par value (the
"Preferred Shares"), at a price of $180 per one one-hundredth of a Preferred
Share (the "Purchase Price"), subject to adjustment. The description and terms
of the Rights are set forth in a Rights Agreement (the "Rights Agreement")
between the Company and Harris Trust Company of New York, as Rights Agent (the
"Rights Agent").
Until the earlier to occur of (i) 10 days following a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") have acquired beneficial ownership of 20% or more of the outstanding
Common Shares or (ii) 10 business days (or such later date as may be determined
by action of the Board of Directors of the Company prior to such time as any
person or group of affiliated persons becomes an Acquiring Person) following the
commencement of, or announcement of an intention to make, a tender offer or
exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 15% or more of the outstanding Common Shares
(the earlier of such dates being the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Share certificates outstanding as
of the Record Date, by such Common Share certificate with a copy of a summary of
the Rights (the "Summary of Rights") attached thereto.
The Rights Agreement provides that, until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights will be transferred with and
only with the Common Shares. Until the Distribution Date (or earlier redemption
or expiration of the Rights), new Common Share certificates issued after the
Record Date upon transfer or new issuance of Common Shares 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 Common Shares outstanding as of the Record
Date, even without such notation or a copy of the Summary of Rights being
attached thereto, will also constitute the transfer of the Rights associated
with the Common Shares 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 Shares
as of the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights will
expire on June 8, 2008 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged by the Company, in each case, as described below.
The Purchase Price payable, and the number of Preferred Shares 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
Shares; (ii) upon the grant to holders of the Preferred Shares of certain rights
or warrants to subscribe for or purchase Preferred Shares at a price, or
securities convertible into Preferred Shares with a conversion price, less than
the then-current market price of the Preferred Shares; or (iii) upon the
distribution to holders of the Preferred Shares of evidences of indebtedness or
assets (excluding regular periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of one one-hundredths of a
Preferred Share issuable upon exercise of each Right are also subject to
adjustment in the event of a stock split of the Common Shares or a stock
dividend on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will not be
redeemable. Each Preferred Share will be entitled to a minimum preferential
quarterly dividend payment of $1 per share but will be entitled to an aggregate
dividend of 100 times the dividend declared per Common Share. In the event of
liquidation, the holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment of $100 per share but will be entitled to an
aggregate payment of 100 times the payment made per Common Share. Each Preferred
Share will have 100 votes, voting together with the Common Shares. Finally, in
the event of any merger, consolidation or other transaction in which Common
Shares are exchanged, each Preferred Share will be entitled to receive 100 times
the amount received per Common Share. These rights are protected by customary
anti-dilution provisions.
Because of the nature of the Preferred Shares' dividend, liquidation and
voting rights, the value of the one one-hundredth interest in a Preferred Share
purchasable upon exercise of each Right should approximate the value of one
Common Share.
In the event that the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold after a person or group has become an Acquiring Person, proper
provision will be made so that each holder of a Right will thereafter have the
right to receive, upon the exercise thereof at the then current exercise price
of the Right, that number of shares of common stock of the acquiring company
which at the time of such transaction will have a market value of two times the
exercise price of the Right. In the event that any person or group of affiliated
or associated persons becomes an Acquiring Person, proper provision shall be
made so that each holder of a Right, other than Rights beneficially owned by the
Acquiring Person (which will thereafter be void), will thereafter have the right
to receive upon exercise that number of Common Shares having a market value of
two times the exercise price of the Right.
At any time after any person or group becomes an Acquiring Person and prior
to the acquisition by such person or group of 50% or more of the outstanding
Common Shares, the Board of Directors of the Company may exchange the Rights
(other than Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one Common Share, or one
one-hundredth of a Preferred Share (or of a share of a class or series of the
Company's preferred stock having equivalent rights, preferences and privileges),
per Right (subject to adjustment).
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 Preferred Shares will be issued (other than
fractions which are integral multiples of one one-hundredth of a Preferred
Share, which may, at the election of the Company, be evidenced by depositary
receipts) and, in lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Shares on the last trading day prior to the date
of exercise.
At any time prior to the acquisition by a person or group of affiliated or
associated persons of beneficial ownership of 20% or more of the outstanding
Common Shares, the Board of Directors of the Company may redeem the Rights, in
whole but not in part, at a price of $.01 per Right (the "Redemption Price").
The redemption of the Rights may be made effective at such time on such basis
with such conditions as the Board of Directors, in its sole discretion, may
establish. 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.
The terms of the Rights may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights, including an amendment
to lower certain thresholds described above to not less than the greater of (i)
the sum of .001% and the largest percentage of the outstanding Common Shares
then known to the Company to be beneficially owned by any person or group of
affiliated or associated persons and (ii) 10%, except that from and after such
time as any person or group of affiliated or associated persons becomes an
Acquiring Person no such amendment may adversely affect the interests of the
holders of the Rights.
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.
The Rights Agreement and the press release announcing the declaration of
the Rights are attached hereto as exhibits and are incorporated herein by
reference. The foregoing description of the Rights is qualified in its entirety
by reference to such exhibits.
Item 6. Exhibits.
99.1 Rights Agreement, dated as of May 29, 1998, between CSX
Corporation and Harris Trust Company of New York, as
Rights Agent, including the form of Right Certificate as
Exhibit A and the Summary of Rights to Purchase Preferred
Shares as Exhibit B (incorporated herein by reference to
Exhibit 99.1 to the Company's Registration on Form 8-A
filed May 29, 1998 (File No. 2-62373)).
99.2 Press Release, dated May 29, 1998.
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SIGNATURE
Pursuant to the requirements of Section 12 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.
Dated: May 29, 1998
CSX CORPORATION
By /s/ Alan A. Rudnick
---------------------------------
Name: Alan A. Rudnick
Title: Vice President-General Counsel
and Corporate Secretary
<PAGE>
EXHIBIT LIST
99.1 Rights Agreement, dated as of May 29, 1998, between CSX
Corporation and Harris Trust Company of New York, as Rights
Agent, including the form of Right Certificate as Exhibit A
and the Summary of Rights to Purchase Preferred Shares as
Exhibit B (incorporated herein by reference to Exhibit 99.1
to the Company's Registration on Form 8-A filed May 29, 1988
(File No. 2-63273)).
99.2 Press Release, dated May 29, 1998.
Contact: Elisabeth Gabrynowicz
Phone: (804) 782-1449
CSX BOARD OF DIRECTORS EXTENDS
SHAREHOLDER RIGHTS PLAN PROVISIONS
FOR IMMEDIATE RELEASE
RICHMOND, Va., May 29, 1998--CSX Corporation announced today that its Board
of Directors has extended the company's shareholder rights plan provisions,
which are designed to protect shareholders against coercive takeover tactics.
The Board adopted a new rights plan that is essentially the same as the
company's 1988 rights plan, which will expire shortly.
In taking the action, the company declared a dividend distribution of one
preferred share purchase right on each share of common stock outstanding on June
8, 1998. The new rights plan will expire June 8, 2008.
The CSX Board gave careful consideration to all issues and viewpoints and
concluded that the rights plan benefits shareholders by encouraging prospective
acquirers to negotiate so that the Board may obtain the best result for
shareholders.
CSX Corporation, headquartered in Richmond, Va., is an international
transportation company offering a variety of rail, container-shipping,
intermodal, barge, trucking and contract logistics services.
-CSX-
CSX's internet address is http://www.csx.com
