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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event
reported): October 6, 1998
Emerson Electric Co.
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(Exact Name of Registrant as Specified in Charter)
Missouri 1-278 43-0259330
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(State or Other (Commission (I.R.S. Employer
Jurisdiction of File Number Identification Number)
Incorporation)
8000 West Florissant Avenue
St. Louis, Missouri 63136
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code:
(314) 553-2000
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ITEM 5. OTHER EVENTS.
On October 6, 1998, the Board of Directors of Emerson Electric Co. (the
"Company") declared a dividend of one preferred share purchase right (a
"Right") for each outstanding share of Common Stock, par value $0.50 per share,
of the Company (the "Common Stock"). The dividend distribution is payable on
November 1, 1998 (the "Record Date") to the stockholders of record as of the
close of business on that date. Each Right entitles the registered holder to
purchase from the Company one one-thousandth of a share of Series B Junior
Participating Preferred Stock, par value $2.50 per share (the "Preferred
Stock") of the Company at a price of $260.00 per one one-thousandth of a share
of Preferred Stock (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a 1998 Rights Agreement
dated as of November 1, 1998, as the same may be amended from time to time (the
"Rights Agreement"), between the Company and ChaseMellon Shareholder Services,
L.L.C., as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) the close of business on the tenth
business day following the date of public announcement or the date on which the
Company first has notice or determines that a person or group of affiliated or
associated persons (other than the Company, any subsidiary of the Company or
any employee benefit plan of the Company) (an "Acquiring Person") has acquired,
or obtained the right to acquire, 20% or more of the outstanding shares of
voting stock of the Company without the prior express written consent of the
Company executed on behalf of the Company by a duly authorized officer of the
Company following express approval by action of at least a majority of the
members of the Board of Directors then in office (the "Stock Acquisition Date")
or (ii) the close of business on the tenth business day (or such later date as
may be determined by action of the Board of Directors but not later than the
Stock Acquisition Date) following the commencement of a tender offer or
exchange offer, without the prior written consent of the Company, by a person
(other than the Company, any subsidiary of the Company or an employee benefit
plan of the Company) which, upon consummation, would result in such party's
control of 20% or more of the Company's voting stock (the earlier of the dates
in clause (i) or (ii) above being called the "Distribution Date"), the Rights
will be evidenced, with respect to any of the Common Stock certificates
outstanding as of the Record Date, by such Common Stock certificates.
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 Company's Common Stock. Until the Distribution Date (or
earlier redemption, exchange or expiration of the Rights), new Common Stock
certificates issued after the Record Date upon transfer or new issuances of
Common Stock will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution 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 this Summary of Rights, will also constitute the transfer
of the Rights associated with the 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
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Common Stock as of the close of business on the Distribution Date and such
separate certificates alone will then evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire, if not previously exercised, on November 1, 2008 (the "Final
Expiration Date"), unless the Final Expiration Date is extended or unless the
Rights are earlier redeemed or exchanged by the Company.
The Purchase 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
or warrants to subscribe for or purchase Preferred Stock at a price, or
securities convertible into Preferred Stock with a conversion price, less than
the then-current market price of the Preferred Stock or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular periodic cash dividends or dividends payable in
Preferred Stock) or of subscription rights or warrants (other than those
referred to above).
The number of outstanding Rights and the number of one one-thousandths of
a share of Preferred Stock issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Common Stock or a
stock dividend on the Common Stock payable in shares of Common Stock or
subdivisions, consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the Rights will not
be redeemable and junior to any other series of preferred stock the Company may
issue (unless otherwise provided in the terms of such stock). Each share of
Preferred Stock will have a preferential dividend in an amount equal to 1,000
times any dividend declared on each share of Common Stock. In the event of
liquidation, the holders of the Preferred Stock will receive a preferred
liquidation payment of equal to the greater of $1,000 and 1,000 times the
payment made per share of Common Stock. Each share of Preferred Stock will
have one vote, voting together with the Common Stock. In the event of any
merger, consolidation or other transaction in which shares of Common Stock are
converted or exchanged, each share of Preferred Stock will be entitled to
receive 1,000 times the amount and type of consideration received per share of
Common Stock. The rights of the Preferred Stock as to dividends, liquidation
and voting, and in the event of mergers and consolidations, are protected by
customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend, liquidation and
voting rights, the value of the one one-thousandth interest in a share of
Preferred Stock purchasable upon exercise of each Right should approximate the
value of one share of Common Stock.
If any person or group (other than the Company, any subsidiary of the
Company, any employee benefit plan of the Company) acquires 20% or more of the
Company's outstanding voting stock without the prior written consent of the
Board of Directors, each Right, except those held by such persons, would
entitle each holder of a Right to acquire such number of shares of the
Company's Common Stock as shall equal the result obtained by multiplying the
then current
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Purchase Price by the number of one one-thousandths of a share of Preferred
Stock for which a Right is then exercisable and dividing that product by 50% of
the then current per-share market price of Company Common Stock.
If any person or group (other than the Company, any subsidiary of the
Company, any employee benefit plan of the Company) acquires more than 20% but
less than 50% of the outstanding Company Common Stock without prior written
consent of the Board of Directors, each Right, except those held by such
persons, may be exchanged by the Board of Directors for one share of Company
Common Stock.
If the Company were acquired in a merger or other business combination
transaction where the Company is not the surviving corporation or where Company
Common Stock is exchanged or changed or 50% or more of the Company's assets or
earnings power is sold in one or several transactions without the prior written
consent of the Board of Directors, each Right would entitle the holders thereof
(except for the Acquiring Person) to receive such number of shares of the
acquiring company's common stock as shall be equal to the result obtained by
multiplying the then current Purchase Price by the number one one-thousandths
of a share of Preferred Stock for which a Right is then exercisable and
dividing that product by 50% of the then current market price per share of the
common stock of the acquiring company on the date of such merger or other
business combination transaction.
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 Preferred Stock will be issued
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock, 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 Stock on the last
trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes such, the Board
of Directors of the Company may redeem the Rights in whole, but not in part, at
a price of $0.005 per Right (the "Redemption Price"). The redemption of the
Rights may be made effective at such time, on such basis and 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, but not
limited to, an amendment to lower certain thresholds described above to not
less than the greater of (i) any percentage greater than the largest percentage
of the voting power of all securities of the Company then known to the Company
to be beneficially owned by any person or group of affiliated or associated
persons (other than an excepted person) 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.
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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 form of Rights Agreement between the Company and the Rights Agent
specifying the terms of the Rights, which includes as Exhibit B thereto the
form of Right Certificate, is attached hereto as Exhibit 1 and is incorporated
herein by reference. The foregoing description of the Rights does not purport
to be complete and is qualified in its entirety by reference to the form of
Rights Agreement (and the exhibits thereto) attached hereto.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
Exhibit No. Description of Exhibit
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4 Rights Agreement, dated as of November 1, 1998 between Emerson
Electric Co. and ChaseMellon Shareholder Services, L.L.C., as
Rights Agent, which includes the form of Certificate of
Designations, setting forth the terms of the Series B Junior
Participating Preferred Stock, par value $2.50 per share, as
Exhibit A, the form of Right Certificate as Exhibit B and the
Summary of Preferred Stock Purchase Rights as Exhibit C.
Pursuant to the Rights Agreement, printed Right Certificates
will not be mailed until as soon as practicable after the
earlier of the tenth day after public announcement that a
person or group (except for certain exempted persons or
groups) has acquired beneficial ownership of 20% or more of
the outstanding shares of Common Stock or the tenth business
day (or such later date as may be determined by action of the
Board of Directors) after a person commences, or announces its
intention to commence, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership
by a person or group of 20% or more of the outstanding shares
of Common Stock (incorporated by reference to Exhibit 1 to
the Form 8-A filed by Emerson Electric Co. on October 6,
1998).
99 Press release dated October 6, 1998.
SIGNATURE
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 hereunto duly authorized.
EMERSON ELECTRIC CO.
(Registrant)
Date: October 6, 1998 By: /s/ W. Wayne Withers
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W. Wayne Withers
Senior Vice President,
Secretary and General Counsel
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EXHIBIT INDEX
Exhibit No. Description of Exhibit
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4 Rights Agreement, dated as of November 1, 1998 between Emerson
Electric Co. and ChaseMellon Shareholder Services, L.L.C., as
Rights Agent, which includes the form of Certificate of
Designations, setting forth the terms of the Series B Junior
Participating Preferred Stock, par value $2.50 per share, as
Exhibit A, the form of Right Certificate as Exhibit B and the
Summary of Preferred Stock Purchase Rights as Exhibit C.
Pursuant to the Rights Agreement, printed Right Certificates
will not be mailed until as soon as practicable after the
earlier of the tenth day after public announcement that a
person or group (except for certain exempted persons or
groups) has acquired beneficial ownership of 20% or more of
the outstanding shares of Common Stock or the tenth business
day (or such later date as may be determined by action of the
Board of Directors) after a person commences, or announces its
intention to commence, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership
by a person or group of 20% or more of the outstanding shares
of Common Stock (incorporated by reference to Exhibit 1 to
the Form 8-A filed by Emerson Electric Co. on October 6,
1998).
99 Press release dated October 6, 1998.
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Exhibit 99
FOR IMMEDIATE RELEASE
EMERSON ELECTRIC CO. ADOPTS
SHAREHOLDER RIGHTS PLAN
ST. LOUIS, OCTOBER 6, 1998 - - Emerson Electric Co. announced today that
its Board of Directors has adopted a Shareholder Rights Plan which provides for
its shareholders to receive one Preferred Stock Purchase Right for each share
of common stock owned. The plan is similar to the plan first adopted by
Emerson in 1988, which expires on November 1 of this year.
The Stock Purchase Rights are designed to assure that all of Emerson's
shareholders receive fair and equal treatment in the event of any proposed
takeover of the Company and to guard against partial tender offers, open market
accumulations and other abusive tactics to gain control of Emerson without
paying all shareholders a control premium. Emerson has no indication whatever
of the existence of any such attempt. Shareholder Rights Plans have been
adopted by many other publicly traded corporations.
Under the Shareholder Rights Plan, each Emerson shareholder of record at
the close of business on November 1, 1998, will receive as a dividend a
distribution of one Right for each outstanding share of Emerson Common Stock.
Further details of the Rights Plan will be contained in a letter to be
mailed to all shareholders of record.
