SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) February 4, 2000
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GENERAL EMPLOYMENT ENTERPRISES, INC.
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(Exact name of registrant as specified in its charter)
Illinois 1-5707 36-6097429
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
Oakbrook Terrace Tower, One Tower Lane, Suite 2100,
Oakbrook Terrace, Illinois 60181
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(Address of principal executive offices) (Zip Code)
(630) 954-0400
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Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS
On February 4, 2000, the Board of Directors of GENERAL EMPLOYMENT
ENTERPRISES, INC. (the "Company") declared a dividend distribution of
one Right for each outstanding share of Common Stock, without par
value (the "Common Stock"), of the Company to the stockholders of
record on February 22, 2000 (the "Record Date"). Each Right entitles
the registered holder to purchase from the Company one share of Common
Stock at a price of $21.50 per 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
Continental Stock Transfer & Trust Company, as Rights Agent (the
"Rights Agent"). The Rights replace the share purchase rights which
were initially distributed to the Company's stockholders by a dividend
in 1990 and which expired by their own terms on February 22, 2000.
Initially following the Record Date, the Rights will be attached
to all certificates representing shares of Common Stock then
outstanding, and no separate Rights Certificates will be distributed.
Unless previously redeemed by the Board in accordance with the Rights
Agreement, the Rights will separate from the Common Stock and the
"Distribution Date" will occur upon the earlier of (i) the tenth
business day following the Stock Acquisition Date (as defined below)
or (ii) the tenth business day after the commencement or announcement
of an intention to make a tender offer or exchange offer which would
result in any person or group of affiliated or associated persons
becoming, without the prior consent of the Company, an Acquiring
Person (as defined below).
The "Stock Acquisition Date" is defined as the first date of
public announcement by the Company or an Acquiring Person that any
person or group (other than certain exempt persons or groups including
certain "grandfathered" stockholders) has become the beneficial owner
of 10% or more of the shares of Common Stock then outstanding (such
person or group being called an "Acquiring Person").
Following the Record Date and until the Distribution Date, (i)
the Rights will be evidenced by the Common Stock certificates and will
be transferred with and only with such Common Stock certificates, (ii)
new Common Stock certificates issued after the Record Date will
contain a notation incorporating the Rights Agreement by reference and
(iii) the surrender for transfer of any certificate for Common Stock
outstanding will also constitute the transfer of the Rights associated
with the Common Stock represented by such certificate.
The Rights will not be exercisable until the Distribution Date
and will expire at the close of business on February 22, 2010, unless
earlier redeemed by the Company as described below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common Stock
as of the close of business on the Distribution Date and, thereafter,
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the separate Rights Certificates alone will represent the Rights.
Except as otherwise determined by the Board, only shares of Common
Stock issued prior to the Distribution Date will be issued with
Rights.
In the event (a "Flip-in Event") that any person, at any time
after the date of the Rights Agreement, becomes an Acquiring Person,
each holder of a Right thereafter will have the right to receive, upon
exercise thereof, Common Stock (or, in certain circumstances, cash,
property or other securities of the Company) having a value equal to
two times the Purchase Price. Notwithstanding any of the foregoing,
following the occurrence of a Flip-in Event, all Rights that are, or
(under certain circumstances specified in the Rights Agreement) were,
beneficially owned by an Acquiring Person, any of its associates or
affiliates, and certain of its transferees, will be null and void.
Moreover, the Rights will not be exercisable following the first
occurrence of a Flip-in Event until such time as the Rights are no
longer redeemable by the Company as described below.
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 or (ii) 50% or more of the Company's assets or
earning power is sold or transferred (each, a "Flip-over Event"), each
holder of a Right (except Rights which previously have been voided as
described above) shall thereafter have the right to receive, upon
exercise thereof, common stock or other securities of the acquiring
company having a value equal to two times the Purchase Price.
The Purchase Price payable, and the number of shares of Common
Stock or other securities or property issuable, upon exercise of the
Rights are subject to adjustment from time to time in accordance with
customary anti-dilution provisions.
With certain exceptions, no adjustment to the Purchase Price will
be required until cumulative adjustments amount to at least 1% of the
Purchase Price. No fractional shares will be issued. Instead, a cash
payment will be made in lieu of fractional shares based on the market
price of the Common Stock on the last trading day prior to the date of
exercise.
At any time after the Rights become exercisable for Common Stock,
the Board may exchange the unexercised Rights (other than Rights owned
by any Acquiring Person which have become void), in whole or in part,
at an exchange ratio of one share of Common Stock (or of a share of a
class or series of the Company's stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment).
The Board is empowered to redeem the Rights in whole, but not in
part, at a price of $0.01 per Right (the "Redemption Price") at any
time before the earlier of (i) the close of business on the tenth
business day following the Stock Acquisition Date or (ii) the final
expiration date of the Rights. Immediately upon the action of the
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Board ordering redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the
Redemption Price.
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 or to
the Company, stockholders may, depending upon the circumstances,
recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) or for common
stock of an acquiring company as set forth above.
The Board of Directors of the Company may amend the Rights
Agreement. After the Distribution Date, however, the Board of
Directors of the Company may amend the Rights Agreement only to cure
any ambiguity, to cure any defective or inconsistent provisions, to
make changes which do not adversely affect the interest of the holders
of the Rights (other than an Acquiring Person or an affiliate or
associate of an Acquiring Person) or to shorten or lengthen any time
period under the Rights Agreement; provided that no amendment to
adjust the time period governing redemption may be made at any time
when the Rights are not redeemable. In addition, no supplement or
amendment may be made which changes the Redemption Price, the final
expiration date, the purchase price or the number of shares of Common
Stock for which a Right is exercisable, unless at the time of such
supplement or amendment certain events have not occurred and such
supplement or amendment does not adversely affect the interests of the
holders of Rights certificates (other than an Acquiring Person or an
affiliate or associate of an Acquiring Person).
The Rights may have certain anti-takeover effects. The Rights
will cause substantial dilution to a person or group that attempts to
acquire the Company unless the acquisition is conditioned on a
substantial number of Rights being acquired. The Rights should not
interfere with any merger or other business combination properly
approved by the Board.
A copy of the Rights Agreement was 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 to all Rights
holders 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 full text of the Rights Agreement, which
is hereby incorporated by this reference.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS
4.1 Rights Agreement, dated as of February 4, 2000, between
General Employment Enterprises, Inc. and Continental
Stock Transfer & Trust Company, as Rights Agent
(incorporated by reference to Exhibit 1 to General
Employment Enterprise, Inc.'s Registration Statement on
Form 8-A filed with the Securities and Exchange
Commission on February 7, 2000).
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SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
GENERAL EMPLOYMENT ENTERPRISES, INC.
(Registrant)
By: /s/ Herbert F. Imhoff
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Name: Herbert F. Imhoff
Title: Chairman of the Board and
Chief Executive Officer
Dated: February 4, 2000
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EXHIBIT INDEX
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Exhibit No. Description
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4.1 Rights Agreement, dated as of February 4, 2000,
between General Employment Enterprises, Inc. and
Continental Stock Transfer & Trust Company, as
Rights Agent (incorporated by reference to Exhibit
4.1 to General Employment Enterprise, Inc.'s
Registration Statement on Form 8-A filed with the
Securities and Exchange Commission on February 7,
2000).
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