SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
CURRENT REPORT
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
ELECTRONIC CLEARING HOUSE, INC.
(Exact name of registrant as specified in its charter)
NEVADA 93-0946274
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
28001 Dorothy Drive, Agoura Hills, California 91301
(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
none
Securities to be registered pursuant to Section 12(g) of the Act:
Preferred Stock Purchase Rights
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
On September 30, 1996, the Board of Directors of Electronic
Clearing House, Inc. ("Company") declared a dividend of one
preferred share purchase right ("Right") for each outstanding
share of common stock, par value of $0.01 ("Common Stock"), of
the Company. The dividend is payable on September 30, 1996
("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 series A Junior Participating
Preferred Stock, no par value ("Preferred Stock"), of the Company
at a price of $0.50 per one one-hundredth of a share of Preferred
Stock ("Purchase Price"), subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement dated
as of September 30, 1996 ("Rights Agreement") between the Company
and Oxford Transfer & Registrar, as Rights agent ("Rights
Agent").
Initially, the Rights will be attached to all certificates
representing Common Stock then outstanding, regardless of whether
any such certificates have a copy of this Summary of Rights
attached thereto, and no separate Rights Certificates will be
distributed. The Rights will separate from the Common Stock and
a Distribution Date will occur upon the earlier of (i) 10 days
following a public announcement that, without the prior consent
of the Board of Directors, a person or group of affiliated or
associated persons ("Acquiring Person") have acquired beneficial
ownership of twenty-percent (20%) or more of the outstanding
Common Stock ("Stock Acquisition Date"), or (ii) 10 business days
(or such later date as may be determined by action of the Board
of Directors prior to such time as any Person 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 twenty-percent (20%) or more of such
outstanding Common Stock.
The Rights Agreement provides that, until the Distribution Date,
the Rights will be transferred with and only with the Common
Stock. Until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Stock certificates issued
after the Record Date, upon transfer or new issuance 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
certificate for 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 Common Stock represented by such
certificate. As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of the Common
Stock as of the close of business on the Distribution Date and
such separate Rights Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The
Rights will expire on September 30, 2006 ("Final Expiration
Date"), unless the Rights are earlier redeemed or exchanged by
the Company, in each case, as described below.
The Purchase Price payable, and the manner 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 evidence of indebtedness or assets
(excluding regular periodic cash dividends paid out of earnings
or retained earnings 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-
hundredth 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 Common Stock or a subdivision, consolidation or
combination of the Common Stock occurring, in any such case,
prior to the Distribution Date.
Because of the nature of the Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-hundredth
interest in a share of Preferred Stock purchasable upon exercise
of each Right should approximate the value of one share of Common
Stock.
Preferred Stock purchasable upon exercise of the Rights will not
be redeemable. Each share of preferred Stock will be entitled
to a minimum preferential dividend payment of 100 times the
dividend declared per share of Common Stock. In the event of
liquidation, the holder of the Preferred Stock 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 share of Common Stock. Each share of Preferred
Stock will have 100 votes, voting together with the Common Stock.
Finally, in the event of any merger, consolidation or other
transaction in which Common Stock are exchanged, each share of
Preferred Stock will be entitled to receive 100 times the amount
received per share of Common Stock. These rights are protected
by customary antidilution provisions.
In the event that any person becomes the beneficial owner of
