<PAGE> 1
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
July 24, 1998
(Date of Report)
SYNTHETECH, INC.
(Exact Name of Registrant as Specified in Charter)
Oregon 0-12992 84-0845771
(State or Other (Commission File (IRS Employer
Jurisdiction No.) Identification
of Incorporation) No.)
1290 Industrial Way, Albany, Oregon 97321
(Address of principal executive offices)
(Zip Code)
(541) 967-6575
(Registrant's telephone number, including area code)
<PAGE> 2
Item 5. Other Events
On July 23, 1998, the Board of Directors of Synthetech,
Inc. (the "Company") declared a dividend of one common share
purchase right (a "Right") for each outstanding share of
common stock, $.001 par value per share (the "Common Shares"),
of the Company. The dividend is payable on August 4, 1998
(the "Record Date") to the shareholders of record on that
date. Each Right entitles the registered holder to purchase
from the Company one Common Share, at a price of $30 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 American Securities
Transfer & Trust, Inc., 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 15% 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 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
called 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 this Summary of Rights attached
thereto.
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 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.
PAGE 1
<PAGE> 3
The Rights are not exercisable until the Distribution
Date. The Rights will expire on August 3, 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 Common
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 Common
Shares, (ii) upon the grant to holders of the Common Shares of
certain rights or warrants to subscribe for or purchase Common
Shares at a price, or securities convertible into Common
Shares with a conversion price, less than the then-current
market price of the Common Shares or (iii) upon the
distribution to holders of the Common Shares of evidences of
indebtedness or assets (excluding regular periodic cash
dividends paid out of earnings or retained earnings or
dividends payable in Common Shares) or of subscription rights
or warrants (other than those referred to above).
The number of outstanding Rights and the number of Common
Shares 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.
If 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. If 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.
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 Common Shares will be issued and in lieu thereof,
an adjustment in cash will be made based on the market price
of the Common Shares on the last trading day prior to the date
of exercise.
PAGE 2
<PAGE> 4
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 per Right (subject to adjustment).
At any time prior to the earlier to occur of the
Distribution Date or the Final Expiration Date, the Board of
Directors of the Company may redeem the Rights in whole, but
not in part, at a price of $.0001 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, 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 shareholder of the Company,
including, without limitation, the right to vote or to receive
dividends.
PAGE 3
<PAGE> 5
Exhibits
4.1 Rights Agreement, dated as of July 23, 1998, between
Synthetech, Inc. and American Securities Transfer &
Trust, Inc., incorporated herein by reference to
Exhibit 1 to the Company's Registration Statement on Form
8-A, dated July 25, 1998.
99.1 Press release issued July 24, 1998.
PAGE 4
<PAGE> 6
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.
SYNTHETECH, INC.
Dated: July 24, 1998 By /s/Charles B. Williams
----------------------
Charles B. Williams,
Vice President and CFO
PAGE 5
<PAGE> 7
EXHIBIT INDEX
Exhibit
Number Description Page
- ------- ----------- ----
4.1 Rights Agreement, dated as of July 23,
1998, between Synthetech, Inc. and
American Securities Transfer & Trust,
Inc., incorporated herein by reference
to Exhibit 1 to the Company's
Registration Statement on Form 8-A,
dated July 24, 1998.
99.1 Press release issued July 24, 1998.
PAGE 6
<PAGE>
SYNTHETECH, INC. DECLARES DIVIDEND DISTRIBUTION OF
SHARE PURCHASE RIGHTS
Albany, Oregon, July 24, 1998--The Board of Directors
of Synthetech, Inc. adopted a shareholder rights agreement
designed to protect shareholders from coercive takeover
tactics. In making its announcement, the Company said it is
not aware of any effort to gain control of the Company.
Under the agreement, each shareholder of record as of
August 4, 1998, will receive a dividend of one purchase right
for each share of the Company's outstanding common stock.
M. "Sreeni" Sreenivasan, a Director, President, and Chief
Executive Officer of Synthetech, Inc., stated: "The Rights
are designed to assure that all of Synthetech's shareholders
receive fair and equal treatment in the event of any attempted
takeover of the Company and to guard against partial tender
offers, squeeze-outs, open market accumulations and other
abusive tactics to gain control of Synthetech without all
shareholders receiving a pro rata portion of the control
premium."
The rights are similar to those adopted by many public
companies. The rights will be exercisable only if a person or
group acquires 15% or more of Synthetech's outstanding common
stock or announces a tender offer that would result in
ownership by a person or group of 15% or more of the
outstanding common stock. Details of the rights are outlined
in the Company's filings with the Securities and Exchange
Commission and in a letter and summary of rights that will be
mailed to shareholders shortly after the August 4, 1998 record
date.
The Rights are intended to enable all Synthetech's
shareholders to realize the long-term value of their
investment in the Company. They will not prevent a takeover,
but should encourage anyone seeking to acquire the Company to
negotiate with the Board prior to attempting a takeover.
Synthetech's Peptide Building Blocks are used by
pharmaceutical companies to make a wide range of peptide-based
drugs under development as potential therapies for AIDS,
cancer, cardiovascular and other diseases.
MORE INFORMATION:
Web site: http://www.synthetech.com
E-mail: [email protected]
M. "Sreeni" Sreenivasan, President & CEO (541) 967-6575
Charlie Williams, CFO (541) 967-6575
