UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
OCTOBER 20, 1998 1-6479-1
Date of Report (Date of earliest event reported) (Commission File Number)
OVERSEAS SHIPHOLDING GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 13-2637623
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
1114 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
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(Address of Principal Executive Offices) (Zip Code)
(212) 869-1222
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(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On October 20, 1998, the Board of Directors of Overseas Shipholding Group,
Inc. (the "CORPORATION" or the "COMPANY") declared a dividend distribution of
one right (a "RIGHT") to purchase one one-tenth of a share of the Common Stock,
$1.00 par value, of the Corporation (the "COMMON SHARES") for each outstanding
share of Common Stock, payable to the stockholders of record on November 9, 1998
(the "RECORD DATE"). The Board of Directors also authorized and directed the
issuance of one Right with respect to each Common Share issued thereafter until
the Distribution Date (as defined below) and, in certain circumstances, with
respect to Common Shares issued after the Distribution Date. Except as set forth
below, each Right, when it becomes exercisable, entitles the registered holder
to purchase from the Corporation one one-tenth of a Common Share at a price of
$70 per whole Common 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 Corporation and ChaseMellon Shareholder
Services, L.L.C., as Rights Agent (the "RIGHTS AGENT"), dated as of October 20,
1998.
Initially, the Rights will be attached to all certificates representing
Common Shares then outstanding, and no separate Right Certificates will be
distributed. The Rights will separate from the Common Shares upon the earliest
to occur of (i) a person or entity (a "PERSON") or group of affiliated or
associated Persons (a "GROUP") having acquired beneficial ownership of 10% or
more of the outstanding Common Shares (except pursuant to a Permitted Offer, as
hereinafter defined); or (ii) 10 business days (or such later date as the Board
of Directors may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer the consummation of which
would result in a Person or Group becoming an Acquiring Person (as hereinafter
defined) (the earliest of such dates being called the "DISTRIBUTION DATE"). A
Person or Group whose acquisition of Common Shares causes a Distribution Date
pursuant to clause (i) above is an "ACQUIRING PERSON." The date that a Person or
Group becomes an Acquiring Person is the "SHARES ACQUISITION DATE."
Notwithstanding the foregoing, certain stockholders who currently own in excess
of 10% of the outstanding Common Shares and their affiliates, associates and
permitted transferees will not be deemed to be Acquiring Persons and their
ownership will not cause a Distribution Date unless they acquire additional
Common Shares equal to more than 20% of the number of Common Shares owed by them
on the date of the Rights Agreement. Furthermore, a Person who acquires Common
Shares pursuant to a tender or exchange offer which is for all outstanding
Common Shares at a price and on terms which the Board of Directors determines
(prior to acquisition) to be adequate and in the best interests of the
Corporation and its stockholders (other than such Person, its affiliates and
associates) (a "PERMITTED OFFER") will not be deemed to be an Acquiring Person
and such Person's ownership will not constitute a Distribution Date.
The Rights Agreement provides that, until the Distribution Date, the Rights
will be transferred with and only with the Common Shares. Until the Distribution
Date (or earlier
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redemption or expiration of the Rights), new Common Share certificates issued
after the Record Date upon the 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 this 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 to each
initial record holder of certain Common Shares issued after the Distribution
Date), and such separate Right Certificates alone will evidence the Rights.
THE RIGHTS ARE NOT EXERCISABLE UNTIL THE DISTRIBUTION DATE, and will expire
at the close of business on November 9, 2008, unless earlier redeemed by the
Corporation as described below.
In the event that any person becomes an Acquiring Person, each holder of
Rights (other than Rights that have become null and void as described below)
will thereafter have the right (the "FLIP-IN RIGHT") to receive, upon exercise
of such Rights, the number of Common Shares (or, in certain circumstances, other
securities of the Corporation) having a value (immediately prior to such
triggering event) equal to two times the aggregate exercise price of such
Rights. (So that, for example, if a Person became an Acquiring Person at a time
when the current per share market price of the Company's Common Shares is $20.00
(and prior to any antidilution adjustment as described below), each holder of a
Right (other than a Right which has become null and void as described herein)
would have the right to receive upon exercise of the Right seven Common Shares
upon payment of an exercise price of $70.00.) The Board, at its option, may
exchange each Right (other than those that have become null and void as
described below) for one Common Share in lieu of the Flip-In Right, provided no
Person is the beneficial owner of 50% or more of the Common Shares at the time
of such exchange. Notwithstanding the foregoing, following the occurrence of the
event described above, all Rights that are or (under certain circumstances
specified in the Rights Agreement) were beneficially owned by any Acquiring
Person or any affiliate or associate thereof or certain transferees thereof will
be null and void.
Under the Rights Agreement, the Board of Directors may take such reasonable
actions and may establish such reasonable procedures as it may deem desirable in
connection with the exercise, exchange or transfer of Rights in order to
reasonably assure, in the judgment of the Board of Directors, the preservation
of the Company's status as a United States citizen within the provisions of
Section 2 of the Shipping Act of 1916, as amended, or any successor statute
applicable to the business being conducted by the Company (the "CITIZENSHIP
PROVISIONS"), including without limitation restricting the issuance of shares of
the Company pursuant to or in exchange for the Rights to United States citizens
or limiting such issuance to non-United States citizens to such degree as shall,
in the judgment of the Board of Directors, reasonably assure compliance with the
Minimum U.S. Ownership percentage established from time to time by the Board of
Directors under the Company's By-laws to maintain the Company's status as a
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United States citizen. The provisions of this paragraph will not, however,
prevent the transfer after the Distribution Date of any Right by a non-United
States citizen to a United States citizen, including for the purpose of
permitting the exercise of the Right by the United States citizen, provided that
any such transfer (or exercise) is consistent with such reasonable procedures as
may be established by the Board to reasonably assure compliance with the
Citizenship Provisions and to otherwise carry out the provisions of the Rights
Agreement.
In the event that, at any time following the Shares Acquisition Date, (i)
the Corporation is acquired in a merger or other business combination
transaction in which the holders of all of the outstanding Common Shares
immediately prior to the consummation of the transaction are not the holders of
all of the surviving corporation's voting power, or (ii) more than 50% of the
Corporation's assets or earning power is sold or transferred, then each holder
of Rights (except Rights which previously have been voided as set forth above)
shall thereafter have the right (the "FLIP-OVER RIGHT") to receive, upon
exercise of such Rights, common shares of the acquiring company (or in certain
circumstances, its parent) having a value equal to two times the aggregate
exercise price of the Rights; provided, however, that the Flip Over Right shall
not apply to any transaction described in clause (i) if (x) such transaction is
with a Person or Persons (or a wholly owned subsidiary of any such Person or
Persons) that acquired Common Shares pursuant to a Permitted Offer and (y) the
price and form of consideration offered in such transaction is the same as that
paid to all holders of Common Shares whose shares were purchased pursuant to the
Permitted Offer. The holder of a Right will continue to have the Flip-Over Right
whether or not such holder exercises or surrenders the Flip-In Right.
The Purchase Price payable, and the number of Common Shares or other
securities 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
quarterly cash dividends) or of subscription rights or warrants (other than
those referred to above).
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.
At any time prior to the earlier to occur of (i) a person becoming an
Acquiring Person or (ii) the expiration of the Rights, the Corporation may
redeem the Rights in whole, but not in part,
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at a price of $.01 per Right (the "Redemption Price"), which redemption shall be
effective at such time, on such basis and with such conditions as the Board of
Directors may establish in its sole discretion. The Corporation may, at its
option, pay the Redemption Price in Common Shares.
All of the provisions of the Rights Agreement may be amended by the Board
of Directors prior to the Distribution Date. After the Distribution Date, the
provisions of the Rights Agreement may be amended by the Board in order to cure
any ambiguity, defect or inconsistency, to make changes which do not adversely
affect the interests of holders of Rights (excluding the interests of any
Acquiring Person), or, subject to certain limitations, to shorten or lengthen
any time period under the Rights Agreement.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Corporation, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights will
not be taxable to stockholders of the Corporation, stockholders may, depending
upon the circumstances, recognize taxable income should the Rights become
exercisable or upon the occurrence of certain events thereafter.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors. The Rights should not interfere
with any merger or other business combination approved by the Board of
Directors, as the Rights may be redeemed by the Company at $.01 per Right prior
to the time that a person or group has acquired beneficial ownership of 10% or
more of the Common Shares, and, moreover, are not triggered by a Permitted Offer
approved by the Board of Directors as described herein.
The Rights Agreement is incorporated herein by reference. The foregoing
description of the Rights is qualified in its entirety by reference to such
Agreement.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS
(c) EXHIBITS.
4.1 Rights Agreement, dated as of October 20, 1998, between Overseas
Shipholding Group, Inc., and ChaseMellon Shareholder Services, L.L.C., with
the form of Right Certificate attached as Exhibit A thereto and the Summary
of Rights to Purchase Shares attached as Exhibit B thereto incorporated by
reference to Overseas Shipholding Group, Inc. Form 8-A filed with the
Securities and Exchange Commission via Edgar on November 9, 1998. Pursuant
to the Rights Agreement, printed Right Certificates will not be mailed
until as soon as practicable after the earlier of the date of public
announcement that a person or group has acquired beneficial ownership of
10% or more of the Common Shares or the tenth business day (or such later
date as may be determined by action of the Corporation's Board of
Directors) after a person commences or announces its intention to commence
a tender or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 10% or more of the Common
Shares.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Overseas Shipholding Group, Inc. has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
OVERSEAS SHIPHOLDING GROUP, INC.
By: /s/ Robert N. Cowen
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Name: Robert N. Cowen
Title: Senior Vice President and
Secretary
Date: November 9, 1998
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EXHIBIT LIST
Rights Agreement, dated as of October 20, 1998, between Overseas
Shipholding Group, Inc., and ChaseMellon Shareholder Services, L.L.C., with
the form of Right Certificate attached as Exhibit A thereto and the Summary
of Rights to Purchase Shares attached as Exhibit B thereto incorporated by
reference to Overseas Shipholding Group, Inc. Form 8-A filed with the
Securities and Exchange Commission via Edgar on November 9, 1998. Pursuant
to the Rights Agreement, printed Right Certificates will not be mailed
until as soon as practicable after the earlier of the date of public
announcement that a person or group has acquired beneficial ownership of
10% or more of the Common Shares or the tenth business day (or such later
date as may be determined by action of the Corporation's Board of
Directors) after a person commences or announces its intention to commence
a tender or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 10% or more of the Common
Shares.
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