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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) January 24, 1996
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Defiance, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-14044 34-1526359
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1111 Chester Avenue. Suite #750. Cleveland, OH 44114-3516
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(Address of principal offices) (Zip Code)
Registrant's telephone number, including area code (216) 861-6300
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Not applicable
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(Former name or former address, if changed since last report.)
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Item 5. Other events.
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On January 24, 1996, the registrant's board of directors adopted the Defiance,
Inc. Stock Repurchase Plan (the "Plan"). The Plan was effective January 24,
1996, and authorizes the repurchase of up to 1,000,000 shares of the
registrant's 6,573,450 currently outstanding common shares, over a three-year
period. Shares purchased will be held by the registrant as Treasury Stock.
Item 7. Financial statements and exhibits
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(c) Exhibits.
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28.1 Defiance, Inc. Stock Repurchase Plan, effective January 24, 1996
28.2 Defiance, Inc. Press Release dated January 24, 1996
28.3 Letter from Comerica Bank granting written consent to stock
repurchases as required under Section 10.1 of Second Amended and
Restated Loan Agreement by and between Defiance, Inc. and Comerica
Bank dated July 29, 1994
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SIGNATURES
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 thereunto duly authorized.
Dated: January 30, 1996 DEFIANCE, INC.
By: /s/ Michael J. Meier
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Michael J. Meier
Vice President -- Finance, Chief
Financial Officer, Secretary and
Treasurer (Principal Financial
Officer)
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EXHIBIT 28.1
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DEFIANCE, INC.
STOCK REPURCHASE PLAN
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This Stock Repurchase Plan (the "Plan") has been adopted and approved
by the Board of Directors of DEFIANCE, INC., a Delaware corporation (the
"Company"), to be effective as of January 24, 1996.
1. PURPOSE. The purpose of this plan is: (a) to enhance shareholder
value, (b) to express the confidence of the Board of Directors in the
long-term growth potential of the Company, and (c) to advance the interests of
the Company and its shareholders by making, from time to time, stock
repurchases in accordance with Rule 10b-18 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"). The Board of Directors believes
that from time to time, the Company's common stock provides an attractive
investment opportunity for the Company, and represents as good an investment
as the Company can find for its funds.
2. PLAN.
a. MAXIMUM PURCHASES. The Company, from time to time, as the
Stock Repurchase Committee of the Board of Directors (described at
Section 4 below), in its sole discretion deems appropriate, may
purchase up to One Million (1,000,000) shares of its outstanding common
stock in accordance with this Plan.
b. FUNDING. The Company shall use excess cash flow and/or
loans from Comerica Bank to finance such purchases under this Plan.
Whether borrowings or excess cash are utilized, the level of cash or
borrowing shall be limited to an amount which will not adversely affect
the Company's ability to
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fund capital expenditures, acquisitions or the Company's ability to
maintain cash reserves adequate to fund its business operations.
The Stock Repurchase Committee of the Board of Directors shall allocate
such funds, or authorize such borrowings, as it deems to be appropriate
for the purchase of shares of the Company's common stock under this
Plan, and shall specify the basis or formula for determining the
aggregate amount of shares to be purchased.
3. CONDITIONS.
a. RULE 10b-18. Except as hereinafter provided, this Plan and
any stock purchase in accordance therewith shall comply with and be
subject to Rule 10b-18 promulgated under the Exchange Act, or any
successor thereto, as such Rule may be modified from time to time. All
stock purchases under this Plan shall meet the following conditions in
accordance with Rule 10b-18:
i. BROKER/DEALER. The Company and any "affiliated
purchaser" as defined in Rule 10b-18 shall effect all purchases
from or through only one broker/dealer on any single day, unless
it is an unsolicited transaction;
ii. TIMING. All stock purchases by the Company and any
affiliated purchaser, including block purchases (defined at
3.a.iv. below) shall be made with or through a member of the
National Association of Securities Dealers; provided that no
purchase shall constitute the opening transaction in the
Company's common stock on any day nor shall a purchase be
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made during the last one-half hour of trading before the
termination of the period in which last sale prices are
reported in the consolidated transaction reporting system;
iii. PURCHASE PRICE. No purchase by the Company or by
any affiliated purchaser (whether a block purchase or not)
shall be made at a price that is higher, but may be made at a
price that is equal to or lower than (x) the then-current
independent published bid or (y) the last reported independent
sale price, whichever is higher; and
iv. AMOUNT LIMITATION. All purchases by the
Company and any affiliated purchaser (other than block
purchases) shall not exceed, in any one day, the higher of one
round lot (100 shares or other customary unit of trading for a
security) or the number of round lots closest to twenty-five
percent (25%) of the average daily trading volume (excluding
any block purchases made by the Company or an affiliated
purchaser) for the Company's common stock in the four (4)
calendar weeks preceding the week in which the purchase is to
be made ("trading volume"). Such amount limitation shall not
apply to the purchase of any block. A "block" generally means
a quantity of stock that either: (i) has a purchase price of at
least Two Hundred Thousand and 00/100s Dollars ($200,000.00),
(ii) is at least five thousand (5,000) shares with
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a purchase price of at least Fifty Thousand and 00/100s Dollars
($50,000.00), or (iii) at least twenty (20) round lots of the
security that totals one hundred fifty percent (150%) or more of
the trading volume for that security or if trading volume is
unavailable, is at least twenty (20) round lots of the security
and totals at least one-tenth of one percent (0.001) of the
outstanding shares of the security exclusive of any shares owned
by any affiliate.
V. EXCEPTION. Notwithstanding the foregoing provi-
sions of this Section 3.a., the Company may make unsolicited
stock purchases under the Plan from persons who are not members
of the National Association of Securities Dealers, Inc. if such
transactions will not be reported in the consolidated
transaction reporting system and the Committee determines that
each such purchase will be made on such terms and under such
circumstances that the purchase will not be "manipulative" or
"deceptive" as those terms are used in Section 10(b) of the
Exchange Act.
b. RESTRICTIONS ON OFFICERS AND DIRECTORS. No officer or
director of the Company, who is a member of the Stock Repurchase
Committee, shall purchase or sell any common stock of the Company or
any security convertible into common stock on any day that the Company
makes a purchase under this Plan.
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c. LIMITATIONS. No stock purchase shall be made under
this Plan: (i) when the Board of Directors and the Company are in
possession of material, non-public information, (ii) when a tender
offer has been made for shares of the Company's common stock, (iii)
when the Company is engaged in a distribution of its securities,
except for any distribution of securities made pursuant to a stock
option or similar plan maintained by the Company, or (iv) if the
number of shareholders immediately after such purchase is less than
the minimum number then required for listing on the NASDAQ National
Market Svstem.
d. REPURCHASED SHARES. Shares of the Company's common
stock repurchased hereunder will be treated as treasury shares.
4. ADMINISTRATION OF THIS PLAN.
a. ADMINISTRATION. This Plan shall be administered by a
committee of not less than three (3) directors and/or officers of the
Company ("Stock Repurchase Committee") to administer this Plan to
effect the stock purchases on the Company's behalf subject to specific
instructions or a formula established from time to time by said
committee. Initially, the Board of Directors has designated Thomas H.
Roulston, Jerry A. Cooper, and Michael J. Meier, officers and
directors of the Company, as the Stock Repurchase Committee, to make
or direct a broker/dealer to make such stock purchases on behalf of
the Company.
b. AUTHORITY. The Stock Repurchase Committee of the Board
of Directors shall have full and final authority with respect to this
Plan: (i) to
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interpret all provisions of this Plan consistent with applicable laws
and regulations, (ii) to determine the frequency and number of shares
of common stock to be purchased, (iii) to adopt, amend and rescind
general and special rules and regulations for this Plan's
administration, and (iv) to make all other determinations necessary or
advisable for the administration of this Plan, but only to the extent
consistent with the provisions of this Plan and applicable federal and
state securities laws.
5. NOTICES. During the term of this Plan, the Company shall from
time to time provide such notice to the NASD or file such reports under the
Exchange Act as may be required or appropriate under applicable rules and
regulations.
6. TERM. The term of this Plan shall be for three (3) years,
commencing January, 1996.
7. AMENDMENT AND TERMINATION. The Board of Directors may at any
time suspend, amend or terminate this Plan.
8. GOVERNING LAW. The laws of the State of Delaware will govern
all matters relating to this Plan, except to the extent it is superseded by
the laws of the United States.
122444.2a
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EXHIBIT 28.2
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Defiance, Inc.
[LOGO] 1111 Chester Ave., Suite 750
Cleveland, OH 44114-3516
(216) 861-6300
(216) 861-6006 (FAX)
FOR IMMEDIATE RELEASE
DEFIANCE, INC. ANNOUNCES STOCK REPURCHASE PROGRAM
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AND DECLARES REGULAR OUARTERLY DIVIDEND
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CLEVELAND, Ohio, January 24,1996 -- Directors of Defiance, Inc. (Nasdaq
NNM:DEFI) today declared a regular quarterly dividend of $.04 per share,
payable March 5, 1996 to shareholders of record February 15, 1996. Directors
also authorized the company to establish a stock repurchase program.
The company will initiate a stock repurchase program effective today for up
to 1,000,000 shares, or 15% of its 6,573,450 currently oustanding common
shares, over a three-year period. Shares purchased will be held by the
company as Treasury Stock.
Jerry A. Cooper, president and chief executive officer, said, "By authorizing
this stock repurchase program and affirming our quarterly dividend of $.04
per share, our board of directors has expressed confidence in the long-term
growth prospects of Defiance and their belief that the company's stock
represents an excellent investment opportunity. This program is flexible and
can be implemented without detracting from Defiance's business strategies or
investment opportunities."
Defiance, Inc. is recognized as a world-class supplier of tooling systems,
testing services, and precision machined components to the U.S.
transportation industry, with headquarters in Cleveland, Ohio.
# # #
Contact: Patrick Gallagher, Edward Howard & Co., (216) 781-2400
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EXHIBIT 28.3
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Comerica Bank
January 24, 1996
Mr. Michael Meier
Defiance, Inc.
1111 Chester Avenue
Suite 750
Cleveland, Ohio 44114-3516
Re: Defiance, Inc.
Dear Mike:
You have requested that Comerica Bank consent to Defiance, Inc.'s
repurchase of outstanding shares of Defiance, Inc. common stock pursuant to the
Defiance, Inc. Stock Repurchase Plan effective as of January 24, 1996.
Comerica Bank hereby consents to Defiance, Inc.'s repurchase of shares of its
common stock pursuant to the terms of the Stock Repurchase Plan as in effect on
the date hereof. Our consent is conditioned on there being no default or event
of default under the Second Amended and Restated Loan Agreement by and between
Defiance, Inc. and Comerica Bank as of the time of each repurchase of stock and
after giving effect to each repurchase of stock.
Our consent shall not act as a consent or waiver of any other
transaction, act or omission, whether related or unrelated thereto.
Very truly yours,
COMERICA BANK
By: /s/ Kerry McGuire
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Its: Vice-President
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