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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A/A
For Registration of Certain Classes of Securities
Pursuant to Section 12(b) or (g) of the
Securities Exchange Act of 1934
SOUND ADVICE, INC.
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(Exact name of registrant as specified in its charter)
Florida 59-1520531
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(State of incorporation) (I.R.S. Employer
or organization) Identification No.)
1901 Tigertail Boulevard
Dania, Florida 33004
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(Address of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which each class
to be so registered is to be registered
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None None
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock
Purchase Rights
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(Title of class)
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
On May 5, 1997, the Board of Directors (the "Board") of Sound Advice,
Inc., a Florida corporation (the "Company"), authorized and approved a dividend
distribution of one Right (each "Right" and collectively the "Rights") for each
outstanding share of common stock, $.01 par value per share (the "Common
Stock"), of the Company to shareholders of record at the close of business on
May 16, 1997. Each Right initially entitled the registered holder to purchase
from the Company one share of Common Stock at a price of $12 per share (as
amended as described below, the "Purchase Price"), subject to certain
adjustments. The Purchase Price shall be paid in cash. The description and terms
of the Rights are set forth in the 1997 Common Stock Purchase Rights Agreement
(as amended, the "Rights Agreement") between the Company and American Stock
Transfer & Trust Company, as Rights Agent. The material terms of the Rights
Agreement are summarized below.
Initially, the Rights are represented by the Common Stock certificates
representing shares then outstanding, and no separate Rights certificates will
be distributed. The Rights will separate from the Common Stock and a
distribution of the Rights certificates will occur upon the earlier of (i) ten
business days following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of 15% or more of the
outstanding shares of Common Stock (or, in the case of Peter Beshouri and
Michael Blumberg, executive officers and principal shareholders of the Company,
24% or more of the outstanding shares of Common Stock), (ii) ten business days
after a person or group of affiliated or associated persons has (x) become the
direct or indirect beneficial owner of at least 10% of the Company's outstanding
Common Stock, and (y) whose ownership interest is deemed by the Board to cause a
material adverse impact on the business or prospects of the Company or its
shareholders (such persons or group hereinafter called an "Adverse Person"), or
(iii) ten business days following the commencement of a tender offer or exchange
offer that would result in a person or group becoming an Acquiring Person or an
Adverse Person. Until the date that the Rights certificates are distributed (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 date that the
Rights Plan is adopted will contain a notation incorporating the Rights
Agreement by reference and (iii) the surrender for transfer of any certificates
for Common Stock outstanding also will constitute the transfer of the Rights
associated with the Common Stock represented by such certificates.
On September 13, 2000, the Board approved a First Amendment to Rights
Agreement, which increases the Purchase Price to a price of $50.00 per share.
The Rights are not exercisable until the Distribution Date and will
expire ten years after the adoption of the Rights Agreement, unless earlier
redeemed by the Company as described below.
Upon a triggering event and 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
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on the Distribution Date and, thereafter, 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 person or group of affiliated or associated persons
becomes an Acquiring Person or an Adverse Person (except pursuant to an offer
for all outstanding shares of Common Stock that is determined by the Board to be
fair to and otherwise in the best interest of the Company and its shareholders,
a "Qualifying Tender Offer"), each Right then outstanding would "flip-in" and
become a right to buy that number of shares of Common Stock of the Company which
at the time of such acquisition would have a market value of two times the
exercise price of the Right. The acquiror who triggered the Rights would be
excluded from the "flip-in" because his Rights would have become null and void
upon his triggering acquisition.
In the event that the "flip-in" is triggered, if there is not
sufficient authorized Common Stock available for issuance upon the exercise of
each Right or if the Board so elects, the Board may: (i) seek shareholder
approval to increase the number of authorized shares of Common Stock or (ii)
designate as issuable upon exercise of the Rights such amount of Common Stock,
cash, other equity or debt securities, assets and/or other consideration as
would be equal to the value that would have been received if each Right had
received only Common Stock upon exercise.
If, following a person or group of affiliated or associated persons
becoming an Acquiring Person or an Adverse Person, (i) the Company shall
consolidate with or merge into any other person or entity in which the Company
is not the surviving corporation, (ii) any other person or entity shall merge
into the Company and all or part of the outstanding Common Stock shall be
changed into or exchanged for securities of any other person or entity, or cash
or any other property, or (iii) the Company sells 50% or more of its assets or
earning power, each Right then outstanding would "flip-over" and thereby would
become a right to buy that number of shares of common stock of the acquiring
company which at the time of such transaction has a market value of two times
the exercise price of the Right.
At any time after a person or group of affiliated or associated persons
becomes an Acquiring Person or an Adverse Person and before the acquisition by
such person or group of 50% or more of the outstanding Common Stock of the
Company, the Board may exchange the Rights (other than Rights owned by such
person or group which have become void), in whole or in part, for Common Stock
at an exchange ratio of 1.0 shares of the Company's Common Stock per Right,
subject to adjustment.
At any time until ten days following the public announcement that a
person or group of affiliated or associated persons has become an Acquiring
Person or an Adverse Person, the Company may redeem the Rights at a price of
$.001 per Right, payable in cash. Under certain circumstances set forth in the
Rights Agreement, the decision to redeem shall require the concurrence of at
least two thirds of the members of the Board and a majority of the Independent
Directors (as hereinafter defined). After the redemption period has expired, the
Company's rights
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of redemption may be reinstated if the Acquiring Person or Adverse Person
reduces his or her beneficial ownership to less than 10% of the outstanding
shares of Common Stock in a transaction or series of transactions not involving
the Company. Immediately upon the action of the Board ordering redemption of the
Rights, with, where required, the concurrence of at least two thirds of the
members of the Board and a majority of the Independent Directors, the Rights
will terminate and the only right which the holders of Rights will thereafter
have will be to receive the $.001 redemption price.
The term "Independent Directors" means any member of the Board who is
not an Acquiring Person or Adverse Person, is not an employee or officer of the
Company or an employee, officer or director of any Acquiring Person or Adverse
Person, and is not a relative or spouse of (i) an Acquiring Person or Adverse
Person, (ii) any officer or other person employed in a management position with
the Company or with any Acquiring Person or Adverse Person, or (iii) any
director of any Acquiring Person or Adverse Person.
The Purchase Price payable, and the number of shares of Common Stock
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 Stock, (ii) if
holders of the Common Stock are granted certain rights or warrants to subscribe
for Common Stock or convertible securities at less than the current market price
of the Common Stock, or (iii) upon the distribution to holders of the Common
Stock 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 amount to at least 1% of the Purchase
Price. No fractional shares of Common Stock will be issued and, in lieu thereof,
an adjustment in cash will be made based on the market price of the Common Stock
on the last trading date prior to the date of exercise.
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.
The implementation of the Rights Agreement has not interfered with the
day-to-day operations of the Company. The Rights Agreement provides that the
Company may not enter into any transaction of the sort enumerated in the
"flip-in/flip-over" provisions if, in connection therewith, there are
outstanding securities or there are agreements or arrangements intended to
counteract the protective provisions of the Rights. For example, the Company may
not merge with an acquiring corporation if the acquiring corporation has granted
its shareholders rights to purchase its Common Stock at less than fair market
value upon the triggering of flip-over rights in one of its acquisition targets.
Any of the provisions of the Rights Agreement may be amended by the Board as
long as the Rights are then redeemable. When the Rights are not redeemable, the
provisions of the Rights Agreement may be amended by the Board only in order to
cure any ambiguity, to correct or supplement any provision which may be
inconsistent with any other
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provision or make changes which do not affect adversely the interests of holders
of Rights; PROVIDED, HOWEVER, that no amendment may change the redemption price
or the expiration date of the Rights, and amendments after a person or group of
affiliated or associated persons becomes an Acquiring Person or an Adverse
Person (other than pursuant to a Qualifying Tender Offer) may be made only if
approved by a majority of the Independent Directors and at least two thirds of
the Board.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to the Company's original Registration
Statement on Form 8-A, filed as of May 13, 1997. The First Amendment to the
Rights Agreement is attached hereto as Exhibit 4.1. A copy of the Rights
Agreement, or First Amendment to the Rights Agreement, is available free of
charge from the Rights Agent. This summary description of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by reference.
ITEM 2. EXHIBITS.
4.1 First Amendment to Rights Agreement, dated as of September 13,
2000, between the Company and American Stock Transfer & Trust
Company.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
September 13, 2000 SOUND ADVICE, INC.
By: /s/ Kenneth L. Danielson
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Kenneth L. Danielson,
Chief Financial Officer and Treasurer
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