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
Date of Report (Date of earliest event reported): July 15, 1997
IWERKS ENTERTAINMENT, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-22558 95-4439361
(State or Other Jurisdiction(Commission (IRS Employer
of Incorporation) File Number) Identification No.)
4540 West Valerio Street
Burbank, California 91505-1045
(Address of Principal Executive Offices)
(818) 841-7766
(Registrant's Telephone Number)
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ITEM 5. OTHER EVENTS
The Registrant and U.S. Stock Transfer Corporation (the "Rights
Agent") entered into a Rights Agreement Amendment dated as of July 15,
1997 (the "Amendment") to that certain Rights Agreement dated as of May
22, 1995 (the "Rights Agreement") between the Registrant and the Rights Agent.
The Amendment provides that no Person (as defined in the Rights Agreement)
shall become an Acquiring Person (as defined in the Amendment) as a result of
entering into, performing the terms of, or consummating the transactions
contemplated by (i) that certain Agreement and Plan of Reorganization dated
August 4, 1997 (the "Merger Agreement"), among IWK-1 Merger Corporation, a
wholly-owned subsidiary of the Registrant, Showscan Entertainment Inc. and the
Registrant, or (ii) those certain Stockholder Support Agreements (the
"Stockholder Support Agreements") pursuant to which certain stockholders of
Iwerks have granted to Showscan Entertainment Inc. an irrevocable proxy to
vote their shares in favor of the Merger at a forthcoming meeting of Iwerks'
stockholders. The Amendment also provides that funds and other advisory
accounts managed by Heartland Advisors, Inc. ("Heartland Advisors Inc.")
shall not constitute an Acquiring Person so long as its aggregate beneficial
ownership of Common Stock of the Registrant does not exceed 25% of the Common
Stock then outstanding.
The Amendment further provides that a Distribution Date (as defined in
the Rights Agreement) shall not be deemed to have occurred solely as a result
of (i) the approval, execution and delivery of the Merger Agreement or the
Stockholder Support Agreements, or (ii) the consummation of the Merger (as
defined in the Merger Agreement) or the performance of the terms of the
Stockholder Support Agreements, or (iii) the acquisition by Heartland
Advisors, Inc. of Beneficial Ownership of Common Stock in an amount less
than or equal to 25% of the then outstanding Common Stock.
Except as expressly amended by the Amendment, the Rights Agreement
remains in full force and effect in accordance with its terms. A copy of
the Amendment is filed as Exhibit 4.1 and is incorporated herein by this
reference.
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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 hereunto duly authorized.
August 6, 1997 IWERKS ENTERTAINMENT, INC.
By: /S/ BRUCE C. HINCKLEY
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Bruce C. Hinckley
Chief Financial Officer
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EXHIBIT INDEX
EXHIBITS PAGE NUMBER
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4.1 Rights Agreement Amendment dated as of July 15,
1997, between Iwerks Entertainment, Inc. and U.S.
Stock Transfer Corporation
RIGHTS AGREEMENT AMENDMENT
Rights Agreement Amendment, dated as of July 15, 1997 (this "Amendment"),
to the Rights Agreement dated as of May 22, 1995 (the "Rights Agreement"),
between Iwerks Entertainment, Inc., a Delaware corporation (the "Company") and
U.S. Stock Transfer Corporation, as Rights Agent (the "Rights Agent").
The Company and the Rights Agent have heretofore executed and delivered
the Rights Agreement. Pursuant to Section 27 of the Rights Agreement, the
Company and the Rights Agent may from time to time supplement or amend the
Rights Agreement in accordance with the provisions of Section 27 thereof.
In consideration of the foregoing premises and mutual agreements set forth
in the Rights Agreement and this Amendment, the parties hereto agree as
follows:
1. The definition of "Acquiring Person" in Section 1 of the Rights
Agreement is hereby amended and restated to read in its entirety as follows:
""Acquiring Person" shall mean (i) any Person (as hereinafter defined) who
is an Adverse Person (as hereinafter defined), or (ii) any Person who or which,
together with all Affiliates (as hereinafter defined) and Associates (as
hereinafter defined) of such Person, shall, subsequent to the Declaration Date,
become the Beneficial Owners (as hereinafter defined) of 15% of more of the
shares of Common Stock then outstanding, but shall not include (x) an Exempt
Person (as hereinafter defined) or (y) any Person who becomes a Beneficial
Owner solely because (1) of a change in the aggregate number of shares of
Common Stock outstanding since the last date on which such Person acquired
Beneficial Ownership of any shares of Common Stock, or (2) it acquired such
Beneficial Ownership in the good faith belief that such acquisition would not
(A) cause such Beneficial Ownership to exceed 15% of the shares of Common Stock
then outstanding (or, in the case of Heartland Advisors, Inc., the percentage
Heartland Advisors, Inc. may hold without ceasing to be an Exempt Person) and
such Person relied in good faith in computing the percentage of its Beneficial
Ownership on publicly filed reports or documents of the Company which are
inaccurate or out-of-date, or (B) otherwise cause a Distribution Date or the
adjustment provided for in Section 11 to occur. Notwithstanding clause (y) of
the prior sentence, if any Person that is not an Acquiring Person because of
the operation of such clause (y) does not reduce its Beneficial Ownership of
shares of Common Stock to 15% or less (or, in the case of Heartland Advisors,
Inc., the percentage Heartland Advisors, Inc. may hold without ceasing to be an
Exempt Person) by the close of business on the fifth Business Day after notice
from the Company (the date of notice being the first day) that such Person's
Beneficial Ownership of Common stock so exceeds 15% (or, in the case of
Heartland Advisors, Inc., the percentage Heartland Advisors, Inc. may hold
without ceasing to be an Exempt Person), such Person shall, at the end of such
five Business Day period, become an Acquiring Person (and clause (y) shall no
longer apply to such Person). For purposes of this definition, the
determination whether any Person acted in "good faith" shall be conclusively
determined by the Board of Directors, acting by a vote of those directors of
the Company whose approval would be required to redeem the Rights under Section
24. Notwithstanding anything in this Rights
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Agreement, none of Roy Wright, Bruce Hinckley, William Battison, Donald
Iwerks, Dag Tellefsen, Meriken Nominees Limited,
Tucker Lemon or Dennis Pope or their respective Affiliates
or Associates, or any other Person, shall become an "Acquiring Person" as the
result of entering into, performing the terms of, or consummating the
transactions contemplated by (x) the Agreement and Plan of Reorganization,
dated as of August 4, 1997, as amended from time to time (the "Merger
Agreement"), among the Company, IWK-1 Merger Corporation, a Delaware
corporation and a wholly owned subsidiary of the Company and Showscan
Entertainment, Inc. or (y) the Stockholder Support Agreements entered into
between Showscan Entertainment, Inc. and each of Roy Wright, Bruce Hinckley,
William Battison, Donald Iwerks, Dag Tellefsen and Meriken Nominees Limited
(collectively, the "Stockholder Support Agreements")."
2. The definition of "Exempt Person" in Section 1 of the Rights
Agreement is hereby amended and restated to read in its entirety as follows:
""Exempt Person" shall include (i) the Company, (ii) any Subsidiary (as
hereinafter defined) of the Company, (iii) any employee benefit plan of the
Company or any of its Subsidiaries, or any entity holding shares of Common
Stock which was organized, appointed or established by the Company or any
Subsidiary of the Company for or pursuant to the terms of any such plan and
(iv) funds and other advisory accounts managed by Heartland Advisors, Inc.
("Heartland Advisors, Inc."), so long as its aggregate Beneficial Ownership of
Common Stock does not exceed 25% of the Common Stock then outstanding."
3. Section 3(a)(ii) of the Rights Agreement is hereby amended and
restated to read in its entirety as follows:
"(ii) the close of business on the tenth day (or such later day as may be
determined by action of the Board of Directors of the Company prior to such
time as any Person becomes an Acquiring Person) after the date of the
commencement of a tender or exchange offer by any Person (other than an Exempt
Person) to acquire (when added to any equity securities as to which such Person
is the Beneficial Owner immediately prior to such commencement) Beneficial
Ownership of 15% (or, in the case of Heartland Advisors, Inc., the percentage
Heartland Advisors, Inc. may hold without ceasing to be an Exempt Person) or
more of the issued and outstanding Common Stock (including any such date which
is after the Declaration Date and prior to the issuance of the Rights), and"
4. Section 3(a) of the Rights Agreement is further amended by adding a
new sentence as the final sentence thereto, which shall read in its entirety as
follows:
"Notwithstanding anything in this Rights Agreement to the contrary, a
Distribution Date shall not be deemed to have occurred solely as a result
of (i) the approval, execution or delivery of the Merger Agreement or the
Stockholder Support Agreements, or (ii) the consummation of the Merger (as
defined in the Merger Agreement) or the performance of the terms of the
Stockholder Support Agreements, or (iii) the acquisition by Heartland
Advisors, Inc. of Beneficial Ownership of Common Stock, in an amount less
than or equal to 25% of the then outstanding Common Stock."
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5. This Amendment shall be governed by and construed in accordance with
the laws of the State of Delaware.
6. This Amendment may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed an original, and all such
counterparts shall together constitute but one and the same instrument.
7. Except as expressly set forth herein, this Amendment shall not by
implication or otherwise alter, modify, amend or in any way affect any of the
terms, conditions, obligations, covenants or agreements contained in the Rights
Agreement, all of which are ratified and affirmed in all respects and shall
continue in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.
IWERKS ENTERTAINMENT, INC.
By: /s/ Roy A. Wright
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Title: Chief Executive Officer
U.S. STOCK TRANSFER CORPORATION
By: /s/ Richard C. Brown
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Title: Vice President
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