U.S. 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) November 10, 1998
RENTECH, INC.
(Exact name of registrant as specified in its charter)
Colorado 0-19260 84-0957421
(State of incorporation) (Commission File Number) (IRS Employer
Identification No.)
1331 17th Street, Suite 720, Denver, Colorado 80202 80202
(Address of principal executive offices) (Zip Code)
(303) 298-8008
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Item 5. Other Events.
On October 28, 1998, the Board of Directors of Rentech, Inc., a
Colorado corporation (the "Company") declared a dividend of one
preference share purchase right (a "Right") for each outstanding share of
common stock, par value $.01 per share (the "Common Shares"), of the
Company. The dividend is payable on December 1, 1998 to stockholders of
record on November 10, 1998 (the "Record Date"). Each Right represents
the right of the registered holder to purchase from the Company one
one-hundredth of a share of Series 1998-C Participating Cumulative
Preference Stock, $10 par value per share (the "Preference Shares"), of
the Company at a price of $12.00 per one one-hundredth of a Preference
Share (the "Purchase Price"), subject to adjustment. The description and
terms of the Rights are set forth in a Rights Agreement dated as of
November 10, 1998 (the "Rights Agreement") between the Company and
American Securities Transfer and 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
have acquired beneficial ownership of 15% or more of the outstanding
Common Shares and have become an "Acquiring Person" according to the
terms of the Rights Agreement or (ii) 10 business days (or such later
date as may be determined by action of the Board of Directors prior to
<PAGE>
PAGE 2
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 a Summary
of Rights attached thereto.
The Rights Agreement provides that, 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 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 such separate Right Certificates alone will
evidence the Rights.
The Rights are not exercisable until the Distribution Date. The
Rights will expire on December 1, 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 Preference 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 Preference Shares, (ii) upon the grant to
holders of the Preference Shares of certain rights or warrants to
subscribe for or purchase Preference Shares at a price, or securities
convertible into Preference Shares with a conversion price, less than the
then-current market price of the Preference Shares or (iii) upon the
distribution to holders of the Preference Shares of evidences of
indebtedness or assets (excluding regular periodic cash dividends paid
out of earnings or retained earnings or dividends payable in Preference
Shares) or of subscription rights or warrants (other than those referred
to above).
<PAGE>
PAGE 3
The number of outstanding Rights and the number of one
one-hundredths of a Preference Share 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.
Preference Shares purchasable upon exercise of the Rights will not
be redeemable. Each Preference Share will be entitled to an aggregate
dividend of 100 times a dividend declared per Common Share. In the event
of liquidation, the holders of the Preference Shares will be entitled to
a minimum preferential liquidation payment of $100 per share but will be
entitled to an aggregate payment of 100 times the payment made per Common
Share. Each Preference Share will have 100 votes, voting together with
the Common Shares. Finally, in the event of any merger, consolidation or
other transaction in which Common Shares are exchanged, each Preference
Share will be entitled to receive 100 times the amount received per
Common Share. These rights are protected by customary antidilution
provisions.
Because of the nature of the Preference Shares' liquidation and
voting rights, the value of the one one-hundredth interest in a
Preference Share purchasable upon exercise of each Right should
approximate the value of one Common Share.
In the event that 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. In the event that 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 at the time of such occurrence of two times the
exercise price of the Right.
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 hare become void), in whole or in part, at an exchange ratio
of one Common Share, or one one-hundredth of a Preference Share, per
Right (subject to adjustment).
<PAGE>
PAGE 4
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 Preference Shares will be
issued (other than fractions which are integral multiples of one
one-hundredth of a Preference Share, which may, at the election of the
Company, be evidenced by depositary receipts) and in lieu thereof, an
adjustment in cash will be made based on the market price of the
Preference Shares on the last trading day prior to the date of exercise.
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15% or more
of the outstanding Common Shares, 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 and 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, including
an amendment to lower certain thresholds described above to not less than
the greater of (i) the sum of .001% and the largest percentage of the
outstanding Common Shares then known to the Company to be beneficially
owned by any person or group of affiliated or associated persons and (ii)
10%, 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 stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
The Rights will not prevent a takeover of the Company. However, the
Rights may cause substantial dilution to a person or group that acquires
15% or more of the Common Stock unless the Rights are first redeemed by
the Board of Directors of the Company. Nevertheless, the Rights should
not interfere with a transaction that is in the best interests of the
Company and its stockholders because the Rights can be redeemed on or
prior to the consummation of such transaction.
As of November 10, 1998 there were 42,152,076 shares of Common Stock
issued and outstanding. As long as the Rights are attached to the Common
Stock, the Company will issue one Right with each new share of Common
Stock so that all such shares will have Rights attached.
<PAGE>
PAGE 5
The Rights Agreement and a form of press release announcing the
declaration of the Rights are attached hereto as exhibits and are
incorporated herein by reference. The foregoing description of the
Rights is qualified in its entirety by reference to such exhibits.
Item 7. Financial Statements and Exhibits
(c) Exhibits.
4. Rights Agreement, dated as of November 10, 1998,
between Rentech, Inc. and American Securities
Transfer and Trust, Inc., as Rights Agent, including
(i) as Exhibit A-the Form of Articles of Amendment to
Articles of Incorporation-Designation, Preferences and
Rights of the Series 1998-C Participating Cumulative
Preference Stock, (ii) as Exhibit B-the Forms of Rights
Certificate, Assignment and Election to Purchase, and
(iii) as Exhibit C-the Summary of Rights to Purchase
Preference Shares (incorporated herein by reference to
Exhibits 1, 2, 3 and 4 to the Company's Registration
Statement on Form 8-A, filed with the Commission on
November 19, 1998).
99. Press release, dated November 10, 1998, issued by the
Company (incorporated hereby reference to Exhibit 5 to
the Company's Registration Statement on Form 8-A filed
with the Commission on November 19, 1998).
<PAGE>
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.
RENTECH, INC.
By: (signature)
------------------------------------
Dennis L. Yakobson
Chairman of the Board, President
and Chief Executive Officer
Date: November 18, 1998
EXHIBIT INDEX
Exhibit No. Description
4. Rights Agreement, dated as of November 10, 1998, between
Rentech, Inc. and American Securities Transfer and
Trust, Inc., as Rights Agent, including (i) as Exhibit
A-the Form of Articles of Amendment to Articles of
Incorporation- Designation, Preferences and Rights of
the Series 1998-C Participating Cumulative Preference
Stock, (ii) as Exhibit B-the Forms of Rights
Certificate, Assignment and Election to Purchase, and
(iii) as Exhibit C-the Summary of Rights to Purchase
Preference Shares (incorporated herein by reference to
Exhibits 1, 2, 3 and 4 to the Company's Registration
Statement on Form 8-A, filed with the Commission on
November 19, 1998).
99. Press release, dated November 10, 1998, issued by the
Company (incorporated hereby reference to Exhibit 5 to
the Company's Registration Statement on Form 8-A filed
with the Commission on November 19, 1998).
