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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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) April 13, 1999
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BROADWAY & SEYMOUR, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 0-20034 41-1522214
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
128 South Tryon Street
Charlotte, North Carolina 28202
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(Address of Principal Executive Offices)
(Zip Code)
(704) 372-4281
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former name or address, if changed from last report)
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Item 5. Other Events.
On April 13, 1999, the Board of Directors of Broadway & Seymour, Inc.
(the "Company") declared a dividend of one preferred share purchase right (a
"Right") for each outstanding share of common stock, par value $0.01 per share,
of the Company (the "Common Stock"). The dividend is payable on April 26, 1999
(the "Record Date") to the stockholders of record on that date. Each Right
entitles the registered holder to purchase from the Company one one-hundredth
of a share of Series A Junior Participating Preferred Stock, par value $0.01
per share, of the Company (the "Preferred Stock") at a price of $22.00 per one
one-hundredth of a share of Preferred Stock (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth in a Rights
Agreement, dated as of April 14, 1999, as the same may be amended from time to
time (the "Rights Agreement"), between the Company and EquiServe Trust Company,
N.A., 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 (an
"Acquiring Person"), with certain exceptions set forth below, has acquired
beneficial ownership of 20% or more of the outstanding shares of Common Stock
or (ii) 10 business days (or such later date as may be determined by action of
the Board of Directors prior to 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 20% or more of the outstanding shares of Common Stock (the earlier of
such dates being called the "Distribution Date"), the Rights will be evidenced,
with respect to any of the Common Stock certificates outstanding as of the
Record Date, by such Common Stock certificate. An Acquiring Person does not
include (A) the Company, any subsidiary of the Company, any employee benefit
plan of the Company or of any subsidiary of the Company, or any entity or
trustee holding Common Stock for or pursuant to the terms of any such plan or
for the purpose of funding any such plan or funding other employee benefits for
employees of the Company or of any subsidiary of the Company, (B) any person
that would be deemed an "Acquiring Person" upon the adoption of the Rights
Agreement, unless and until such person acquires beneficial ownership of any
additional shares of Common Stock after the date of the Rights Agreement, or
(C) any person whose beneficial ownership of 20% or more of the outstanding
shares of Common Stock results from an acquisition of shares of Common Stock by
the Company that, by reducing the number of shares outstanding, increases the
proportionate number of shares of Common Stock beneficially owned by such
person to 20% or more of the shares of Common Stock then outstanding, unless
such person thereafter become the beneficial owner of any additional shares of
Common Stock and upon the consummation of such acquisition such person
beneficially owns 20% or more of the shares of Common Stock then outstanding.
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 Stock. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Stock certificates issued
after the Record Date upon transfer or new issuances of Common Stock will
contain a legend 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 shares of Common Stock
outstanding as of the Record Date, even without such
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notation or a copy of this Summary of Rights, will also constitute the transfer
of the Rights associated with the shares of Common Stock 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 Stock 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 April 14, 2009 (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 shares of Preferred
Stock 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
Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for or purchase Preferred Stock at a
price, or securities convertible into Preferred Stock with a conversion price,
less than the then current market price of the Preferred Stock or (iii) upon
the distribution to holders of the Preferred Stock of evidences of indebtedness
or assets (excluding regular periodic cash dividends or dividends payable in
Preferred Stock) or of subscription rights or warrants (other than those
referred to above).
The number of outstanding Rights and the number of one one-hundredths
of a share of Preferred Stock issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Common Stock or a
dividend on the Common Stock payable in shares of Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the Rights will
not be redeemable. Unless otherwise provided in connection with the creation of
a subsequent series of preferred stock, the Preferred Stock will be subordinate
to any other series of the Company's preferred stock. Each share of Preferred
Stock will be entitled, when, as and if declared, to a minimum quarterly
dividend payment of $1.00 per share but will be entitled to an aggregate
dividend of 100 times the dividend declared per share of Common Stock. In the
event of the liquidation of the Company, the holders of the Preferred Stock
will be entitled to receive a minimum liquidation payment of $100.00 per share
(plus any accrued but unpaid dividends) but will be entitled to an aggregate
payment of 100 times the payment made per share of Common Stock. Each share of
Preferred Stock will have 100 votes, voting together with the Common Stock. In
the event of any merger, consolidation or other transaction in which shares of
Common Stock are converted or exchanged, each share of Preferred Stock will be
entitled to receive 100 times the amount received per share of Common Stock.
The rights of Preferred Stock as to dividends, liquidation and voting are
protected by customary antidilution provisions. Because of the nature of the
Preferred Stock's dividend, liquidation and voting rights, the value of the one
one-hundredth interest in a share of Preferred Stock purchasable upon exercise
of each Right should approximate the value of one share of Common Stock.
In the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring
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Person (which will thereupon become void), will thereafter have the right to
receive, upon exercise of a Right at the then current Purchase Price, that
number of shares of Common Stock (or other securities or property) having a
market value of two times the Purchase Price.
In the event that, after a person or group of affiliated or associated
persons has become an Acquiring Person, 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, proper provision will be made so that each
holder of a Right (other than Rights beneficially owned by an Acquiring Person,
which will have become void) will thereafter have the right to receive, upon
the exercise thereof at the then current Purchase Price, that number of shares
of common stock of the person with whom the Company has engaged in the
foregoing transaction (or its parent), which number of shares at the time of
such transaction will have a market value of two times the Purchase Price.
At any time after any person or group of affiliated or associated
persons becomes an Acquiring Person and prior to the acquisition by such person
or group of 50% or more of the outstanding shares of Common Stock, the Board of
Directors of the Company may cause the Company to exchange the Rights (other
than Rights owned by such person or group, which will have become void), in
whole or in part, at an exchange ratio of one share of Common Stock (or one
one-hundredth of a share of Preferred Stock, or shares of a class or series of
the Company's preferred stock having equivalent rights, preferences and
privileges) per Right, subject to adjustment.
No fractional shares of Preferred Stock will be issued (other than
fractions that are integral multiples of one one-hundredth of a share of
Preferred Stock, 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 Preferred Stock on the last trading day prior
to the date of exercise.
At any time prior to the earlier of (i) the tenth day after the time
that a person or group of affiliated or associated persons has become an
Acquiring Person (subject to extension by the Board of Directors) and (ii) the
Final Expiration Date, the Board of Directors may cause the Company to redeem
the Rights in whole, but not in part, at a price of $.01 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.
For so long as the Rights are then redeemable, the Company may, except
with respect to the Redemption Price, amend the Rights in any manner, including
an amendment to lower certain thresholds described above to not less than the
greater of (i) the sum of 0.001% and the largest percentage of the outstanding
shares of Common Stock then known to the Company to be beneficially owned by
any person or group of affiliated or associated persons and (ii) 10%. After the
Rights are no longer redeemable, the Company may, except with respect to the
Redemption Price, amend the Rights in any manner that does not adversely affect
the interests of holders of the Rights.
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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.
As of March 31, 1999, there were 8,279,380 shares of Common Stock
issued and outstanding and 1,029,582 shares of Common Stock reserved for
issuance pursuant to outstanding options issued under the Company's employee
benefit plans. 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.
The Rights Agreement is filed herewith as Exhibit 99.1, and is
incorporated herein by reference. A copy of the Rights Agreement is available
free of charge from the Company. This summary description of the Rights does
not purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, as the same may be amended from time to time.
Item 7. Exhibits
Exhibit No. Description
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99.1 Rights Agreement, dated as of April 14, 1999, between
Broadway & Seymour, Inc. (the "Company") and EquiServe Trust
Company, N.A., as Rights Agent, including the form of
Certificate of Designations with respect to the Series A
Junior Participating Preferred Stock, included as Exhibit A
to the Rights Agreement, the forms of Rights Certificate and
of Election to Exercise, included as Exhibit B to the Rights
Agreement, and the form of Summary of Rights to Purchase
Shares of Series A Junior Participating Preferred Stock
included as Exhibit C to the Rights Agreement, all
incorporated by reference to Exhibit 4 to the Company's
Registration Statement on Form 8-A dated April 16, 1999.
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SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) 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.
BROADWAY & SEYMOUR, INC.
By: /s/ Lillian N. Wilson
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Lillian N. Wilson,
Secretary
Date: April 16, 1999
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EXHIBIT INDEX
Exhibit No. Description
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99.1 Rights Agreement, dated as of April 14, 1999, between
Broadway & Seymour, Inc. (the "Company") and EquiServe Trust
Company, N.A., as Rights Agent, including the form of
Certificate of Designations with respect to the Series A
Junior Participating Preferred Stock, included as Exhibit A
to the Rights Agreement, the forms of Rights Certificate and
of Election to Exercise, included as Exhibit B to the Rights
Agreement, and the form of Summary of Rights to Purchase
Shares of Series A Junior Participating Preferred Stock
included as Exhibit C to the Rights Agreement, all
incorporated by reference to Exhibit 4 to the Company's
Registration Statement on Form 8-A dated April 16, 1999.
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