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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 3, 1998
ANCOR COMMUNICATIONS, INCORPORATED
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(Exact name of registrant as specified in its charter)
Minnesota 1-2982 41-1569659
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(State or other jurisdiction (Commission file number) (I.R.S. Employer
of incorporation) Identification No.)
6130 Blue Circle Drive, Minnetonka, MN 55343
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(Address of principal executive offices)
Registrant's telephone number, including area code: (612) 932-4000
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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
On November 3, 1998, the Board of Directors of Ancor Communications,
Incorporated (the "Company"), declared a dividend of one preferred share
purchase right (a "Right") per share for each outstanding share of Common Stock,
par value $.01 per share (the "Common Shares"), of the Company. The dividend is
payable to shareholders of record on November 10, 1998 (the "Record Date").
Each Right entitles the registered holder to purchase from the Company one
one-hundredth of a share of Series D Junior Participating Preferred Stock, par
value $.01 per share (the "Preferred Shares"), of the Company at a price of
$20.00 per one-hundredth of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement"), dated as of November 3, 1998, between the
Company and Norwest Bank Minnesota, N. A., as Rights Agent (the "Rights Agent").
Initially, the Rights will be evidenced by the certificates representing
Common Shares then outstanding and no separate Right Certificates will be
distributed. The Rights will separate from the Common Shares, and a Distribution
Date for the Rights will occur, upon the earlier of: (i) the tenth day after the
first date of public announcement that a Person or group of affiliated or
associated Persons has become an "Acquiring Person" (i.e., has become, subject
to certain exceptions, the beneficial owner of 15% or more of the outstanding
Common Shares (other than as a result of a Permitted Offer and subject to
certain exceptions)) and (ii) the close of business on the 10th day following
the commencement or public announcement of a tender offer or exchange offer, the
consummation of which would result in a person or group of affiliated or
associated persons becoming an Acquiring Person.
A "Permitted Offer" is a tender offer or an exchange offer for all
outstanding Common Shares of the Company determined by the Board of Directors of
the Company, after receiving such advice as it deems necessary and giving due
consideration to all relevant factors, to be in the best interests of the
Company and its shareholders.
Until the Distribution Date, (i) the Rights will be evidenced by the Common
Share certificates and will be transferred with and only with the Common Shares,
(ii) new Common Share certificates issued after the Record Date upon transfer or
new issuance of the Common Shares will contain a notation incorporating the
Rights Agreement by reference, and (iii) the surrender for transfer of any
Common Share certificate, even without such notation or a copy of this Summary
of Rights attached thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented by such certificate.
As promptly as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common
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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 November 3, 2008, unless extended or earlier redeemed or exchanged by
the Company as described below. No fraction of a Preferred Share (other than
fractions in integral multiples of one one-hundredth of a share) will be issued
and, in lieu thereof, an adjustment in cash will be made based on the closing
price on the last trading date prior to the date of exercise.
The Purchase Price payable and the number of Preferred Shares 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 Shares, (ii) upon the grant to holders of
the Preferred Shares of certain rights, options or warrants to subscribe for or
purchase Preferred Shares or convertible securities at less than the then
current market price of the Preferred Shares or (iii) upon the distribution to
holders of the Preferred Shares of evidences of indebtedness or assets
(excluding regular periodic cash dividends or dividends payable in Preferred
Shares) or of subscription rights or warrants (other than those described in
clause (ii) of this paragraph). With certain exceptions, no adjustment in the
Purchase Price will be required until cumulative adjustments require an
adjustment of at least 1% in the Purchase Price.
The number of outstanding Rights and the number of Preferred Shares
issuable upon exercise of the Rights 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.
Preferred Shares purchasable upon exercise of the Rights will not be
redeemable. Each Preferred Share will be entitled to a minimum preferential
quarterly dividend payment of $1.00 per share but will be entitled to an
aggregate dividend of 100 times the dividend declared per Common Share. In the
event of liquidation, the holders of the Preferred Shares will be entitled to a
minimum preferential liquidation payment of $100.00 per share but will be
entitled to an aggregate payment of 100 times the payment made per Common Share.
Each Preferred 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 Preferred Share will be entitled to
receive 100 times the amount received per Common Share. These rights are subject
to adjustment in the event of a stock dividend on the Common Shares or a
subdivision, combination or consolidation of the Common Shares.
In the event any Person becomes an Acquiring Person, each holder of a Right
shall thereafter have a right to receive, upon exercise thereof at the then
current aggregate exercise price, in lieu of Preferred Shares, such number of
Common Shares of the Company having a current aggregate market price equal to
twice the current aggregate exercise price. In the event
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that at any time after there is an Acquiring Person the Company is acquired in
certain mergers or other business combination transactions or 50% or more of the
assets or earning power of the Company and its subsidiaries (taken as a whole)
are sold, holders of the Rights will thereafter have the Right to receive, upon
exercise thereof at the then current aggregate exercise price, such number of
Common Shares of the acquiring company (or, in certain cases, one of its
affiliates) having a current aggregate market price equal to twice the current
aggregate exercise price.
At any time after a Person becomes an Acquiring Person (subject to certain
exceptions), and prior to the acquisition by a Person of 50% or more of the
outstanding Common Shares, the Board of Directors of the Company may exchange
all or part of the Rights for Common Shares at an exchange ratio of one Common
Share per right, subject to adjustment.
At any time before a Person has become an Acquiring Person, the Board of
Directors of the Company may redeem the Rights in whole, but not in part, at a
price of $0.01 per Right (the "Redemption Price"), subject to adjustment. 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.
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.
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
hereby incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
99.1 Press Release, dated November 3, 1998
99.2 Rights Agreement, dated as of November 3, 1998, between the Company
and Norwest Bank Minnesota, N.A., as Rights Agent, (incorporated by
reference to the Company's Registration Statement on Form 8-A, dated
November 4, 1998).
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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.
November 4, 1998 ANCOR COMMUNICATIONS, INCORPORATED
By /s/ Kenneth E. Hendrickson
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Kenneth E. Hendrickson
Chief Executive Officer
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
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99.1 Press Release, dated November 3, 1998
99.2 Rights Agreement, dated as of November 3, 1998, between the Company and
Norwest Bank Minnesota, N.A., as Rights Agent, (incorporated by
reference to the Company's Registration Statement on Form 8-A, dated
November 4, 1998).
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[Logo of Ancor Communications, Inc.] FOR IMMEDIATE RELEASE
CONTACT: Mary Miller or Aaron Pearson
Ancor Communications Shandwick USA
612/932-4003 612/841-6217
[email protected] [email protected]
ANCOR ADOPTS SHAREHOLDER RIGHTS PLAN
MINNEAPOLIS, NOVEMBER 3, 1998-- Ancor Communications, Incorporated (Nasdaq:
ANCR), announced today that its Board of Directors has adopted a Shareholder
Rights Plan designed to preserve the long-term value of the company for all of
its shareholders.
The purpose of the plan is to encourage any prospective buyer to negotiate with
Ancor's board. Kenneth E. Hendrickson, Ancor's Chief Executive Officer, said
"The shareholder rights plan is not being adopted in response to any acquisition
or merger proposal. We are adopting this plan to insure that all shareholders
receive equal treatment and a fair price in any business combination involving
Ancor."
The Company has declared a dividend of one right for each common share
outstanding on November 10, 1998. Each right will entitle a shareholder to buy a
fraction of a share of a newly authorized series of preferred stock at an
exercise price of $20 per share. The rights will become exercisable in the event
that a person or group acquires 15% or more of Ancor's common shares or a tender
offer is commenced that would result in ownership by a person or group of 15% or
more of Ancor's common shares (subject to certain exceptions).
If a potential acquiror purchases at least 15% of Ancor's outstanding Common
Stock, shareholders other than the acquiror would be able to exercise the rights
issued under the plan to purchase shares of Ancor's Common Stock, or in some
cases cash, property or other securities of Ancor or shares of the acquiror's
common stock, at a 50% discount from the market price. In addition, the Board
may elect to exchange the rights for Ancor's Common Stock.
The Company's Board of Directors will be entitled to redeem the rights at $.01
per right at any time prior to an acquiror purchasing 15% or more of Ancor's
Common Stock.
The new purchase rights will be distributed as a non-taxable dividend and will
trade with Ancor's Common Stock. There will be no rights certificates issued
unless the rights become exercisable. The rights will expire on November 3,
2008.
ABOUT ANCOR COMMUNICATIONS
Ancor Communications, Inc. (Nasdaq: ANCR) provides GigWorks(TM) high-performance
storage and data-intensive network solutions based on Fibre Channel technology.
The Company was the first to deliver a Fibre Channel switch, and the first to
top the one-gigabit performance level. Ancor is a member of the Fibre Channel
Association, the Storage Network Industry Association, the ANSI Standards
Committee and the University of New Hampshire Fibre Channel
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Consortium to promote the advancement of Fibre Channel standards and
interoperability. Information on Ancor is available on the World Wide Web at
http://www.ancor.com.
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Editor's note: GigiWorks(TM), ANCOR(TM) and the Ancor logo are the marks and
property of Ancor Communications, Inc.
For more information about Fibre Channel technology and Ancor Fibre Channel
solutions, call (800) 342-7379 or access World Wide Web site
http://www.ancor.com. Media, contact Mary Miller, Ancor, at (612) 932-4071 or
[email protected] or Aaron Pearson, Shandwick, at (612) 832-5000 or
[email protected].
Forward-looking statements as defined by the Private Securities Litigation
Reform Act of 1995 are qualified by the risk factors outlined in the documents
Ancor Communications, Inc. files with the Securities and Exchange Commission.
