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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): DECEMBER 26, 2000
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CHASE INDUSTRIES INC.
(Exact name of Registrant as specified in its charter)
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DELAWARE 1-13394 51-0328047
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of incorporation) Identification Number)
14212 COUNTY ROAD M-50
MONTPELIER, OHIO 43543
(Address of principal (Zip code)
executive offices)
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Registrant's telephone number, including area code: (419) 485-3193
NOT APPLICABLE
(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
A. Rights Agreement.
On December 26, 2000, the Board of Directors of Chase Industries Inc.
(the "Company"), authorized the issuance of one preferred share purchase right
(a "Right") with respect to each outstanding share of common stock, $0.01 par
value (the "Common Shares"), of the Company. The rights will be issued on
January 5, 2001, to the holders of record of Common Shares on that date. Each
Right entitles the registered holder to purchase from the Company one
one-thousandth of a share of Series A Junior Participating Preferred Stock, $.01
par value (the "Preferred Shares"), of the Company at a price of $30 per one
one-thousandth 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 December 28, 2000, between the
Company and Mellon Investor Services LLC, a New Jersey limited liability
company, as Rights Agent (the "Rights Agent").
Detachment of Rights; Exercise. Initially, the Rights will attach to
all Common Share certificates representing outstanding shares and no separate
Right Certificate will be distributed. The Rights will separate from the Common
Shares and a "Distribution Date" will occur upon the earlier of (i) 10 business
days following a public announcement that a person or group of affiliated or
associated persons has become an Acquiring Person, or (ii) 10 business days
following the commencement or announcement of an intention to commence a tender
offer or exchange offer the consummation of which would result in a person or
group becoming an Acquiring Person, subject to the Board of Directors' right to
defer a Distribution Date upon an occurrence described in this clause (ii).
Although the public announcement by Chase Acquisition Corporation on December
18, 2000, of its intent to commence an unsolicited tender offer that would
result in it becoming an Acquiring Person did not cause a Distribution Date to
occur, the subsequent commencement of the tender offer on January 2, 2001, will
cause the Distribution Date to occur on January 17, 2001, unless the Board of
Directors elects to defer the Distribution Date with respect to the tender
offer. See "Item 5.C. Unsolicited Tender Offer" below.
In general, a person becomes an Acquiring Person if such person or a
group of which such person is a member acquires beneficial ownership of 20% or
more of the Company's outstanding voting common stock, or any additional shares
of the Company's common stock in the case of any person or group that owned 20%
or more of the Company's outstanding voting common stock as of December 26,
2000. Holders of shares of Chase Industries nonvoting common stock are deemed to
have beneficial ownership of the number of shares of voting common stock into
which such nonvoting shares are convertible.
Until the Distribution Date (or earlier redemption or expiration of the
Rights) (i) the Rights will be evidenced, with respect to any of the Common
Shares outstanding on January 5, 2001, by the certificates representing such
Common Shares with a copy of the Summary of Rights attached thereto, (ii) the
Rights will be transferred with and only with the Common Shares, (iii) new
Common Share certificates issued after January 5, 2001, upon transfer or new
issuance of the Common Shares will contain a notation incorporating the Rights
Agreement by reference, and (iv) the surrender for transfer of any certificates
for Common Shares outstanding as of January 5, 2001, even without such
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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 (the "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 thereafter
evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on December 26, 2010 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or the Rights are earlier redeemed or exchanged by
the Company as described below.
If a person or group were to become an Acquiring Person, then each
Right then outstanding (other than Rights beneficially owned by the Acquiring
Person which would become null and void) would become a right to buy that number
of Common Shares (or under certain circumstances, receive the equivalent number
of one one-thousandths of a Preferred Share or other assets or securities of the
Company) that at the time of such acquisition would have a market value of two
times the Purchase Price of the Right.
If, at any time after a person or group of affiliated or associated
persons becomes an Acquiring Person, the Company were acquired in a merger or
other business combination transaction or more than 50% of its consolidated
assets or earning power were sold, 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 Purchase Price of the Right, that number of shares
of common stock of the acquiring company which at the time of such transaction
would have a market value of two times the Purchase Price of the Right.
Preferred Shares. The dividend and liquidation rights, and the
non-redemption feature, of the Preferred Shares are designed so that the value
of one one-thousandth of a Preferred Share purchasable upon exercise of each
Right will approximate the value of one Common Share. The Preferred Shares
issuable upon exercise of the Rights will be non-redeemable and rank junior to
all other series of the Company's preferred stock. Each whole Preferred Share
will be entitled to receive a quarterly preferential dividend in an amount per
share equal to the greater of (i) $0.01 in cash, or (ii) 1,000 times the
dividend declared on each Common Share. In the event of liquidation, the holders
of the Preferred Shares will be entitled to receive a preferential liquidation
payment equal to the greater of (i) $10.00 per share, or (ii) an amount per
share equal to 1,000 times the payment made on each Common Share. In the event
of any merger, consolidation or other transaction in which Common Shares are
exchanged for or changed into other stock or securities, cash or other property,
each whole Preferred Share will be entitled to receive 1,000 times the amount
received per Common Share. Each whole Preferred Share shall be entitled to 1,000
votes on all matters submitted to a vote of the stockholders of the Company, and
Preferred Shares shall generally vote together as one class with the Common
Stock, and any other capital stock, entitled to vote thereon on all matters
submitted to a vote of stockholders of the Company.
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The offer and sale of the Preferred Shares issuable upon exercise of
the Rights will be registered with the Securities and Exchange Commission and
such registration will not be effective until the Rights become exercisable.
Antidilution and Other Adjustments. The number of one one-thousandths
of a Preferred Share or other securities or property issuable upon exercise of
the Rights, and the Purchase Price payable, are subject to customary adjustments
from time to time to prevent dilution.
The number of outstanding Rights and the number of one one-thousandths
of a Preferred 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.
Exchange Option. At any time after a person or group of affiliated or
associated persons becomes an Acquiring Person and before the acquisition by a
person or group of 50% or more of the outstanding voting common stock, the Board
of Directors may, at its option, issue Common Shares (or Preferred Shares) in
mandatory redemption of, and in exchange for, all or part of the then
outstanding and exercisable Rights (other than Rights owned by such person or
group which would become null and void) at an exchange ratio of one Common Share
(or one one-thousandth of a Preferred Share) for each Right then outstanding.
Redemption of Rights. At any time prior to the time that a person or
group has become an Acquiring Person, the Board of Directors of the Company may
redeem all but not less than all the then outstanding Rights at a price of
$0.0001 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 the action
of the Board of Directors ordering 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.
No Rights as Stockholder. 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.
Amendment of Rights. 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 extend the Final Expiration Date, and,
provided a Distribution Date has not occurred, to extend the period during which
the Rights may be redeemed, except that after the first public announcement that
a person or group has become an Acquiring Person, no such amendment may
materially and adversely affect the interests of the holders of the Rights.
A copy of the press release announcing the adoption of the Rights
Agreement is attached hereto as Exhibit 99.7 and incorporated herein by
reference.
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B. Bylaw Amendments.
On December 26, 2000, the Board of Directors of the Company also
approved a number of amendments to the Company's Bylaws. The amendments provide
for, among other things, advance notice to the Company of plans by stockholders
to nominate directors for election or to propose other action at any annual or
special meeting of the Company's stockholders, the right of the board of
directors to set the date for any special meeting of stockholders, and prior
notice to the board of directors of any proposed action to be taken by written
consent in order to allow the board to set a record date for such consent. The
provisions of the bylaws amended on December 26, 2000, may only be repealed or
amended upon approval of a majority of the Board of Directors or not less than
two-thirds of the outstanding shares of common stock entitled to vote thereon. A
copy of the press release announcing these amendments is attached hereto as
Exhibit 99.7 and incorporated herein by reference.
The foregoing description of the rights and the bylaw amendments does
not purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, form of Certificate of Designation of Series A Junior
Participating Preferred Stock, form of Right Certificate, form of Summary of
Rights to Purchase Preferred Stock and the Bylaws filed as exhibits hereto and
incorporated herein by reference.
C. Unsolicited Tender Offer.
On December 18, 2000, an investor group including a unit of Citicorp
Venture Capital Ltd. issued a press release stating that it intended to commence
an unsolicited tender offer for 2,300,000 shares (or 15%) of the Company's
outstanding common stock at a price of $10.50 per share in cash. On January 2,
2001, this unsolicited tender offer was commenced. The terms of the offer are
described in the Schedule TO (and Offer to Purchase filed as Exhibit (a)(1)(A)
thereto) filed by Chase Acquisition Corporation and Court Square Capital Limited
with the Securities and Exchange Commission on January 2, 2001. According to the
Offer to Purchase, the offer is scheduled to expire January 31, 2001, and if the
offer is successful, shares that are not acquired in the tender offer will be
acquired in a subsequent merger at a per-share price, to be paid in cash, equal
to the highest price per share paid pursuant to the tender offer.
The Board of Directors of the Company has engaged Credit Suisse First
Boston to advise it in connection with its evaluation of the proposed
transaction. The Board of Directors intends to formally respond to the
transaction on or before January 16, 2001, and has urged stockholders of the
Company to defer making a determination whether to accept or reject the proposed
tender offer until the Board of Directors makes its formal recommendation.
The December 18, 2000, public announcement of the intent to commence
the tender offer expressly is excluded from causing the occurrence of a
Distribution Date under the Rights Agreement described in Item 5.A. above, but
the subsequent commencement of the tender offer on January 2, 2001, will result
in Chase Acquisition Corporation and/or Court Square Capital Limited becoming an
Acquiring Person for purposes of the Rights Plan and, therefore, will cause the
occurrence of a Distribution Date under the Rights Plan on January 17, 2001,
unless the Board of Directors elects to defer the occurrence of the Distribution
Date or amend the Rights Agreement so that the Chase Acquisition Corporation
transaction does not cause the Rights to become exercisable, as permitted under
the Rights Plan.
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Copies of the Company's press releases dated December 18, 2000, and
January 2, 2001, regarding the tender offer are attached hereto as Exhibits 99.6
and 99.8, respectively, and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS.
99.1 -- Rights Agreement, dated as of December 28, 2000,
between Chase Industries Inc. and Mellon Investor
Services LLC, specifying the terms of the Rights,
which includes the form of Certificate of Designation
of Series A Junior Participating Preferred Stock as
Exhibit A, the form of Right Certificate as Exhibit B
and the Summary of Rights to Purchase Preferred Stock
as Exhibit C.
99.2 -- Form of Certificate of Designation of Series A Junior
Participating Preferred Stock (included as Exhibit A
to the Rights Agreement (Exhibit 99.1 hereto))
setting forth the terms of the Series A Junior
Participating Preferred Stock, par value $.01 per
share.
99.3 -- Form of Right Certificate (included as Exhibit B to
the Rights Agreement (Exhibit 99.1 hereto)). Pursuant
to the Rights Agreement, printed Right Certificates
will not be delivered until as soon as practicable
after the Distribution Date.
99.4 -- Form of Summary of Rights to Purchase Preferred
Shares (included as Exhibit C to the Rights Agreement
(Exhibit 99.1 hereto)) which, together with
certificates representing the outstanding Common
Shares of the Company, shall represent the Rights
prior to the Distribution Date.
99.5 -- Bylaws of Chase Industries Inc., as amended and
restated as of December 26, 2000.
99.6 -- Press release dated December 18, 2000 (incorporated
by reference to the Company's Schedule 14D-9 filed
with the Securities and Exchange Commission on
December 18, 2000.
99.7 -- Press release dated December 27, 2000 (incorporated
by reference to the Company's Schedule 14D-9 filed
with the Securities and Exchange Commission on
December 27, 2000).
99.8 -- Press release dated January 2, 2001.
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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 thereunto duly authorized.
CHASE INDUSTRIES INC.
By: /s/ Martin V. Alonzo
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Martin V. Alonzo
President and Chief Executive Officer
Date: January 4, 2001
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INDEX TO EXHIBITS
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EXHIBIT
NUMBER DESCRIPTION
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99.1 -- Rights Agreement, dated as of December 28, 2000,
between Chase Industries Inc. and Mellon Investor
Services LLC, specifying the terms of the Rights,
which includes the form of Certificate of Designation
of Series A Junior Participating Preferred Stock as
Exhibit A, the form of Right Certificate as Exhibit B
and the Summary of Rights to Purchase Preferred Stock
as Exhibit C.
99.2 -- Form of Certificate of Designation of Series A Junior
Participating Preferred Stock (included as Exhibit A
to the Rights Agreement (Exhibit 99.1 hereto))
setting forth the terms of the Series A Junior
Participating Preferred Stock, par value $.01 per
share.
99.3 -- Form of Right Certificate (included as Exhibit B to
the Rights Agreement (Exhibit 99.1 hereto)). Pursuant
to the Rights Agreement, printed Right Certificates
will not be delivered until as soon as practicable
after the Distribution Date.
99.4 -- Form of Summary of Rights to Purchase Preferred
Shares (included as Exhibit C to the Rights Agreement
(Exhibit 99.1 hereto)) which, together with
certificates representing the outstanding Common
Shares of the Company, shall represent the Rights
prior to the Distribution Date.
99.5 -- Bylaws of Chase Industries Inc., as amended and
restated as of December 26, 2000.
99.6 -- Press release dated December 18, 2000 (incorporated
by reference to the Company's Schedule 14D-9 filed
with the Securities and Exchange Commission on
December 18, 2000.
99.7 -- Press release dated December 27, 2000 (incorporated
by reference to the Company's Schedule 14D-9 filed
with the Securities and Exchange Commission on
December 27, 2000).
99.8 -- Press release dated January 2, 2001.
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