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FORM 8-A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
INSIGHT ENTERPRISES, INC.
(Exact name of registrant as specified in charter)
Delaware 86-0766246
(State of incorporation (I.R.S. Employer
or organization) Identification Number)
6820 South Harl Ave.
Tempe, Arizona 85283
(Address of principal executive offices) (Zip Code)
If this Form relates to the registration of a class of debt securities and is
effective upon filing pursuant to General Instruction A.(c)(1), please check the
following box. [ ]
If this Form relates to the registration of a class of debt securities and is to
become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to General
Instruction A.(c)(2), please check the following box. [ ]
Securities to be registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which each class
to be so registered is to be registered
None None
Securities to be registered pursuant to Section 12(g) of the Act:
Series A Preferred Convertible Stock par value $0.01 per share
(Title of Class)
Series A Preferred Convertible Stock Rights
(Title of Class)
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Item 1. Description of Securities to be Registered.
SERIES A PREFERRED CONVERTIBLE STOCK, $0.01 PAR VALUE
The description of the securities is set forth in full in the
Certificate of Designation for the Series A Preferred Convertible Stock in
Exhibit 5 to this Form 8-A and is incorporated herein by reference.
RIGHTS TO PURCHASE SERIES A PREFERRED CONVERTIBLE STOCK,
$0.01 PAR VALUE
On December 4, 1998, the Board of Directors of Insight
Enterprises, Inc. (the "Company") declared a dividend distribution of one Right
for each outstanding share of common stock, par value $0.01 per share, of the
Company (the "Common Stock") to stockholders of record at the close of business
on December 14, 1998 (the "Record Date"). Each Right entitles the registered
holder to purchase from the Company one three-hundredth of a share of a series
of cumulative preferred stock of the Company designated Series A Preferred Stock
(the "Preferred Stock"), at a price of $200.00 (the "Purchase Price"), subject
to adjustment. The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and Norwest Bank
Minnesota, N.A., as Rights Agent (the "Rights Agent").
Distribution of the Rights; Rights Certificates
Until the Distribution Date (or earlier redemption or expiration
of the Rights), which is defined below, the Rights will be evidenced, with
respect to any of the Common Stock certificates outstanding prior to the
Distribution Date, by such Common Stock certificates. Until the Distribution
Date, (or earlier redemption or expiration of the Rights), (i) the Rights will
be transferred with and only with the Common Stock, (ii) new Common Stock
certificates issued after the Record Date upon transfer, replacement or new
issuance of Common Stock will be deemed to be issued with Rights and will
contain a notation incorporating the Rights Agreement by reference and (iii) the
surrender for transfer of any certificate for Common Stock will also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to
holders of record of the Common Stock as of the close of business on the
Distribution Date. From and after the Distribution Date, such separate Rights
Certificates alone will evidence the Rights. Except as otherwise determined by
the Board of Directors, and except in connection with the exercise of employee
stock options, any other issuance of Common Stock with respect to awards
outstanding under employee benefit plans outstanding on the Distribution Date
and in connection with the conversion of convertible securities issued after
December 4, 1998, only Common Stock issued prior to the Distribution Date will
be issued with Rights.
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Definition of Distribution Date
"Distribution Date" shall mean the earlier to occur of (i) 10
business days following the date of a public announcement that a person,
together with persons affiliated or associated with it, has acquired beneficial
ownership of 15% or more of the outstanding Common Stock or (ii) 10 business
days following the earlier of the commencement of, or the first public
announcement of the intent to commence, a tender offer or exchange offer by a
person other than the Company if, upon consummation of the offer, such person,
together with persons affiliated or associated with it, would be the beneficial
owner of 15% or more of the outstanding Common Stock.
Exercise and Expiration of the Rights
The Rights are not exercisable until the Distribution Date. The
Rights will expire at the close of business on December 4, 2008 (the "Final
Expiration Date"), unless earlier redeemed or exchanged by the Company as
described below.
Adjustment of the Purchase Price
The Purchase Price payable and the number of and kind 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, options or warrants to subscribe for
Preferred Stock (or shares having the same rights, privileges and preferences as
the shares of Preferred Stock) at less than the current market price of the
Preferred Stock or (iii) upon the distribution to holders of the Preferred Stock
of evidences of indebtedness, securities, cash or assets (excluding regular
periodic dividends out of earnings or retained earnings) or of subscription
rights or warrants (other than those referred to above). 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. No fractional shares of Preferred Stock will be issued upon the exercise
of any Right or Rights (other than fractions which are integral multiples of one
three-hundredth of a share of Preferred Stock), and in lieu thereof an
adjustment in cash will be made based on the current market price of the
Preferred Stock on the last trading day prior to the date of exercise.
Effect of a Triggering Event
Any of the events described in the succeeding second and
fourth paragraphs are defined as a "Triggering Event."
"Acquiring Person" shall have the meaning ascribed to it in the
Rights Agreement (generally defined to include any person who or which, together
with all persons affiliated or associated with it, shall be the beneficial owner
of 15% or more of the shares of Common Stock then outstanding), but shall not
include the Company, any subsidiary of the Company, any employee benefit plan of
the Company or of any subsidiary of the Company, or any person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan.
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In the event that a person, together with persons affiliated or
associated with it, becomes an Acquiring Person (except pursuant to an offer for
all outstanding shares of Common Stock that the independent directors determine
to be fair and adequate to shareholders and otherwise in the best interests of
the Company and its shareholders or as a result of repurchases of stock by the
Company or certain inadvertent actions by institutional or certain other
shareholders), proper provision shall be made so that each holder of a Right,
except as provided below, shall thereafter have the right to receive, upon
exercise thereof, Common Stock (or, in certain circumstances as determined by
the Company, other securities, cash, or other property) having a value of two
times the Purchase Price. Notwithstanding any of the foregoing, following the
occurrence of the event set forth in this paragraph, all Rights that are, or
(under certain circumstances set forth in the Rights Agreement) were,
beneficially owned by any Acquiring Person (or by certain related parties and
transferees) will be null and void. Rights are not exercisable following the
occurrence of the event set forth above until such time as the Rights are no
longer redeemable by the Company, as set forth below.
For example, at an exercise price of $200 per Right, each Right
not owned by an Acquiring Person (or by certain related parties and transferees)
following an event set forth in the preceding paragraph would entitle its holder
to purchase $400 worth of Common Stock (or other consideration, as noted above)
for $200. Assuming that the Common Stock had a per share value of $66.67 at such
time, the holder of each valid Right would be entitled to purchase 6 shares of
Common Stock for $200.
In the event that, at any time following the Stock Acquisition
Date, which is defined below, (i) the Company is acquired in a merger or other
business combination transaction in which the Company is not the surviving
corporation (other than a merger which follows an offer described in the second
preceding paragraph), or (ii) fifty percent (50%) or more of the Company's
assets, cash flow or earning power is sold or transferred, proper provision
shall be made so that each holder of a Right (other than Rights that theretofore
become null and void as described in the second preceding paragraph) shall
thereafter have the right to receive, upon exercise thereof, common stock of the
acquiring company having a value equal to two times the exercise price of the
Right.
Redemption of the Rights
At any time until the close of business on the tenth business
day following the date of a public announcement that a person has become an
Acquiring Person (the "Stock Acquisition Date"), the Company may redeem all, but
not less than all, the then outstanding Rights at a redemption price of $.01 per
Right (the "Redemption Price"). Immediately upon the action of the Board of
Directors of the Company ordering redemption of the Rights, the Rights will
terminate and the only right of the holder of Rights will be to receive the
Redemption Price. The foregoing notwithstanding, the Rights generally may not be
redeemed for one hundred and twenty (120) days in the event that a majority of
the Board of Directors is elected by shareholder action by written consent, or
is comprised of persons elected at a meeting of shareholders who were not
nominated by the Board of Directors of the Company in office immediately prior
to such meeting.
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Exchange of the Rights
At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15% or more of the
outstanding shares of Common Stock 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 may exchange the Rights (other than Rights owned by such person or
group which have become void), in whole or in part, at an exchange ratio of one
share of Common Stock, or one three-hundredth of a share of Preferred Stock (or
of a share of a class or series of the Company's preferred stock having
equivalent rights, preferences and privileges), per Right (subject to
adjustment).
Amendment of the Rights Agreement
Any of the provisions of the Rights Agreement may be amended by
the Board of Directors of the Company prior to the Distribution Date.
Thereafter, the provisions of the Rights Agreement may be amended by the Board
of Directors of the Company in order to (i) cure any ambiguity, (ii) shorten or
lengthen any time period under the Rights Agreement, or (iii) make changes that
will not adversely affect the interests of the holders of Rights; provided such
lengthening is for the purpose of protecting, enhancing or clarifying the rights
of, and/or the benefits to, the holders of Rights, and further; provided, that
no amendment may be made at such time as the Rights are not redeemable.
Exercise of the Right entitles the Right holder to the rights of a 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. While the distribution of the Rights
will not be taxable to stockholders or to the Company, stockholders may,
depending on the circumstances, recognize taxable income in the event that the
Rights become exercisable for Common Stock (or other consideration) of the
Company or for common stock of the acquiring company as set forth above.
Copy of the Rights Agreement available
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a Current Report on Form
8-K. A copy of the Rights Agreement will be 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, which is
incorporated herein by reference.
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Item 2. Exhibits
- ------ --------
1. Rights Agreement, incorporated by reference to the 8-K
filed by the company March 17, 1999.
2. Form of Rights Certificate (Exhibit A to the Rights
Agreement), see number 1.
3. Summary of Rights to Purchase Preferred Shares (Exhibit
B to the Rights Agreement, see number 1.
4. Resolutions authorizing adoption of Rights Agreement.
5. Form of Certificate of Designation of Preferred Shares.
6 Form of press release dated December 4, 1998.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the Registrant has duly caused this Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 17, 1999
INSIGHT ENTERPRISES, INC.
By: /s/ ERIC J. CROWN
Eric J. Crown
Chairman of the Board of Directors and Chief
Executive Officer (Principal Executive Officer)
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EXHIBIT INDEX
Exhibits
- --------
1. Rights Agreement, incorporated by reference to the 8-K
filed by the company March 17, 1999.
2. Form of Rights Certificate (Exhibit A to the Rights
Agreement), see number 1.
3. Summary of Rights to Purchase Preferred Shares
(Exhibit B to the Rights Agreement, see number 1.
4. Resolutions authorizing adoption of Rights Agreement.
5. Form of Certificate of Designation of Preferred Shares.
6. Form of press release dated December 4, 1998.
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EXHIBIT 4
FORM OF BOARD RESOLUTIONS ADOPTING SHAREHOLDER RIGHTS AGREEMENT
INSIGHT ENTERPRISES, INC.
December 4, 1998
WHEREAS, the Board of Directors deems it desirable and in the
best interests of the Company and its stockholders that steps be taken to
preserve for stockholders the long-term value of the Company in the event of a
takeover; and
WHEREAS, in furtherance thereof, the Board of Directors
desires to adopt a shareholder rights agreement effective as of December 4,
1998, and pay a dividend of one right (the "Right" or "Rights") for each share
of common stock of the Company, par value $0.01 per share (the "Common Shares"),
to stockholders of record of the Common Shares issued and outstanding as of
December 14, 1998, each Right representing the right to purchase one
three-hundredth of a share of Preferred Stock upon the terms and subject to the
conditions set forth in the Rights Agreement, to be dated as of the effective
date of these resolutions between the Company and Norwest Bank Minnesota, N.A.
(the "Agreement");
NOW, THEREFORE, BE IT RESOLVED, that Rights shall be issued
entitling the holder thereof to purchase one three-hundredth of a share of
Series A Preferred Stock, $.01 par value, as herein authorized ("Preferred
Stock"), upon the terms and subject to the conditions set forth in the
Agreement, and that the exercise price of the Right shall be $200.00 per Right;
and
RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby, is authorized, empowered, and directed, in the name and
on behalf of the Company, to execute the Agreement substantially in the form
distributed to the Board of Directors at its meeting on October 27, 1998, and
attached hereto as Exhibit A, with such modifications as the signing officers
shall deem necessary or desirable in connection therewith; and that the
signature of such signing officers on the Agreement shall conclusively identify
the same as being authorized by this vote; and
RESOLVED FURTHER, that certificates evidencing the Rights (the
"Right Certificates") shall be substantially in the form set forth in the
Agreement and shall be issued and delivered as provided therein; and
RESOLVED FURTHER, that the Right Certificates shall be signed
by the Chairman of the Board, the Chief Executive Officer, the President, or the
Chief Financial Officer and shall be attested by the Secretary or an Assistant
Secretary of the Company under its corporate seal (which may be in the form of a
facsimile of the seal of the Company), provided that the signature of any of
said officers of the Company may, but need not be, a facsimile signature
imprinted or otherwise reproduced on the Right Certificates, and that the
Company hereby adopts for such purpose the facsimile signature of the present or
any future Chairman of the Board, Chief Executive Officer, President, Chief
Financial Officer, Secretary, and Assistant Secretary of the Company,
notwithstanding the fact that at the time the Right Certificates shall be
authenticated and
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delivered or disposed of he or she shall have ceased to be such officer; and
RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby is, authorized to execute on behalf of the Company and
under its corporate seal (which may be in the form of a facsimile of the seal of
the Company) Right Certificates issued to replace lost, stolen, mutilated or
destroyed Right Certificates, and such Right Certificates as may be required for
exchange, substitution or transfer as provided in the Agreement in the manner
and form to be required in, or contemplated by, the Agreement; and
RESOLVED FURTHER, that the Right Certificates shall be
manually countersigned by the Rights Agent and books for the registration and
transfer of the Right Certificates shall be maintained by the Rights Agent at
its principal offices; and
RESOLVED FURTHER, that the number of shares of Preferred Stock
equal to the number of shares of Common Shares outstanding on the record date
divided by three hundred be, and they hereby are, initially reserved for
issuance upon exercise of the Rights, such number to be subject to adjustment
from time to time in accordance with the Amended Agreement; and
RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby is, authorized, empowered, and directed, for and on
behalf of the Company, to execute personally or by attorney-in-fact and to cause
to be filed with the Securities and Exchange Commission, at such time as they
determine to be necessary or appropriate, a registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), for the registration
of the Preferred Stock or Common Shares issuable upon exercise of the Rights,
and thereafter to execute and cause to be filed any amended registration
statement or registration statements and amended prospectus or prospectuses, or
amendments or supplements to any of the foregoing, and to cause such
registration statement and any amendments thereto to become effective in
accordance with the Securities Act and the General Rules and Regulations of the
Securities and Exchange Commission thereunder; and
RESOLVED FURTHER, that the Secretary of the Company be, and he
hereby is, appointed as agent for service of the Company with respect to said
registration statement with all the powers and functions specified in the
General Rules and Regulations of the Securities and Exchange Commission under
the Securities Act; and
RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby is, authorized, empowered, and directed, jointly and
severally, in the name and on behalf of the Company, to take all such action,
including filing a Registration Statement on Form 8-A for the Rights, and to
execute all such documents as they may deem necessary or appropriate in
connection with the issuance of the Rights and the Preferred Stock or Common
Shares issuable upon exercise of the Rights in order to comply with the
Securities Act and the Securities Exchange Act of 1934, as amended; and
RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby is, authorized, empowered, and directed, jointly and
severally, in the name and on behalf of the Company, to execute and file such
application or applications, and amendments and supplements thereto, and take
such other action as may be required or appropriate to cause the
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Rights and, if appropriate in the judgment of such officers it is appropriate to
do so, the Preferred Stock and Common Shares issuable upon exercise of the
Rights, to be listed on the National Association of Securities Dealers Automated
Quotation ("NASDAQ") and to appear before the Securities and Exchange
Commission, NASDAQ, and the National Association of Securities Dealers, Inc.,
and to execute such papers and agreements as may be necessary to conform with
the requirements of the Securities and Exchange Commission and the National
Association of Securities Dealers, Inc. to effectuate such listing and
registration; and
RESOLVED FURTHER, that so long as the Rights are attached to
the Common Shares as provided in the Agreement, one additional Right shall be
delivered with each Common Share that shall become outstanding on or after the
record date as set forth above including but not limited to Common Shares issued
upon conversion of any convertible securities of the Company and the exercise of
options to purchase Common Shares granted by the Company; and
RESOLVED FURTHER, that the Board of Directors deems it
desirable and in the best interests of the Company that the Preferred Stock and
Common Shares issuable upon exercise of the Rights be qualified or registered
for sale in various jurisdictions; that the Chairman of the Board, the Chief
Executive Officer, the President, the Chief Financial Officer, the Secretary, or
any Assistant Secretary be, and each of them hereby is, authorized to determine
the jurisdictions in which appropriate action shall be taken to qualify or
register for sale all or such part of the Preferred Stock and Common Shares
issuable upon exercise of the Rights as said officers may deem advisable; that
said officers are hereby authorized to perform on behalf of the Company any and
all such acts as they may deem necessary or advisable in order to comply with
the applicable laws of any such jurisdictions, and in connection therewith to
execute and file all requisite papers and documents, including, but not limited
to, applications, reports, surety bonds, irrevocable consents and appointments
of attorneys for service of process; and the execution by such officers of any
such papers or documents or the doing by them of any act in connection with the
foregoing matters shall conclusively establish their authority therefor and the
approval and ratification by the Company of the papers and documents so executed
and the action so taken; and
RESOLVED FURTHER, that the officers of the Company are
authorized to select and appoint a banking institution to act as Rights Agent
under the Agreement, with such compensation as such officers or any of them
shall approve; and
RESOLVED FURTHER, that the form of Certificate of Designation
of Series A Preferred Stock, substantially in the form presented to the Board of
Directors at its meeting on October 27, 1998, as modified as the signing
officers deem necessary or desirable, is hereby approved in all respects; and
RESOLVED FURTHER, that the Board of Directors hereby adopts,
as if expressly set forth herein, the form of any resolution required by any
authority to be filed in connection with any applications, consents to service,
issuer's covenants or other documents if (i) in the opinion of the officers of
the Company executing the same, the adoption of such resolutions is necessary or
desirable and (ii) the Secretary or an Assistant Secretary of the Company
evidences such adoption by inserting in the minutes of this meeting copies of
such resolutions, which will thereupon be deemed to be adopted by the Board of
Directors with the same force and effect as if presented at this meeting; and
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RESOLVED FURTHER, that the proper officers of the Company be,
and each of them hereby is, authorized and directed, jointly and severally, for
and on behalf of the Company, to execute and deliver any and all certificates,
agreements and other documents, take any and all steps and do any and all things
which they may deem necessary or advisable in order to effectuate the purposes
of each and all of the foregoing resolutions; and
RESOLVED FURTHER, that any actions taken by such officers
prior to the date of this meeting that are within the authority conferred hereby
are hereby ratified, confirmed and approved in all respects as the act and deed
of the Company.
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EXHIBIT 5
CERTIFICATE OF DESIGNATIONS
OF THE
PREFERRED STOCK, SERIES A
(Par Value $ .01 Per Share)
OF
INSIGHT ENTERPRISES, INC.
---------------------------
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
---------------------------
The undersigned duly authorized officer of Insight Enterprises, Inc., a
corporation organized and existing under the General Corporation Law of the
State of Delaware (the "Company"), in accordance with the provisions of Section
103 thereof, and pursuant to Section 151 thereof, DOES HEREBY CERTIFY:
That the Amended and Restated Certificate of Incorporation of the
Company (the "Certificate of Incorporation") authorizes the creation of up to
three million (3,000,000) shares of the Company's preferred stock, par value
$.01 per share (such preferred stock, together with all other preferred stock of
the Company the creation of which is in the future authorized by the Certificate
of Incorporation shall be referred to as the "Preferred Stock"); and
That pursuant to the authority conferred upon the Board of Directors
(the "Board") by the Certificate of Incorporation, the Board on December 4, 1998
adopted the following resolution creating a series of one hundred thousand
(100,000) shares of Preferred Stock designated as set forth below:
RESOLVED, that pursuant to the authority expressly granted to and
vested in the Board by provisions of the Certificate of Incorporation and the
General Corporation Law of the State of Delaware, the issuance of a series of
Preferred Stock, which shall consist of one hundred thousand (100,000) shares of
the three million (3,000,000) shares of Preferred Stock which the Company now
has authority to issue, and has not been previously issued, be, and the same
hereby is, authorized, and this Board hereby fixes the powers, designations,
preferences and relative, participating, options or other special rights, and
the qualifications, limitations or restrictions, of the shares of such series
authorized by this resolution as follows:
SERIES A PREFERRED STOCK
(a) The distinctive serial designation of the Preferred Stock
is "Series A Preferred Stock" (hereinafter called "Series A Preferred Stock").
(b) The number of shares constituting the Series A Preferred
Stock is one
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hundred thousand (100,000) shares.
(c) The holders of shares of Series A Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors out of
funds legally available for the purpose, quarterly dividends payable in cash on
the 15th day of January, April, July, and September in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series A Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (i) $10.00 or (ii) subject to the
provision for adjustment hereinafter set forth, 300 times the aggregate per
share amount of all cash dividends, and 300 times the aggregate per share amount
(payable in kind) of all noncash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock of the Company since the immediately preceding quarterly dividend
payment date, or, with respect to the first quarterly dividend payment date,
since the first issuance of any share or fraction of a share of Series A
Preferred Stock. In the event the Company shall at any time after December 4,
1998 (the "Rights Declaration Date") declare or pay any dividend on Common Stock
payable in shares of Common Stock , or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount to which holders of Series A Preferred Stock were entitled immediately
prior to such event under clause (ii) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
The Company shall declare a dividend or distribution on the
Series A Preferred Stock as provided in this paragraph (c) immediately after it
declares a dividend or distribution on the Common Stock; provided that, in the
event no dividend or distribution shall have been declared on the Common Stock
during the period between any quarterly dividend payment date and the next
subsequent quarterly dividend payment date, a dividend of $10.00 per share on
the Series A Preferred Stock shall nevertheless be payable on such subsequent
quarterly dividend payment date.
Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A
Preferred Stock, unless the date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of Series A Preferred
Stock entitled to receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the shares of Series
A Preferred Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such
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shares at the time outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Series A Preferred Stock entitled to
receive payment of a dividend or distribution declared thereon, which record
date shall be no more than 30 days prior to the date fixed for the payment
thereof.
(d) Except as prescribed by law and in addition to the rights
provided for in the Certificate of Incorporation and in paragraph (1) below, and
subject to the provision for adjustment hereinafter set forth, the holders of
the Series A Preferred Stock shall be entitled to three hundred votes for each
share held and shall be entitled to exercise such voting rights with the holders
of Common Stock without distinction as to class, at any annual or special
meeting of shareholders for the election of directors and on any other matter
coming before such meeting. In the event the Company shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the number of votes per share to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(e) (i) If at any time dividends on any Series A Preferred
Stock shall be in arrears in an amount equal to six (6) quarterly dividends
thereon, the occurrence of such contingency shall mark the beginning of a period
(herein called a "default period") which shall extend until such time when all
accrued and unpaid dividends for all previous quarterly dividend periods and for
the current quarterly dividend period on all shares of Series A Preferred Stock
then outstanding shall have been declared and paid or set apart for payment.
During each default period, the holders of the Series A Preferred Stock, voting
as a class, shall have the right to elect a majority of the Company's Board of
Directors.
(ii) During any default period, such voting right
of the holders of the Series A Preferred Stock may be exercised initially at a
special meeting called pursuant to subparagraph (iii) of this paragraph (e) or
at any annual meeting of stockholders, and thereafter at annual meetings of
stockholders, provided that such voting right shall not be exercised unless the
holders of ten percent (10%) in number of shares of the Series A Preferred Stock
outstanding shall be present in person or by proxy. The absence of a quorum of
the holders of Common Stock shall not affect the exercise by the holders of the
Series A Preferred Stock of such voting right. At any meeting at which the
holders of the Series A Preferred Stock shall exercise such voting right
initially during an existing default period, they shall have the right, voting
as a class, to elect directors to fill such vacancies, if any, in the Board of
Directors as may then exist in order to elect a majority of the Company's Board
of Directors or, if such right is exercised at an annual meeting, to elect a
majority of the Company's Board of Directors. If the number which may be so
elected at any special meeting does not amount to the required number, the
holders of the Series A Preferred Stock shall have the right to make such
increase in the number of directors as shall be necessary to permit the election
by them of the required number. After the holders of the Series A Preferred
Stock shall have exercised their right to elect directors in any default period
and during the continuance of such period, the number of
<PAGE> 4
directors shall not be increased or decreased except by vote of the holders of
the Series A Preferred Stock as herein provided or pursuant to the rights of any
equity securities ranking senior to or pari passu with the Series A Preferred
Stock.
(iii) Unless the holders of the Series A Preferred
Stock shall, during an existing default period, have previously exercised their
right to elect directors, the Board of Directors may order, or any stockholder
or stockholders owning in the aggregate not less than ten percent (10%) of the
total number of shares of the Series A Preferred Stock outstanding, may request,
the calling of a special meeting of the holders of the Series A Preferred Stock
for that purpose, which meeting shall thereupon be called by the President, a
Vice-President or the Secretary of the Corporation. Notice of such meeting and
of any annual meeting at which holders of the Series A Preferred Stock are
entitled to vote pursuant to this subparagraph (iii) of Paragraph (e) shall be
given to each holder of record of Series A Preferred Stock by mailing a copy of
such notice to him at his last address as the same appears on the books of the
Company. Such meeting shall be called for a time not earlier than 20 days and
not later than 60 days after such order or request or in default of the calling
of such meeting within 60 days after such order or request, such meeting may be
called on similar notice by any stockholder or stockholders owning in the
aggregate not less than ten (10%) of the total number of shares of Series A
Preferred Stock outstanding. Notwithstanding the provisions of this subparagraph
(iii) of Paragraph (e), no such special meeting shall be called during the
period within 60 days immediately preceding the date fixed for the next annual
meeting of the stockholders.
(iv) In any default period, the holders of Common
Stock, and other classes of stock of the Company, if applicable, shall continue
to be entitled to elect the whole number of directors until the holders of the
Series A Preferred Stock shall have exercised their right to elect a majority of
the Company's Board of Directors voting as a class, after the exercise of which
right (x) the directors so elected by the holders of the Series A Preferred
Stock shall continue in office until their successors shall have been elected by
such holders or until the expiration of the default period, and (y) any vacancy
in the Board of Directors may (except as provided in subparagraph (ii) of
Paragraph (e) be filled by vote of a majority of the remaining directors
theretofore elected by the holders of the class of stock which elected the
director whose office shall have become vacant. References in this Paragraph (e)
to directors elected by the holders of a particular class of stock shall include
directors elected by such directors to fill vacancies as provided in clause (y)
of the foregoing sentence.
(v) Immediately upon the expiration of a default
period, (x) the right of the holders of the Series A Preferred Stock as a class
to elect directors shall cease, (y) the term of any directors elected by the
holders of the Series A Preferred Stock as a class shall terminate, and (z) the
number of directors shall be such number as may be provided for in the
certificate of incorporation or by-laws irrespective of any increase made
pursuant to the provisions of subparagraph (ii) of this Paragraph (e) (such
number being subject, however, to change thereafter in any manner provided by
law or in the certificate of incorporation or by-laws). Any vacancies in the
Board of Directors effected by the provisions of clauses (y) and (z) in the
preceding sentence may be filled by a majority of the remaining directors.
(f) Except as set forth herein, holders of Series A Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are
<PAGE> 5
entitled to vote with holders of Common Stock as set forth herein) for taking
any corporate action.
(g) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in Paragraph
(c) are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Company shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for consideration
any shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends or make any other
distributions on any shares of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series A Preferred
Stock, except dividends paid ratably on the Series A Preferred Stock and all
such parity stock on which dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A Preferred Stock,
provided that the Company may at any time redeem, purchase or otherwise acquire
shares of any such parity stock in exchange for shares of any stock of the
Company ranking junior (either as to dividends or upon dissolution, liquidation
or winding up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration
any shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a purchase
offer made in writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable treatment among the
respective series or classes.
(v) permit any subsidiary of the Company to purchase
or otherwise acquire for consideration any shares of stock of the Company unless
the Company could, under this Paragraph (g), purchase or otherwise acquire such
shares at such time and in such manner.
(h) Any Series A Preferred Stock purchased or otherwise
acquired by the Company in any manner whatsoever shall be retired and canceled
promptly after the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued Preferred Stock and may be reissued
as part of a new series of Preferred Stock to be created by resolution or
resolutions of the Board, subject to the conditions and restrictions on issuance
set forth herein.
<PAGE> 6
(i) (i) Upon any voluntary or involuntary liquidation,
dissolution or winding up of the Company, no distribution shall be made to the
holders of Stock ranking junior to (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless, prior
thereto, the holders of Series A Preferred Stock shall have received the greater
of (i) $100.00 per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment,
or (ii) an amount per share which shall be determined by (A) dividing (1) the
value of the assets of the Company available for distribution to shareholders,
less the amount to be paid upon liquidation, dissolution, or winding up to the
holders of all other series of stock ranking on a parity with the Series A
Preferred Stock, by (2) the sum of the number of one three-hundredths shares of
Series A Preferred Stock outstanding as of the date of such event plus the
number of shares of Common Stock, as adjusted by multiplying such number of
shares of Common Stock outstanding as of the date of such event by the
Adjustment Number (as defined below), and (B) multiplying the result obtained in
clause (A) by 300, (the "Series A Preferred Stock Liquidation Preference").
Following the payment of the full amount of the Series A Preferred Stock
Liquidation Preference, no additional distributions shall be made to the holders
of shares of Series A Preferred Stock. Following the payment of the full amount
of the Series A Preferred Stock Liquidation Preference in respect of all
outstanding shares of Series A Preferred Stock holders of Common Stock shall
receive their ratable and proportionate share of the remaining assets to be
distributed, on a per share basis.
(ii) In the event, however, that there are not
sufficient assets available to permit payment in full of the Series A Preferred
Stock Liquidation Preference and the liquidation preferences of all other series
of stock ranking on a parity upon liquidation, dissolution or winding up with
the Series A Preferred Stock, then such remaining assets shall be distributed
ratably to the holders of the Series A Preferred Stock and such other series of
parity stock in proportion to the total amounts to which the holders of all such
shares are entitled upon liquidation, dissolution or winding up.
(iii) The Adjustment Number as of the date of this
Certificate of Amendment shall be one (1). In the event the Company shall at any
time after December 4, 1998 declare or pay any dividend on Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
Adjustment Number in effect immediately prior to such event shall be adjusted by
multiplying such Adjustment Number by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately prior to such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately after such event.
(iv) The merger or consolidation of the Company with
or into any other corporation or the merger or consolidation of any other
corporation with or into the Company, or the sale, transfer, exchange or
conveyance by the Company of all or substantially all the assets of the Company,
as an entirety, shall not be deemed to be a liquidation for purposes of this
paragraph (i).
(j) In case the Company shall enter into any
consolidation, merger,
<PAGE> 7
combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such case the Series A Preferred Stock shall at the same
time be similarly exchanged or changed in an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 300 times the aggregate
amount of stock, securities, cash and/or any other property (payable in kind),
as the case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the Company shall at any time after December
4, 1998 declare or pay any dividend on Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of Series A Preferred
Stock shall be adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(k) The Series A Preferred Stock shall not be redeemable.
(l) Series A Preferred Stock may be issued in fractions of a
share which shall entitle the holder, in proportion to such holder's fractional
shares, to exercise voting rights, receive dividends, participate in liquidating
distributions and to have the benefit of all other rights of holders of Series A
Preferred Stock.
(m) The Series A Preferred Stock is not convertible into, or
exchangeable for, shares of stock of any other class.
(n) At any time when any shares of Series A Preferred Stock
are outstanding, neither the Amended and Restated Certificate of Incorporation
of the Company nor this Certificate of Designation shall be amended in any
manner which would materially alter or change the powers, preferences or special
rights of the Series A Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority or more of the outstanding
shares of Series A Preferred Stock, voting separately as a class.
IN WITNESS WHEREOF, Insight Enterprises, Inc. has caused this
Certificate to be signed by Eric J. Crown, its Chief Executive Officer, and
attested by Stanley Laybourne, its Secretary this 10th day of December, 1998.
INSIGHT ENTERPRISES, INC.
By
Name: Eric J. Crown
Title: Chief Executive Officer
Attest:
By
<PAGE> 8
Name: Stanley Laybourne
Title: Secretary
<PAGE> 1
EXHIBIT 6
Friday December 4, 7:07 pm Eastern Time
Company Press Release
Insight Enterprises Inc. Adopts
Shareholder Rights Agreement
TEMPE, Ariz.--(BUSINESS WIRE)--Dec. 4, 1998--Computer direct marketer Insight
Enterprises Inc. (NASDAQ/NMS/NSIT) ("Insight" or the "company") announced that
its board of directors has unanimously adopted a Shareholder Rights Agreement.
Under the Agreement, Rights to purchase company stock will be distributed as a
dividend at the rate of one Right for each share of company common stock held of
record as of the close of business on Dec. 14, 1998. Insight's adoption of the
Rights Agreement is similar to plans adopted by many U.S. public companies. It
is designed to deter coercive or unfair takeover tactics. The Rights Agreement
will assist the company's board of directors in dealing with any future actions
taken by hostile entities which attempt to deprive the company and its
shareholders of the opportunity to obtain the most attractive price for their
shares.
The Rights are not being distributed in response to any effort to acquire
control of the company, and the Board is not aware of any such effort.
Each Right will entitle holders of company common stock to buy one
three-hundredth of a share of company Preferred Stock at an exercise price of
U.S. $200.00.
The Rights will be exercisable - and will detach from the common shares - if a
person or group acquires 15% or more of the company's outstanding common stock,
or announces a tender or exchange offer that, if consummated, would result in a
person or group beneficially owning 15% or more of the company's common stock.
Should a person or group acquire, without prior approval of the Board, 15% or
more of the company's common stock, each Right would entitle the holder (other
than such an acquiring person or group) to purchase company common stock (or, in
certain circumstances, shares of the acquiring person) with a value of twice the
Right's exercise price upon payment of the Right's exercise price.
In addition, if any person has become a 15% or more shareholder and the company
is acquired in a merger or other business combination transaction in which the
holders of all of the outstanding Common Shares immediately prior to the
consummation of the transaction are not the holders of all of the surviving
corporation's voting power, or more than 50% of the company's assets or earning
power is sold or transferred, then each Right would entitle the holder (other
than such an acquiring person or group) to receive, upon exercise and payment of
the exercise price, common shares of the acquiring company having a value equal
to two times the exercise price.
<PAGE> 2
The company will be entitled to redeem the Rights at U.S. $0.01 per Right at any
time prior to a person or group acquiring 15% or more of the company's
outstanding common stock (without prior approval of the Board). The Rights will
expire at the close of business on Dec. 14, 2008.
Details of the Rights Agreement are outlined in materials that will be mailed to
all shareholders.
About Insight
Insight is a leading direct provider of computers, hardware and software,
offering a broad line of more than 80,000 brand name products primarily to
businesses in the United States, Canada and the United Kingdom. Products are
sold by a staff of customer dedicated account executives through outbound
telesales and via the Internet.
Recently featured in Forbes as an "Up & Comer", Insight's net sales for the 12
months ended September 30, 1998 were $891.7 million. For product sales or
company information, call 800-INSIGHT or visit www.insight.com.
Contact:
Insight Enterprises Inc., Tempe
Valerie J. Paxton,, 602/350-1611
Email: [email protected]
