<PAGE>
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): August 25, 1999
ENDOCARDIAL SOLUTIONS, INC.
--------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-22233 41-1724963
- --------------------- ------------------ ----------------------
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
1350 Energy Lane, Suite 110, St. Paul, Minnesota 55108
------------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (651) 644-7890
--------------
Not Applicable
-------------------------------------------------------------
(Former name or former address, if changed since last report)
Page 1 of 6 Pages
Exhibit Index Appears on Page 6
<PAGE>
Item 5. OTHER EVENTS.
On August 24, 1999, the Board of Directors of Endocardial Solutions,
Inc. (the "Company"), declared a dividend of one preferred share purchase right
(a "Right") per share for each outstanding share of Common Stock, $.01 par value
per share (a "Common Share"), of the Company. The dividend is payable to
stockholders of record on September 15, 1999 (the "Record 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,
$.01 par value per share (a "Preferred Share"), of the Company at a price of
$60.00 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 August 25, 1999, between the
Company and Norwest Bank Minnesota, National Association, as 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 (a "Distribution Date") for the Rights will occur, upon the
earlier of: (i) 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 20% or more (25%
in the case of Medtronic, Inc. and its affiliates) of the outstanding Common
Shares (other than as a result of a Permitted Offer)) 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 stockholders.
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 a 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 Shares as of the close of business on the
Distribution Date, and such separate Right Certificates alone will evidence the
Rights.
Page 2 of 6 Pages
<PAGE>
The Rights are not exercisable until the Distribution Date. The Rights
will expire on September 15, 2009, 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 Preferred Share
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 (other than the Acquiring Person) 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 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
Page 3 of 6 Pages
<PAGE>
sold, holders of the Rights (other than the Acquiring Person) 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, 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 stockholder 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, a copy of
which was filed as Exhibit 1 to the Company's Form 8-A filed with the Securities
and Exchange Commission.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS
Exhibit No. Description
----------- -----------
99.1 Press release dated August 25, 1999
Page 4 of 6 Pages
<PAGE>
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.
Date: September 15, 1999
ENDOCARDIAL SOLUTIONS, INC.
By: /s/ Leota L. Pearson
-------------------------------
Leota L. Pearson
Chief Financial Officer
Page 5 of 6 Pages
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description
- ----------- -----------
99.1 Press release dated August 25, 1999
Page 6 of 6 Pages
<PAGE>
Exhibit 99.1
August 25, 1999
ENDOCARDIAL SOLUTIONS ADOPTS STOCKHOLDER RIGHTS PLAN
MINNEAPOLIS / ST.PAUL -- Endocardial Solutions, Inc. (Nasdaq: ECSI) today
announced its board of directors has adopted a Stockholder Rights Plan designed
to enhance the ability of the company's stockholders to realize the long-term
value of their investment.
"The purpose of the Stockholder Rights Plan is to protect the interest of
our stockholders by encouraging potential buyers to negotiate directly with the
board," said Jim Bullock, president and CEO. "The plan is intended to increase
the likelihood that our stockholders will realize the long-term value of their
investment and will receive fair and equal treatment in the event of an
attempted takeover of Endocardial Solutions. The plan was not adopted in
response to any stock accumulation or other hostile act."
Under the plan, the board of directors has declared a dividend of one
preferred share purchase right for each share of common stock of the company
held by stockholders of record as of the close of business on September 15,
1999. The rights will attach to certificates representing the common stock, and
no separate certificates will be issued at this time. The rights will expire on
September 15, 2009.
When exercisable each right will entitle Endocardial Solutions stockholders
to purchase one-hundredth of a share of a newly created series of preferred
stock, at an exercise price of $60. The rights will generally become exercisable
after any person or group acquires beneficial ownership of 20% or more of the
common stock (25% or more in the case of an acquisition of an existing
stockholder of the company that currently owns a 21.5% beneficial interest in
the company) or announces a tender or exchange offer that would result in that
person or group beneficially owning 20% or more of the common stock (25 % or
more in the case of an acquisition by that current stockholder). Stockholders
other than such acquiring person or groups would be able to exercise the rights
to purchase common stock at a 50% discount from market.
Based in St. Paul, Minnesota, Endocardial Solutions (www.endocardial.com)
developed, manufactures and markets the EnSite 3000 -Registered Trademark-
System for diagnostic mapping of complex arrhythmias (abnormally rapid
heartbeats caused by irregular electrical activity in the heart). The integrated
system provides a 3D graphical display of the heart's electrical activity.
Through a
<PAGE>
distribution agreement with Medtronic, Inc. (www.medtronic.com), the EnSite 3000
- -Registered Trademark- System and catheter are available in full market release
to electrophysiologists in Europe.
The discussion above contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. A number of factors
should be considered in conjunction with these forward-looking statements. These
factors are set forth in the cautionary statements included in Exhibit 99 to
Endocardial Solutions' Form 10-Q for the quarter ended June 30, 1999, filed with
the Securities and Exchange Commission. Endocardial Solutions cautions investors
and others to review the statements set forth in that report and that other
factors may prove to be important in affecting the business and results of
operations of Endocardial Solutions.
CONTACTS:
Leota Pearson, VP Finance & CFO, Endocardial Solutions (651) 523-6933
[email protected]
Perry Ketchum, Ketchum Metz Inc. (612) 479-0145 [email protected]
