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| PTEC > SEC Filings for PTEC > Form 8-K on 21-Oct-2009 | All Recent SEC Filings |
21-Oct-2009
Entry into a Material Definitive Agreement
Board) following the commencement of, or announcement of a tender offer or
exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 20% or more of the Company's outstanding
common stock. The earlier of such dates is referred to as the "Distribution
Date."
Preferred Stock Purchasable Upon Exercise of Rights. Following the
Distribution Date, and until one of the further events described below, holders
of the Rights will be entitled to receive, upon exercise and the payment of the
Purchase Price, one one-thousandth share of the Series B Preferred. In the event
that the Company does not have sufficient Series B Preferred available for all
Rights to be exercised, or the Board decides that such action is necessary and
not contrary to the interests of Rights holders, the Company may instead
substitute cash, assets or other securities for the Series B Preferred for which
the Rights would have been exercisable under this provision or as described
below.
Right to Buy Company Common Shares. Unless the Rights are earlier redeemed,
in the event that an Acquiring Person becomes the beneficial owner of 20% or
more of the Company's common stock then outstanding, then each holder of a Right
which has not theretofore been exercised (other than Rights beneficially owned
by the Acquiring Person, which will thereafter be void) will thereafter have the
right to receive, upon exercise, the Company's common stock having a value equal
to two times the Purchase Price. Rights are not exercisable following the
occurrence of an event as described above until such time as the Rights are no
longer redeemable by the Company as set forth below.
Right to Buy Acquiring Company Stock. Similarly, unless the Rights are
earlier redeemed, in the event that, after an Acquiring Person becomes the
beneficial owner of 20% or more of the Company's common stock then outstanding,
(i) the Company is acquired in a merger or other business combination
transaction, or (ii) 50% or more of the Company's consolidated assets or earning
power are sold (other than in transactions in the ordinary course of business),
proper provision must be made so that each holder of a Right which has not
theretofore been exercised (other than Rights beneficially owned by the
Acquiring Person, which will thereafter be void) will thereafter have the right
to receive, upon exercise, shares of common stock of the acquiring company
having a value equal to two times the Purchase Price.
Exchange Provision. At any time after the date an Acquiring Person obtains
20% or more of the Company's common stock and prior to the acquisition by the
Acquiring Person of 50% of the Company's outstanding common stock. The Company
may, with the approval of a majority of the Board, exchange the Rights (other
than Rights owned by the Acquiring Person or its affiliates), in whole or in
part, for shares of the Company's common stock at an exchange ratio of one share
of the Company's common stock per Right (subject to adjustment).
Redemption of the Rights. Rights will be redeemable at the Company's option
for $0.001 per Right at any time on or prior to the tenth day (or such later
date as may be determined by a majority of the Board) following public
announcement that a Person has acquired beneficial ownership of 20% or more of
the Company's common stock (the "Shares Acquisition Date").
Expiration of the Rights. The Rights expire on the earliest of (a) the close
of business on October 21, 2014 or (b) the exchange or redemption of the Rights
as described above.
Amendment of Terms of Rights. The terms of the Rights and the 2009 Amended
Rights Agreement may be amended in any respect without the consent of the Rights
holders on or prior to the Distribution Date; thereafter, the terms of the
Rights and the 2009 Amended Rights Agreement may be amended without the consent
of the Rights holders in order to cure any ambiguities or to make changes that
do not adversely affect the interests of Rights holders (other than the
Acquiring Person).
No Stockholders Rights Prior to Exercise. Until a Right is exercised, the
holder of the Right, as such, will have no rights as a stockholder of the
Company (other than any rights resulting from such holder's ownership of common
stock), including, without limitation, the right to vote or to receive
dividends.
Anti-Dilution Provisions. The Purchase Price payable, the number of Rights,
and the number of Series B Preferred or common stock or other securities or
property issuable upon exercise of the Rights are subject to adjustment from
time to time in connection with the dilutive issuances by the Company as set
forth in the Rights Agreement. With certain exceptions, no adjustment in the
Purchase Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price.
Terms of the Series B Preferred. Shares of Series B Preferred purchasable
upon exercise of the Rights will not be redeemable. Each share of Series B
Preferred will be entitled to an aggregate dividend of 1,000 times the dividend
declared per a share of common stock. In the event of liquidation, the holders
of the Series B Preferred would be entitled to receive an aggregate payment
equal to 1,000 times the payment made per share of common stock. Each share of
Series B Preferred will have 1,000 votes, voting together with the common stock.
Finally, in the event of any merger, consolidation or other transaction in which
the shares of common stock are exchanged, each share of Series B Preferred will
be entitled to receive 1,000 times the amount of consideration received per
share of common stock. These rights are protected by customary anti-dilution
provisions. Because of the nature of the dividend and liquidation rights of the
Series B Preferred, the value of one one-thousandth of a share of Series B
Preferred should approximate the value of one share of common stock. The
Series B Preferred would rank junior to any other series of the Company's
preferred stock.
Certain Anti-Takeover Effects. The Rights approved by the Board are designed
to protect and maximize the value of the outstanding equity interests in the
Company in the event of an unsolicited attempt by an acquirer to take over the
Company in a manner or on terms not approved by the Board. Takeover attempts
frequently include coercive tactics to deprive the Board and stockholders of any
real opportunity to determine the destiny of the Company. The Rights have been
declared by the Board in order to deter such tactics, including a gradual
accumulation of shares in the open market of a 20% or greater position to be
followed by a merger or a partial or two-tier tender offer that does not treat
all shareholders equally. These tactics may unfairly pressure stockholders,
squeeze them out of their investment without giving them any real choice, or
deprive them of the full value of their shares.
The Rights are not intended to prevent a takeover of the Company and will not do so. Subject to the restrictions described above, the Rights may be redeemed by the Company at $0.001 per Right at any time prior to the Distribution Date. Accordingly, the Rights should not interfere with any merger or business combination approved by the Company's Board. Nonetheless, the Rights may have the effect of rendering more difficult or discouraging an acquisition of the Company deemed undesirable by the Board. The Rights may cause substantial dilution to a person or group that attempts to acquire the Company on terms or in a manner not approved by the Board, except pursuant to an offer conditioned upon the negation, purchase or redemption of the Rights.
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