SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
NOVEMBER 10, 1999
Date of Report (Date of Earliest Event Reported)
ABBOTT LABORATORIES
(Exact Name of Registrant as Specified in Charter)
ILLINOIS
(State or Other Jurisdiction of Incorporation)
1-2189 36-0698440
(Commission File Number) (IRS Employer Identification No.)
100 Abbott Park Road, Abbott Park, Illinois 60064-6400
(Address of Principal Executive Offices) (Zip Code)
(847) 937-6100
(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS
On November 10, 1999, the Board of Directors (the "Board of Directors")
of Abbott Laboratories (the "Company") declared a dividend distribution of
one Right for each outstanding share of common stock, no par value (the
"Common Stock"), of the Company to shareholders of record at the close of
business on December 1, 1999 (the "Record Date"). Except as described below,
each Right, when exercisable, entitles the registered holder to purchase from
the Company one ten-thousandth of a share of Series A Junior Participating
Preferred Stock, par value $1.00 per share (the "Preferred Stock"), at a
price of $200.00 per one ten-thousandth of a share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights are set forth
in a form of Rights Agreement (the "Rights Agreement"). A definitive version
of the Rights Agreement will be entered into between the Company and a Rights
Agent.
Initially, the Rights will automatically attach to all Common Stock
certificates representing shares then outstanding, and no separate
certificates evidencing the Rights (the "Right Certificates") will be
distributed. Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of 10% or more of the outstanding shares of Common Stock
(the "Shares Acquisition Date") or (ii) 15 business days (or such later date
as may be determined by action of the Board of Directors prior to the time
that any person becomes an Acquiring Person) following the commencement of
(or a public announcement of an intention to make) a tender or exchange offer
if, upon consummation thereof, such person or group would be the beneficial
owner of 10% or more of such outstanding shares of Common Stock (the earlier
of such dates being called the "Distribution Date"), the Rights will be
evidenced by the Common Stock certificates and not by separate certificates.
The Rights Agreement also provides that, until the Distribution Date,
the Rights will be transferred with and only with the Common Stock. Until the
Distribution Date (or earlier redemption, expiration or termination of the
Rights), the transfer of any certificates for Common Stock, with or without a
copy of the Summary of Shareholder Rights Plan attached to the Rights
Agreement, will also constitute the transfer of the Rights associated with
the Common Stock represented by such certificates. As soon as practicable
following the Distribution Date, Right Certificates will be mailed to holders
of record of the Common Stock as of the close of business on the Distribution
Date and, thereafter, such separate Right Certificates alone will evidence
the Rights. Any shares of Common Stock issued after the Distribution Date
will generally be accompanied by Right Certificates only if such shares of
Common Stock are issued pursuant to the exercise of options or under any
employee plan or arrangement or upon the exercise, conversion or exchange of
other securities issued by the Company, or in other circumstances where the
issuance of accompanying Right Certificates is deemed necessary or
appropriate by the Board of Directors.
The Rights are not exercisable until the Distribution Date and will
expire at the earliest of (i) November 10, 2009 (the "Final Expiration
Date"), (ii) upon redemption by the Company as described below or (iii) upon
exchange of all Rights for Common Stock as described below.
In the event that any person (other than the Company, its affiliates or
any person receiving newly-issued shares of Common Stock directly from the
Company) becomes the beneficial owner of 10% or more of the then outstanding
shares of Common Stock, each holder
of a Right will thereafter have the right to receive, upon exercise at the
then current exercise price of the Right, Common Stock (or, in certain
circumstances, cash, property or other securities of the Company) having a
value equal to two times the exercise price of the Right.
In the event that, at any time following the Shares Acquisition Date,
the Company is acquired in a merger or other business combination transaction
or 50% or more of the Company's assets or earning power are sold, proper
provision will be made so that each holder of a Right will thereafter have
the right to receive, upon exercise at the then current exercise price of the
Right, common stock of the acquiring or surviving company having a value
equal to two times the exercise price of the Right.
Notwithstanding the foregoing, following the occurrence of any of the
events set forth in the preceding two paragraphs, any Rights that are, or
(under certain circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person will immediately become null and
void.
The Purchase Price payable, and the number 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, among other
circumstances, in the event of a stock dividend on, or a subdivision, split,
combination, consolidation or reclassification of, the Preferred Stock or the
Common Stock, or a reverse split of the outstanding shares of Preferred Stock
or the Common Stock.
At any time after the acquisition by a person or group of affiliated or
associated persons of beneficial ownership of 10% or more of the outstanding
Common Stock and prior to the acquisition by such person or group of 50% or
more of the outstanding Common Stock or the existence of a Solicitation
Participant, 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 per Right (subject to
adjustment).
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 Company will not be required to issue fractional
shares of Preferred Stock or Common Stock (other than fractions in multiples
of one ten-thousandths of a share of Preferred Stock) and, in lieu thereof,
an adjustment in cash may be made based on the market price of the Preferred
Stock or Common Stock on the last trading date prior to the date of exercise.
Subject to the following paragraph, at any time after the date of the
Rights Agreement until the earlier of the time that a person becomes an
Acquiring Person or the Final Expiration Date, the Board of Directors may
redeem the Rights in whole, but not in part, at a price of $.0001 per Right
(the "Redemption Price"), which may (at the option of the Company) be paid in
cash, shares of Common Stock or other consideration deemed appropriate by the
Board of Directors. Upon the effectiveness of any action of the Board of
Directors ordering redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption
Price.
If at any time prior to a person becoming an Acquiring Person (i) there
occurs a change (resulting from one or more proxy or consent solicitations)
in a majority of the directors in office
at the commencement of the first such solicitation and (ii) any person who is
a participant in any such solicitations (a "Solicitation Participant") has
proposed or initiated a business combination transaction involving the
Company, then approval of the holders of at least 85% of the outstanding
shares of Common Stock ("Shareholder Approval") would be required prior to
any redemption of the Rights or any amendment of the Rights Agreement that
would adversely affect the interests of holders of Rights or facilitate a
transaction with a Solicitation Participant.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the
right to vote or to receive dividends.
The provisions of the Rights Agreement may be amended by the Board of
Directors (subject to Shareholder Approval, if applicable), except that any
amendment adopted after the time that a person becomes an Acquiring Person
may not adversely affect the interests of holders of Rights.
As of October 31, 1999, there were 1,522,169,258 shares of Common Stock
outstanding and 76,592,025 shares of Common Stock reserved for issuance under
employee benefit plans. Each outstanding share of Common Stock on the Record
Date will receive one Right. 240,000 shares of Preferred Stock will be
reserved for issuance in the event of exercise of the Rights.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the
Company without conditioning the offer on the Rights being redeemed or a
substantial number of Rights being acquired, and under certain circumstances
the Rights beneficially owned by such a person or group may become void. The
Rights should not interfere with any merger or other business combination
approved by the Board of Directors because the Board of Directors may, at its
option subject to Shareholder Approval, if applicable, at any time prior to
the time that any person becomes an Acquiring Person, redeem all (but not
less than all) of the then outstanding Rights at the Redemption Price.
A copy of the definitive Rights Agreement will be filed with the
Securities and Exchange Commission as an Exhibit to a Registration Statement
on Form 8-A. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights
Agreement.
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES THEREOF
WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
Exhibit No. Exhibit
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99.1 Form of Rights Agreement to be entered into between Abbott
Laboratories and a Rights Agent, which includes as Exhibit
A thereto the Form of Certificate of Designations,
Preferences and Rights of the Series A Junior Participating
Preferred Stock, as Exhibit B thereto the Form of Right
Certificate and as Exhibit C thereto the Summary of
Shareholder Rights Plan.
99.2 Press Release by Abbott Laboratories, dated November 10,
1999.
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.
ABBOTT LABORATORIES
Date: November 10, 1999 By: /s/Gary P. Coughlan
----------------------------------
Name: Gary P. Coughlan
Title: Senior Vice President,
Finance and Chief Financial
Officer
EXHIBIT INDEX
Exhibit No. Exhibit
- ----------- -------
99.1 Form of Rights Agreement to be entered into between Abbott
Laboratories and a Rights Agent, which includes as Exhibit
A thereto the Form of Certificate of Designations,
Preferences and Rights of the Series A Junior Participating
Preferred Stock, as Exhibit B thereto the Form of Right
Certificate and as Exhibit C thereto the Summary of
Shareholder Rights Plan.
99.2 Press Release by Abbott Laboratories, dated November 10,
1999.