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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
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Date of report (Date of earliest event reported): March 26, 2001
NATIONAL DATA CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Delaware 001-12392 58-0977458
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
National Data Plaza
Atlanta, Georgia 30329-2010
(Address of Principal Executive Offices, including Zip Code)
Registrant's telephone number, including area code: (404) 728-2000
N/A
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
On March 26, 2001, National Data Corporation (the "Company") entered into a
Stockholder Protection Rights Agreement pursuant to which it will distribute one
right (a "Right") for each outstanding share of the Company's Common Stock, par
value $.125 per share (the "Common Stock"), to stockholders of record at the
close of business on April 5, 2001 and for each share of Common Stock issued by
the Company thereafter and prior to the Separation Time (as described below).
Each Right entitles the registered holder to purchase from the Company one one-
thousandth (1/1,000th) of a share (a "Unit") of Series A Junior Participating
Preferred Stock, par value $1.00 per share (the "Preferred Stock"), at a
purchase price of $140.00 per Unit (the "Exercise Price"), subject to
adjustment. The description and terms of the Rights are set forth in the
Stockholder Protection Rights Agreement between the Company and SunTrust Bank,
Atlanta, as Rights Agent, dated March 26, 2001 (the "Rights Agreement").
Separation Time
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Initially, the Rights will be transferable only with the shares of Common
Stock with respect to which they were distributed. Until the Separation Time
the Rights will be evidenced by the certificates representing the shares of
outstanding Common Stock with which they are associated, and no separate Rights
Certificates will be distributed. The Rights will separate from the Common
Stock and the Separation Time will occur upon the earlier of (i) ten business
days following public announcement by the Company that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, obtained
the right to acquire, or otherwise obtained beneficial ownership of 15% or more
of the then-outstanding shares of Common Stock, or (ii) ten business following
the commencement of a tender offer or exchange offer that would result in a
person or group beneficially owning 15% or more of the then-outstanding shares
of Common Stock. An Acquiring Person does not include (a) any person who is a
beneficial owner of 15% or more of the Common Stock on March 26, 2001 (the date
of adoption of the Rights Agreement), unless such person or group shall
thereafter acquire beneficial ownership of additional Common Stock and fails to
reduce its beneficial ownership of Common Stock to previous levels, or (b) a
person who acquires beneficial ownership of 15% or more of the Common Stock
without any intention to affect control of the Company and who thereafter
promptly divests sufficient shares so that such person ceases to be the
beneficial owner of 15% or more of the Common Stock. In addition, the Company,
any wholly-owned subsidiary of the Company and any employee stock ownership or
other employee benefit plan of the Company or a wholly-owned subsidiary of the
Company shall not be an Acquiring Person.
Transfer of Rights and Certificates
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Until the Separation Time, (i) the Rights will be evidenced by Common Stock
certificates and will be transferred with and only with such Common Stock
certificates, (ii) new Common Stock certificates issued after April 5, 2001
will bear a legend
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incorporating the Rights Agreement by reference, and (iii) the surrender for
transfer of any certificates representing outstanding Common Stock will also
constitute the surrender for transfer of the Rights associated with the Common
Stock represented by such certificate.
Promptly after the Separation Time, Rights Certificates will be mailed to
holders of record of Common Stock as of the close of business on the date when
the Separation Time occurs (other than holders of Rights that are or were
beneficially owned by an Acquiring Person or an affiliate or associate thereof
or by any transferee of any of the foregoing, which Rights shall be void) and,
thereafter, the separate Rights Certificates alone will represent the Rights.
Exercise of Rights for Common Stock
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If a Flip-In Date occurs (i.e., the close of business ten business days
following a public announcement by the Company that a person has become an
Acquiring Person), and if the Company has not redeemed the Rights as described
below, then a Right entitles the holder thereof to acquire shares of Common
Stock (rather than Preferred Stock) having a value equal to twice the Right's
exercise price. Instead of issuing shares of Common Stock upon exercise of a
Right following a Flip-In Date, the Company may substitute therefor shares of
Preferred Stock at a ratio of one one-thousandth of a share of Preferred Stock
for each share of Common Stock so issuable. In the event there are not
sufficient treasury shares or authorized but unissued shares of Common Stock or
Preferred Stock to permit exercise in full of the Rights, the Company may
substitute debt or equity securities or other assets (or a combination thereof).
In addition, the Company, upon the action of the Board of Directors may, after a
Flip-In Date and prior to the time that an Acquiring Person becomes the
beneficial owner of more than 50% of the Common Stock, elect to exchange all
outstanding Rights (other than Rights that have become void) for shares of
Common Stock at an exchange ratio of one share of Common Stock per Right, as
adjusted. Notwithstanding any of the foregoing, Rights that are, or (under
certain circumstances set forth in the Rights Agreement) were, beneficially
owned by any person on or after the date such person becomes an Acquiring Person
will be null and void.
In addition, the Rights Agreement provides that if an Acquiring Person
controls the Company's Board of Directors, then the Company shall not enter into
an agreement with respect to, consummate or permit to occur any: (i)
consolidation, merger or share exchange if either the Acquiring Person or an
affiliate or associate of the Acquiring Person is a party to the transaction or
the terms of the transaction are not the same for the Acquiring Person as for
the other holders of Common Stock; or (ii) sale or transfer of a majority of the
Company's assets, unless the Company enters into an agreement for the benefit of
the holders of the Rights providing that upon consummation of such transaction
each Right shall constitute the right to purchase stock in the acquiring entity
having a value equal to twice the exercise price of the Rights for an amount in
cash equal to the exercise price of the Rights.
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Exercise Period
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The Rights are not exercisable until the Separation Time and will expire at
the close of business on March 26, 2011, unless earlier exchanged or redeemed by
the Company as described below.
Redemption of Rights
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At any time until the close of business on the Flip-In Date, the Company
may, upon the action of the Board of Directors, elect to redeem the Rights at a
price of $0.01 per Right. The Board of Directors may condition redemption of
the Rights upon the occurrence of a specified future time or event.
Adjustments
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The exercise price payable and the number of Rights outstanding are subject
to adjustment from time to time to prevent dilution in the event of a stock
dividend, stock split or reverse stock split, or other recapitalization which
would change the number of shares of Common Stock outstanding.
If prior to the Separation Time, the Company distributes securities or
assets in exchange for Common Shares (other than regular cash dividends or a
dividend paid solely in Common Shares) whether by dividend, reclassification, or
otherwise, the Corporation shall make such adjustments, if any, in the Exercise
Price, number of Rights and otherwise as the Board of Directors deems
appropriate.
Amendments
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Any provisions of the Rights Agreement may be amended at any time prior to
the close of business on the Flip-In Date without the approval of holders of the
Rights, and thereafter, the Rights Agreement may be amended without approval of
the Rights holders in any way which does not materially adversely affect the
interests of the Rights holders generally or to cure an ambiguity or to correct
or supplement any provision which may be inconsistent with any other provision
or otherwise defective.
Rights Prior to Exercise
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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 upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable.
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Effect of the Rights
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The Rights may have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors of the Company unless the offer
is conditioned on a substantial number of Rights being acquired. However, the
Rights should not interfere with any merger, statutory share exchange or other
business combination approved by a majority of the Board of Directors since the
Rights may be redeemed by the Company upon resolution of the Board of Directors
at any time on or prior to the close of business ten business days after
announcement by the Company that a person has become an Acquiring Person. Thus,
the Rights are intended to encourage persons who may seek to acquire control of
the Company to initiate such an acquisition through negotiations with the Board
of Directors. However, the effect of the Rights may be to discourage a third
party from making a partial tender offer or otherwise attempting to obtain a
substantial equity position in the equity securities of, or seeking to obtain
control of, the Company. To the extent any potential acquirors are deterred by
the Rights, the Rights may have the effect of preserving incumbent management in
office.
Documents and Effect of This Summary
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A copy of the Rights Agreement is included as an Exhibit to this Report.
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 hereby
incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
No financial statements are required to be filed as part of this Report.
The following exhibits are filed as part of this Report:
EXHIBIT NO. DESCRIPTION
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99.1 Stockholder Protection Rights Agreement, dated March 26, 2001,
between National Data Corporation and SunTrust Bank, Atlanta,
as Rights Agent
99.2 Press Release, dated March 26, 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 hereunto duly authorized.
NATIONAL DATA CORPORATION
By: /s/ Walter Hoff
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Name: Walter Hoff
Title: President and Chief
Executive Officer
Dated: March 27, 2001
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