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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): September 16, 1996
Comshare, Incorporated
(Exact name of registrant as specified in its charter)
Michigan
(State or other jurisdiction of incorporation)
0-4096 38-1804887
(Commission File Number) (IRS Employer Identification No.)
555 Briarwood Circle, Ann Arbor, Michigan 48108
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (313) 994-4800
Not Applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
On September 12, 1996, the Board of Directors of Comshare,
Incorporated (the "Company") declared a dividend distribution of one Right for
each outstanding share of Common Stock, $1.00 par value (the "Common Stock"),
of the Company. The distribution is payable to the Company's shareholders of
record on September 30, 1996. Each Right entitles the registered holder to
purchase from the Company one one-hundredth of a share of Series A Preferred
Stock, no par value (the "Preferred Stock") at a price of $110.00 per one
one-hundredth of a share (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 KeyBank National Association, as
Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) ten business days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") acquired, or obtained the right to acquire, beneficial
ownership of 15% or more of the outstanding shares of the Common Stock or (ii)
ten business days (or such later date as may be determined by the Board of
Directors, with the concurrence of a majority of the Continuing Directors,
prior to such time as any person becomes an Acquiring Person) following the
commencement or announcement of an intention to commence a tender offer or
exchange offer by any person if, upon consummation thereof, such person would
be an Acquiring Person (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced, with respect to any of the
Common Stock certificates outstanding as of September 30, 1996, by such Common
Stock certificate. The Rights Agreement 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, exchange or expiration of the
Rights), new Common Stock certificates issued after September 30, 1996 upon
transfer or new issuance of the Common Stock will contain a notation
incorporating the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption, exchange or expiration of the Rights), the surrender
for transfer of any of the Common Stock certificates outstanding as of
September 30, 1996 or issued thereafter 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 ("Right Certificates") will be mailed to holders of
record of the Common Stock as of the close of business on the Distribution Date
and such separate Right Certificates alone will evidence the Rights. Subject
to certain adjustments as may be required by the Rights Agreement, the Company
will issue one Right with each new share of Common Stock issued until the
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Distribution Date so that all shares will have attached Rights. No person
shall be deemed to be an Acquiring Person on account of shares of Common Stock
beneficially owned by such person on September 16, 1996 unless thereafter they
become the beneficial owner of any additional shares of Common Stock. A
"Continuing Director" is a member of the Board of Directors of the Company who
is not an Acquiring Person or an affiliated or associated person of an
Acquiring Person and who was a member of the Board prior to the Share
Acquisition Date (as defined below) or subsequently became a member of the
Board and whose nomination for election or election to the Board was
recommended or approved by a majority of the Continuing Directors then on the
Board. At least two Continuing Directors must approve of, or concur on, any
action requiring the approval or concurrence of Continuing Directors.
The Rights are not exercisable until the Distribution Date, and, if
later, the expiration of the Company's right to redeem the Rights. The Rights
will expire on September 16, 2006, unless earlier redeemed or called for
exchange by the Company as described below or their earlier expiration upon the
consummation of certain transactions as described below.
The Preferred Stock will be nonredeemable and will be junior to any
other class of preferred stock. Each share of Preferred Stock will be entitled
to receive when, as and if declared, a quarterly dividend equal to the greater
of $1.00 or 100 times the per share value of any dividend (other than stock
dividends) declared on the Common Stock since the immediately preceding
quarterly dividend payment date. In the event of liquidation, the holders of
the Preferred Stock generally will be entitled to receive a liquidation payment
in an amount equal to $100.00 per share of Preferred Stock plus all accrued and
unpaid dividends thereon, and, after the holders of Common Stock have received
a liquidation payment in an amount equal to $1.00 per share, holders of the
Preferred Stock and the Common Stock shall receive their ratable and
proportionate share of the remaining assets to be distributed, with the holders
of Preferred Stock entitled to receive an aggregate per share amount equal to
100 times the aggregate amount to be distributed per share to holders of shares
of Common Stock. Each share of Preferred Stock will be entitled to 100 votes
per share voting together with the Common Stock. In the event of any merger,
consolidation or other transaction in which the Common Stock is exchanged, each
share of Preferred Stock will be entitled to receive 100 times the amount
received per share of Common Stock. The rights of the Preferred Stock as to
dividends, voting and liquidation preferences are protected by anti-dilution
provisions.
The Purchase Price payable, and the number of shares of the Preferred
Stock or other securities or property
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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 or warrants to
subscribe for shares of the Preferred Stock or convertible securities 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 or
assets (excluding regular periodic cash dividends out of earnings or retained
earnings at a rate not in excess of 125% of the rate of the last cash dividend
theretofore paid or a dividend paid in the Preferred Stock) 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 such Purchase
Price.
Prior to a Triggering Event, fractional shares of the Preferred Stock
will not be issued (other than fractions which are integral multiples of one
one-hundredths of a share of Preferred Stock) and, in lieu thereof, an
adjustment in cash will be made equal to the same fraction of the current
market value of one one-hundredth of a share of Preferred Stock. Following the
occurrence of a Triggering Event, the Company shall not be required to issue
fractions of shares of Common Stock and, in lieu thereof, an adjustment in cash
will be made equal to the same fraction of the current market value of one
share of Common Stock.
In the event that (i) the Company were the surviving corporation in a
merger or other combination with an Acquiring Person or affiliated or
associated persons of an Acquiring Person and its Common Stock were not changed
or exchanged; or (ii) an Acquiring Person engages in one of a number of
self-dealing transactions specified in the Rights Agreement; or (iii) in
certain circumstances, an Acquiring Person becomes the beneficial owner of 15%
or more of the outstanding shares of Common Stock (except pursuant to a tender
or exchange offer for all outstanding shares at a price and on terms determined
by a majority of the Continuing Directors, after receiving advice from an
investment banking firm selected by a majority of such Continuing Directors, to
be a price that is fair to shareholders and in the best interests of the
Company and its shareholders (a "Permitted Exception")), or (iv) during such
time as there is an Acquiring Person, there shall occur certain failures to
pay, or reductions in, dividends on outstanding common or preferred stock of
the Company or a recapitalization of the Company which has the effect of
increasing the Acquiring Person's proportionate share of the outstanding Common
Stock by more than 1%, then proper provision shall be made so that each holder
of a Right, other than Rights that were or are
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beneficially owned by the Acquiring Person (which will thereafter be void),
shall thereafter have the right to receive upon exercise that number of shares
of the Common Stock (or, in certain circumstances, a combination of cash, other
property, Preferred Stock, Common Stock and/or other securities) having a
market value of two times the exercise price of the Right. Following the
Distribution Date, in the event (i) that the Company were acquired in a merger
or other business combination transaction in connection with which the Company
is not the continuing or surviving corporation or in which all or a part of the
Common Stock shall be changed into or exchanged for stock or other securities
of any other Person or cash or any other property (other than certain mergers
and combinations with an Acquiring Person who becomes such in a Permitted
Exception if the price per share of Common Stock offered in such transaction is
no less than the price per share of Common Stock paid to all holders in the
Permitted Exception tender or exchange offer and the form of consideration
being offered in such transaction is the same as the form of consideration paid
in the Permitted Exception tender or exchange offer (a "Permitted
Combination")); or (ii) that 50% or more of the Company's assets or earning
power were sold, then proper provision shall be made so that each holder of a
Right, other than Rights that were or are beneficially owned by the Acquiring
Person (which will thereafter be void), shall thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the Acquiring Person which at
the time of such transaction would have a market value of two times the
exercise price of the Right. Upon the consummation of a Permitted Combination,
all rights shall expire. Each of the events described in this paragraph
constitutes a "Triggering Event" under the Rights Agreement.
At any time after any Person becomes an Acquiring Person but prior to
the time such Acquiring Person has acquired 50% or more of the outstanding
Common Stock, the Board (with the concurrence of a majority of the Continuing
Directors) may cause shareholders to exchange all or part of their Rights for
shares of Common Stock or Preferred Stock at a ratio of one share of Common
Stock or one one-hundredth of a share of Preferred Stock per Right, subject to
adjustment. As soon as the Board has determined to make such exchange, the
Rights may no longer be exercised.
At any time prior to 5:00 P.M., Ann Arbor time, on the tenth business
day following the public announcement that a person or group of affiliated or
associated persons has acquired beneficial ownership of 15% or more of the
outstanding shares of the Common Stock of the Company (the "Shares Acquisition
Date"), the Board of Directors of the Company may redeem the Rights in whole,
but not in part, at a price of
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$.0025 per Right (the "Redemption Price"); provided that if such
redemption occurs on or after the Shares Acquisition Date the Board shall be
entitled to so redeem the Rights only if such redemption is approved by a
majority of the Continuing Directors and the Continuing Directors constitute a
majority of the Board of Directors; provided, further, that if such redemption
occurs on or after the date of a change (resulting from a proxy or consent
solicitation effected in compliance with applicable law and the requirements of
any national securities exchange on which the Common Stock of the Company is
listed) in a majority of the directors in office at the commencement of such
solicitation if any person who is a participant in such solicitation has stated
(or, if upon the commencement of such solicitation, a majority of the Board of
Directors has determined in good faith) that such person (or any affiliated or
associated persons) intends to take, or may consider taking, any action which
would result in such person becoming an Acquiring Person or which would cause
the occurrence of a Triggering Event, the Board shall be entitled to redeem the
Rights only if such redemption is approved by a majority of the Continuing
Directors who were members of the Board of Directors prior to the proxy or
consent solicitation referred to above or subsequently became a member of the
Board of Directors and whose nomination for election or election thereto was
recommended or approved by a majority of such directors and the Continuing
Directors who were members of the Board of Directors prior to the proxy or
consent solicitation referred to above (or subsequently became a member of the
Board of Directors and whose nomination for election or election thereto was
recommended or approved by a majority of the Redemption Continuing Directors)
(the "Redemption Continuing Directors") and the Redemption Continuing Directors
constitute a majority of the Board of Directors. Thereafter, the Company's
right of redemption may be reinstated, prior to a Triggering Event, (i) if an
Acquiring Person reduces his beneficial ownership to 5% or less of the
outstanding shares of Common Stock in a transaction or series of transactions
not involving the Company; and (ii) there are no other Persons, immediately
following the event described in clause (i), who are Acquiring Persons.
Additionally, the Board of Directors may at any time prior to the occurrence of
a Triggering Event, redeem the then outstanding Rights in whole, but not in
part, at the Redemption Price, if such redemption is in connection with the
consummation of a merger or other business combination involving the Company
but not involving an Acquiring Person or its Affiliates or Associates which is
determined to be in the best interests of the Company and its shareholders by a
majority of the Continuing Directors. Immediately upon the action of the Board
of Directors of the Company electing to redeem the Rights, the Company shall
make announcement thereof, and upon such election, the right to exercise the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
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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 Rights Agreement may be amended without shareholder approval prior
to the Distribution Date at the Board of Directors' discretion (with the
concurrence of a majority of the Continuing Directors and only if the
Continuing Directors constitute a majority of the directors in their office).
After the Distribution Date, the Board of Directors (with the concurrence of a
majority of the Continuing Directors and only if the Continuing Directors
constitute a majority of the directors then in office) generally may amend the
Rights Agreement without the consent of the Rights holders to cure any
ambiguity, correct defects or inconsistencies, shorten or lengthen time periods
or supplement or change any other provision which shall not adversely affect
the Rights holders; provided that the lengthening of any time period is for the
purpose of protecting, enhancing or clarifying the rights of, and/or for the
benefit of the holders of the Rights (other than the Acquiring Person and its
affiliated and associated persons). However, if the Rights are not then
redeemable, the Board may not lengthen a time period relating to when the
Rights may be redeemed.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A,
dated September 17, 1996. A copy of the Rights Agreement is 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 hereby incorporated herein by reference.
The form of (i) Certificate of Amendment to the Company's Articles of
Incorporation determining the terms of the Series A Preferred Stock and (ii) the
Rights Agreement between the Company and the Rights Agent specifying the terms
of the Rights are attached hereto as exhibits and incorporated herein by
reference. The foregoing description of the Preferred Stock and the Rights are
qualified by reference to such exhibits.
Item 7: Financial Statements and Exhibits
Exhibit 3(a): Form of Amendment to Articles of Incorporation determining the
terms of the Series A Preferred Stock (included as Exhibit A
to the Rights Agreement filed herewith as Exhibit 4(a)).
Exhibit 4(a): Rights Agreement, dated as of September 16, 1996, between
Comshare, Incorporated and KeyBank National Association, as
Rights Agent.
Exhibit 99: Press Release, dated September 16, 1996.
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SIGNATURES
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.
September 16, 1996 COMSHARE, INCORPORATED
/s/ Kathryn A. Jehle
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By: Kathryn A. Jehle
Senior Vice President,
Chief Financial Officer,
Treasurer and Assistant Secretary
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EXHIBIT INDEX
Number Description
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4(a) Rights Agreement, dated as of September 16, 1996, between
Comshare, Incorporated and KeyBank National Association,
as Rights Agent.
99 Press Release, dated September 16, 1996.