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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 02549
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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): January 27, 1998
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PROJECT SOFTWARE & DEVELOPMENT, INC.
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(Exact name of registrant as specified in its charter)
Massachusetts 0-23852 04-2448516
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(State or other jurisdiction) (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 Crosby Drive, Bedford, Massachusetts 01730
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (781) 280-2000
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ITEM 5. OTHER EVENTS.
On January 27, 1998, the Board of Directors (the "Board") of
Project Software & Development, Inc. (the "Company") declared a dividend
distribution of one preferred stock purchase right (one "Right") for each
outstanding share of common stock, par value $.01 per share, of the Company (the
"Common Stock") to holders of record of the Common Stock at the close of
business on January 27, 1998 (the "Record Date"). Each Right entitles the
registered holder to purchase from the Company a unit (a "Unit") consisting of
one one-thousandth of a share of Series A Junior Participating Preferred Stock,
par value $.01 per share, of the Company (the "Preferred Stock") or, in certain
circumstances, to receive cash, property, Common Stock or other securities of
the Company, at a purchase price of $140 per Unit, subject to adjustment (the
"Purchase Price"). The full description and terms of the Rights are set forth in
the Rights Agreement (the "Rights Agreement"), dated as of January 27, 1998,
between the Company and BankBoston, N.A., as Rights Agent (the "Rights Agent").
Initially, the Rights will be attached to all certificates
representing shares of Common Stock then outstanding, and no separate Rights
Certificates will be distributed. The Rights will separate from the Common Stock
upon the earlier of (i) 10 business days (subject to extension by the Board)
following a public announcement by the Company (the date of such public
announcement being the "Stock Acquisition Date") that a person or group of
affiliated or associated persons, other than an Exempt Person (as defined
below), has acquired, or obtained the right to acquire, beneficial ownership of
more than 15% of the outstanding shares of Common Stock (an "Acquiring Person")
or (ii) 10 business days (subject to extension by the Board) following the
commencement of a tender offer or exchange offer that would result in a person
or group, other than an Exempt Person, beneficially owning more than 15% of such
outstanding shares of Common Stock (the earlier of (i) and (ii) being the
"Distribution Date"). Until the Distribution Date, (i) the Rights will be
evidenced by the Common Stock certificates and will be transferred with and only
with such Common Stock certificates, (ii) new Common Stock certificates issued
subsequent to the Record Date will contain a notation incorporating the Rights
Agreement by reference and (iii) the surrender for transfer of any certificates
for outstanding Common Stock will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificates. Pursuant to
the Rights Agreement, the Company reserves the right to require prior to the
occurrence of a Triggering Event (as defined below) that, upon the exercise of
Rights, a number of Rights be exercised so that only whole shares of Preferred
Stock will be issued. The term "Exempt
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Person" includes, among others, the Company, any subsidiary of the Company and,
in certain circumstances, a person or group beneficially owning 15% or more of
the outstanding shares of Common Stock as of the Record Date but only if the
percentage of outstanding Common Stock owned by such person or group does not at
any time exceed the sum of (A) the lowest percentage of the outstanding Common
Stock owned by such person or group at any time after the Record Date and (B) 1%
of the shares of Common Stock then outstanding.
The Rights are not exercisable until the Distribution Date and
will expire at the close of business on January 27, 2008 unless earlier
redeemed, extended or terminated by the Company as described below. At no time
will the Rights have any voting power.
As soon as practicable after the Distribution Date, separate
Rights Certificates will be mailed to holders of record of the Common Stock as
of the close of business on the Distribution Date, and thereafter, the Rights
will trade separately, and the Rights Certificates alone will represent the
Rights. Except as otherwise determined by the Board, only shares of Common Stock
issued prior to the Distribution Date will be issued with Rights.
In the event (a "Section 11(a)(ii) Event") that any person or
group becomes an Acquiring Person, each holder of a Right will thereafter have
the right to receive, upon exercise thereof, Common Stock or, in the discretion
of the Board, Units, (or, in certain circumstances, cash, property or other
securities of the Company) having a Current Market Price (as defined in the
Rights Agreement) equal to two times the Purchase Price of the Right.
Notwithstanding any of the foregoing, following the occurrence of any Section
11(a)(ii) Event, all Rights that are, or (under certain circumstances specified
in the Rights Agreement) were, beneficially owned by specified Acquiring Persons
(or by certain related persons) will be null and void. However, Rights are not
exercisable following the occurrence of any Section 11(a)(ii) Event until such
time as the Rights are no longer redeemable by the Company as set forth below.
For example, at an exercise price of $140 per Right, each
Right not owned by a specified Acquiring Person (or by certain related persons)
following a Section 11(a)(ii) Event would entitle its holder to purchase $280
worth of Common Stock (or other consideration, as noted above) for $140.
Assuming that the Common Stock had a Current Market Price of $20 at such time,
the holder of each valid Right would be entitled to purchase 14 shares of Common
Stock for $140.
In the event (a "Section 13 Event") that, at any time
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on or after the Stock Acquisition Date, (i) the Company shall take part in a
merger or other business combination transaction in which the Company is not the
surviving entity or in which the Common Stock is changed into or exchanged for
other securities, cash or any other property of any other person or (ii) 50% or
more of the Company's assets or earning power is sold or transferred, each
holder of a Right (except Rights which previously have been voided, as set forth
above) shall thereafter have the right to receive, upon payment of the exercise
price, common stock of the acquiring company having a Current Market Price equal
to two times the exercise price of the Right. Section 11(a)(ii) Events and
Section 13 Events are collectively referred to as "Triggering Events."
The Purchase Price payable and the number of Units of
Preferred Stock (or the amount of cash, property or other securities) 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) in the event that
holders of the Preferred Stock are granted certain rights or warrants to
subscribe for 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
quarterly cash dividends) or of subscription rights or warrants (other than
those referred to above).
With certain exceptions, no adjustments in the Purchase Price
will be required until cumulative adjustments amount to at least 1% of the
Purchase Price. The Company may, but is not required to, issue fractional shares
of Preferred Stock upon the exercise of any Right or Rights. In lieu thereof, an
adjustment in cash will be made based on the Current Market Price of the
Preferred Stock.
At any time until 10 business days following the Stock
Acquisition Date (or such later date as the Board may determine before the
Rights become nonredeemable), the Company may redeem the Rights in whole, but
not in part, at a price of $.001 per Right (payable, at the option of the
Company, in cash, Common Stock or such other consideration deemed appropriate by
the Board). Immediately upon the effectiveness of any action of the Board
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 of $.001 per
Right.
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
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taxable to stockholders or to the Company, stockholders may, depending upon the
circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or cash, property or other securities) of the
Company or for common stock of the acquiring company as set forth above.
The terms of the Rights may be amended by the Company (a) in
any manner prior to the time the Rights separate and are distributed and (b)
after the time the Rights separate and are distributed, in order to (i) cure any
ambiguity, (ii) correct or supplement provisions which may be defective or
inconsistent, (iii) make changes which do not adversely affect interests of
holders of Rights (other than those of an Acquiring Person and certain related
persons) or (iv) shorten or lengthen any time period under the Rights Agreement
for the purpose of protecting, enhancing or clarifying the rights of, or the
benefits to, the holders of Rights (other than an Acquiring Person and certain
related persons); provided, however, that no extension or amendment to adjust
the time period for redemption is permitted after the Rights become
nonredeemable.
A Registration Statement on Form 8-A with respect to the
Rights has been filed with the Securities and Exchange Commission. The Rights
have certain antitakeover effects. The Rights will cause substantial dilution to
a person or group that attempts to acquire the Company without conditioning the
offer on substantially all the Rights being acquired. The Rights will not
interfere with any merger or other business combination or with a third party
approved by the Board of Directors of the Company since the Board of Directors
of the Company may, at its option, at any time prior to any person becoming an
Acquiring Person, redeem all but not less than all of the then outstanding
Rights at the Redemption Price.
A Registration Statement on Form 8-A with respect to the
Rights has been filed with the Securities and Exchange Commission. A copy of the
Rights Agreement is being filed with the Securities and Exchange Commission as
an Exhibit to a Registration Statement on Form 8-A. A copy of the Rights
Agreement is available free of charge from the Company or the Rights Agent. 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
incorporated herein by reference.
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ITEM 7. EXHIBITS.
Number Title
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4(a) Rights Agreement dated as of January 27, 1998, between Project
Software & Development, Inc. and BankBoston, N.A., as Rights Agent.
4(b) Form of Certificate of Designation of Series A Junior Participating
Preferred Stock of Project Software & Development, Inc. (which is
attached as Exhibit A to the Rights Agreement filed as Exhibit 4(a)
hereto).
4(c) Form of Rights Certificate (which is attached as Exhibit B to the
Rights Agreement filed as Exhibit 4(a) hereto).
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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, thereunto duly authorized.
PROJECT SOFTWARE & DEVELOPMENT,
INC.
Dated: February 2, 1998 By: /s/ David M. Sample
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David M. Sample
President, Chairman and Chief
Executive Officer
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EXHIBIT INDEX
Pursuant to Item 601 of Regulation S-K
Number Title
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4(a) Rights Agreement dated as of January 27, 1998, between Project
Software & Development, Inc. and BankBoston, N.A., as Rights Agent.
4(b) Form of Certificate of Designation of Series A Junior Participating
Preferred Stock of Project Software & Development, Inc. (which is
attached as Exhibit A to the Rights Agreement filed as Exhibit 4(a)
hereto).
4(c) Form of Rights Certificate (which is attached as Exhibit B to the
Rights Agreement filed as Exhibit 4(a) hereto).