SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
CUSTOM CHROME, INC.
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(Exact name of Registrant as specified in its charter)
Delaware 94-1716138
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(State of incorporation or organization) (IRS Employer Identification No.)
16100 Jacqueline Court
Morgan Hill, CA 95037
(Address of principal executive offices) (Zip Code)
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Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
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None None
Securities to be registered pursuant to Section 12(g) of the Act:
Preferred Share Purchase Rights
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(Title of Class)
Item 1. Description of Securities to be Registered.
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On November 13, 1996, pursuant to a Preferred Shares Rights Agreement
(the "Rights Agreement") between Custom Chrome, Inc. (the "Company") and
American Stock Transfer and Trust Company, as Rights Agent (the "Rights Agent"),
the Company's Board of Directors declared a dividend of one right (a "Right") to
purchase one one-thousandth of a share of the Company's Series A Participating
Preferred Stock, $0.001 par value ("Series A Preferred") for each outstanding
share of Common Stock, $0.001 par value ("Common Shares"), of the Company. The
dividend is payable on December 13, 1996 (the "Record Date") to stockholders of
record as of the close of business on that date. Each Right entitles the
registered holder to purchase from the Company one one-thousandth of a share of
Series A Preferred at an exercise price of $80.00 (the "Purchase Price"),
subject to adjustment as provided for in the Rights Agreement.
The following summary of the principal terms of the Rights Agreement
is a general description only and is subject to the more detailed terms and
conditions of the Rights Agreement. A copy of the Rights Agreement is attached
as Exhibit 4 to this Registration Statement and is incorporated herein by
reference.
Rights Evidenced by Common Share Certificates
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The Rights will not be exercisable until the Distribution Date
(hereinafter defined). Certificates for the Rights ("Rights Certificates") will
not be sent to stockholders and the Rights will attach to and trade only
together with the Common Shares. Accordingly, Common Share certificates
outstanding on the Record Date will evidence the Rights related thereto, and
Common Share certificates issued after the Record Date will contain a legend
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender or transfer of
any certificates for Common Shares, outstanding as of the Record Date, even
without notation or a copy of the Summary of Rights being attached thereto, will
also constitute the transfer of the Rights associated with the Common Shares
represented by such certificate. The Rights will be transferable only in
connection with the transfer of Common Shares prior to the Distribution Date.
Distribution Date
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The Rights will separate from the Common Shares, Rights Certificates
will be issued and the Rights will become exercisable upon the earlier of: (i)
10 days (or such later date as may be determined by a majority of the Board of
Directors, excluding directors affiliated with the Acquiring Person, as defined
below (the "Continuing Directors")) following a public announcement that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 15% or more of the outstanding Common Shares,
including Common Shares held by affiliates or associates of the Acquiring
Person, or (ii) 10 business days (or such later date as may be determined by a
majority of the Continuing Directors then in office) following the commencement
of, or announcement of an intention to make, a tender offer or exchange offer
the consummation of which would result in the beneficial ownership by a person
or group of 15% or more of the outstanding Common Shares.
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Issuance of Rights Certificates; Expiration of Rights
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As soon as practicable following the Distribution Date, separate
Rights Certificates will be mailed to holders of record of the Common Shares as
of the close of business on the Distribution Date and such separate Rights
Certificates alone will evidence the Rights from and after the Distribution
Date. All Common Shares issued prior to the Distribution Date will be issued
with Rights. As of the Distribution Date, the Rights will be evidenced solely
by the Rights Certificates and may be transferred separately and apart from any
transfer of one or more Common Shares. In general, Rights will be issued in
respect of all Common Shares issued after the Record Date but prior to the
earlier of the Distribution Date or Final Expiration Date (as hereinafter
defined), unless the Board of Directors specifies to the contrary at or before
the time of the issuance of the Common Shares (including issuances of Common
Shares pursuant to the exercise of rights under the Company's benefit plans).
The Rights will expire on the earliest of (i) November 13, 2006 (the "Final
Expiration Date") or (ii) redemption or exchange of the Rights as described
below.
Initial Exercise of the Rights
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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 $80.00 per Right, one one-thousandth share of the
Series A Preferred.
Right to Buy Company Common Shares
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Unless the Rights are earlier redeemed, in the event that an Acquiring
Person becomes the beneficial owner of 15% or more of the Company's Common
Shares then outstanding, then proper provision will 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, Common Shares having a
value equal to two times the Purchase Price. In the event that the Company does
not have sufficient Common Shares available for all Rights to be exercised, or
the Board decides that such action is necessary or appropriate and not contrary
to the interests of Rights holders, the Company may instead reduce the Purchase
Price or substitute cash, assets or other securities having an aggregate value
equivalent to the excess of (i) the value of the Common Shares issuable upon
exercise of the Rights over (ii) the Purchase Price to be paid upon exercise of
the Rights. 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
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Similarly, unless the Rights are earlier redeemed, in the event that,
after an Acquiring Person becomes the beneficial owner of 15% or more of the
Company's Common Shares then outstanding, (i) the Company is acquired in a
merger or other business combination transaction (whether or not the Company is
the surviving entity), or (ii) 50% or more of the Company's consolidated assets
or earning power are sold, proper provision must be made so that each holder of
a Right which has not theretofore
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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 (free of any restrictions) of the acquiring
company having a value equal to two times the Purchase Price.
Exchange Provision
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At any time after the acquisition by an Acquiring Person of 15% or
more of the Company's outstanding Common Shares and prior to the acquisition by
such Acquiring Person of 50% or more of the Company's outstanding Common Shares,
the Board of Directors of the Company may exchange the Rights (other than Rights
owned by the Acquiring Person), in whole or in part, at an exchange ratio of one
Common Share per Right.
Redemption
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At any time on or prior to the close of business on the earlier of (i)
the 10th day following the first public announcement by the Company or Acquiring
Person that the Acquiring Person has become such (the "Share Acquisition Date")
or such later date as may be determined by a majority of the Continuing
Directors and publicly announced by the Company, or (ii) the Final Expiration
Date of the Rights, the Company may redeem the Rights in whole, but not in part,
at a price of $0.01 per Right (the "Redemption Price"). The Company may, at its
option, pay the Redemption Price either in Common Shares or cash. If the Board
of Directors authorizes the redemption of the Rights after a person becomes an
Acquiring Person, then a majority of the Continuing Directors are required to
authorize the redemption of the rights. Immediately upon action by the Board of
Directors redeeming the Rights as described above, the Rights will terminate and
the only right thereafter of the holders of Rights is to receive the Redemption
Price.
Adjustments to Prevent Dilution
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The Purchase Price payable, the number of Rights, and the number of
Series A Preferred or Common Shares or other securities or property issuable
upon exercise of the Rights are subject to adjustment from time to time in
connection with 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.
Cash Paid Instead of Issuing Fractional Shares
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No fractional portion less than integral multiples of one Common Share
will be issued upon exercise of a Right and in lieu thereof, an adjustment in
cash will be made based on the market price of the Common Shares on the last
trading date prior to the date of exercise.
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No Stockholders' 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 (other than any rights resulting from
such stockholder's ownership of Common Shares), including, without limitation,
the right to vote or to receive dividends.
Amendment of Rights Agreement
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The provisions of the Rights Agreement may be supplemented or amended
by the Board of Directors in any manner without the approval of the Rights
holders prior to the date on which the Rights are distributed separate from the
Common Shares. After such date, the provisions of the Rights Agreement may be
amended by the Board in order to cure any ambiguity, defect or inconsistency, to
make changes which do not adversely affect the interests of holders of Rights
(excluding the interests of any Acquiring Person), or to shorten or lengthen any
time period under the Rights Agreement; provided, however, that no amendment to
adjust the time period governing redemption shall be made at such time as the
Rights are not redeemable.
Rights and Preferences of the Series A Preferred
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Series A Preferred purchasable upon exercise of the Rights will not be
redeemable. Each share of Series A Preferred will be entitled to an aggregate
dividend of 1,000 times the aggregate per share amount of all dividends declared
(including noncash dividends and other distributions) per Common Share. In the
event of liquidation, the holders of each share of Series A Preferred will be
entitled to receive 1,000 times the per share consideration being distributed
with respect to each Common Share plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of
such payment. Each share of Series A Preferred will have 1,000 votes, voting
together with the Common Shares. These rights are protected by certain anti-
dilution provisions, including a proportional adjustment to the number of
outstanding shares of Series A Preferred in the event the Company (i) declares a
dividend on Common Shares payable in Common Shares, (ii) subdivides the
outstanding Common Shares, or (iii) combines the outstanding Common Shares into
a smaller number of shares.
Because of the nature of the dividend, liquidation and voting rights
of the shares of Series A Preferred, the value of the one one-thousandth
interest in a share of Series A Preferred purchasable upon exercise of each
Right should approximate the value of one Common Share.
Certain Anti-takeover Effects
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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 acquiror to take over the Company, in a manner or on
terms not approved by the Board of Directors. Takeover attempts frequently
include coercive tactics to deprive the Company's Board of Directors and its
stockholders of any real opportunity to determine the destiny of the Company.
The Rights have been declared by the
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Board in order to deter such tactics, including a gradual accumulation of shares
in the open market of a 15% or greater position to be followed by a merger or a
partial or two-tier tender offer that does not treat all stockholders equally.
These tactics unfairly pressure stockholders into making ill-advised investment
decisions, squeeze them out of their investment without giving them any real
choice and deprive them of the full value of their equity interest.
The Rights are not intended to prevent a takeover of the Company and
will not do so. The Rights may be redeemed by the Company at $0.01 per Right
within ten days (or such later date as may be determined by a majority of the
Continuing Directors) after the public announcement that 15% or more of the
Company's shares have been acquired by a single acquiror or group. Accordingly,
the Rights should not interfere with any merger or business combination approved
by the Board of Directors.
Issuance of the Rights does not in any way weaken the financial
strength of the Company or interfere with its business plans. The issuance of
the Rights themselves has no dilutive effect, will not affect reported earnings
per share, should not be taxable to the Company or to its stockholders, and will
not change the way in which the Company's shares are presently traded. The
Company's Board of Directors believes that the Rights represent a sound and
reasonable means of addressing the complex issues of corporate policy created by
the current takeover environment.
However, the Rights may have the effect of rendering more difficult or
discouraging an acquisition of the Company deemed undesirable by the Board of
Directors. 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
Company's Board of Directors, except pursuant to an offer conditioned upon the
negation, purchase or redemption of the Rights.
Item 2. Exhibits.
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1. Specimen Certificate for the Company's Common Stock. (1)
2. Restated Certificate of Incorporation of the Company. (2)
3. Bylaws of the Company, as amended. (3)
4. Preferred Shares Rights Agreement, dated as of November 13, 1996
between Custom Chrome, Inc. and American Stock Transfer and Trust
Company, including the Certificate of Designation, the form of
Rights Certificate and the Summary of Rights attached thereto as
Exhibits A, B and C, respectively. (4)
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(1) Incorporated by reference to an exhibit filed with the Company's
Registration Statement on Form S-1 (Commission File No. 33-42875) declared
effective by the Securities and Exchange Commission on November 5, 1991.
(2) Incorporated by reference to an exhibit filed with the Company's Annual
Report on Form 10-K (File No. 00019540) filed with the Securities and
Exchange Commission on April 30, 1992.
(3) Incorporated by reference to an exhibit filed with the Company's
Registration Statement of Form S-1 (Commission File No. 33-42875) declared
effective by the Securities and Exchange Commission on November 5, 1991.
(4) Exhibit filed herewith.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereto duly authorized.
Custom Chrome, Inc.
Date: December 9, 1996
By: /s/ Ignatius J. Panzica
____________________________________________
Ignatius J. Panzica
Chairman of the Board, President and
Chief Executive Officer
EXHIBIT INDEX
Exhibit
No. Exhibit
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1 Preferred Shares Rights Agreement, dated as of November 13,
1996 between Custom Chrome, Inc. and American Stock Transfer
and Trust Company, including the Certificate of Designation, the
form of Rights Certificate and the Summary of Rights attached
thereto as Exhibits A, B and C, respectively.