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): February 11, 2000
LabOne, Inc.
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(Exact name of registrant as
specified in its charter)
Missouri 0-16946 43-1039532
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(State or other jurisdiction (Commission (I. R. S. Employer
or incorporation File Number) Identification No.)
10101 Renner Road,
Lenexa, KS 66219
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(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: 913-888-1770
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Not Applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Information
On February 11, 2000, the Board of Directors of LabOne, Inc. (the
"Company") adopted a shareholder rights plan. The rights plan replaces and
modernizes a shareholder rights plan which was adopted by the Company in 1988
and expired in 1998.
Declaration of Rights Dividend
In conjunction with the rights plan, the Board of Directors declared a
dividend distribution of one Right for each outstanding share of Common Stock,
$.01 par value per share, of the Company ("Common Stock"). The dividend is
payable on February 25, 2000 to shareholders of record at the close of business
on that date. Each Right entitles the registered holder thereof to purchase from
the Company at any time following the Distribution Date (as defined below) a
unit consisting of one one-hundredth of a share (a "Unit") of Series A Preferred
Stock, $.01 par value per share (the "Preferred Stock"), at a purchase price of
$50.00 per Unit (the "Purchase Price"), subject to adjustment as described
below. The Rights are not exercisable until the Distribution Date. The
description and terms of the Rights are set forth in a Rights Agreement dated
February 11, 2000 (the "Rights Agreement") between the Company and American
Stock Transfer & Trust Company, as Rights Agent.
Rights will also be issued with respect to shares of Common Stock issued
by the Company or transferred from the Company's treasury after February 25,
2000 and prior to the Distribution Date, and, under certain circumstances,
Rights will be issued with respect to shares of Common Stock issued or
transferred by the Company after the Distribution Date.
Rights Initially Attached to and Trade with Common Stock
Until the earlier of the Distribution Date or the date the Rights are
redeemed or expire: (1) the Rights will be evidenced by Common Stock
certificates and no separate Rights Certificates will be distributed, (2) the
Rights will be transferable only in connection with the transfer of the
underlying shares of Common Stock, (3) the surrender for transfer of any Common
Stock certificate (with or without a copy of this Summary of Rights attached
thereto) will also constitute the transfer of the Rights associated with the
shares of Common Stock represented by such certificate and (4) new Common Stock
certificates issued after February 25, 2000 will contain a notation
incorporating the Rights Agreement by reference. Shareholders will not be
required to take any action in connection with the payment of the Rights
dividend on February 25, 2000.
When Rights Separate from Common Stock and Become Exercisable
The Rights will separate from the Common Stock and become exercisable on
the Distribution Date, which will occur upon the earlier of (1) ten business
days after the Stock Acquisition Date (as defined below) or (2) ten business
days (or such later date as the Board shall determine prior to such time as
there is an Acquiring Person) following the commencement of, or announcement of
an intention to make, a tender or exchange offer, the consummation of which
would result in a Person becoming an "Acquiring Person." The "Stock Acquisition
Date" means the earlier of (i) the date of the first public announcement by the
Company or an Acquiring Person that an Acquiring Person has become such or (ii)
the date on which the Company has actual notice, direct or indirect, or
otherwise determines that a Person has become an Acquiring Person. As soon as
practicable after the Distribution Date, Rights Certificates will be mailed to
holders of record of
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the Common Stock as of the close of business on the Distribution Date, and
thereafter the separate Rights Certificates will represent the Rights.
Under the Rights Agreement, an Acquiring Person is a Person who, together
with all affiliates and associates of such Person, and without the prior written
approval of the Company, is the Beneficial Owner (as defined in the Rights
Agreement) of 15% or more of the outstanding shares of Common Stock of the
Company, subject to a number of exceptions set forth in the Rights Agreement.
The Rights Agreement exempts certain persons from the definition of "Acquiring
Person," including (1) Grant Family Members (as defined in the Rights
Agreement), who currently beneficially own approximately 17.4% of the
outstanding shares of Common Stock, unless such family members become (other
than with the prior written approval of the Board of Directors or pursuant to a
Qualifying Offer) the Beneficial Owners of 20% or more of the shares of Common
Stock then outstanding, excluding shares of Common Stock and other securities
acquired on or after February 11, 2000 pursuant to certain employee or director
benefit plans, (2) the Company or any subsidiary of the Company and (3) any
employee benefit plan of the Company or any subsidiary and certain persons
appointed pursuant to the terms of any such plan. Under the Rights Agreement, a
Person shall not be an Acquiring Person if such Person acquires beneficial
ownership of 15% or more of the outstanding shares of Common Stock pursuant to a
Qualifying Offer, which is a cash tender offer for all of the outstanding shares
of Common Stock which meets certain conditions specified in the Rights
Agreement. The Rights Agreement contains exceptions for Persons who
inadvertently become Acquiring Persons or who exceed the ownership limits as a
result of repurchases of stock by the Company, if certain conditions are
satisfied.
Adjustment of Rights upon Occurrence of a Triggering Event
In the event that a Person becomes an Acquiring Person, each holder of a
Right (except the Acquiring Person and certain other persons as described below)
will no longer have the right to purchase Units of Preferred Stock, but instead
will thereafter have the right to receive, upon exercise of the Right, shares of
Common Stock (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 then current exercise price of the Right. For
example, at a Purchase Price of $50 per Right, each Right not owned by an
Acquiring Person would entitle its holder to purchase $100 worth of Common Stock
(or other consideration, as noted above) for $50. Assuming that the Common Stock
has a per share value of $10 at such time, the holder of each valid Right would
be entitled to purchase ten shares of Common Stock for $50. Once a Person
becomes an Acquiring Person, all Rights that are, or under certain circumstances
were, beneficially owned by such Acquiring Person (or certain related parties)
will be null and void.
In the event that, at any time after the Stock Acquisition Date, (1) the
Company is acquired in a merger or other business combination transaction in
which the Company is not the surviving corporation (other than a merger which
follows a Qualifying Offer and satisfies certain other requirements), or (2) 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 exercise, common stock
of the acquiring company having a Current Market Price equal to two times the
then current Purchase Price of the Right. The events set forth in this paragraph
and in the preceding paragraph which allow Rights
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to be exercised are referred to individually as a "Triggering Event" and
collectively as "Triggering Events."
Exchange of Rights
At any time after any Person becomes an Acquiring Person, the Board of
Directors of the Company may, at its option, exchange the Rights (except Rights
which previously have been voided as set forth above), in whole or in part, at
an exchange ratio of one-hundredth of a share of Preferred Stock or one share of
Common Stock for each Right, subject to adjustment for any stock split, stock
dividend or similar transaction occurring after February 25, 2000. The Board of
Directors may not cause the exchange of Rights at any time after any Person,
together with such person's affiliates and associates, becomes the beneficial
owner of 50% or more of the shares of Common Stock then outstanding, with
certain exceptions.
Redemption of Rights
At any time prior to the close of business on the tenth business day after
the Stock Acquisition Date, the Company may order that all Rights be redeemed at
a price of $.01 per Right (payable in cash, Common Stock or other consideration
deemed appropriate by the Board of Directors), subject to adjustment for any
stock split, stock dividend or similar transaction occurring after February 25,
2000 (the "Redemption Price"). Immediately upon the effectiveness of the action
of the Board of Directors ordering redemption of the Rights, the right to
exercise the Rights will terminate and the holders of the Rights will only be
entitled to receive the Redemption Price for each Right so held.
Amendment of Rights
At any time and from time to time prior to the close of business on the
tenth business day after the Stock Acquisition Date, the Company may amend the
Rights in any manner without the approval of any holders of Rights. At any time
and from time to time after the close of business on the tenth business day
after the Stock Acquisition Date, the Company may supplement or amend the Rights
without the approval of any holders of the Rights, provided that no such
supplement or amendment adversely affects the interests of the holders of Rights
as such (other than an Acquiring Person or an affiliate or associate of an
Acquiring Person).
Terms of Preferred Stock
Each Unit of Preferred Stock (consisting of one one-hundredth of a share
of Preferred Stock) that is issuable upon exercise of the Rights after the
Distribution Date and prior to the occurrence of a Triggering Event is intended
to have approximately the same economic rights and voting power as a share of
Common Stock, and the value of a Unit of Preferred Stock should approximate the
value of one share of Common Stock. Each share of Preferred Stock will be
entitled to dividend payments equal to 100 times the aggregate per share amount
of all dividends (other than a dividend payable in Common Stock) declared per
share of Common Stock. In the event of liquidation, the holders of shares of
Preferred Stock will be entitled to the greater of (a) a minimum preferential
liquidation payment of $100 per share, or (b) 100 times the aggregate
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amount to be distributed per share of Common Stock. Each share of Preferred
Stock will have 100 votes, voting together with, and on the same matters as, the
Common Stock. In the event of any merger, consolidation or other transaction in
which shares of Common Stock are exchanged for or changed into other stock,
securities, cash and/or other property, each share of Preferred Stock will be
entitled to receive 100 times the amount received per share of Common Stock.
These rights are protected by customary anti-dilution provisions. Shares of
Preferred Stock are not redeemable. Pursuant to the Rights Agreement, the
Company reserves the right to require, prior to the occurrence of a Triggering
Event, that upon any exercise of Rights a number of Rights be exercised so that
only whole shares of Preferred Stock will be issued.
Adjustment of Rights and Securities Upon Certain Events
The Purchase Price payable, and the number of Units 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 (1) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, or (2) upon the distribution to holders of the Preferred Stock of certain
rights, options, warrants, evidences of indebtedness or assets (excluding
regular quarterly cash dividends). No adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least 1% of the Purchase
Price.
The number of outstanding Rights attached to each share of Common Stock
and the number of Units of Preferred Stock purchasable upon exercise of a Right
are also subject to adjustment in the event of a stock split of the Common Stock
or a stock dividend on the Common Stock payable in shares of Common Stock or a
subdivision or combination of the shares of Common Stock, occurring prior to the
Distribution Date.
The Company is not required to issue fractional Units; in lieu thereof,
the Company may pay cash for such fractional Units based on the market price of
the Preferred Stock on the last trading date prior to the date of issuance.
Rights Holder Not a Shareholder
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 holders of Rights will be able to vote and
receive dividends on the Common Stock that they hold.
Tax Consequences
While the current distribution of the Rights will not be taxable to
shareholders or to the Company, shareholders might, depending upon the
circumstances, realize taxable income in the event that the Rights become
severable from the Common Stock and will likely realize taxable income in the
event such Rights become exercisable for common stock of the acquiring company
as set forth above or are exchanged as provided above.
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Expiration of Rights
The Rights will expire at the close of business on February 25, 2010,
unless the Company redeems or exchanges the Rights prior to such date, in each
case as described above.
Rights Agreement
This summary description of the Rights does not purport to be complete and
is qualified in its entirety by reference to the Rights Agreement and the
exhibits thereto, filed herewith as Exhibit 4.1, which is incorporated herein by
reference.
Item 7. Financial Statements and Exhibits
(c) Exhibits
4.1 Rights Agreement dated as of February 11, 2000, between LabOne, Inc.
and American Stock Transfer & Trust Company, which includes as
Exhibit A, the Certificate of Designations Preferences and Rights of
Series A Preferred Stock, as Exhibit B, the Form of Rights
Certificate, and as Exhibit C, the Summary of Rights to Purchase
Preferred Stock.
99.1 Press Release of the Company dated February 11, 2000
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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.
LABONE, INC.
Date: February 11, 2000 By: /s/ Kurt E. Gruenbacher
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Kurt E. Gruenbacher,
V.P. Finance, Chief Accounting
Officer and Treasurer
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EXHIBIT INDEX
Assigned
Exhibit
Number Description of Exhibit
4.1 Rights Agreement dated as of February 11, 2000, between LabOne, Inc.
and American Stock Transfer & Trust Company, which includes as
Exhibit A, the Certificate of Designations Preferences and Rights of
Series A Preferred Stock, as Exhibit B, the Form of Rights
Certificate, and as Exhibit C, the Summary of Rights to Purchase
Preferred Stock.
99.1 Press Release of the Company dated February 11, 2000
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