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FORM 8-A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
SCHLOTZSKY'S, INC.
(Exact name of registrant as specified in its charter)
Texas 74-2654208
(State of incorporation (I.R.S. Employer
or organization) Identification No.)
203 Colorado Street, Austin, Texas 78701
(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
to be registered on which 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
Stock Purchase Rights.
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
On December 18, 1998, the Board of Directors of Schlotzsky's, Inc. (the
"COMPANY") adopted a Stockholder Rights Plan, providing that one right (a
"RIGHT") will be attached to each share of common stock, no par value, of the
Company (the "COMMON STOCK") as of December 30, 1998 (the "RECORD DATE"). Each
Right entitles the registered holder to purchase from the Company one
one-hundredth of a share of Class C Series A Junior Participating Preferred
Stock, no par value (the "PREFERRED STOCK"), at a Purchase Price of $75.00
per one one-hundredth of a share (the "PURCHASE PRICE"), subject to
adjustment. The description and terms of the Rights are set forth in the
Rights Agreement (the "RIGHTS AGREEMENT"), dated as of December 18, 1998,
between the Company and Harris Trust and Savings Bank, as Rights Agent (the
"RIGHTS AGENT").
Initially, the Rights will be attached to all Common Stock certificates
representing shares outstanding as of the Record Date, and no separate Rights
Certificate will be distributed. The Rights will separate from the Common Stock
and a distribution date ("Distribution Date") will occur upon the earlier of (i)
10 days following a public announcement that a person or group of affiliated or
associated persons (an "ACQUIRING PERSON") has acquired, or obtained the right
to acquire, beneficial ownership of 20% or more of the outstanding shares of
Common Stock (the "STOCK ACQUISITION DATE"), or (ii) 10 business days following
the commencement of a tender offer or exchange offer that would result in a
person or group beneficially owning 20% or more of such outstanding shares of
Common Stock. 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 will contain a
notation incorporating the Rights Agreement by reference; and (iii) the
surrender for transfer of any certificates for Common Stock outstanding will
also constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
The Rights Agreement provides that John C. Wooley, Jeffrey J. Wooley and
certain of their successors and affiliates, who together will be beneficial
owners of approximately 12.5% of the Common Stock of the Company outstanding on
December 18, 1998, are excluded from the definition of "Acquiring Person."
The Rights are not exercisable until the Distribution Date and will expire
at the close of business on December 18, 2008, unless earlier redeemed by the
Company as described below.
As soon as practicable after the Distribution Date, 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 separate Rights
Certificates alone will represent the Rights. Except as otherwise determined by
the Board of Directors, only shares of Common Stock outstanding prior to the
Distribution Date will be issued with Rights.
In the event that (i) the Company is the surviving corporation in a merger
or combination with any Acquiring Person, or any Associate or Affiliate of any
Acquiring Person, and its
Common Stock remains outstanding, (ii) any Acquiring Person, or any Associate
or Affiliate of any Acquiring Person, engages in one or more "self-dealing"
transactions as set forth in the Rights Agreement, (iii) an Acquiring Person
becomes the beneficial owner of 20% or more of the then outstanding shares of
Common Stock or 20%, or (iv) during such time as there is an Acquiring
Person, an event occurs that results in such Acquiring Person's ownership
interest being increased by more than 1% (E.G., a reverse stock split or
recapitalization), each holder of a Right will thereafter have the right to
receive, upon exercise, Common Stock (or, in certain circumstances, cash,
property, or other securities of the Company), having a value equal to two
times the Exercise Price of the Right. The Exercise Price is the Purchase
Price times the number of shares of Common Stock associated with each Right
(initially, one). Notwithstanding any of the foregoing, following the
occurrence of any of the events set forth in this paragraph (the "Flip-In
Events"), all Rights that are, or (under certain circumstances specified in
the Rights Agreement) were, beneficially owned by any Acquiring Person, or an
Associate or Affiliate of any Acquiring Person, will be null and void.
However, Rights are not exercisable following the occurrence of any of the
Flip-In Events set forth above until such time as the Rights are no longer
redeemable by the Company as set forth below.
For example, at an exercise price of $75 per Right, each Right not owned by
an Acquiring Person (or by certain related parties) following an event set forth
in the preceding paragraph would entitle its holder to purchase Common Stock
with a value of $150 (or other consideration, as noted above) for $75. Assuming
that the Common Stock had a per share value of $75 at such time, the holder of
each valid Right would be entitled to purchase 2.0 shares of Common Stock for
$75. Alternatively, the Company could permit the holder to surrender each Right
in exchange for stock, cash, or other property equivalent to one share of Common
Stock (with a value of $75) without the payment of any consideration other than
the surrender of the Right.
In the event that following the Stock Acquisition Date, (i) the Company is
acquired in a merger or consolidation in which the Company is not the surviving
corporation 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 have previously been
voided as set forth above) will thereafter have the right (a flip-over right) to
receive, upon exercise of the Right, Common Stock of the acquiring company
having a value equal to two times the Exercise Price of the Right.
The Purchase Price payable, and the number of shares 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 (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, (ii) if 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. No fractional shares will be
issued and, in lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Stock on the last trading date prior to the
date of exercise.
At any time until 10 days following the Stock Acquisition Date, the Company
may redeem the Rights in whole, but not in part, at a price of $.001 per Right.
The ten day redemption period may be extended by the Board of Directors so long
as the Rights are still redeemable. Immediately upon the action of the Board of
Directors ordering redemption of the Rights, the Rights will terminate and the
only right of the holders of Rights will be to receive the $.001 redemption
price.
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 for Common Stock (or other consideration) of the Company as set
forth above.
Any of the provisions of the Rights Agreement may be amended by the Board
of Directors of the Company prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be amended by the
Board in order to cure any ambiguity, to make changes which do not adversely
affect the interests of holders of Rights (excluding the interest of any
Acquiring Person, or to shorten or lengthen any time period under the Rights
Agreement; provided that no amendment to adjust the time period governing
redemption will be made at such time as the Rights are not redeemable.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
in certain circumstances. Accordingly, the existence of the Rights may deter
certain acquirors from making takeover proposals or tender offers.
The Rights Agreement between the Company and the Rights Agent specifying
the terms of the Rights, which includes as Exhibit B the Form of Rights
Certificate, is attached as an exhibit and incorporated by reference. The
foregoing description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement.
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.
SCHLOTZSKY'S, INC.
By: /s/ John C. Wooley
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Name: John C. Wooley
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Title: Chairman of the Board and President
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Date: December 18, 1998
INDEX TO EXHIBITS
Sequentially
Description of Exhibit Numbered Page
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1. Articles of Incorporation of the Registrant, as --
amended (incorporated by reference to Exhibit to
the Registrant's Registration Statement on Form
S-1 (Registration No. 33-98004) filed with the
Securities and Exchange Commission on October 12,
1995)
2. Statement of Resolutions Regarding the Designation --
Rights, Preferences, and Rights of Class C Series A
Junior Participating Preferred Stock of the Registrant
(included as Exhibit A in Exhibit 3 filed herewith).
3. Rights Agreement dated as of December 18, 1998
between the Registrant and Harris Trust and
Savings Bank, as the Rights Agent (filed
herewith).