form8_k.htm
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): March 7,
2008
______________________
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INTERFACE,
INC.
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(Exact
name of Registrant as Specified in its
Charter)
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Georgia
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000-12016
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58-1451243
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(State
or other Jurisdiction of
incorporation
or Organization)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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2859
Paces Ferry Road, Suite 2000
Atlanta,
Georgia
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30339
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(Address
of principal executive offices)
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(Zip
code)
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Registrant’s
telephone number, including area code: (770) 437-6800
Not
Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
ITEM
1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On March 7, 2008, Interface, Inc.
(“Interface” or
the “Company”)
entered into a Rights Agreement, dated as of March 7, 2008 with an effective
date of March 17, 2008 (the “Agreement”), between
the Company and Computershare Trust Company, N.A. (the “Rights Agent”), which
is attached hereto as Exhibit 4.1, together with its exhibits, which include the
form of the Company’s Articles of Restatement to its Restated Articles of
Incorporation, the form of Rights Certificate and a Summary of the Rights and
the Agreement. As previously announced, the Agreement was approved by
the Board of Directors on February 20, 2008 to succeed the Company’s previous
rights agreement dated March 4, 1998 and effective as of March 16,
1998. The prior agreement expires on March 17, 2008.
In connection with the Agreement, the
Company declared a dividend of one preferred share purchase right (a “Right”) for each
outstanding share of the Company’s Common Stock, and authorized the issuance of
one Right for each share of Common Stock which shall become outstanding between
the Record Date (as hereinafter defined) and the earliest of the Distribution
Date (as hereinafter defined), the redemption of the Rights, or the expiration
date of the Rights. The dividend is payable at the close of business
on March 17, 2008 (the “Record Date”) to the
shareholders of record on that date. Each Right entitles the
registered holder to purchase from the Company one one-hundredth (1/100th) of a
share of Series B Participating Cumulative Preferred Stock of the Company (each
such 1/100th of a
share, a “Unit”), having the
rights, powers and preferences set forth in the Restated Articles of
Incorporation of the Company, as amended by the Articles of Restatement (the
“Series B Preferred
Stock”), at a price of $90.00 (the “Purchase Price”),
subject to adjustment. The description and terms of the Rights are
set forth in the Agreement.
Initially, the Rights will be attached
to the Common Stock then outstanding, and no separate certificates evidencing
the rights (“Rights
Certificates”) will be issued. The Rights will separate from
the Common Stock, Rights Certificates will be issued and the Rights will become
exercisable on the tenth day (the “Distribution Date”)
after the public announcement that a person or group has become an Acquiring
Person (as defined below) (the “Share Acquisition
Date”). An “Acquiring Person” is
a person that, together with its affiliates and associates, is the beneficial
owner of 15% or more of the outstanding Common Stock. Certain
persons, including the Company, any subsidiary of the Company, and Company
benefit plan related holders are excluded from the definition of Acquiring
Person. Moreover, a person or group of affiliated or associated
persons who acquires the beneficial ownership of 15% or more of the Common Stock
then outstanding either (i) by reason of share purchases by the Company reducing
the number of Common Stock outstanding (provided such person or group does not
acquire additional Common Stock), or (ii) inadvertently, if the Company’s Board
of Directors determines such 15% or more beneficial ownership was acquired
inadvertently (but only if at the time of such determination by the Board there
are then in office not less than two Continuing Directors (as defined below) and
such action is approved by a majority of the Continuing Directors then in
office) and, as promptly as practicable, such person or group divests itself of
enough Common Stock so as to no longer have the beneficial ownership of 15% or
more of the outstanding Common Stock, will not be an Acquiring
Person.
Until the Distribution Date, the Rights
will be evidenced by the certificates (or registrations in uncertificated
book-entry form on the books of the Company) for the Common Stock and not by
separate Rights Certificates. The 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), the surrender for transfer of any shares of Common
Stock outstanding as of the Record Date also will constitute the transfer of the
Rights associated with such Common Stock. As soon as practicable
following 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 such separate Right Certificates alone will evidence the
Rights.
If a person becomes an Acquiring
Person, other than pursuant to a Qualifying Tender Offer (as defined below),
then proper provisions shall be made so that each holder of a Right (except as
set forth below) will thereafter have the right to receive, upon exercise and
payment of the Purchase Price, Units having a value equal to twice the Purchase
Price. A “Qualifying Tender
Offer” means a tender or exchange offer for all outstanding shares of
Common Stock of the Company approved by a majority of the Continuing Directors
then in office.
Except for any transaction with a
person who has consummated a Qualifying Tender Offer which transaction is
approved by the Continuing Directors, if, at any time following the Share
Acquisition Date, (i) the Company is acquired in a merger, statutory share
exchange or other business combination in which the Company is not the surviving
corporation, (ii) the Company is merged with or into or combined or consolidated
with another entity and is the surviving corporation, but the Company’s Common
Stock is changed into or exchanged for other securities or assets, or (iii) the
Company sells or transfers assets aggregating more than 50% of its assets or
generating more than 50% of its operating income or cash flow, each holder of a
Right (except as set forth below) shall thereafter have the right to receive,
upon exercise and payment of the Purchase Price, common stock of the acquiring
company having a value equal to twice the Purchase Price. The events
set forth in this paragraph and the preceding paragraph are referred to as the
“Triggering
Events.”
Upon the occurrence of a Triggering
Event, Rights that are or were owned by the Acquiring Person, or any affiliate
or associate of such Acquiring Person, on or after such Acquiring Person's Share
Acquisition Date shall be null and void and may not thereafter be exercised by
any person (including subsequent transferees).
Because of the foregoing provisions,
the Rights may have certain anti-takeover effects. The Rights will
cause substantial dilution to a person or group that acquires 15% or more of the
outstanding shares of Common Stock or if another Triggering Event occurs without
the Rights having been redeemed or in the event of an Exchange (as defined
below). However, the Rights should not interfere with any merger or
other business combination approved in advance by the Board or a merger or other
business combination approved by the Board and the shareholders because the
Rights are redeemable under certain circumstances.
The Rights are not exercisable until
the Distribution Date. The Rights will expire on March 16, 2018 (the
“Expiration
Date”), unless the Expiration Date is extended or unless the Rights are
earlier redeemed or exchanged by the Company, in each case, as described
below.
The Purchase Price payable, and the
number of Units or other securities or property issuable, upon exercise of the
Rights, are subject to adjustment from time to time to prevent dilution in the
event of a stock dividend on, or a subdivision, combination or reclassification
of, the Series B Preferred Stock. The number of Units or other
securities or property issuable upon exercise of the Rights is also subject to
adjustment from time to time to prevent dilution in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Common
Stock.
At any time after any person becomes an
Acquiring Person, the Company (in the discretion of the Continuing Directors)
may exchange all or part of the Rights (other than Rights owned by the Acquiring
Person and certain affiliated persons) for shares of Common Stock (an “Exchange”) at an
exchange ratio of one share of Class A Common Stock per Right held by a holder
of Class A Common Stock and one share of Class B Common Stock per Right held by
a holder of Class B Common Stock, as appropriately adjusted to reflect any stock
split or similar transaction.
At any time until the close of business
on the tenth day after the Share Acquisition Date, 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’s right of redemption may be reinstated
if an Acquiring Person reduces his beneficial ownership to 10% or less of the
outstanding shares of Common Stock in a transaction or series of transactions
not involving the Company. Immediately upon the action of the Board
ordering redemption of the Rights, with, where required, the concurrence of the
Continuing Directors, the Rights will terminate and the only right of the
holders of Rights will be to receive the Redemption Price.
The term “Continuing Director”
means any member of the Board of Directors of the Company, while such Person is
a member of the Board, who is not an Acquiring Person or an affiliate or
associate of an Acquiring Person or a representative or nominee of an Acquiring
Person or of any such affiliate or associate, or otherwise affiliated with an
Acquiring Person or of any such affiliate or associate, and who either (i) was a
member of the Board on the effective date of the Agreement, or (ii) subsequently
becomes a member of the Board, if such Person’s nomination for election or
election to the Board is recommended or approved by a majority of the Continuing
Directors serving at the time of such nomination or election.
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. While the distribution of the Rights will not be taxable
to shareholders or to the Company, shareholders may, depending upon the
circumstances, recognize taxable income in the event that the Rights become
exercisable for Series B Preferred Stock (or other consideration) of the Company
or for common stock of the acquiring company as set forth above.
Prior to the Distribution Date, the
Agreement may be amended in any respect, other than, at such time as the Rights
are not redeemable, to change the Redemption Price, the Expiration Date, the
Purchase Price or the number of shares for which a Right is
exercisable. After the Distribution Date, the provisions of the
Agreement may be amended by the Board (in certain circumstances, with the
concurrence of the Continuing Directors) in order to cure any ambiguity, to make
changes that do not adversely affect the interests of the holders of Rights
(excluding the interests of an Acquiring Person), to correct or supplement any
provision which may be defective or inconsistent with any other provision, or to
shorten or lengthen any time period under the Agreement; provided, however, no
amendment to lengthen the time period governing redemption may be made at such
time as the Rights are not redeemable. After any person has become an
Acquiring Person, the Agreement may be amended only with the approval of a
majority of the Continuing Directors.
The dividend and liquidation rights of
the Series B Preferred Stock are designed so that the value of one Unit issuable
upon exercise of each Right will approximate the same economic value of one
share of Class A Common Stock, including voting rights. Shares of
Series B Preferred Stock issuable upon exercise of each Right will not be
redeemable. Each share of Series B Preferred Stock will entitle the
holder to a minimum preferential dividend of $1.00 per share, but will entitle
the holder to an aggregate dividend payment of 100 times the dividend declared
on each share of Common Stock. In the event of liquidation, each
share of Series B Preferred Stock will be entitled to a minimum preferential
liquidation payment of $1.00, plus accrued and unpaid dividends and
distributions thereon, but will be entitled to an aggregate payment of 100 times
the payment made per share of Common Stock. In the event of any
merger, consolidation or other transaction in which Common Stock is exchanged
for or changed into other stock or securities, cash or other property, each
share of Series B Preferred Stock will be entitled to receive 100 times the
amount received per share of Common Stock. Series B Preferred Stock
is not convertible into Common Stock.
Each share of Series B Preferred Stock
will be entitled to 100 votes on all matters submitted to a vote of the
shareholders of the Company, and shares of Series B Preferred Stock will
generally vote together as one class with the Common Stock and any other voting
capital stock of the Company on all matters submitted to a vote of the Company’s
shareholders. While the Company’s Class B Common Stock remains
outstanding, holders of Series B Preferred Stock will vote as a single class
with the Class A Common Stock for the election of directors. Further,
whenever dividends on the Series B Preferred Stock are in arrears in an amount
equal to six quarterly payments, the Series B Preferred Stock, together with any
other shares of preferred stock then entitled to elect directors, shall have the
right, as a single class, to elect one director until the default has been
cured.
Whenever quarterly dividends or other
dividends or distributions payable on the Series B Preferred Stock are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether declared, on the outstanding Series B Preferred Stock
shall have been paid in full, the Company shall not: (i) declare or pay
dividends on, or make any distributions on, any shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series B Preferred Stock; (ii) declare or pay dividends on, or make any
distributions on, any shares of stock ranking on parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series B Preferred
Stock, except dividends paid ratably on the Series B Preferred Stock and all
such other parity stock; (iii) redeem, purchase or otherwise acquire for value
any shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Preferred Stock or (iv) redeem,
purchase or otherwise acquire for value any Series B Preferred Stock, or any
shares of stock ranking on a parity with the Series B Preferred Stock, except in
accordance with a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the respective series
and classes, shall determine in good faith will result in fair and equitable
treatment among the respective series or classes.
The foregoing description of the
Agreement and the Rights is qualified in its entirety by the full text of the
Agreement, the Rights Certificate and the form of the Company’s Articles of
Restatement to its Restated Articles of Incorporation, all of which are filed
herewith as Exhibit 4.1. In the event of a discrepancy between the
foregoing description and the terms of the Agreement, the Rights or the Articles
of Restatement, the full text of such documents shall be considered
controlling.
ITEM
3.03 MATERIAL MODIFICATION TO RIGHTS OF SECURITY
HOLDERS.
The information set forth under Item
1.01 of this Current Report on Form 8-K is incorporated herein by
reference.
ITEM
9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial
Statements of Businesses Acquired.
None.
(b) Pro
Forma Financial Information.
None.
(c) Shell
Company Transactions.
None.
(d) Exhibits.
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Exhibit No.
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Description
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4.1
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Rights
Agreement dated March 7, 2008 and effective as of March 17, 2008 between
Interface, Inc. and Computershare Trust Company, N.A., as Rights Agent
(together with exhibits, including the form of Articles of Restatement to
the Company’s Restated Articles of Incorporation, form of Rights
Certificate, and Summary of Shareholder Rights
Plan).
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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.
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INTERFACE,
INC.
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By:
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/s/
Patrick C. Lynch
Patrick
C. Lynch
Senior
Vice President
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Date: March
7, 2008
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EXHIBIT
INDEX
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Exhibit No.
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Description
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4.1
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Rights
Agreement dated March 7, 2008 and effective as of March 17, 2008 between
Interface, Inc. and Computershare Trust Company, N.A., as Rights Agent
(together with exhibits, including the form of Articles of Restatement to
the Company’s Restated Articles of Incorporation, form of Rights
Certificate, and Summary of Shareholder Rights
Plan).
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