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): December 10, 2001
HYBRIDON, INC.
(Exact name of Registrant as Specified in its Charter)
Delaware 0-027352 04-3072298
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
345 Vassar Street, Cambridge, Massachusetts 02139
(Address of Principal Executive Offices) Zip Code)
Registrant's telephone number, including area code: (617) 679-5500
Not Applicable
(Former Name or Former Address if Changed Since Last Report)
ITEM 5: OTHER EVENTS.
On December 10, 2001, the Board of Directors of Hybridon, Inc. (the "Company"),
declared a dividend of one Right for each outstanding share of the Company's
Common Stock to stockholders of record at the close of business on January 7,
2002 (the "Record Date"). Each Right entitles the registered holder to purchase
from the Company one one-thousandth of a share of Series C Junior Participating
Preferred Stock, $.01 par value per share (the "Series C Preferred Stock"), at a
Purchase Price of $13.00 in cash, subject to adjustment. The description and
terms of the Rights are set forth in a Rights Agreement dated December 10, 2001
(the "Rights Agreement") between the Company and Mellon Investor Services LLC,
as Rights Agent.
Initially, the Rights are not exercisable and will be attached to all
certificates representing outstanding shares of Common Stock, and no separate
Rights Certificates will be distributed. The Rights will separate from the
Common Stock, and the Distribution Date will occur, upon the earlier of (i) 10
business days following the first date of 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 15% or more of the
outstanding shares of Common Stock 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 15% or more of the outstanding shares of Common
Stock. The Distribution Date may be deferred in circumstances determined by the
Board of Directors. In addition, certain inadvertent acquisitions and certain
acquisitions of additional shares of Series A Preferred Stock as payment-in-kind
dividends will not trigger the occurrence of the Distribution Date. Until the
Distribution Date (or earlier redemption or expiration of the Rights), (i) the
Rights will be evidenced by the Common Stock certificates outstanding on the
Record Date, together with the Summary of Rights, or by new Common Stock
certificates issued after the Record Date which contain a notation incorporating
the Rights Agreement by reference, (ii) the Rights will be transferred with and
only with such Common Stock certificates; and (iii) the surrender for transfer
of any certificates for Common Stock outstanding (with or without a copy of the
Summary of Rights or such notation) will also constitute the transfer of the
Rights associated with the Common Stock represented by such certificate.
The Rights are not exercisable until the Distribution Date and will expire upon
the close of business on December 10, 2011 (the "Final Expiration Date") unless
earlier redeemed or exchanged as described below. 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 separate Rights Certificates alone will represent the
Rights. Except as otherwise determined by the Board of Directors, and except for
shares of Common Stock issued upon exercise, conversion or exchange of then
outstanding options, convertible or exchangeable securities or other contingent
obligations to issue shares or pursuant to any employee benefit plan or
arrangement, only shares of Common Stock issued prior to the Distribution Date
will be issued with Rights.
In the event that any Person becomes an Acquiring Person, unless the event
causing the 15% threshold to be crossed is a Permitted Offer (as defined in the
Rights Agreement),
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then, promptly following the first occurrence of such event, each holder of a
Right (except as provided below and in Section 7(e) of the Rights Agreement)
shall thereafter have the right to receive, upon exercise, that number of shares
of Common Stock of the Company (or, in certain circumstances, cash, property or
other securities of the Company) which equals the exercise price of the Right
divided by 50% of the current market price (as defined in the Rights Agreement)
per share of Common Stock at the date of the occurrence of such event. However,
Rights are not exercisable following such event until such time as the Rights
are no longer redeemable by the Company as described below. Notwithstanding any
of the foregoing, following the occurrence of such event, all Rights that are,
or (under certain circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person will be null and void. The event
summarized in this paragraph is referred to as a "Section 11(a)(ii) Event."
For example, at an exercise price of $13.00 per Right, each Right not owned by
an Acquiring Person (or by certain related parties) following a Section
11(a)(ii) Event would entitle its holder to purchase for $13.00 such number of
shares of Common Stock (or other consideration, as noted above) as equals $13.00
divided by one-half of the current market price (as defined in the Rights
Agreement) of the Common Stock. Assuming that the Common Stock had a market
price of $6.50 per share at such time, the holder of each valid Right would be
entitled to purchase four shares of Common Stock, having a market value of 4 x
$6.50, or $26.00, for $13.00.
In the event that, at any time after any Person becomes an Acquiring Person, (i)
the Company is consolidated with, or merged with and into, another entity and
the Company is not the surviving entity of such consolidation or merger (other
than a consolidation or merger which follows a Permitted Offer) or if the
Company is the surviving entity, but shares of its outstanding Common Stock are
changed or exchanged for stock or securities (of any other person) or cash or
any other property, or (ii) more than 50% 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, that number of shares of common stock of the
acquiring company which equals the exercise price of the Right divided by 50% of
the current market price (as defined in the Rights Agreement) of such common
stock at the date of the occurrence of the event. The events summarized in this
paragraph are referred to as "Section 13 Events." A Section 11(a)(ii) Event and
Section 13 Events are collectively referred to as "Triggering Events."
For example, at an exercise price of $13.00 per Right, each valid Right
following a Section 13 Event would entitle its holder to purchase for $13.00
such number of shares of common stock of the acquiring company as equals $13.00
divided by one-half of the current market price (as defined in the Rights
Agreement) of such common stock. Assuming that such common stock had a market
price of $6.50 per share at such time, the holder of each valid Right would be
entitled to purchase four shares of common stock of the acquiring company,
having a market value of 4 x $6.50, or $26.00, for $13.00.
At any time after the occurrence of a Section 11(a)(ii) Event, when no person
owns a majority of the Common Stock, the Board of Directors of the Company may
exchange the
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Rights (other than Rights owned by such Acquiring Person which have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or one one-thousandth of a share of Series C Preferred Stock (or of a share of a
class or series of the Company's preferred stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment).
The Purchase Price payable, and the number of units of Series C 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
Series C Preferred Stock, (ii) if holders of the Series C Preferred Stock are
granted certain rights or warrants to subscribe for Series C Preferred Stock or
convertible securities at less than the then-current market price (as defined in
the Rights Agreement) of the Series C Preferred Stock, or (iii) upon the
distribution to holders of the Series C Preferred Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends paid out of
earnings or retained earnings) or of subscription rights or warrants (other than
those referred to above). The number of Rights associated with each share of
Common Stock is 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 Common Stock or
subdivisions, consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
With certain exceptions, no adjustment in the Purchase Price will be required
until cumulative adjustments amount to at least 1% of the Purchase Price. No
fractional shares of Series C Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share of Series C Preferred Stock)
will be issued and, in lieu thereof, an adjustment in cash will be made based on
the market price of the Series C Preferred Stock on the last trading date prior
to the date of exercise.
Series C Preferred Stock purchasable upon exercise of the Rights will not be
redeemable. Each share of Series C Preferred Stock will be entitled to receive,
when, as and if declared by the Board of Directors, a minimum preferential
quarterly dividend payment of $10 per share or, if greater, an aggregate
dividend of 1,000 times the dividend declared per share of Common Stock. In the
event of liquidation, the holders of the Series C Preferred Stock will be
entitled to a minimum preferential liquidation payment of $1,000 per share, plus
an amount equal to accrued and unpaid dividends, and will be entitled to an
aggregate payment of 1,000 times the payment made per share of Common Stock.
Each share of Series C Preferred Stock will have 1,000 votes, voting together
with the Common Stock. In the event of any merger, consolidation or other
transaction in which Common Stock is changed or exchanged, each share of Series
C Preferred Stock will be entitled to receive 1,000 times the amount received
per share of Common Stock. These rights are protected by customary antidilution
provisions. Because of the nature of the Series C Preferred Stock's dividend,
liquidation and voting rights, the value of one one-thousandth of a share of
Series C Preferred Stock purchasable upon exercise of each Right should
approximate the value of one share of Common Stock.
At any time prior to the earlier of the tenth Business Day (or such later date
as may be determined by the Board of Directors of the Company) after the Stock
Acquisition Date, the Company may redeem the Rights in whole, but not in part,
at a price of $0.001 per
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Right (the "Redemption Price"), payable in cash or stock. Immediately upon the
redemption of the Rights or such earlier time as established by the Board in the
resolution ordering the redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
The Rights may also be redeemable following certain other circumstances
specified in the Rights Agreement.
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. Although the distribution of the Rights should 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 or for
common stock of the acquiring company as set forth above.
Any provision of the Rights Agreement, other than the redemption price, may be
amended by the Board prior to such time as the Rights are no longer redeemable.
Once the Rights are no longer redeemable, the Board's authority to amend the
Rights is limited to correcting ambiguities or defective or inconsistent
provisions in a manner that does not adversely affect the interest of holders of
Rights.
The Rights are intended to protect the stockholders of the Company in the event
of an unfair or coercive offer to acquire the Company and to provide the Board
with adequate time to evaluate unsolicited offers. The Rights may have
anti-takeover effects. The Rights will cause substantial dilution to a person or
group that attempts to acquire the Company without conditioning the offer on a
substantial number of Rights being acquired. The Rights, however, should not
affect any prospective offeror willing to make an offer at a fair price and
otherwise in the best interests of the Company and its stockholders, as
determined by a majority of the Board. The Rights should not interfere with any
merger or other business combination approved by the Board.
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 which is attached hereto as an Exhibit and is incorporated herein by
reference.
ITEM 7: FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
4.1 Rights Agreement dated December 10, 2001 by and between
Hybridon, Inc. and Mellon Investor Services LLC, as rights
agent, which includes as Exhibit A the Form of Certificate of
Designations of Series C Junior Participating Preferred Stock,
as Exhibit B the Form of Rights Certificate and as Exhibit C
the Summary of Rights to Purchase Common Stock.
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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.
Date: December 21, 2001 HYBRIDON, INC.
By: /s/ Stephen R. Seiler
Name: Stephen R. Seiler
Title: Chief Executive Officer
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