UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
January 19, 2006
Date of Report (Date of earliest event reported)
THE STANLEY WORKS
(Exact name of registrant as specified in its charter)
Connecticut 1-5244 06-0548860
(State or other jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
1000 Stanley Drive
New Britain, Connecticut 06053
(Address of principal executive offices) (Zip Code)
(860) 225-5111 Registrant's
telephone number, including area code
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2. below):
[ ] Written communication 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 January 19, 2006, the Board of Directors of The Stanley
Works (the "Company") declared a dividend distribution of one preferred share
purchase right ("a Right") for each outstanding share of Common Stock to
stockholders of record at the close of business on March 10, 2006, the
expiration date of the Company's existing Rights Agreement (the "Record
Date"). Each Right entitles the registered holder to purchase from the Company
one two-hundredth of a share of Series A Junior Participating Preferred Stock
without par value (the "Preferred Stock") at a Purchase Price of $220, subject
to adjustment. The description and terms of the Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and
Computershare Investor Services L.L.C., as Rights Agent. The declaration of
the dividend extends the Company's existing shareholder rights plan until
March 10, 2016.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate Rights
Certificates will be distributed. The Rights will separate from the Common
Stock and a Distribution Date will occur upon the earlier of (i) ten (10) days
following a public announcement that a person or group of affiliate or
associated persons (an "Acquiring Person") has acquired, or obtained the right
to acquire, beneficial ownership of fifteen percent (15%) or more of the
outstanding shares of Common Stock, subject, to certain exceptions, including
for inadvertent acquisitions in excess of 14.9% of the outstanding shares of
Common Stock (the "Stock Acquisition Date"), or (ii) ten (10) business days
(or such later date as the Board shall determine) following the commencement
of a tender offer or exchange offer that would result in a person or group
beneficially owning fifteen percent (15%) 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 issued
after the Record Date 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.
Pursuant to the Rights Agreement, the Company reserves the right to require
prior to the occurrence of a Triggering Event (as defined below) that, upon
any exercise of Rights, a number of Rights be exercised so that only whole
shares of Preferred Stock will be issued.
The Rights are not exercisable until the Distribution Date
and will expire at the close of business on March 10, 2016, unless earlier
redeemed or exchanged by the Company as described below.
In the event that a Person becomes the beneficial owner of
more than fifteen percent (15%) of the then outstanding shares of Common Stock
(except pursuant to an offer for all outstanding shares of Common Stock which
the independent directors determine to be fair to and otherwise in the best
interests of the Company and its stockholders), 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.
Notwithstanding any of the foregoing, following the occurrence of any of the
events set forth in this paragraph, 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. However, Rights are not
exercisable following the occurrence of either of the events set forth above
until such time as the Rights are no longer redeemable by the Company.
In the event that, at any time following the Stock
Acquisition Date, (i) 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 described in the second preceding paragraph or a merger
which follows an offer described in the second preceding paragraph), or (ii)
fifty percent (50%) or more of the Company's assets, cash flow 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 value equal to two times the exercise price of the Right. The events set
forth in this paragraph and in the preceding paragraph are referred to as the
"Triggering Events."
At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of fifteen percent
(15%) or more of the outstanding Common Shares and prior to the acquisition by
such person or group of fifty percent (50%) or more of the outstanding Common
Shares, the Board may exchange the Rights (other than Rights owned by such
person or group which have become void), in whole or in part, at an exchange
ratio of one Common Share, or one two-hundredths of a Preferred Share (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).
At any time until ten (10) business days following the Stock
Acquisition Date, the Company may redeem the Rights in whole, but not in part,
at a price of $.01 per Right (payable in cash, Common Stock or other
consideration deemed appropriate by the Board). Immediately upon the action of
the Board ordering redemption of the Rights, the Rights will terminate and the
only right of the holders of Rights will be to receive the $.01 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 or for common stock of the acquiring company as
set forth above.
A copy of the Rights Agreement is attached hereto as Exhibit
4.1 and is incorporated herein by reference. The foregoing description of the
Rights Agreement does not purport to be complete and is qualified in its
entirety by reference to the Rights Agreement.
On January 19, 2006, the Company and the Rights Agent also
entered into an Amendment No. 1 to Rights Agreement, (the "Amendment"),
amending the prior Rights Agreement. The Amendment (i) modifies the definition
of "Acquiring Person" to increase from 10% to 15% the beneficial ownership
level that any person or group of persons may acquire before triggering the
Rights and (ii) modifies the definition of "Acquiring Person" to exclude from
the definition any person or group of persons who inadvertently acquires a
beneficial ownership level in excess of 14.9%.
A copy of the Amendment is attached hereto as Exhibit 4.2
and is incorporated herein by reference. The foregoing description of the
Amendment does not purport to be complete and is qualified in its entirety by
reference to the Amendment.
Item 3.01 Material Modification to Rights of Security Holders.
See Item 1.01 above.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits.
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Exhibit 4.1 Rights Agreement, dated as of January 19, 2006, by and
between The Stanley Works and Computershare Investor
Services L.L.C.
Exhibit 4.2 Amendment No. 1 to Rights Agreement, dated as of January
19, 2006, by and between The Stanley Works and
Computershare Investor Services L.L.C.
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.
THE STANLEY WORKS
By: /s/ Bruce H. Beatt
-------------------------------
Name: Bruce H. Beatt
Title: Vice President, General Counsel
and Secretary
Dated: January 20, 2006
INDEX TO EXHIBITS
Exhibit 4.1 Rights Agreement, dated as of January 19, 2006, by and
between The Stanley Works and Computershare Investor
Services L.L.C.
Exhibit 4.2 Amendment No. 1 to Rights Agreement, dated as of January
19, 2006, by and between The Stanley Works and
Computershare Investor Services L.L.C.