Summary
This Form 8-K filing from Entegris, Inc. (ENTG) reports on July 26, 2005, the adoption of a share rights agreement by its wholly-owned subsidiary, Eagle DE, Inc. This action is a key component of the previously announced merger agreement between Entegris and Mykrolis Corporation. The agreement provides for Entegris to reincorporate in Delaware, and then for Mykrolis to merge into Entegris Delaware, which will be renamed Entegris, Inc. This rights agreement is designed to protect Mykrolis shareholders by imposing a 'poison pill' mechanism.
Key Highlights
- 1Entegris, Inc. (ENTG) announced the adoption of a share rights agreement by its subsidiary, Eagle DE, Inc.
- 2This is a necessary step related to the proposed merger between Entegris and Mykrolis Corporation.
- 3The merger will result in Entegris reincorporating in Delaware and Mykrolis merging into a Delaware subsidiary.
- 4The rights agreement, effective upon merger completion (expected around August 6, 2005), will issue one preferred share purchase right per outstanding common share.
- 5These rights are designed to deter hostile takeovers by triggering a 'poison pill' if an acquiring person accumulates 15% or more of the common shares.
- 6The rights will not be exercisable until a future 'Distribution Date', typically triggered by the accumulation of shares by an Acquiring Person or other specified events.
- 7The merger is subject to shareholder approval and other closing conditions.
Frequently Asked Questions
The Rights Agreement is a 'poison pill' designed to protect Entegris and Mykrolis shareholders. It aims to deter hostile takeovers by making it prohibitively expensive for any single entity to acquire a significant stake (15% or more) in the company without the board's approval.
The rights will be declared on the Record Date of August 8, 2005, but will only become effective and exercisable after the merger with Mykrolis is completed, which is expected around August 6, 2005. They will not be exercisable until a future 'Distribution Date', which is triggered by an 'Acquiring Person' (someone acquiring 15% or more of the stock) or other specific events.
This rights agreement is a crucial step in the planned merger. It ensures that the terms of the merger are negotiated and executed under favorable conditions, protecting existing shareholders from potential opportunistic takeovers during the transaction process. The merger will also involve Entegris reincorporating in Delaware and Mykrolis merging into a Delaware entity.
If an 'Acquiring Person' acquires 15% or more of the outstanding common shares, the Rights will 'separate' from the common stock. At that point, other shareholders will have the right to purchase additional shares of Entegris (or the acquiring company in case of a subsequent merger or asset sale) at a substantial discount, effectively diluting the stake of the Acquiring Person and making the acquisition more costly.