8-KRegulation FD

GARMIN LTD 8-K Report, Regulation FD Disclosure (Apr 5, 2010)

Filed April 5, 2010For Securities:GRMN

Summary

Garmin Ltd. (GRMN) has filed an 8-K to disclose its intention to redeem its outstanding shareholder rights. This action is a direct consequence of the company's proposed redomestication from the Cayman Islands to Switzerland. Swiss corporate law does not permit Swiss companies to maintain shareholder rights plans, necessitating this redemption prior to the redomestication. The redemption is scheduled to occur with a record date of April 15, 2010, and the rights will be redeemed at a nominal price of $0.001 per right. This price has been adjusted from the original $0.002 due to a previous two-for-one stock split in August 2006. Investors holding these rights should be aware of this upcoming change and the minimal financial impact of the redemption itself.

Key Highlights

  • 1Garmin Ltd. plans to redeem all outstanding shareholder rights.
  • 2The redemption is a mandatory step due to the company's proposed redomestication to Switzerland.
  • 3Swiss law prohibits Swiss companies from maintaining shareholder rights plans.
  • 4The record date for the rights redemption is April 15, 2010.
  • 5The redemption price for each right is $0.001.
  • 6The redemption price reflects an adjustment due to a prior stock split.

Frequently Asked Questions

Garmin is redeeming its shareholder rights because its proposed redomestication from the Cayman Islands to Switzerland is contingent upon compliance with Swiss corporate law, which does not permit Swiss companies to have shareholder rights plans.

The redemption price for each right is $0.001. This amount has been adjusted from the original $0.002 due to a two-for-one stock split that occurred on August 15, 2006.

The board of directors anticipates that the record date for the redemption of the rights will be April 15, 2010. Notice of this redemption has been provided to the NASDAQ Global Select Market.

The financial impact is expected to be minimal, as the rights are being redeemed at a nominal price of $0.001 per right. This action is primarily a regulatory and corporate governance move related to the redomestication.