U.S. SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
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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) April 2, 2007
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GREATBATCH, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-16137 16-1531026
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(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation) Identification No.)
9645 Wehrle Drive, Clarence, New York 14031
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (716) 759-6901
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Not Applicable
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(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:
[ ] 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.
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As previously reported, on March 27, 2007, Greatbatch, Inc.
(the "Company") entered into separate privately negotiated
agreements under which it will exchange approximately an
additional $67.8 million aggregate principal amount of its
outstanding 2 1/4% Convertible Subordinated Debentures due
2013 (the "Outstanding Debentures") for an equivalent
principal amount of the Company's previously announced new
series of 2 1/4% Convertible Subordinated Debentures due 2013
(the "Additional New Debentures"). On April 2, 2007,
Greatbatch completed the exchange of Outstanding Debentures
for Additional New Debentures. After completion of the
exchange, approximately $52.2 million in aggregate principal
amount of Outstanding Debentures remain outstanding.
The Company issued the Additional New Debentures pursuant to
an indenture, dated as of March 28, 2007, by and between the
Company and Manufacturers and Traders Trust Company, as
trustee, (the "2007 Indenture") as amended by the First
Supplemental Indenture thereto (the "First Supplemental
Indenture"). The Additional New Debentures bear interest at 2
1/4% per annum, with interest payable on June 15 and December
15 of each year, commencing June 15, 2007. The Additional New
Debentures mature on June 15, 2013. The Additional New
Debentures are unsecured indebtedness of the Company, and rank
pari passu in right of payment to the Outstanding Debentures
and junior in right of payment to the Company's senior
indebtedness, including its bank credit facility.
The Additional New Debentures will be convertible upon the
occurrence of certain conditions into shares of the Company's
common stock at an initial conversion price of approximately
$34.70 per share, which is equivalent to an initial conversion
ratio of approximately 28.8219 shares per $1,000 principal
amount of Additional New Debentures. The conversion price and
the conversion ratio will adjust automatically upon certain
changes to the Company's capitalization.
The Additional New Debentures are convertible at the option of
the holders at such time as: (i) the closing price of the
Company's common stock exceeds 150% of the conversion price of
the Additional New Debentures, initially $34.70, for 20 out of
30 consecutive trading days; (ii) the trading price per $1,000
principal amount of Additional New Debentures is less than 98%
of the product of (x) the closing sale price of common stock
for each day during any five consecutive trading day period
and (y) the conversion rate per $1,000 principal amount of
Additional New Debentures; (iii) the Additional New Debenture
has been called for redemption, at any time on or after the
date the notice of redemption has been given until the close
of business on the business day immediately preceding the
redemption date; (iv) the Company distributes to all holders
of common stock rights or warrants entitling them to purchase
additional shares of common stock at less than the average
closing price of common stock for the ten trading days
immediately preceding the announcement of the distribution;
(v) the Company distributes to all holders of common stock any
form of dividend which has a per share value exceeding 5% of
the price of the common stock on the day prior to such date of
distribution; (vi) the Company affects a consolidation,
merger, share exchange or sale of assets pursuant to which its
common stock is converted to cash or other property; (vii) the
period beginning 60 days prior to but excluding June 15, 2013;
and (viii) certain fundamental changes occur or are approved
by the Company's Board of Directors.
Conversions in connection with corporate transactions that
constitute a fundamental change require the Company to pay a
premium make-whole amount whereby the conversion ratio on the
Additional New Debentures may be increased by up to 8.2 shares
per $1,000 principal amount. The premium make-whole amount
will be paid in shares of common stock upon any such
conversion, subject to the net share settlement feature of the
Additional New Debentures described below.
The Additional New Debentures contain a net share settlement
feature, which requires the Company, unless it has made an
election under the 2007 Indenture, upon conversion of the
Additional New Debentures, to pay holders in cash for each
$1,000 principal amount of Additional New Debentures the
lesser of $1,000 and the conversion value of the Additional
New Debentures, unless the Company otherwise elects. Any
amounts in excess of $1,000 will be settled in shares of the
Company's common stock, or at the Company's option, cash.
The Additional New Debentures are redeemable by the Company at
any time on or after June 20, 2012, and prior to maturity, or
at the option of a holder upon the occurrence of certain
fundamental changes affecting the Company. The Additional New
Debentures do not contain the put option provisions of the
Outstanding Debentures which provide the holders a one-time
option to require the Company to repurchase the Outstanding
Debentures on June 15, 2010.
An event of default under the 2007 Indenture will occur if the
Company: (i) is delinquent in making certain payments due
under the Additional New Debentures; (ii) fails to deliver
certain required notices; (iii) fails to deliver all cash and
any shares of common stock upon conversion of the Additional
New Debentures; (iv) fails, following notices, to cure a
breach of a covenant under the Additional New Debentures or
the 2007 Indenture; or (v) commences or has commenced against
it any proceeding seeking liquidation, reorganization or other
relief under any bankruptcy, insolvency or similar law.
The holders of the Additional New Debentures are entitled to
the benefits of the registration rights agreement, dated as of
March 28, 2007 (the "2007 Registration Rights Agreement"),
entered into by the Company with the holders of new debentures
previously issued by the Company on March 28, 2007. Under the
2007 Registration Rights Agreement, the Company has agreed to
file a shelf registration statement with respect to the resale
of the Additional New Debentures and the Company common stock
issuable upon conversion thereof. The Company is obligated to
file this registration statement within 30 days of March 28,
2007 and to cause such registration statement to become
effective within 90 days of the closing of the transaction. In
the event that the Company fails to comply with its
obligations under the 2007 Registration Rights Agreement, the
Company is obligated to make additional payments to the
holders of the Additional New Debentures.
The form of exchange and purchase agreement and the 2007
Registration Rights Agreement were filed as exhibits to the
Company's Form 8-K on March 29, 2007. The First Supplemental
Indenture is included herewith and incorporated herein by
reference. The foregoing descriptions of such agreements are
for summary purposes only and are qualified in their entirety
by the full text of such agreements.
The Additional New Debentures and the common stock issuable
upon conversion of the Additional New Debentures will not be
registered under the Securities Act of 1933, as amended, or
the securities laws of any state and, unless so registered,
may not be offered or sold in the United States except
pursuant to an applicable exemption from the registration
requirement of the Securities Act and applicable state
securities laws.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation
Under an Off-Balance Sheet Arrangement of a Registrant.
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See Item 1.01 above, which is incorporated by reference
herein.
Item 3.02 Unregistered Sales of Equity Securities.
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See Item 1.01 above, which is incorporated by reference
herein. The issuance of the Additional New Debentures is
exempt from registration under the Securities Act of 1933, as
amended, pursuant to Rule 506 promulgated thereunder.
Item 9.01 Financial Statements and Exhibits.
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(c) Exhibits
10.1 Form of Exchange and Purchase Agreement by and
between Greatbatch, Inc. and certain other parties
thereto (incorporated by reference to Exhibit 10.1 to
our Current Report on Form 8-K filed on March 29,
2007).
10.2 Form of Registration Rights Agreement by and between
Greatbatch, Inc. and certain other parties thereto
(incorporated by reference to Exhibit 10.2 to our
Current Report on Form 8-K filed on March 29, 2007).
10.3 First Supplemental Indenture, dated April 2, 2007, by
and between Greatbatch, Inc. and Manufacturers and
Traders Trust Company, as trustee.
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, thereunto duly authorized.
GREATBATCH, INC.
Dated: April 4, 2007
By: /s/ Thomas J. Mazza
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Thomas J. Mazza
Senior Vice President and
Chief Financial Officer
EXHIBIT DESCRIPTION
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10.1 Form of Exchange and Purchase Agreement by and between Greatbatch,
Inc. and certain other parties thereto (incorporated by reference to
Exhibit 10.1 to our Current Report on Form 8-K filed on March 29,
2007).
10.2 Form of Registration Rights Agreement by and between Greatbatch,
Inc. and certain other parties thereto (incorporated by reference to
Exhibit 10.2 to our Current Report on Form 8-K filed on March 29,
2007).
10.3 First Supplemental Indenture, dated April 2, 2007, by and between
Greatbatch, Inc. and Manufacturers and Traders Trust Company, as
trustee.