Seagate 2004 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2004 Seagate annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 124

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

Table of Contents
SEAGATE TECHNOLOGY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
On December 9, 2004, New SAC and Goldman Sachs Financial Markets, L.P. (“GSFM”) entered into a forward sale contract to sell the
remaining 30,000,000 registered common shares available to be sold by New SAC under the July 20, 2004 registration statement. Under the
contract, New SAC hypothecated 30,000,000 of the Company’s common shares (the “Shares”), received proceeds of approximately $499
million and distributed these proceeds to holders of its ordinary shares including approximately $79 million to current and former officers and
employees of the Company who hold ordinary shares of New SAC. On January 3, 2005, New SAC satisfied its delivery obligation under the
forward sale contract and transferred all of its voting, dividend and economic rights to the Shares to GSFM. On June 15, 2005, final settlement
of the Shares occurred pursuant to the forward sale contract. At that time, any remaining interest in the Shares was transferred to GSFM and
any short position that GSFM or its affiliates had been maintaining with regard to the Shares was closed out.
The Company did not receive any of the proceeds from New SAC’s sale of its shares on September 23, 2004 and November 15, 2004,
nor did it receive any proceeds from the December 9, 2004 forward sale contract between New SAC and GSFM.
On January 19, 2005, the Company filed a registration statement on Form S-3 with the SEC with respect to 100,000,000 common shares
of the Company owned by New SAC. On March 15, 2005, the SEC declared this registration statement effective, thus allowing New SAC the
ability to sell all 100,000,000 of these common shares to the public in the future. The Company will not receive any of the proceeds from the
potential sale of these shares.
On March 7, 2005, New SAC announced that it intended to continue to dispose of the Company’s remaining common shares that it holds
in a series of orderly and disciplined transactions in 2005 and 2006. New SAC stated that the disposition would be effected primarily through a
combination of market sales under the Company’s January 19, 2005 registration statement and through the distribution of the Company’s
shares to New SAC shareholders. New SAC also stated that it may sell the Company’s common shares from time to time under Rule 144,
which limits the volume of such sales in any 90-day period to the greater of 1% of the Company’s outstanding shares or the average weekly
trading volume of the Company’s shares during the four weeks preceding any trade.
In particular, New SAC stated that it expected to make quarterly distributions of 25,000,000 of the Company’s common shares owned by
it to the New SAC shareholders beginning in the spring of 2005 and continuing for the next three quarters thereafter, for a total distribution in
this manner of 100,000,000 common shares over the next year. On May 16, 2005, the first quarterly distribution of shares was completed and
approximately 25,000,000 of the Company’s common shares owned by New SAC were distributed to the New SAC shareholders. On July 26,
2005, the second quarterly distribution of shares was completed and approximately 25,000,000 of the Company’s common shares were
distributed to the New SAC shareholders. Absent registration, these distributed shares will be illiquid and not eligible for re-sale in the public
markets under Rule 144 until 12 months from the date of their distribution out of New SAC. New SAC also stated that the shareholders of New
SAC with the power to request registration of these shares have consented to an agreement among themselves not to do so for at least a year, if
at all.
On April 21, 2005, pursuant to Rule 144, New SAC sold 15,000,000 unregistered shares of the Company’s common stock and received
gross proceeds of $277 million and distributed its proceeds to holders of its ordinary shares including approximately $44 million to current and
former officers and employees of the Company who hold ordinary shares of New SAC. The Company did not receive any of the proceeds from
the sale of these shares by New SAC.
Any sale of the shares registered through the January 19, 2005 registration statement will be reflected in a Form 4 filing with the SEC
within 2 business days after such sale or transfer. In addition, a prospectus supplement will be filed with the SEC in connection with any such
sale.
73