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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
August 6, 1999
Date of Report (Date of earliest event reported)
ONEOK, Inc.
(Exact name of registrant as specified in its charter)
Oklahoma 1-2572 73-1520922
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 West Fifth Street; Tulsa, OK
(Address of principal executive offices)
74103
(Zip code)
(918) 588-7000
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
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Items 1 - 4. Not Applicable.
Item 5. Other Events.
Southern Union Company v. Southwest Gas Corporation, et al.,
No. CIV 99 1294 PHX ROS, United States District Court for the District of
Arizona. On July 19, 1999, the plaintiff, Southern Union Gas Company ("Southern
Union"), filed its complaint against Southwest Gas Corporation ("Southwest"),
ONEOK, Inc. ("ONEOK"), Michael O. Maffie, Thomas Y. Hartley and Thomas R.
Sheets (jointly "Southwest Individual Defendants") and Eugene N. Dubay and John
A. Gaberino, Jr. (jointly "ONEOK Individual Defendants"), James M. Irvin
("Irvin") and Jack D. Rose ("Rose"). Southern Union alleges (1) that the action
arises out of a fraud and racketeering scheme by Southwest and ONEOK and the
individual defendants to block Southwest's shareholders from voting for
Southern Union's offer to acquire Southwest and ensure that only ONEOK's offer
would be approved, (2) the defendants entered into a secret campaign of
deception, corruption and misrepresentation with members of regulatory
commissions in order to influence their vote on the Southern Union proposal to
acquire Southwest and to mislead the board and shareholders of Southwest to
believe falsely that such an acquisition would face greater regulatory hurdles
than the proposed Southwest-ONEOK merger, (3) Southwest and Southwest
Individual Defendants fraudulently induced Southern Union to enter into a
Confidentiality and Standstill Agreement (the "Agreement") with Southwest, and
(4) that corruption and fraud were necessary to defeat the Southern Union
offer. The complaint alleges numerous causes of action including (1)
racketeering in violation of 18 U.S.C. Sections 1962(c) and 1962(d), unlawful
activity in violation of Arizona Criminal Code through a pattern of unlawful
activities predicated on acts of extortion and a scheme or artifice to defraud
against all defendants and conspiracy, (2) fraud in the inducement, breach of
contracts, violation of the Securities Exchange Act of 1934, breach of covenant
of good faith and fair dealing and rescission of the Agreement against
Southwest, and (3) intentional interference with a business relationship and
tortious interference of a contractual relationship against ONEOK, the ONEOK
Individual Defendants, the Southwest Individual Defendants, Rose and Irvin. The
complaint asks for the award of an amount of not less than $750,000,000 to be
trebled for racketeering and unlawful violations (with attorneys' fees and
investigators' fees); compensatory damages of not less than $750,000,000 for
fraud in the inducement, breach of contract, breach of covenant of good faith
and fair dealings, intentional interference with a business relationship,
tortious interference with contractual relationship and civil conspiracy (with
interest and costs); rescission of the Agreement (with costs), punitive
damages, injunctive relief under the Securities Act of 1934 and any further
relief the court deems just and proper. On August 2, 1999, Southern Union filed
a motion with the district court for a temporary restraining order and
preliminary injunction requesting, among other things, that ONEOK and Southwest
be enjoined from participating in any regulatory approval procedures before the
Arizona Corporation Commission or the California Public Utility Commission
regarding approval of the pending ONEOK-Southwest Merger and from otherwise
proceeding with or consummating the proposed merger. The motion was later
modified to limit the request to the regulatory matters. A hearing was held on
the motion on August 5, 1999 at which time the judge denied the motion for a
temporary restraining order.
ONEOK, Inc. v. Southern Union Company, No. 99-CV-0345-H(M), United
States District Court for the Northern District of Oklahoma, on appeal of
preliminary injunction, United States Court of Appeals for the Tenth Circuit,
Case Number 99-5103. On May 11, 1999, the district court granted a temporary
restraining order enjoining Southern Union from any future violation of its
confidentiality and standstill agreement with Southwest Gas, including
soliciting proxies from Southwest Gas shareholders. On May 17, 1999, the
temporary restraining order became a preliminary injunction by stipulation of
the parties and was appealed to the Tenth Circuit. On July 20, 1999, the
defendant, Southern Union, filed with the District Court a Motion to Vacate
Preliminary Injunction and to Suspend Preliminary Injunction based on newly
discovered evidence alleged by the defendant to show a conspiracy between the
plaintiff, ONEOK, and Southwest Gas to corrupt the regulatory process so as to
influence the Southwest Board of Directors to approve ONEOK's proposed merger
and reject Southern Union's offer to acquire Southwest. A hearing on the issue
of jurisdiction of the district court was held on July 23, 1999. By order dated
July 23, 1999, the district court determined that it lacked jurisdiction to
modify the preliminary injunction as requested by the defendant, and the motion
was denied. On August 2, 1999, ONEOK filed an amended complaint with the
district court and a motion for a contempt citation. The amended complaint
added a claim for abuse of process stating that Southern Union's actions in
filing the Arizona complaint (see Southern Union case above) were conducted
with malice and intention to oppress ONEOK and as a result of such intentional
wrongful conduct, Southern Union is liable for exemplary damages as a means of
punishment and deterrence. The motion alleges that despite the preliminary
injunction issued by the district court against Southern Union, Southern Union
and persons acting in concert with Southern Union have continued efforts to
derail the ONEOK-Southwest merger at a critical time in the shareholder and
regulatory process. On August 3, 1999, ONEOK filed a request for immediate
hearing on its application for contempt citation and for an order specifically
enjoining Southern Union and persons acting in concert from proceeding with the
motion for temporary restraining order and preliminary injunction before the
Arizona Court. A hearing is scheduled for August 11, 1999.
In a related matter, in the case of Klein v. Southwest Gas
Corporation, Superior Court of San Diego County, California, Case No. 726615,
the United States District Court remanded the case back to state court.
Southern Union immediately filed a motion for a temporary restraining order
seeking to delay the Southwest shareholders' meeting scheduled for August 10,
1999. A hearing was held on the motion on August 5, 1999 at which time the
court denied the motion for a temporary restraining order.
ONEOK denies that it has done anything illegal or improper in its
effort to obtain required approvals of the proposed Southwest-ONEOK merger and
categorically denies all substantive allegations in the complaint filed by
Southern Union in the Arizona case. ONEOK intends to defend the Arizona case
vigorously and to continue to oppose any attempt by Southern Union to evade or
modify the preliminary injunction issued against Southern Union in the Oklahoma
case.
Item 6. Not Applicable
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Exhibit
No. Description
99.a Incorporated by Reference - Southwest Gas Corporation
Quarterly Report on Form 10-Q for the quarter ended March 31,
1999 (Commission File No. 1-07850).
99.b Incorporated by Reference - Southwest Gas Corporation Current
Reports on Form 8-K dated February 11, 1999, April 28, 1999,
May 4, 1999, July 21, 1999, and July 30, 1999 (Commission File
No. 1-07850).
Items 8-9. Not Applicable
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SIGNATURE
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, on this 6th day of August 1999.
ONEOK, Inc.
By: /s/ Jim Kneale
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Jim Kneale
Vice President, Chief Financial
Officer, and Treasurer
