<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: (Date of earliest event reported): September 23, 1999
MIDCOAST ENERGY RESOURCES, INC.
(Exact name of registrant as specified in its charter)
TEXAS 0-8848 76-0378638
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
1100 LOUISIANA, SUITE 2950, HOUSTON, TEXAS 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 650-8900
N/A
(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS
At the annual meeting of shareholders of Midcoast Energy Resources, Inc., a
Nevada corporation (the "Company") held on May 17, 1999, the shareholders of the
Company approved a proposal to reincorporate the Company under the laws of the
state of Texas. Specifically, shareholders that owned shares representing
approximately 76.2% of the issued and outstanding shares of the Company voted in
favor of the proposal. Previously, the Board of Directors had approved of the
proposal and recommended it to the shareholders in a unanimous written consent
dated as of February 22, 1999.
Midcoast Pipeline, Inc., a Texas corporation and a wholly-owned subsidiary
of the Company (the "Texas Corporation"), was formed in order to effect the
reincorporation merger. By a joint unanimous written consent of its sole
shareholder and director dated as of September 22, 1999, the Texas Corporation
approved of the reincorporation proposal.
In order to accomplish the Reincorporation in accordance with the laws of
the States of Nevada and Texas, the the Company merged (the "Merger") with and
into the Texas Corporation, pursuant to the terms and provisions of the Plan and
Agreement of Merger (the "Merger Plan") dated as of September 22, 1999, which
has been entered into by the Company and the Texas Corporation and is filed as
Exhibit 2.1 hereto. The merger was consummated with the filing of articles of
merger in Nevada and Texas on September 23, 1999. Under Nevada law, shareholders
who opposed the Merger did not have dissenters' rights under the Nevada Private
Corporation Law because the common stock of the Company is listed on the AMEX.
Under the terms of the Merger Plan, the Texas Corporation was the surviving
corporation; the separate corporate existence of the Company ceased; the Texas
Corporation succeeded to all of the business, properties, assets, and
liabilities of the Company; the directors, officers, and employees of the
Company became the directors, officers, and employees of the Texas Corporation;
each outstanding share of common stock of the Company automatically converted
into one share of the Texas Corporation common stock. After the completion of
the change of domicile via the Merger, the surviving corporation was governed by
the articles of incorporation (the "Articles of Incorporation") and the bylaws
(the "Bylaws") of the Texas Corporation. The Articles of Incorporation and
Bylaws of the Texas Corporation have been filed herewith as Exhibits 3.1 and
3.2, respectively. According to Nevada and Texas law, the Merger became
effective (the "Effective Date") immediately upon filing of the Nevada and Texas
Articles of Merger. Immediately following the Merger and at the Effective Time,
all stock certificates which represented shares of common stock of the Company
automatically represented and evidenced ownership of shares of common stock of
the Texas Corporation.
DESCRIPTION OF CAPITAL STOCK AFTER THE MERGER
Under the Articles of Incorporation and Bylaws of the Texas Corporation,
the authorized capital stock of the Company consists of 31,250,000 shares of
common stock, par value $.01 per share (the "Common Stock"), and 5,000,000
shares of preferred stock, par value $.001 per share (the "Preferred Stock").
As of the Effective Date, the Company will have approximately 10,719,480 shares
of Common Stock and no (0) shares of Preferred Stock outstanding, and will have
reserved
2
<PAGE>
approximately 309,380 shares of Common Stock for issuance upon exercise of
outstanding options and 480,564 shares of Common Stock for issuance upon
exercise of outstanding warrants.
Following the reincorporation in Texas, the common stock, par value $0.01
per share, of the successor Texas company is deemed to be registered under
Section 12(b) of the Securities Exchange Act of 1934 by virtue of the operation
of Rule 12g-3 of the Securities and Exchange Commission.
Common Stock Under the Articles of Incorporation and Bylaws of the Texas
Corporation. The holders of Common Stock are entitled to one vote per share
with respect to all matters required by law to be submitted to the stockholders
of the Company. The holders of Common Stock have the sole right to vote, except
as otherwise provided by law or by the Company's Articles of Incorporation. The
Common Stock does not have any cumulative voting rights. A majority of the
issued and outstanding Common Stock constitutes a quorum at any meeting of
stockholders and the vote by the holders of a majority of the outstanding shares
is required to effect certain fundamental corporate changes such as liquidation,
merger or amendment of the Articles of Incorporation.
Holders of shares of Common Stock are entitled to receive dividends, if,
as, and when declared by the Board out of funds legally available therefore.
Upon liquidation of the Company, holders of shares of Common Stock are entitled
to share ratably in all assets of the Company remaining after payment of
liabilities. Holders of shares of Common Stock have no preemptive rights or
other rights to subscribe for unissued or treasury shares or securities
convertible into shares. The outstanding shares of Common Stock are fully paid
and nonassessable.
Preferred Stock Under the Certificate of Incorporation and Bylaws of the
Delaware Corporation. The Board of Directors of the Company, without any action
by the stockholders of the Company, is authorized to issue up to a total of
5,000,000 shares of Preferred Stock in one or more series and to determine the
powers, preferences and rights and the qualifications, limitations or
restrictions, of the authorized and unissued preferred stock. The Board of
Directors could issue a series of Preferred Stock that could, depending on the
terms of such series, provide for a liquidation preference over the Common Stock
or impede the completion of a merger, tender offer or other takeover attempt.
The Board of Directors, in so acting, could issue Preferred Stock having terms
that discourage an acquisition attempt through which an acquiror may be
otherwise able to change the composition of the Board of Directors, including a
tender or exchange offer or other transaction that some, or a majority, of the
Texas Corporation's stockholders might believe to be in their best interest. As
of the date of this Report, no series of Preferred Stock has been so established
by the Board of Directors.
CERTAIN OF THE RIGHTS OF STOCKHOLDERS
The Company was incorporated under the laws of the State of Nevada, and the
Texas Corporation is incorporated under the laws of the State of Texas. The
Company's shareholders, whose rights as shareholders were governed by Nevada law
and the Company's artiticles of incorporation and bylaws (collectively, the
"Nevada Charter Documents"), became, upon consummation of the Merger,
shareholders of the Texas Corporation whose rights are now governed by Texas law
and the Texas Corporation's Articles of Incorporation and Bylaws (collectively,
the "Texas Charter Documents"). The following summary does not purport to be a
complete statement of the rights of the Texas Corporation's shareholders as
governed by applicable Texas law and the Texas Charter Documents and is
qualified in its entirety by the Texas Business Corporations Act (the "TBCA") to
which shareholders are referred. Generally, the provisions of the Texas Charter
Documents are similar to those of the Nevada Charter Documents in many respects.
3
<PAGE>
Charter Amendments. Under Texas law, an amendment to the articles of
incorporation requires the approval of the holders of at least two-thirds of the
outstanding shares of the corporation, unless a different amount, not less than
a majority, is specified in the articles of incorporation. The holders of the
outstanding shares of a particular class are entitled to vote as a class on a
proposed amendment if the amendment would alter or change the power, preferences
or special rights of one or more series of any class so to affect them
adversely. The Articles or Incorporation provide for a majority vote to amend
the articles of incorporation.
Bylaw Amendments. Texas law provides that the power to adopt, amend or
repeal the bylaws may be reserved exclusively to the board of directors. The
Articles of Incorporation reserve the power to adopt, amend or repeal the bylaws
to the board of directors.
Shareholder Vote for Mergers and Other Corporate Reorganizations. Under
Texas law, stockholders have the right to vote on all mergers (except for
parent-subsidiary mergers in which the parent owns at least 90% of the
subsidiary) to which the corporation is a party. In certain circumstances,
different classes of securities may be entitled to vote separately as classes
with respect to such transactions. Unless the articles of incorporation provide
otherwise, approval of the holders of at least two-thirds of all outstanding
shares entitled to vote is required by Texas law to approve a merger. Unless the
articles of incorporation provide otherwise, the approval of the stockholders of
the corporation in a merger is not required under Texas law if: (i) the
corporation is the sole surviving corporation in the merger; (ii) there is no
amendment to the corporation's articles of incorporation; (iii) each stockholder
holds the same number of shares after the merger as before, with identical
designations, preferences, limitations and relative rights; (iv) the voting
power of the shares outstanding after the merger plus the voting power of the
shares issuable as a result of the merger (taking into account convertible
securities and warrants, options or other rights to purchase securities issued
pursuant to the merger) does not exceed the voting power of the shares
outstanding prior to the merger by more than 20%; (v) the number of
participating shares (that is, shares whose holders are entitled to participate
without limitation in dividends or other distributions) outstanding after the
merger plus the participating shares issuable as a result of the merger (taking
into account convertible securities and warrants, options or other rights to
purchase securities issued pursuant to the merger) does not exceed the number of
participating shares outstanding prior to the merger by more than 20%; and (vi)
the board of directors of the corporation adopts a resolution approving the
plan of merger. The Articles of Incorporation require a majority vote for the
approval of a merger.
Business Combinations. Texas corporations are subject to the provisions of
Part Thirteen of the TBCA. That section provides that a corporation shall not,
directly or indirectly, enter into or engage in a business combination with an
affiliated stockholder, or any affiliate or associate of the affiliated
stockholder, during the three-year period immediately following the affiliated
stockholder's share acquisition date unless: (1) the business combination or the
purchase or acquisition of shares made by the affiliated stockholder on the
affiliated stockholder's share acquisition date is approved by the board of
directors of the issuing public corporation before the affiliated stockholder's
share acquisition date; or (2) the business combination is approved, by the
affirmative vote of the holders of at least two-thirds of the outstanding voting
shares of the issuing public corporation not beneficially owned by the
affiliated stockholder or an affiliate or associate of the affiliated
stockholder, at a meeting of stockholders and not by written consent, duly
called for that purpose not less than six months after the affiliated
stockholder's share acquisition date. An
4
<PAGE>
"affiliated stockholder" is defined as a person, other than the issuing public
corporation or a wholly-owned subsidiary of the issuing public corporation, that
is the beneficial owner of 20 % or more of the outstanding voting shares of the
issuing public corporation or that, within the preceding three-year period, was
the beneficial owner of 20 % or more of the then outstanding voting shares of
the issuing public corporation. Part Thirteen further provides that where it
specifies a particular stockholder vote required to approve a matter, a
provision in the certificate of incorporation or bylaws may require a greater,
but not a lesser, vote. However, a corporation may elect not to be governed by
Part XIII, and the Texas Corporation has a provision in its Bylaws opting out of
Part III of the TBCA.
Sales, Leases, Exchanges or Other Dispositions. In Texas, except as
otherwise provided in the articles of incorporation, the sale, lease, exchange
or other disposition (not including any pledge, mortgage, deed of trust or trust
indenture, unless otherwise provided in the articles of incorporation) of all,
or substantially all, of the property and assets of a Texas corporation, if not
made in the usual and regular course of its business, requires the approval of
the holders of at least two-thirds of the outstanding shares of the corporation.
Furthermore, the transfer of substantially all of a corporation's assets to
wholly-owned subsidiaries in such a manner that the corporation continues to
indirectly engage in its business is deemed to be in the usual and regular
course of its business. However, the Articles of Incorporation require only a
majority vote.
Class Voting. Under Texas law, class voting is required in connection with
certain amendments of a corporation's articles of incorporation, a merger or
consolidation requiring stockholder approval if the plan of merger or
consolidation contains any provision which, if contained in a proposed amendment
to a corporation's articles of incorporation, would require class voting or
certain sales of all or substantially all of the assets of a corporation.
Vacancies. Under Texas law, vacancies during the year may be filled by the
affirmative vote of a majority of the remaining directors then in office, even
if less than a quorum or by election at an annual or special meeting of the
stockholders called for that purpose. Any director appointed shall hold office
for the unexpired term of his predecessor in office. The Articles of
Incorporation do not provide otherwise.
Removal of Directors. Under Texas law, the articles of incorporation or
bylaws may provide that holders of a number, but not less than a majority, of
voting shares of each class entitled to vote at an election of directors may
vote to remove any director or the entire board without cause unless (i) the
board is a classified board in which case, unless the articles of incorporation
provide otherwise, directors may be removed only for cause, (ii) the corporation
has cumulative voting in which case if less than the entire board is to be
removed, no director may be removed if the vote cast against his removal would
be enough to elect him, or (iii) a class or series of shares is entitled by the
articles of incorporation to elect one or more directors in which case only the
holders of that class or series shall be entitled to vote on removal of any
director elected by such holders. The Bylaws will allow for the removal of
directors by majority vote for cause, as defined in the Bylaws.
Actions by Written Consent of Shareholders. Unless the articles of
incorporation or bylaws provide otherwise, Texas law provides that any action
required or permitted to be taken at a meeting
5
<PAGE>
of the stockholders may be taken without a meeting if the holders of outstanding
stock having at least the minimum number of votes that would be necessary to
authorize or take such action at a meeting consents to the action in writing. In
addition, Texas law requires the corporation to give prompt notice of the taking
of corporate action without a meeting by less than unanimous written consent to
those stockholders who did not consent in writing. The Company is currently
prohibited from taking action by written consent in lieu of a meeting of the
stockholders as a condition of its Listing Agreement with AMEX. The Articles of
Incorporation of the Texas Corporation provide that stockholders cannot take
action without a meeting of stockholders.
Right to Call Special Meetings of Stockholders. Under Texas law, (1) the
president, the board of directors, or such other person or persons as may be
authorized in the articles of incorporation or (2) the holders of not less than
10% of all of the shares entitled to vote have the right to call a special
stockholders' meeting, unless the articles of incorporation provide for a number
of shares greater than or less than 10%, in which event, special meetings of the
stockholders may be called by the holders of at least the percentage of shares
so specified in the articles of incorporation, but in no event may the articles
of incorporation provide for a number of shares greater than 50% that would be
required to call a special meeting. The Articles of Incorporation require the
holders of 50% of the outstanding shares to call a special meeting.
INDEMNIFICATION OF DIRECTORS AND OFFICERS AFTER THE MERGER
The Articles of Incorporation and Bylaws of the Texas Corporation require
the Company to indemnify its directors and officers to the fullest extent
permitted under Texas law. The Articles of Incorporation limits the personal
liability of a director to the corporation or its shareholders to damages for:
(i) any breach of the director's duty of loyalty to the Corporation or its
shareholders, (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) an act or omission
for which the liability of a director is expressly provided for by an applicable
statute, or (iv) any transaction from which the director derived an improper
personal benefit.
Furthermore, pursuant to certain indemnity agreements executed by each
current director and executive officer, the Company must indemnify, defend and
hold harmless its directors and officers from and against any loss, liability or
claim arising out of or relating to their capacities as such. There is in
effect for the Company an insurance policy providing directors and officers with
indemnification, subject to certain exclusions and to the extent not otherwise
indemnified by the Company, against loss (including expenses incurred in the
defense of actions, suits or proceedings in connection therewith) arising from
any negligent act, error, omission or breach of duty while acting in their
capacity as directors and officers of the Company. The policy also reimburses
the Company for liability incurred in the indemnification of its directors and
officers.
Summary of Texas Law. The following is a summary of the indemnification
provisions of Texas law.
Scope. A corporation is permitted to provide indemnification or
advancement of expenses, by a bylaw provision, agreement, security arrangement
or otherwise against judgments, penalties, fines, settlements and reasonable
expenses actually incurred by the person in connection with the
6
<PAGE>
proceeding. However, if the person is found liable to the corporation, or if the
person is found liable on the basis he received an improper personal benefit,
indemnification under Texas law is limited in the reimbursement of reasonable
expenses and no indemnification will be available if the person is found liable
for willful or intentional misconduct.
Advancement of Expenses. Reasonable court costs and attorneys' fees
incurred by a director who was, is, or is threatened to be made, a named
defendant or respondent in a proceeding because the person is or was a director
of such corporation may be paid or reimbursed by the corporation in advance of
the final disposition of the proceeding after the corporation receives (i) a
written affirmation by the director of his good faith belief that he has met the
standard of conduct necessary for indemnification under Texas law and (ii) a
written undertaking by or on behalf of the director to repay the amount paid or
reimbursed if it is ultimately determined that he has not met those requirements
or indemnification for such expenses is precluded under Texas law.
Procedure for Indemnification. Texas law provides that a determination
that indemnification is appropriate under Texas law shall be made (i) by a
majority vote of a quorum consisting of directors who are not party to the
proceeding, (ii) if such a quorum cannot be obtained, by a special committee of
the board of directors consisting of at least two directors not party to the
proceeding, (iii) by special legal counsel, or (iv) by stockholder vote.
Mandatory Indemnification. Under Texas law, indemnification by the
corporation is mandatory only if the director is wholly successful on the merits
or otherwise, in the defense of the proceeding.
Insurance. Texas law allows a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation against any liability asserted against such person and
incurred by such person in such a capacity or arising out of his status as such
a person whether or not the corporation would have the power to indemnify him
against that liability. In addition, a corporation may also establish and
maintain arrangements, other than insurance, to protect these individuals,
including a trust fund or surety arrangement.
Standard of Care. In general, directors are charged with the duty in their
decision-making process and oversight responsibilities to act as would a
reasonably prudent person in the conduct of such person's own affairs.
Stockholder Reports. Texas law requires a report to the stockholders upon
indemnification or advancement of expenses.
Limited Liability of Directors. Texas law permits a corporation to
eliminate in its charter all monetary liability of a director to the corporation
or its stockholders for conduct in the performance of such director's duties.
However, Texas law does not permit any limitation of the liability of a director
for: (i) breaching the duty of loyalty to the corporation or its stockholders;
(ii) failing to act in good faith; (iii) engaging in intentional misconduct or
a known violation of law; (iv) engaging in a transaction from which the director
obtains an improper benefit; or (v) violating applicable statutes which
expressly provide for the liability of a director.
7
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
The following exhibits are filed with this report on Form 8-K:
2.1 -- Plan and Agreement of Merger between the Company and the Texas
Corporation dated September 22, 1999 (filed previously with the
original filing on Form 8-K on September 29, 1999).
3.1 -- Amended and Restated Articles of Incorporation for the Texas
Corporation filed on September 23, 1999 in Texas (filed
previously with the original filing on Form 8-K on September 29,
1999).
3.2 -- Bylaws of the Texas Corporation adopted on September 22, 1999
(filed previously with the original filing on Form 8-K on
September 29, 1999).
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 hereunto duly authorized.
MIDCOAST ENERGY RESOURCES, INC.
December 2, 1999 /s/ Richard A. Robert
--------------------------------------
Richard A. Robert,
Chief Financial Officer and Treasurer
8
<PAGE>
EXHIBITS
EXHIBIT NO.
2.1 -- Plan and Agreement of Merger between the Company and the Texas
Corporation dated September 22, 1999 (filed previously with the
original filing on Form 8-K on September 29, 1999).
3.1 -- Amended and Restated Articles of Incorporation for the Texas
Corporation filed on September 23, 1999 in Texas (filed
previously with the original filing on Form 8-K on September 29,
1999).
3.2 -- Bylaws of the Texas Corporation adopted on September 22, 1999
(filed previously with the original filing on Form 8-K on
September 29, 1999).
9
