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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
(AMENDMENT NO. 3)
Pursuant to Section 14(d)(4) of the
Securities Exchange Act of 1934
PENNZOIL COMPANY
(Name of Subject Company)
PENNZOIL COMPANY
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $0.83 1/3 PER SHARE
(including the associated Preferred Stock Purchase Rights)
(Title of Class of Securities)
709903 10 8
(CUSIP Number of Class of Securities)
LINDA F. CONDIT
CORPORATE SECRETARY
PENNZOIL COMPANY
PENNZOIL PLACE, P.O. BOX 2967
HOUSTON, TEXAS 77252-2967
(713) 546-8910
(Name, address and telephone number of person authorized
to receive notice and communications on behalf of the person(s) filing
statement)
Copies To:
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Moulton Goodrum, Jr. Charles F. Richards, Jr.
Baker & Botts, L.L.P. Richards, Layton & Finger
One Shell Plaza One Rodney Square
Houston, Texas 77002-4995 P.O. Box 551
(713) 229-1234 Wilmington, Delaware 19899-0551
(302) 658-6541
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This Amendment No. 3 (this "Amendment") amends and supplements the
Solicitation/Recommendation Statement on Schedule 14D-9, as amended, originally
filed on July 1, 1997 by Pennzoil Company, a Delaware corporation (the
"Company"), relating to a tender offer commenced by Resources Newco, Inc., a
wholly owned subsidiary of Union Pacific Resources Group Inc. on June 23, 1997.
All capitalized terms used in this Amendment without definition have the
meanings attributed to them in the Schedule 14D-9.
The items of the Schedule 14D-9 set forth below are hereby amended by
adding the following:
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
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EXHIBIT
NO. DESCRIPTION
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*32 Letter to stockholders of the Company dated July 14, 1997.
*33 Published message dated July 14, 1997.
*34 Form of Notice of Withdrawal of Shares tendered pursuant to
the Offer to Purchase.
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* Included in materials sent to stockholders
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
PENNZOIL COMPANY
Dated: July 14, 1997 By: /s/ James L. Pate
James L. Pate
Chairman of the Board, President
and Chief Executive Officer
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EXHIBIT INDEX
Exhibit No. Description
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*32 Letter to stockholders of the Company dated July 14, 1997.
*33 Published message dated July 14, 1997.
*34 Form of Notice of Withdrawal of Shares tendered pursuant
to the Offer to Purchase.
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* Included in materials sent to stockholders
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EXHIBIT 32
[PENNZOIL COMPANY LETTERHEAD]
July 14, 1997
Dear Shareholder:
Last week you may have received a letter from Union Pacific Resources
seeking your support for their proposal, drafted in the guise of a series of
questions for Pennzoil's management and Board. It is not possible or appropriate
to try to respond to all of the misinformation and misrepresentations contained
in their letter, which we intend to respond to in litigation. However, I do want
to set the record straight on certain matters, including issues covered by the
enclosed ad which is appearing today in The Wall Street Journal.
When I assumed the Chairmanship of Pennzoil Company in May 1994, your Board
of Directors implemented a strategic plan that would enhance Pennzoil's position
as a global producer of oil and gas and as a world class refiner and marketer of
Pennzoil motor oil and other premium automotive products. In the last year and a
half, total return on our stock has been 42%, a strong endorsement of our
strategic initiatives. However, the fruits of our strategic plan are just now
beginning to be realized and the long-term benefits remain virtually
unrecognized in our public market valuation.
Union Pacific Resources knows all of this. And they are seeking to take
advantage of it by acquiring Pennzoil at a price that is inadequate. To make
matters worse, they propose to do so by using a highly coercive, two-tiered
structure with a back-end merger that is highly uncertain as to both price and
execution.
As I said in my previous communication to you, Pennzoil's Board is
committed to staying on the strategic course Pennzoil has set for itself. The
Board strongly believes that this is not the time to be considering a
transaction such as that proposed by UPR, particularly when we are on the verge
of reaping the benefits of the seeds sown over the past 3 years.
I urge you not to tender your shares to UPR.
Sincerely,
/s/ James L. Pate
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EXHIBIT 33
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[Pennzoil Logo] DON'T BE MISLED BY UPR [Pennzoil Logo]
STOCK PRICE PER SHARE EARNINGS PER SHARE
[chart] [chart]
Since the initial public offering by Union Wall Street analysts currently project that
Pacific Resources (UPR) in October 1995 until Pennzoil's earnings and earnings per share, on
June 20, 1997 (prior to announcement of UPR's a recurring basis, will increase significantly
tender offer), the total return on Pennzoil's over the next two years, while projecting that
stock has been 42%, double the return on UPR. UPR's will decline. Further, the combination
And, from the beginning of 1997 to June 20, proposed by UPR is substantially dilutive to
Pennzoil's stock was up 5.5%, while UPR was UPR's earnings in amounts UPR has been
down 9.1%. unwilling to disclose.
FINDING & DEVELOPMENT COST PER BARREL RESERVES ADDED PER NET WELL DRILLED
[chart] [chart]
UPR is much less efficient in finding and developing reserves than Pennzoil and adds substantially less reserves for
each well drilled. UPR's highest producing area is the short-lived Austin Chalk, which generally has small reserve
pockets that deplete rapidly. UPR has minimal production and interests in the Gulf of Mexico and no international
presence. In essence, UPR is landlocked, with little growth potential. Pennzoil has a substantial presence in the
Gulf of Mexico and international projects with huge reserve potential. It is not credible that UPR, with little if
any offshore or international experience, can manage these high-growth assets better than Pennzoil.
THE VALUE OF UPR'S OFFER IS SIGNIFICANTLY LESS THAN $84 PER SHARE
UPR IS OFFERING $84 PER SHARE FOR HALF OF YOUR STOCK. UPR PROPOSES TO ISSUE UPR STOCK FOR THE OTHER HALF. BECAUSE OF
UPR'S PRIOR MARKET PERFORMANCE AND THE UNCERTAINTIES WITH RESPECT TO ITS FUTURE BUSINESS, THE VALUE OF THE UPR STOCK
TO BE DELIVERED IN THE SECOND STEP IS SUBJECT TO SUBSTANTIAL DOWNWARD PRESSURE AND UNCERTAINTY. THE STOCK WOULD NOT BE
DELIVERED AT ALL IF UPR'S SHAREHOLDERS DO NOT APPROVE THE TRANSACTION. FINALLY, THE UPR PROPOSAL LIMITS THE NUMBER OF
SHARES TO BE ISSUED TO YOU WITH NO WALKAWAY RIGHTS OR DOWNSIDE PROTECTION ONCE UPR'S STOCK DECLINES BELOW $25 PER SHARE.
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WHAT'S THE RUSH?
UPR HAS BEEN RUSHING PENNZOIL SHAREHOLDERS TO TENDER THEIR SHARES BEFORE THE PURPORTED EXPIRATION DATE OF
UPR'S OFFER ON JULY 21, 1997. HOWEVER, UPR'S OFFER IS CONDITIONED, AMONG OTHER THINGS, UPON AN OUTCOME
FAVORABLE TO UPR IN ITS LAWSUIT CHALLENGING PENNZOIL'S RIGHTS PLAN IN THE DELAWARE CHANCERY COURT. NOW
UPR'S COUNSEL HAS ADMITTED THAT UPR HAS NO INTENTION OF EVEN SUBMITTING THE CASE TO THE COURT PRIOR TO THE
JULY 21, 1997 EXPIRATION DATE.
THE FOLLOWING EXCERPT IS FROM THE TRANSCRIPT OF A TELEPHONE CONFERENCE ON JULY 9, 1997 IN THE DELAWARE
CHANCERY COURT, CIVIL ACTION NO. 15755:
"MR. WELCH (COUNSEL FOR UPR):
YOUR HONOR, ED WELCH. ONE COMMENT I DID WANT TO MAKE, IF THE COURT WILL PERMIT IT, IN RESPONSE TO
YOUR HONOR'S COMMENT AT THE END OF MY PRESENTATION. YOUR HONOR MADE REFERENCE TO THE FACT THAT
THE 21ST IS FAST APPROACHING. THAT IS CORRECT.
I DID WANT TO ADD THAT AT THIS POINT IN TIME, WE DO NOT INTEND TO BRING ON A MOTION FOR A
PRELIMINARY INJUNCTION PRIOR TO JULY THE 21ST IN CHANCERY. IT SIMPLY DOESN'T MAKE SENSE. THINGS
AT THIS POINT ARE TO FLUID. THERE IS MUCH WORK THAT NEEDS TO BE DONE BEFORE A CASE LIKE THIS
IS PROPERLY PRESENTED...."
SO, WE ASK, WHY IS UPR MISLEADING SHAREHOLDERS ABOUT JULY 21?
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DO NOT TENDER INTO UPR'S INADEQUATE OFFER.
IMPORTANT
IF YOU WOULD LIKE A COPY OF OUR SCHEDULE 14D-9, HAVE ANY QUESTIONS OR NEED ASSISTANCE
IN WITHDRAWING A TENDER, PLEASE CALL D.F. KING & CO., INC., TOLL-FREE AT 1-800-735-3591.
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This form may be used to withdraw Shares that you have tendered to UPR. If you
would like a copy of Pennzoil Company's Schedule 14D-9, have any questions or
need assistance in withdrawing a tender, please call D.F. King & Co., Inc.
toll-free at 1-800-735-3591.
Notice of Withdrawal
of
Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
PENNZOIL COMPANY
Tendered Pursuant to
the Offer to Purchase dated June 23, 1997
by
RESOURCES NEWCO, INC.,
A WHOLLY OWNED SUBSIDIARY OF
UNION PACIFIC RESOURCES GROUP INC.
Ladies and Gentlemen:
The undersigned hereby withdraws the shares of Common Stock, par value
$0.83 1/3 per share (the "Shares"), including the associated Preferred Stock
Purchase Rights (the "Rights"), of Pennzoil Company, a Delaware corporation,
described below.
All references to the Shares include the associated Rights, unless the
context otherwise requires.
THE BANK OF NEW YORK
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By Mail: Facsimile Transmission:
Tender & Exchange Department (212) 815-6213 By Hand or Overnight Courier:
P.O. Box 11248 (For Eligible Institutions Tender & Exchange Department
Only)
Church Street Station Receive and Deliver Window
New York, New York Confirm by Telephone 101 Barclay Street
10286-1248 (800) 507-9357 New York, New York 10286
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DESCRIPTION OF SHARES WITHDRAWN
Name(s) of tendering stockholder(s)
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Name(s) of registered holder(s) (if different)
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Number of Shares withdrawn
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FURTHER DESCRIPTION OF SHARES WITHDRAWN
(to be completed only if certificates have been delivered or otherwise
identified to the Bank of New York or tendered by book-entry transfer)
Certificate Number(s)*
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If applicable, DTC or PHDTC account number
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Name of DTC or PHDTC account
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(MUST BE SIGNED AND COMPLETED ON REVERSE SIDE)
*CALL D.F. KING & CO., INC. AT 1-800-735-3591 FOR ASSISTANCE IF YOU DO NOT HAVE
YOUR CERTIFICATE NUMBER(S).
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STOCKHOLDER SIGN HERE
(Must be signed by registered holder(s) exactly as name(s) appear(s) on
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
previously transmitted or transmitted herewith. If signature is by a trustee,
executor, administrator, guardian, attorney-in-fact, officer of a corporation or
other person acting in a fiduciary or representative capacity, please set forth
full title of such person.)
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Signature(s) of Owner(s)
Dated:
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Name(s)
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Please Print
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Capacity (full title)
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Address
- --------------------------------------------------------------------------------
(Including Zip Code)
(Area Code and Tel. No.)
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SIGNATURE GUARANTEE
(required if certificates have been delivered or otherwise identified
to The Bank of New York, unless the Shares have been tendered by an
Eligible Institution)
Authorized Signature
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Name
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Title
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Address
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Name of Firm
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(Area Code and Tel. No.)
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Dated:
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