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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
----------
(Amendment No. 5)
INLAND STEEL INDUSTRIES, INC.
(Name of Issuer)
Common Stock, $1.00 par value per share
(Title of class of securities)
457472108
(CUSIP number)
Gary K. Duberstein, Esq.
Greenway Partners, L.P.
277 Park Avenue, 27th Floor
New York, New York 10172 (212) 350-5100
(Name, address and telephone number of person authorized
to receive notices and communications)
August 5, 1998
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[_].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following page(s))
(Page 1 of 16 Pages)
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NYFS11...:\92\56392\0003\91\SCH8058W.18B
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 2 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENWAY PARTNERS, L.P.
I.R.S. IDENTIFICATION NO. 13-3714238
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 830,000
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 830,000
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 830,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 1.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
2
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 3 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENTREE PARTNERS, L.P.
I.R.S. IDENTIFICATION NO. 13-3752875
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 355,000
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 355,000
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 355,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 0.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
3
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 4 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENHOUSE PARTNERS, L.P.
I.R.S. IDENTIFICATION NO. 13-3793447
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, AF, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 830,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 830,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 830,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 1.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
4
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 5 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENHUT, L.L.C.
I.R.S. IDENTIFICATION NO. 13-3793450
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, AF, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 355,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 355,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 355,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 0.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: OO
- ------------------ -------------------------------------------------------------
5
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 6 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENBELT CORP.
I.R.S. IDENTIFICATION NO. 13-3791931
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 2,939,600
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 2,939,600
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 2,939,600
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 6.0%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: CO
- ------------------ -------------------------------------------------------------
6
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 7 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENSEA OFFSHORE, L.P.
I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Cayman Islands
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 630,700
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 630,700
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 630,700
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 1.3%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
7
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 8 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GREENHUT OVERSEAS, L.L.C.
I.R.S. IDENTIFICATION NO. 13-3868906
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC, AF, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 630,700
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 630,700
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 630,700
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 1.3%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: OO
- ------------------ -------------------------------------------------------------
8
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 9 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON ALFRED D. KINGSLEY
I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: PF, AF, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 28,000
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 4,755,300
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 28,000
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 4,755,300
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 4,783,300
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 9.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
9
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 457472108 13D Page 10 of 16 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON GARY K. DUBERSTEIN
I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON (ENTITIES ONLY)
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: PF, AF, OO
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 4,755,300
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 4,755,300
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 4,755,300
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 9.7%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
10
<PAGE>
This Amendment No. 5 ("Amendment No. 5") amends the Statement on
Schedule 13D (the "Schedule 13D") filed on February 21, 1997 by and on behalf of
Greenway Partners, L.P. ("Greenway"), Greentree Partners, L.P. ("Greentree"),
Greenhouse Partners, L.P. ("Greenhouse"), Greenhut, L.L.C. ("Greenhut"),
Greenbelt Corp. ("Greenbelt"), Greensea Offshore, L.P. ("Greensea"), Greenhut
Overseas, L.L.C. ("Greenhut Overseas"), Alfred D. Kingsley ("Kingsley") and Gary
K. Duberstein ("Duberstein"; and together with the foregoing persons, the
"Reporting Persons"). Capitalized terms used herein and not defined herein have
the meanings ascribed thereto in the Schedule 13D.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Since the filing of the Amendment No. 4 to the Schedule 13D,
Greenbelt purchased an aggregate of 140,500 Shares for total consideration
(including brokerage commissions) of $3,821,250 derived from capital in the
accounts that it manages.
ITEM 4. PURPOSE OF THE TRANSACTION
On July 20, 1998, the Company commenced an offer (the "Self-Tender
Offer") to purchase up to 25,500,000 Shares (approximately 51% of all
outstanding Shares) pursuant to a procedure commonly referred to as a "Dutch
auction." The terms of the Self-Tender Offer are set forth in the Company's
Offer to Purchase dated July 20, 1998 and related letter of transmittal.
Pursuant to the Self-Tender Offer, the Company has committed to
purchase Shares at a single per Share price not greater than $34 nor less than
$30 per Share (the "Purchase Price"). The Company will select the lowest price
between $30 and $34 per Share that will allow the Company to purchase 25,500,000
Shares. Each stockholder seeking to tender Shares in response to the Self-Tender
Offer must (i) specify the price (not greater than $34 nor less than $30 per
Share) at which the stockholder is willing to have the Company purchase Shares
or (ii) elect to have its Shares purchased at a price determined by the Dutch
auction tender process, which could result in all of such person's Shares being
purchased at the minimum price of $30 per Share. The Self-Tender Offer is
scheduled to close at midnight on Friday, August 14, 1998, unless extended.
Because the Company will purchase approximately 51% of its
outstanding Shares (assuming that 25,500,000 Shares are validly tendered and not
withdrawn), the proportionate interest in the Company's outstanding Shares held
by stockholders who tender their Shares at a price per Share above the Purchase
Price or determine not to tender their Shares necessarily will increase. Thus,
if the Reporting Persons do not tender virtually all of their Shares at the
lowest possible price provided for in the Self-Tender Offer or elect to have
their Shares purchased at a price determined by the Dutch auction tender
process, their proportionate interest in the Company's outstanding Shares will
increase from 9.7% to in excess of 10%. In addition, the Reporting Persons own
approximately 360,100 shares of common stock of Ryerson Tull,Inc., an 87% owned
subsidiary of the Company. According to the Company's Offer to Purchase, the
Reporting Persons may receive from the Company additional shares in connection
with their holdings of shares of common stock of Ryerson Tull on terms yet to be
determined (the "Possible Ryerson Transaction").
On November 25, 1997, the Company adopted a Rights Agreement (the
"Poison Pill") under which stockholders hold one right per each Share. The
rights will separate from the Shares and will be distributed if, among other
things, the Board of Directors of the Company declares, in accordance with the
Poison Pill, that a person who is the beneficial owner of 10% or more of the
outstanding Shares is an "Adverse Person" (a "Triggering Event"). Accordingly,
following the closing
Page 11 of 16 Pages
<PAGE>
of the Self-Tender Offer, the Reporting Persons would be at risk of being
declared an "Adverse Person."
Following the occurrence of a Triggering Event, each right not owned
by the Adverse Person would entitle its holder to purchase, at the right's then
current exercise price, Shares having a value of twice the right's then current
exercise price. Accordingly, the value of the Shares retained by the Adverse
Person would be severely diminished, i.e., the Adverse Person would suffer the
"poison" of the Poison Pill. The Reporting Persons always have been careful not
to take any step that would cause their ownership of Shares to cross the 10%
Poison Pill threshold because they understand full well the consequences of the
poison of the Poison Pill.
Promptly after learning of the Self-Tender Offer, the Reporting
Persons asked the Company for assurance that any increase in the proportionate
share of the outstanding Shares held by the Reporting Persons solely as a result
of the consummation of the Company's Self-Tender Offer or the Possible Ryerson
Transaction, and not as a result of any additional purchases of Shares by the
Reporting Persons, would not place them in a position in which the Company's
Board of Directors could declare them to be an Adverse Person because the
Reporting Persons then would own more than 10% of the outstanding Shares.
On July 29, 1998, after the Company failed to respond to oral
requests made over the course of several days for the assurance that the
Reporting Persons will not be declared an "Adverse Person" based on any
proportionate increase in their beneficial ownership of Shares as described
above, Greenway sent a letter to the Company requesting that the Company provide
such assurance in writing by countersigning such letter. A copy of that letter
is filed herewith as Exhibit 10 and is incorporated herein by reference.
The Reporting Persons received no written response from the Company
to its letter. Rather, late in the afternoon on August 3, 1998, a representative
of the Company called Greenway and stated that the Company refused to provide
any assurance with respect to whether the Reporting Persons would be deemed a
10% stockholder for purposes of the Poison Pill solely as a result of any
increase in the Reporting Persons' proportionate ownership of Shares following
the consummation of the Self-Tender Offer or the Possible Ryerson Transaction.
In the absence of assurance from the Company that a Triggering Event
would not occur as a result of the closing of the Self-Tender Offer or Possible
Ryerson Transaction, the Reporting Persons commenced legal proceedings in the
Court of Chancery of the State of Delaware seeking, among other things, to
enjoin the Company and the named individual defendants, their agents and
employees, and anyone acting on their behalf, from taking any steps to
consummate the Self-Tender Offer, unless the Company agrees that the Reporting
Persons will not be deemed to be an "Adverse Person" so long as the Reporting
Persons do not acquire beneficial ownership of any Shares in excess of the
4,783,300 Shares already beneficially owned by them or additional Shares that
may be received in connection with the Possible Ryerson Transaction. A copy of
the Verified Complaint filed with the Court of Chancery is filed herewith as
Exhibit 11 and is hereby incorporated herein by reference. A hearing on the
Reporting Persons' motion for a temporary restraining order with respect to the
Self-Tender Offer has been scheduled in the Court of Chancery for Monday, August
10, 1998.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) As of the date of this Statement, the Reporting Persons
beneficially owned in the aggregate 4,783,300 Shares constituting 9.7% of the
Page 12 of 16 Pages
<PAGE>
outstanding Shares (the percentage of Shares owned being based upon 49,226,317
Shares outstanding on July 17, 1998 as set forth in the Self-Tender Offer). The
Reporting Persons may be deemed to have direct beneficial ownership of Shares as
follows:
Approximate
Number of Percentage of
Name Shares Outstanding Shares
---- -------- ------------------
Greenway 830,000 1.7%
Greentree 355,000 0.7%
Greenbelt 2,939,600 6.0%
Greensea 630,700 1.3%
Alfred D. Kingsley 28,000 0.1%
Greenhouse, as the general partner of Greenway, may be deemed to own
beneficially (as that term is defined in Rule 13d-3 under the Securities
Exchange Act of 1934) Shares which Greenway may be deemed to possess direct
beneficial ownership. Each of Messrs. Kingsley and Duberstein, as general
partners of Greenhouse, may be deemed to beneficially own Shares which
Greenhouse may be deemed to beneficially own. Each of Messrs. Kingsley and
Duberstein disclaim beneficial ownership of such Shares for all other purposes.
Greenhut as the general partner of Greentree may be deemed to own
beneficially (as that term is defined in Rule 13d-3 under the Securities
Exchange Act of 1934) Shares which Greentree may be deemed to possess direct
beneficial ownership. Each of Messrs. Kingsley and Duberstein, as members of
Greenhut, may be deemed to beneficially own Shares which Greenhut may be deemed
to beneficially own. Each of Messrs. Kingsley and Duberstein disclaim beneficial
ownership of such Shares for all other purposes.
Greenhut Overseas, as the investment general partner of Greensea,
may be deemed to own beneficially (as that term is defined in Rule 13d-3 under
the Securities Exchange Act of 1934) Shares which Greensea may be deemed to
possess direct beneficial ownership. Each of Messrs. Kingsley and Duberstein, as
members of Greenhut Overseas, may be deemed to beneficially own Shares which
Greenhut Overseas may be deemed to beneficially own. Each of Messrs. Kingsley
and Duberstein disclaim beneficial ownership of such Shares for all other
purposes.
Greenbelt has direct beneficial ownership of the Shares in the
accounts which it manages. In addition, Greenbelt is the investment advisor for
Greenland Investment Company Limited, a Cayman Islands company ("Greenland"). In
such capacity, Greenbelt has the right to vote and direct the disposition of the
519,100 Shares held by Greenland and, consequently, has direct beneficial
ownership of such Shares. Substantially all of the equity interests in Greenland
are owned by Strategic Investment Partners Limited ("SIPL"). Because SIPL has
the right to elect to terminate its investment in Greenland upon less than 60
days' notice and, upon such termination, all securities held by Greenland would
be sold by Greenland or, with SIPL's consent, distributed to SIPL in kind, SIPL
could be deemed to be the beneficial owner of the Shares held by Greenland.
Information concerning SIPL and the identity and background of certain
individuals and entities related thereto is set forth on Exhibit 7 to the
Amendment No. 4 to the Schedule 13D and incorporated herein by reference. Each
of the Messrs. Kingsley and Duberstein, as executive officers and directors of
Greenbelt may be deemed to beneficially own Shares which Greenbelt beneficially
owns. Each of Messrs. Kingsley and Duberstein disclaim beneficial ownership of
such Shares for all other purposes.
Page 13 of 16 Pages
<PAGE>
(b) Greenway has the sole power to vote or direct the vote of
830,000 Shares and the sole power to dispose or to direct the disposition of
such Shares. Greenhouse and Messrs. Kingsley and Duberstein may be deemed to
share with Greenway the power to vote or to direct the vote and dispose or to
direct the disposition of such Shares.
Greentree has the sole power to vote or direct the vote of 355,000
Shares and the sole power to dispose or direct the disposition of such Shares.
Greenhut and Messrs. Kingsley and Duberstein may be deemed to share with
Greentree the power to vote or to direct the vote and to dispose or to direct
the disposition of such Shares.
Greensea has the sole power to vote or direct the vote of 630,700
Shares and the sole power to dispose or direct the disposition of such Shares.
Greenhut Overseas and Messrs. Kingsley and Duberstein may be deemed to share
with Greensea the power to vote or to direct the vote and to dispose or to
direct the disposition of such Shares.
Greenbelt has the sole power to vote or direct the vote of 2,420,500
Shares held in managed accounts and the 519,100 Shares held by Greenland, and,
except as described in Item 5(a) with respect to Greenland, the sole power to
dispose or direct the disposition of all such Shares. Messrs. Kingsley and
Duberstein may be deemed to share with Greenbelt the power to direct the vote
and to dispose or to direct the disposition of such Shares.
Mr. Kingsley also has the sole power to vote or direct the vote of
28,000 Shares and the sole power to dispose or direct the disposition of such
Shares.
(c) Information concerning transactions in the Shares by the
Reporting Persons during the past sixty days or since the most recent filing on
Schedule 13D, whichever is less, is set forth in Exhibit 12 attached hereto,
which is incorporated herein by reference.
(d) No other person is known to have the right to receive or the
power to direct the receipt of dividends from, or the proceeds from the sale of,
the Shares, except the dividends from, or proceeds from the sale of Shares in
each respective account managed by Greenbelt or held by Greenland will be
delivered into each such respective account or Greenland, as the case may be.
Neither any such individual account nor Greenland has an interest in more than
five percent of the class of outstanding Shares.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
The following Exhibits are filed herewith:
10. Letter dated July 29, 1998 from Greenway to the Company.
11. Verified Complaint filed in The Court of Chancery of the State
of Delaware in and for New Castle County on August 5, 1998.
12. Information concerning transactions in the Shares effected by
the Reporting Persons in the last sixty days or since the most recent filing on
Schedule 13D, whichever is less.
Page 14 of 16 Pages
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of their knowledge and belief, the
undersigned certify that the information contained in this Statement is true,
complete and correct.
Dated: August 6, 1998
GREENHOUSE PARTNERS, L.P. GREENWAY PARTNERS, L.P.
By: Greenhouse Partners, L.P., its
general partner
By: /s/ Gary K. Duberstein
----------------------------------
Gary K. Duberstein, general By: /s/ Gary K. Duberstein
partner -------------------------------
Gary K. Duberstein, general
partner
GREENHUT, L.L.C. GREENTREE PARTNERS, L.P.
By: Greenhut, L.L.C., its general
partner
By: /s/ Gary K. Duberstein
----------------------------------
Gary K. Duberstein, Member By: /s/ Gary K. Duberstein
-------------------------------
Gary K. Duberstein, Member
GREENHUT OVERSEAS, L.L.C. GREENSEA OFFSHORE, L.P.
By: Greenhut Overseas, L.L.C., its
investment general partner
By: /s/ Gary K. Duberstein
----------------------------------
Gary K. Duberstein, Member By: /s/ Gary K. Duberstein
-------------------------------
Gary K. Duberstein, Member
GREENBELT CORP.
By: /s/ Alfred D. Kingsley
-------------------------------
Alfred D. Kingsley, President
/s/ Alfred D. Kingsley
-------------------------------
ALFRED D. KINGSLEY
/s/ Gary K. Duberstein
-------------------------------
GARY K. DUBERSTEIN
Page 15 of 16 Pages
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
10 Letter dated July 29, 1998 from Greenway to the Company.
11 Verified Complaint filed in The Court of Chancery of the
State of Delaware in and for New Castle County on August 5,
1998.
12 Information concerning transactions in the Shares effected by
the Reporting Persons in the last sixty days or since the
most recent filing on Schedule 13D, whichever is less.
Page 16 of 16 Pages
Exhibit 10
July 29, 1998
BY FAX AND OVERNIGHT
- --------------------
Inland Steel Industries, Inc.
30 Monroe Street
Chicago, IL 60603
Attn: George A. Ranney, Jr.
Vice President and General Counsel
Re: July 20, 1998 Offer to Purchase
-------------------------------
Gentlemen:
This letter is written on behalf of Greenway Partners, L.P., Greentree
Partners, L.P., Greenhouse Partners, L.P., Greenhut L.L.C., Greenbelt Corp.,
Greensea Offshore, L.P., Greenhut Overseas, L.L.C., Alfred D. Kingsley and Gary
K. Duberstein (collectively, the "Greenway Group").
We have received from Inland Steel Industries, Inc. (the "Company") a copy
of its July 20, 1998 Offer to Purchase setting forth the Company's offer to
purchase, on the terms and subject to the conditions set forth therein, up to
25,500,000 shares of its common stock ("Common Stock") at a purchase price not
greater than $34 nor less than $30 per share (the "Offer").
Under Sections 1(b) and 11(a)(ii)(B) of the Company's November 25, 1997
Rights Agreement, the Board of Directors of the Company may declare a
stockholder to be an "Adverse Person" if, among other things, the Board
determines that the stockholder is "the Beneficial Owner of a number of shares
of Common Stock which the Board of Directors of the Company determines to be
substantial (which number of shares shall in no event represent less than 10% of
the outstanding shares of Common Stock)."
The Greenway Group beneficially owns 4,783,300 shares of Common Stock,
representing approximately 9.7% of the outstanding shares of Common Stock. Given
all of the variables involved in the Company's "Dutch" auction tender, including
choice of price and number of shares tendered and tax considerations (by the
Greenway Group and all other stockholders), the Greenway Group may become the
beneficial owner of in excess of 10% of the outstanding shares of Common Stock
as a result of the consummation of the Offer. According to the Offer, the
Greenway Group also may receive from the Company additional shares of Common
Stock in respect of our holding of shares of Ryerson Tull on terms yet to be
determined.
Please confirm by counter-signing this letter and returning it by August
3, 1998 that, notwithstanding the consummation of the transactions contemplated
by the Offer or a subsequent transaction by the Company involving Ryerson Tull,
the Greenway Group will not become "the Beneficial Owner of a number of shares
of Common Stock which the Board of Directors of the Company determines to be
substantial" or be declared an "Adverse Person" so long as the Greenway Group
does not acquire beneficial ownership of any shares of Common Stock in excess of
the 4,783,300 shares of Common Stock beneficially owned by the Greenway Group
plus such shares of Common Stock which may be received in respect of any shares
of Ryerson Tull that may be owned by the Greenway Group.
1
<PAGE>
Please confirm your agreement with the foregoing by signing a copy of this
letter where indicated below and returning it to us by August 3, 1998. As you no
doubt understand, we cannot allow ourselves to be placed in a position where the
Company could purport to trigger the "poison" of the pill against us. Therefore,
we look forward to receiving a counter-signed copy of this letter from the
Company on a timely basis so that we need not be forced to seek clarification in
another forum.
Very truly yours,
GREENWAY PARTNERS, L.P.,
on behalf of the Greenway Group
By: GREENHOUSE PARTNERS, L.P.,
its General Partner
By: /s/ Gary K. Duberstein
----------------------------------------
Gary K. Duberstein
General Partner
AGREED:
INLAND STEEL INDUSTRIES, INC.
By:
-----------------------------------------
Name:
Title:
Date: , 1998
-------------------
cc: Robert J. Darnall
Chairman, President and Chief Executive Officer
Jay M. Gratz
Vice President and Chief Financial Officer
2
Exhibit 11
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
GREENWAY PARTNERS, L.P., )
GREENTREE PARTNERS, L.P., )
GREENHOUSE PARTNERS, L.P., )
GREENHUT, L.L.C., GREENBELT )
CORP., GREENSEA OFFSHORE, ) C.A. No.
L.P., GREENHUT OVERSEAS, ) ------------------
L.L.C., ALFRED D. KINGSLEY )
and GARY K. DUBERSTEIN, )
)
Plaintiffs, )
)
v. )
)
INLAND STEEL INDUSTRIES, INC., )
A. ROBERT ABBOUD, ROBERT J. )
DARNALL, JAMES A. HENDERSON, )
ROBERT B. McKERSIE, LEO F. )
MULLIN, JEAN-PIERRE ROSSO, )
JOSHUA I. SMITH, NANCY H. )
TEETERS and ARNOLD R. WEBER, )
)
Defendants. )
VERIFIED COMPLAINT
------------------
Plaintiffs Greenway Partners, L.P., Greentree Partners, L.P.,
Greenhouse Partners, L.P., Greenhut, L.L.C., Greenbelt Corp., Greensea Offshore,
L.P., Greenhut Overseas, L.L.C., Alfred D. Kingsley and Gary K. Duberstein
(collectively, "Greenway"), by their undersigned attorneys, allege upon
knowledge with respect to themselves and their own acts and upon information and
belief as to all other matters as follows:
1
<PAGE>
NATURE OF ACTION
----------------
1. This action for injunctive relief arises out of a "Dutch auction"
self-tender offer (the "Self-Tender Offer") scheduled to close at midnight on
Friday, August 14, 1998. Pursuant to this Self-Tender Offer, defendant Inland
Steel Industries, Inc. ("Inland Steel" or the "Company") seeks to wrongfully
coerce plaintiffs, who own approximately 9.7% of the Company's common stock,
into tendering their common stock to the Company. If plaintiffs do not tender
their shares at the lowest possible price provided for by the Dutch auction or
at the price to be determined by the Company and other shareholders as a result
of the Dutch auction, then solely as a result of the Company's consummation of
the Self-Tender Offer plaintiffs' ownership of common stock will rise above 10%
and the Company's Board of Directors could immediately declare plaintiffs to be
an "Adverse Person" under the Company's poison pill shareholder rights plan (the
"Poison Pill").
2. Unless the Court enjoins the Self-Tender Offer, plaintiffs
forever will be deprived of any opportunity to make a free, non-coerced choice
on the merits of the Self-Tender Offer, including whether to tender any shares,
and, if so, how many shares and at what price or prices. Instead, plaintiffs
will be forced to tender their shares at the lowest possible price provided for
by the Dutch auction or at the price to be determined by the Company and other
shareholders as a result of the Dutch auction. Plaintiffs will be forced to
tender at this price for reasons other than the merits of the Self-Tender Offer
i.e., to evade the threat unique to plaintiffs of being dragged across the 10%
Poison Pill threshold solely by the Company's purchase of its shares from other
stockholders pursuant to the Company's Self-Tender Offer.
3. The Company has refused to assure plaintiffs that the Company
will not contend that plaintiffs will have crossed the 10% Poison Pill threshold
by reason of the Company's Self-Tender Offer. When asked why the Company could
not provide this assurance, the Company's Chief Financial Officer stated: "We
don't see what's in it for us."
2
<PAGE>
4. No Delaware court ever has sanctioned the conduct that defendants
are engaged in here: the joint use of a Poison Pill and a Self-Tender Offer to
coerce shareholders to sell their shares to the Company.
PARTIES
-------
5. Plaintiffs (collectively referred to as "Greenway") own 4,783,300
shares of the Company's common stock, representing approximately 9.7% of the
outstanding shares of the Company's common stock. Plaintiffs have been investors
in the Company since 1995, have been shareholder activists seeking to enhance
the value of the Company for all shareholders, and have submitted shareholder
proposals in connection with the Company's 1997 and 1998 annual meetings.
6. Defendant Inland Steel is a corporation incorporated under the
laws of the State of Delaware and is engaged (through subsidiaries) in the
business of metals distribution and processing. As of the close of business on
July 17, 1998, there were 49,226,317 outstanding shares of Inland Steel common
stock.
7. Defendants A. Robert Abboud, Robert J. Darnall, James A.
Henderson, Robert B. McKersie, Leo F. Mullin, Jean-Pierre Rosso, Joshua I.
Smith, Nancy H. Teeters and Arnold R. Weber are directors of the Company.
FACTUAL BACKGROUND
------------------
A. The Self-Tender Offer.
8. On July 20, 1998, Inland Steel commenced an offer (the
"Self-Tender Offer") to purchase up to 25,500,000 shares (approximately 51% of
all outstanding shares) of its common stock pursuant to a procedure commonly
referred to as a "Dutch auction." (A copy of the Offer to Purchase describing
the terms and conditions of the Self-Tender Offer is attached hereto as Exhibit
A.)
9. Pursuant to the Self-Tender Offer, the Company has committed to
purchase up to 25,500,000 shares at a single per share price not greater than
$34 nor less than $30 per share (the "Purchase Price"). The Company will select
the lowest price between $30 and $34 per share that will allow the Company to
purchase 25,500,000 shares. The Company will pay the Purchase Price for all
shares
3
<PAGE>
tendered at prices at or below the Purchase Price. If more than 25,500,000
shares are tendered at or below the Purchase Price, then the Company will
purchase all such shares on a pro-rated basis. For example, if 25,500,000 shares
are tendered at prices ranging from $30 to $32 per share and 10 million shares
are tendered at prices above $32 per share, then the Company will purchase
25,500,000 shares at a price of $32 per share.
10. Greenway also owns approximately 360,100 shares of Ryerson Tull,
Inc. ("Ryerson Tull"), an 87% owned subsidiary of the Company. According to the
Company's Offer to Purchase, Greenway may receive from the Company additional
shares of common stock in connection with Greenway's holdings of Ryerson Tull
shares on terms yet to be determined.
11. Because of the nature of a Dutch auction tender offer, each
stockholder seeking to tender shares in response to the Company's offer must (i)
specify the price (not greater than $34 nor less than $30 per share) at which
the stockholder is willing to have the Company purchase shares, or (ii) elect to
have its shares purchased at a price determined by the Dutch auction tender
process, which could result in all of such person's shares being purchased at
the minimum price of $30 per share. (A copy of the form to be submitted by
stockholders to the Company in order to participate in the Self-Tender Offer is
attached hereto as Exhibit B.)
12. The Company's Self-Tender Offer will close at midnight on
Friday, August 14, 1998, unless extended.
13. Because the Company will purchase approximately 51% of its
outstanding shares (assuming that 25,500,000 shares are validly tendered and not
withdrawn), the proportionate interest in the Company's outstanding common stock
held by stockholders who determine not to tender their shares necessarily will
increase. Thus, if Greenway does not tender any of its shares then Greenway'
proportionate interest in the Company's outstanding common stock will almost
double if other shareholders tender 25,500,000 shares.
4
<PAGE>
B. The Company's Poison Pill.
14. On November 25, 1997, the Company adopted its Poison Pill. All
stockholders hold one right per each share of the Company's common stock. (A
copy of the Company's news release and Form 8-A describing the Poison Pill, and
a copy of the Poison Pill itself, are attached hereto as Exhibit C.)
15. The rights will separate from the Company's shares of common
stock and will be distributed upon the occurrence of any of the following
triggering events (the "Triggering Events"):
(a) The acquisition by any "Acquiring Person" of 20% or more
of the shares of the Company's common stock; or
(b) A declaration by the Board of Directors of the Company
that a person who is the beneficial owner of 10% or more of the outstanding
common stock of the Company is an "Adverse Person" based on a determination that
(i) "such Beneficial Ownership by such Person is
intended to cause the Company to repurchase the shares of Common Stock
beneficially owned by such Person or to cause pressure on the Company to take
action or enter into a transaction or series of transactions intended to provide
such Person with short-term financial gain under circumstances where the Board
of Directors determines that the best long-term interests of the Company and its
stockholders would not be served by taking such action or entering into such
transaction or series of transactions at that time" or
(ii) "such Beneficial Ownership is causing or reasonably
likely to cause a material adverse impact (including, but not limited to,
impairment of relationships with customers or impairment of the Company's
ability to maintain its competitive position) on the business or prospects of
the Company to the detriment of the Company's stockholders."
16. Following the occurrence of any Triggering Event, each right not
owned by an Acquiring Person or an Adverse Person entitles its holder to
purchase, at the right's then current exercise price, shares of the Company's
common stock having a value of twice the right's then current exercise price
(the "Flip-In Provision"). If any person has become an Acquiring Person or an
Adverse Person
5
<PAGE>
and the Company subsequently is involved in certain transactions after which the
Company ceases to exist, then each right will entitle its owner to purchase, at
the right's then current exercise price, shares of common stock of the acquiring
company having a value of twice the right's then current exercise price (the
"Flip-Over Provision").
17. In sum, the Company's Poison Pill has a subjective and objective
trigger. Once a shareholder acquires 10% of the Company's outstanding common
stock, the Board of Directors can pull the subjective trigger and determine that
such person is a Adverse Person and trigger the flip-in poison of the Company's
Poison Pill. Any shareholder who acquires (or seeks to acquire pursuant to a
tender offer) 20% or more of the Company's outstanding common stock immediately
becomes, without any required Board action, an "Acquiring Person" and triggers
the flip-in poison of the Company's Poison Pill.
18. Because Greenway currently owns 9.7% of the Company's
outstanding common stock, additional purchases of common stock by Greenway will
take it over the 10% Poison Pill threshold and would place Greenway in immediate
jeopardy that the Board could, at any time, declare Greenway to be an Adverse
Person under the Poison Pill and thus trigger the flip-in poison of the
Company's Poison Pill. Greenway always has been careful not to take any step
that would cause Greenway's ownership of the Company's stock to cross the 10%
Poison Pill threshold because Greenway knows full well the consequences of the
flip-in poison of the Company's Poison Pill.
C. The Company Refuses Plaintiffs'
Request For Clarification.
19. Promptly after learning of the Self-Tender Offer, Greenway asked
the Company for assurance that any increase in the proportionate share of the
outstanding common stock held by Greenway solely as a result of the consummation
of the Company's Self-Tender Offer, and not as a result of any additional
purchases of common stock by Greenway, would not place Greenway in a position in
which the Company's Board of Directors could declare Greenway to be an Adverse
Person because Greenway then would own more than 10% of the outstanding common
6
<PAGE>
stock of the Company. This information, which is not contained in the Company's
Offer to Purchase, is absolutely vital to any decision by Greenway with respect
to whether or not to tender shares and, if so, how many shares and at what price
or prices. Without an assurance of this type, Greenway has no realistic choice
but to tender its shares at the lowest possible price provided for by the Dutch
auction or at the price to be determined by the Company and other shareholders
as a result of the Dutch auction.
20. On July 29, 1998, and after the Company failed to respond to
oral requests made over the course of several days for this information,
Greenway sent a letter to the Company stating, in part, as follows:
Under Sections 1(b) and 11(a)(ii)(B) of the Company's November
25, 1997 Rights Agreement, the Board of Directors of the Company may
declare a stockholder to be an "Adverse Person" if, among other
things, the Board determines that the stockholder is "the Beneficial
Owner of a number of shares of Common Stock which the Board of
Directors of the Company determines to be substantial (which number
of shares shall in no event represent less than 10% of the
outstanding shares of Common Stock)."
The Greenway Group beneficially owns 4,783,300 shares of
Common Stock, representing approximately 9.7% of the outstanding
shares of Common Stock. Given all of the variables involved in the
Company's "Dutch" auction tender, including choice of price, number
of shares tendered and tax considerations (by the Greenway Group and
all other stockholders), the Greenway Group may become the
beneficial owner of in excess of 10% of the outstanding shares of
Common Stock as a result of the consummation of the Offer. According
to the Offer, the Greenway Group also may receive from the Company
additional shares of Common Stock in respect of our holdings of
shares of Ryerson Tull on terms yet to be determined.
Please confirm by counter-signing this letter and returning it
by August 3, 1998 that, notwithstanding the consummation of the
transactions contemplated by the Offer or a subsequent transaction
by the Company involving Ryerson Tull, the Greenway Group will not
become "the Beneficial Owner of a number of shares of Common Stock
which the Board of Directors of the Company determines to be
substantial" or be declared an "Adverse Person" so long as the
Greenway Group does not acquire beneficial ownership of any shares
of Common Stock in excess of the 4,783,300 shares of Common Stock
beneficially owned by the Greenway Group plus such shares of Common
Stock which may be received in respect of any shares of Ryerson Tull
that may be owned by the Greenway Group.
(A copy of the letter is attached hereto as Exhibit D.)
21. Greenway received no written response from the Company to its
letter. Rather, late in the afternoon, on Monday, August 3, 1998, the Company's
Chief Financial Officer, J.M. Gratz, called plaintiffs Alfred D. Kingsley and
Gary
7
<PAGE>
K. Duberstein. Mr. Gratz refused to provide any assurance with respect to
whether Greenway would be deemed a 10% shareholder for purposes of the Company's
Poison Pill solely as a result of any increase in Greenway's proportionate
ownership of the Company's common stock following the consummation of the
Self-Tender Offer. When pressed why the Company would not provide such
clarification so that Greenway could make a decision with respect to the
outstanding Self-Tender Offer on an informed basis and without wrongful
coercion, Gratz replied: "We don't see what's in it for us."
IRREPARABLE HARM
----------------
22. Absent temporary, preliminary and permanent injunctive relief,
Greenway will suffer irreparable harm. Greenway will be forced to tender all of
its shares at the lowest price provided for in the Self-Tender Offer. Greenway
forever will be deprived of any opportunity to make a free, non-coerced choice
on the merits of the Self-Tender Offer, including whether to tender any shares,
and, if so, how many shares and at what price or prices.
CLAIM FOR RELIEF
----------------
23. Plaintiff incorporates by reference each of the allegations set
forth above as if set forth in full herein.
24. Each of the Company's directors owes the Company's shareholders,
including Greenway, fiduciary duties to, among other things, manage the affairs
of the corporation with due care and with loyalty and in good faith and to
disclose fully and fairly all material information relevant to the Company's
Self-Tender Offer, and not to engage in wrongful coercion.
25. As alleged in detail above, defendants have breached their
fiduciary duties owed to plaintiffs by, inter alia:
(a) Wrongfully and inequitably coercing Greenway into tendering
its shares into the Self-Tender Offer at the lowest possible
price provided for by the Dutch auction or at the price to be
determined by the Company and other shareholders as a result
of the Dutch auction, not for reasons related to the merits of
the Self-Tender
8
<PAGE>
Offer but rather to avoid being deemed by the Company to have
triggered the 10% threshold of the Company's Poison Pill and
thereby allowing the Company to declare plaintiffs an Adverse
Person under the terms of the Company's Poison Pill;
(b) Implementing a scheme to drag plaintiffs, involuntarily, over
the 10% threshold of the Company's Poison Pill, solely as a
result of actions taken by the Company, so that the Board of
Directors can at any time declare Greenway to be an "Adverse
Person" and thus trigger a release of the flip-in poison of
the Company's Poison Pill; and
(c) Failing to disclose in the Self-Tender Offer or in response to
Greenway's inquiries whether or not an increase in Greenway's
ownership of the Company's common stock above 10%, solely as a
result of the Company's consummation of the Company's
Self-Tender Offer, will be deemed by the Company to trigger
the 10% threshold of the Company's Poison Pill.
26. Plaintiffs have no adequate remedy at law.
WHEREFORE, plaintiffs respectfully demand judgment against
defendants as follows:
(a) Temporarily, preliminarily and permanently enjoining the Company
and the individual defendants, their agents and employees, and anyone acting on
their behalf, from taking any steps to purchase shares or otherwise consummate
the Self-Tender Offer, unless the Company agrees that plaintiffs will not be
deemed to be an "Adverse Person" so long as Greenway does not acquire beneficial
ownership of any shares of the common stock of the Company in excess of the
4,783,300 shares of common stock already beneficially owned by Greenway or
additional shares of common stock of the Company that may be received in
connection with any shares of Ryerson Tull owned by Greenway;
(b) Temporarily, preliminarily and permanently enjoining the Company
and the individual defendants, their agents, employees and anyone acting on
their
9
<PAGE>
behalf, from taking any steps to purchase shares or otherwise consummate the
Self-Tender Offer unless and until full, accurate and complete disclosure is
made concerning whether or not any increase in the proportionate ownership of
the outstanding common shares by plaintiffs as a result of the consummation of
the Self-Tender Offer will be deemed by the Company to trigger the 10% threshold
in the Company's Poison Pill;
(c) Awarding attorneys' fees and other costs; and
(d) Granting such other and further relief as the Court deems just
and appropriate.
MORRIS, NICHOLS, ARSHT & TUNNELL
-------------------------------
A. Gilchrist Sparks, III
Alan J. Stone
Jessica Zeldin
P.O. Box 1347
1201 North Market Street
Wilmington, DE 19899
(302) 658-9200
Attorneys for Plaintiffs
OF COUNSEL:
Joseph Allerhand
Stephen A. Radin
WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153
(212) 310-8000
August 5, 1998
10
Exhibit 12
TRANSACTION IN SHARES OF THE COMPANY
The Reporting Persons engaged in the following transactions in
Shares of the Company during the past 60 days or since the most recent filing on
Schedule 13D, whichever is less. All transactions involved purchases of Shares
on the New York Stock Exchange.
Reporting
Person
With Direct Price Per Share
Beneficial Date of Number of (Excluding)
Ownership Transaction Shares Commission)
--------- ----------- ------ -----------
Greenbelt 5/26/98 20,000 $26.625
Greenbelt 5/27/98 40,500 $26.4352
Greenbelt 6/25/98 80,000 $27.6563
NYFS11...:\92\56392\0003\91\SCH8058W.18B
