SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
July 24, 1998
Date of report (Date of earliest event reported)
MAVERICK TUBE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction or Incorporation)
1-10651 43-1455766
(Commission File Number) (IRS Employer Identification No.)
16401 Swingley Ridge Road, Suite 700
Chesterfield, Missouri 63017
(Address of Principal Executive Offices) (Zip Code)
(314) 733-1600
(Registrant's Telephone Number, Including Area Code)
400 Chesterfield Center, Second Floor
Chesterfield, Missouri 63017
(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
On July 24, 1998, the Board of Directors of Maverick Tube Corporation, a
Delaware corporation (the "Company"), declared a dividend payable August 3, 1998
of one right (a "Right") for each outstanding share of common stock, par value
$0.01 per share ("Common Stock"), of the Company held of record at the close of
business on August 3,1998 (the "Record Time"), or issued thereafter and prior to
the Separation Time (as hereinafter defined). The Rights will be issued pursuant
to a Shareholder Rights Agreement, dated as of July 24, 1998 (the "Rights
Agreement"), between the Company and the Rights Agent named therein (the "Rights
Agent"). Each Right, when exercisable, entitles its registered holder to
purchase from the Company one one-hundredth of a share of a new series of
preferred stock, designated as Series I Junior Participating Preferred Stock
(the "Preferred Stock"), at a purchase price of $50.00 (the "Exercise Price"),
subject to adjustment
Initially, the Rights will be attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights Certificates will
be distributed. The Rights will separate from the Common Stock upon the earlier
to occur of the following ("Separation Time"): (i) the day that a public
announcement is made that a person or group of affiliated or associated persons
(an "Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of 20% or more of the outstanding shares of Common Stock,
or (ii) the tenth day following the commencement of a tender offer or exchange
offer that would result in a person or a group becoming the beneficial owners of
20% or more of such outstanding shares of Common Stock. Until the Separation
Time, (i) the Rights will be evidenced, with respect to any of the Company's
Common Stock certificates outstanding as of and after the Record Time (other
than shares held in the Company's treasury), by such Common Stock certificates
and will be transferred with and only with such Common Stock certificates, (ii)
new Common Stock certificates issued after the Record Time will contain a
notation incorporating the Rights Agreement by reference, and (iii) the
surrender for transfer of any certificates for Common Stock outstanding as of
and after the Record Time will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificates.
The Rights are not exercisable until the Separation Time. The Rights
will expire at the close of business on July 23, 2008, unless earlier redeemed
or exchanged by the Company, as described below.
As soon as practicable following the Separation Time, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to
holders of record of the Common Stock as of the close of business at the
Separation Time (except for any persons whose Rights have become void pursuant
to the Rights Agreement) and then and thereafter such separate Rights
Certificates alone will evidence the Rights. Except as otherwise determined by
the Board of Directors, only shares of Common Stock issued prior to the
Separation Time will be issued with Rights.
The Exercise Price payable, and the number of one one-hundredths of a
share of Preferred Stock or other securities or property issuable, upon exercise
of the Rights are subject to adjustment from time to time to prevent dilution
(i) in the event of a stock dividend on, or a subdivision or combination of, the
Common Stock, or (ii) upon the issuance or distribution to holders of Common
Stock of any other securities or assets under circumstances where such an
adjustment is appropriate in order to protect the interests of holders of Rights
generally. Upon exercise of Rights, no fractional shares of Preferred Stock,
other than one one-hundredths of such shares, will be issued and, in lieu
thereof, an adjustment in cash will be made based on a formula set forth in the
Rights Agreement.
In the event that any person shall become an Acquiring Person (such
event being referred to herein as a "Flip-in Event"), each holder of a Right
will thereafter have the right to receive, upon exercise, in lieu of one
one-hundredth of a share of Preferred Stock, that number of shares of Common
Stock (or, in certain circumstances, property or other securities of the
Company) having a market value equal to two times the Exercise Price of the
Right.
For example, at an exercise price of $50.00 per Right, each Right
following a Flip-in Event would entitle its holder to purchase $100.00 worth of
Common Stock of the Company (or, under certain circumstances, property or other
securities of the Company) for $50.00. Assuming that the Common Stock had a per
share value of $25.00 at the time of a Flip-in Event, the holder of each valid
Right would be entitled to purchase four shares of Common Stock for $50.00.
Notwithstanding the discussion in the two preceding paragraphs,
following the occurrence of any Flip-in Event, all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were, beneficially
owned by an Acquiring Person will be null and void, including for purposes of
any subsequent Exchange (as defined below).
If, following a Stock Acquisition Date, (i) the Company is acquired in
a merger or other business combination transaction in which the Company is not
the surviving corporation, or (ii) 50% or more of the Company's assets or
earning power is sold or transferred (in one transaction or a series of
transactions), or (iii) the Acquiring Person increases by more than 1% its
percentage beneficial ownership of the Common Stock or any other class of stock
of the Company or engages in certain self-dealing transactions with the Company,
each holder of a Right (except Rights owned by an Acquiring Person or certain
related parties) shall thereafter have the right to receive, upon the exercise
of the Right and payment of the Exercise Price, common stock of the surviving or
purchasing company or of the Acquiring Person (or, in certain cases, one of its
affiliates) which at the time of such transaction has a market value equal to
two times the Exercise Price.
At any time after the occurrence of a Flip-In Event, the Company may
elect to effect a full or partial exchange (an "Exchange") of shares of its
Common Stock for Rights (other than Rights owned by an Acquiring Person which
have become void), at an initial exchange ratio of one share of Common Stock for
each Right owned, subject to adjustment. Alternatively, the Company may elect to
effect such an Exchange using shares of its Preferred Stock instead of Common
Stock, at an initial exchange ratio of one one-hundredth of a share of Preferred
Stock for each Right owned, subject to adjustment, or other securities of the
Company or assets having an equivalent value.
At any time prior to a Stock Acquisition Date, the Company may elect to
redeem the Rights in whole, but not in part, at a price of $.01 per Right
(payable in cash, Common Stock or other consideration deemed appropriate by the
Board of Directors). Immediately upon the action of the Board of Directors
electing to redeem the Rights, the Rights will terminate and the only right of
the holders of Rights will be to receive the $.01 redemption price per Right.
The Preferred Stock purchasable upon exercise of the Rights or issuable
upon an Exchange will be nonredeemable and junior to any other series of
preferred stock the Company may issue (unless otherwise provided by law or in
the terms of such stock). Each one one-hundredth of a share of Preferred Stock
will have a preferential quarterly dividend in an amount equal to the greater of
$.01 or any quarterly dividend for such quarter declared on each share of Common
Stock, and the holder thereof will be entitled to one vote on all matters
submitted to a vote of the stockholders of the Company, voting as a single class
with the holders of Common Stock, except to the extent expressly provided
otherwise by law or the Rights Agreement. In the event of liquidation, each one
one-hundredth of a share of Preferred Stock will receive a preferred liquidation
payment equal to the greater of $1.00 or the payment made per each share of
Common Stock. The rights of the Preferred Stock are protected by customary
anti-dilution provisions. Fractions of shares of Preferred Stock in integral
multiples of one one-hundredth of a share will be issuable; however, the Company
may elect to distribute depository receipts in lieu of such fractions of shares.
In lieu of fractional shares of Preferred Stock other than integral multiples of
one one-hundredth of a share, an adjustment in cash will be made based on the
market price of the Common Stock on the last trading date prior to the date of
exercise.
Until a Right is exercised or exchanged, the holder thereof, as such,
will have no rights as a shareholder of the Company, including, without
limitation, the right to receive dividends.
While the distribution of the Rights will not be taxable to
shareholders or to the Company, shareholders may, depending upon the
circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) of the Company or for
common stock of an acquiring company as set forth above, or are exchanged as
provided above.
Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Company prior to the Separation Time. After the
Separation Time, the provisions of the Rights Agreement may be amended by the
Board in order to cure any ambiguity or to make changes which do not adversely
affect the interests of holders of Rights generally.
Because the Rights could cause substantial dilution to a person or group
that acquires 20% or more of the Common Stock unless the Rights are first
redeemed by the Board of Directors of the Company, they do have certain
anti-takeover effects. Nevertheless, the Rights should not interfere with a
transaction that is in the best interests of the Company and its shareholders
prior to the Flip-in date, because the Rights can be redeemed before the
consummation of such transaction.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements - not applicable
(b) Pro Forma Financial Information - not applicable
(c) Exhibits. The following exhibits are filed with this report:
Exhibit No. Document
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(99) Press Release, dated July 24, 1998, issued by the Registrant.
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SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 27, 1998
MAVERICK TUBE CORPORATION
By: /s/ Barry R. Pearl
Barry R. Pearl
Vice President of Finance
(Principal Financial Officer)
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EXHIBIT INDEX
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Exhibit
Number Description Page Number
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(99) Press Release, dated July 24, 1998, issued by
the Registrant. E-1
PRESS RELEASE
Maverick Tube Corporation announced today that its Board of Directors
approved the Shareholder Rights Plan at its meeting on July 24, 1998.
The Rights Plan, which is similar to plans adopted by many other
corporations with publicly traded stock, is designed to ensure that Maverick
shareholders would be treated fairly in any merger and to guard against any
partial tender offers for Maverick stock or other abusive takeover tactics that
otherwise might be used by a corporate raider to gain control of the company.
The Rights Plan provides for the issuance of one stock purchase right
for each outstanding share of Maverick's common stock as of a record date to be
determined by the Board of Directors. The Rights will become exercisable only if
a person acting without the approval of Maverick's Board of Directors should
acquire beneficial ownership of twenty percent or more of the outstanding shares
of Maverick's common stock or announce an unsolicited tender offer for the
stock. If exercisable, the Rights would give all shareholders, other than the
twenty percent shareholder, the opportunity to buy substantial additional
amounts of Maverick's common stock under terms and conditions that would
significantly dilute the twenty percent shareholder. Unless and until
exercisable, the Rights will trade with and be inseparable from Maverick's
common stock, and will be evidenced by common stock certificates.
Gregg Eisenberg, president and chief executive officer of the company,
stated that "the Rights Plan is not intended to prevent and will not prevent an
acquisition of the company at a full and fair price. However, it may cause
substantial dilution to a person or group that acquires twenty percent or more
of the company's common stock unless the Rights are first redeemed by the Board
of Directors. The Rights should not interfere with any merger or other business
combination that is in the best interest of the company and its shareholders,
since the Rights may be redeemed by the company prior to the day that a person
or group acquires twenty percent or more of the company's common stock. The
Rights Plan was not adopted in response to any effort to acquire control of the
company."
The Plan does not in any way weaken the company's financial strength or
interfere with its business plans. The issuance of the Rights has no dilutive
effect, will not affect reported earnings per share, is not taxable to the
company or shareholders and will not change the way in which the company's
shares are traded.
