MAVERICK TUBE CORPORATION, 424B1, 1999-10-01

MAVERICK TUBE CORPORATION
424B1, 1999-10-01
STEEL PIPE & TUBES

Previous: CORPORATE VISION INC /OK, 8-K, 1999-10-01

Next: VAN KAMPEN WORLD PORTFOLIO SERIES TRUST, 497J, 1999-10-01

Filed Pursuant to Rule 424(b)(1)
Registration No. 333-87045

2,000,000 SHARES

[Maverick Tube Corporation Logo]

COMMON STOCK

-------------

We are selling 2,000,000 shares of our common stock. Our common
stock is traded on the Nasdaq National Market under the symbol
"MAVK." On September 30, 1999, the reported last sale price of our
common stock on the Nasdaq National Market was $16.625 per share.

-------------------

YOU SHOULD CONSIDER THE RISKS WHICH WE HAVE DESCRIBED IN "RISK
FACTORS" BEGINNING ON PAGE 8 BEFORE BUYING SHARES OF OUR COMMON
STOCK.

-------------------

<TABLE>
<CAPTION>
PER SHARE TOTAL
---------------------- ----------------------
<S> <C> <C>
Public offering price................................ $16.250 $32,500,000
Underwriting discount................................ $ 0.934 $ 1,868,000
Proceeds, before expenses, to us..................... $15.316 $30,632,000
</TABLE>

-------------------

The underwriters may purchase up to an additional 300,000 shares
from us at the public offering price, less the underwriting
discount, within 30 days from the date of this prospectus to cover
over-allotments.

Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.

Raymond James & Associates, Inc., on behalf of the underwriters,
expects to deliver the shares to purchasers on or about
October 6, 1999.

-------------------

RAYMOND JAMES & ASSOCIATES, INC.

MORGAN KEEGAN & COMPANY, INC.

The date of this Prospectus is September 30, 1999.

<PAGE>

[PHOTO]

<PAGE>
You should rely only on the information contained in this
prospectus. We have not, and the underwriters have not, authorized
any other person to provide you with different information. If
anyone provides you with different or inconsistent information, you
should not rely on it. We are not, and the underwriters are not,
making an offer to sell these securities in any jurisdiction where
the offer or sale is not permitted. You should assume that the
information appearing in this prospectus is accurate as of the date
on the front cover of this prospectus only. Our business, financial
condition, results of operations and prospects may have changed
since that date.

-------------------

FORWARD-LOOKING STATEMENTS

We make forward-looking statements in this prospectus and in our
public documents that are incorporated by reference, which represent
our expectations or beliefs about future events and financial
performance. You can identify these statements by forward-looking
words such as "expect," "believe," "anticipate," "goal," "plan,"
"intend," "estimate," "may," "will" or similar words. Similarly, any
discussions about our large-diameter facility or its products and
any other statement that is not a historical fact is a
forward-looking statement. Forward-looking statements are subject to
known and unknown risks, uncertainties and assumptions, including:

* oil and gas price volatility;

* steel price volatility;

* domestic and foreign competitive pressures;

* fluctuations in industry-wide inventory levels;

* the presence or absence of governmentally imposed trade
restrictions;

* asserted and unasserted claims;

* our ability and the ability of entities with which we do
business to modify or redesign our and their computer systems
to work properly in the year 2000; and

* those other risks and uncertainties described under "Risk
Factors" and elsewhere in this prospectus and in our other
filings with the Securities and Exchange Commission.

In light of these risks, uncertainties and assumptions, the
forward-looking events discussed in this prospectus might not occur.
In addition, actual results could differ materially from those
suggested by the forward-looking statements. Accordingly, you should
not place undue reliance on the forward-looking statements. We
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.

<PAGE>
PROSPECTUS SUMMARY

This summary highlights selected information from this
prospectus and may not contain all of the information that is
important to you. To understand this offering fully, you should read
the entire prospectus carefully, including the risk factors and the
financial statements and related notes, before you decide whether to
invest in our common stock. Unless we state otherwise,
all financial information and share and per share data in this
prospectus (1) assume that the underwriters do not exercise their
over-allotment option and (2) do not include shares reserved for
issuance under our stock option plans. Unless the context otherwise
requires, "we," "us," "our" or "Maverick" refers to Maverick Tube
Corporation and its subsidiaries.

OUR COMPANY

We are a leading domestic producer of tubular steel products
used in energy and industrial applications. We manufacture "oil
country tubular goods," which are steel tubular products used in the
completion and production of oil and natural gas wells. We also
serve the energy industry by manufacturing line pipe, which is used
primarily in the transportation of oil and natural gas. For
industrial applications, we manufacture structural tubing and
standard pipe. We also recently began producing "cold drawn tubing,"
which is used as a component of high quality products that require
close tolerances. During fiscal 1998, energy products accounted for
approximately 70% of our total revenues.

Manufacturers produce oil country tubular goods and line pipe
through both the electric resistance welded and seamless processes.
We produce only electric resistance welded pipe, which is generally
a lower priced, comparable quality alternative to seamless pipe in
many applications. We produce oil country tubular goods to meet or
exceed applicable American Petroleum Institute specifications. We
are also capable of manufacturing products in custom or proprietary
grades. Virtually all of our oil country tubular goods and line pipe
are fully completed or "end-finished" at our facilities. In
contrast, some of our competitors outsource the end-finishing of
their products or do not end-finish their products at all. The
principal uses of our energy industry products include:

OIL COUNTRY TUBULAR GOODS
-------------------------

* Surface casing to protect underground
formations while drilling

* Production casing to line wells for
completion

* Production tubing to convey oil and
gas to the surface

LINE PIPE
---------

* Surface production flow lines

* Gathering systems

* Pipeline distribution systems
for oil and gas

Structural tubing is an electric resistance welded product and
has a square, round or rectangular cross-section depending on the
end use. We believe structural tubing is an attractive alternative
to other structural steel forms, such as I-beams and H-beams, as
tubing products offer strength and other product characteristics
similar to beams, but with less steel content, resulting in lower
costs to the end user in many applications. We also produce standard
pipe products that are used in a variety of industrial applications.
The cold drawn tubing market is made up of mechanical or pressure
tubing used for applications that require closer tolerances and/or a
better surface finish than ordinary electric resistance welded or
seamless products.

<PAGE>
The principal uses of our industrial products include:

STRUCTURAL TUBING
-----------------

*Construction, including building columns, handrails and bridge
frames

*Transportation, including boat trailers

*Agricultural, including farm implement components

*Material handling, including storage rack systems and conveying
systems support

*Recreational, including exercise equipment

STANDARD PIPE
-------------

*Steam, water and gas lines

*Plumbing

*Heating

COLD DRAWN TUBING
-----------------

*Hydraulic and pneumatic cylinder stock

*Industrial shapes

*Conveyor rollers

*Axles and steering columns

*Motor housings

OUR BUSINESS STRATEGY

Increase market share by expanding our existing product lines.
We believe that the expansion of our product lines in both the
energy and industrial segments of our business has allowed us to
increase our market share by capitalizing on our existing customer
relationships to market additional products. Our planned
construction and equipping of the new large-diameter facility
discussed below is an important part of this strategy.

Identify and enter new markets. We continually seek and make
acquisitions and capital expenditures to enter new markets as
evidenced by our entry into the structural tube market in 1994, and
our recent entry into the cold drawn tubular market. We intend to
seek additional opportunities to expand our business to new markets
where we believe we can compete effectively and profitably.

Continually improve the efficiency of our manufacturing process.
We intend to continue to pursue our objective of being a low-cost,
high-volume producer of quality steel-tubular products by
seeking to:

* maintain product manufacturing cost controls;

* maximize production yields from raw materials;

* make capital expenditures designed to lower costs and improve
quality;

* minimize unit production costs through effective utilization
of plant capacity; and

* minimize freight costs.

Deliver quality products and service to our customers. We
believe that we have achieved an excellent reputation with our
existing customers. We intend to continue to build long-term
customer relationships with new and existing customers by seeking
to:

* offer broad-based product lines;

* focus on product availability;

* deliver competitively priced quality products; and

* provide a high level of customer support before and after the
sale.

<PAGE>
PRODUCT LINE EXPANSION

To further our growth and enhance our ability to compete in our
energy and industrial businesses, we plan to expand our current
product lines to include larger diameter pipe and tubing products.
As the focal point to this expansion, we intend to construct and
equip a new large-diameter facility immediately adjacent to our
current facilities in Hickman, Arkansas, at an estimated cost of $35
million. We have chosen this strategic location for the new facility
to achieve significant cost-saving advantages. These advantages
include:

* utilization of lower-cost, non-union labor;

* access to rail, truck and barge transportation;

* proximity to the Nucor Corporation steel mill, Maverick's
primary steel supplier; and

* shared overhead.

Based principally on historical product relationships and our
assumptions about markets, we estimate that our current product
size range allows us to compete for approximately 49% of the total
tons consumed in all of the markets we serve. Similarly, we estimate
that our expansion into the production of larger diameter pipe and
tubing products should allow us to compete for approximately 67% of
the total tons consumed in these markets. This represents an estimated
increase of approximately 37% of the total tons consumed for which we
can compete in the markets we serve.

We recently entered into a definitive agreement for the purchase
of a significant portion of the equipment required for the new
large-diameter facility for a purchase price of $11.75 million.
Although consummation of this purchase is subject to various
conditions, we expect to close the transaction in January 2000. We
believe we will begin limited production of select industrial and
energy products at the new facility by July 2000 with full
production capability of all products by October 2000.

We were incorporated in Missouri in 1977 and reincorporated in
Delaware in 1987. Our principal executive offices are located at
16401 Swingley Ridge Road, Seventh Floor, Chesterfield, Missouri
63017 and our telephone number is (636) 733-1600.

THE OFFERING

<TABLE>
<S> <C>
Common stock offered by us...................... 2,000,000 shares

Common stock outstanding after the
offering........................................ 17,440,474 shares<F1>

Use of proceeds................................. We intend to use the proceeds to fund a significant
portion of the costs of constructing and equipping
of a new large-diameter facility.

Nasdaq National Market symbol................... MAVK

<FN>
- -------------------
<F1> Includes 3,000 shares issued after June 30, 1999 upon the exercise of
stock options.
</TABLE>

RISK FACTORS

You should consider the risks discussed in "Risk Factors" and
elsewhere in this prospectus before deciding to invest in our common
stock.

<PAGE>
<PAGE>
SUMMARY CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE, TONS SHIPPED AND PER TON AMOUNTS)

The following table summarizes our financial information. You
should read this information in conjunction with our consolidated
financial statements, and the sections titled "Selected Consolidated
Financial Data," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Business" included
elsewhere in this prospectus.

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED SEPTEMBER 30, ENDED JUNE 30,
---------------------------------------------------- -------------------
1994 1995<F1> 1996<F2> 1997 1998 1998 1999
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales............................... $124,843 $167,896 $204,182 $291,060 $265,389 $213,617 $118,410
Cost of goods sold...................... 117,833 159,865 182,042 252,803 232,038 183,843 118,047
-------- -------- -------- -------- -------- -------- --------
Gross profit............................ 7,010 8,031 22,140 38,257 33,351 29,774 363
Selling, general and administrative..... 4,896 7,728 10,198 13,966 14,815<F3> 9,335 10,528
Start-up costs.......................... 392 245 -- -- -- -- 2,496<F4>
-------- -------- -------- -------- -------- -------- --------
Income (loss) from operations........... 1,722 58 11,942 24,291 18,536 20,439 (12,661)
Interest expense........................ 1,125 3,164 2,522 2,067 1,731 1,274 1,261
Other income............................ -- 772 -- -- -- 61 360
-------- -------- -------- -------- -------- -------- --------
Income (loss) before income taxes....... 597 (2,334) 9,420 22,224 16,805 19,226 (13,562)
Provision (credit) for income taxes..... 168 -- 1,882 7,339 5,420 6,619 (4,874)
-------- -------- -------- -------- -------- -------- --------
Net income (loss)....................... $ 429 $ (2,334) $ 7,538 $ 14,885 $ 11,385 $ 12,607 $ (8,688)
======== ======== ======== ======== ======== ======== ========
Diluted earnings (loss) per share....... $ 0.04 $ (0.16) $ 0.50 $ 0.97 $ 0.73 $ 0.81 $ (0.56)
Average shares deemed outstanding....... 12,845 14,920 15,000 15,282 15,564 15,635 15,437

OTHER DATA:
Depreciation and amortization........... $ 3,395 $ 4,691 $ 5,201 $ 5,697 $ 6,172 $ 4,313 $ 5,471
Capital expenditures.................... 20,759 5,592 5,497 9,537 22,181 8,053 11,976
EBITDA<F5>.............................. 5,117 5,521 17,143 29,988 24,708 24,813 (6,830)
Tons shipped:
Energy products..................... 206,182 203,775 230,504 334,928 263,243 215,656 118,296
Industrial products................. 8,469 72,600 114,728 135,029 164,973 122,654 113,198
Average selling price per ton<F6>:
Energy products..................... $ 574 $ 609 $ 620 $ 655 $ 683 $ 691 $ 558
Industrial products................. 457 527 484 483 477 480 447

<CAPTION>
JUNE 30, 1999
-------------------------
AS
ACTUAL ADJUSTED<F7>
-------- --------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital................................................................................ $ 37,712 $ 37,712
Total assets................................................................................... 145,390 180,390
Current maturities of long-term debt........................................................... 694 694
Long-term debt (less current maturities)....................................................... 7,669 7,669
Revolving credit facility...................................................................... 22,300 26,994
Stockholders' equity........................................................................... 81,375 111,681

<FN>
- ------------------------
<F1> The fiscal year ended September 30, 1995 is the first reporting period
which includes results of operations of our structural tube facility which
began operations in October 1994.
<F2> Includes the one-time effect of the change in accounting practice which
resulted in a reduction in net sales, gross profit, net income and diluted
earnings per share of $8,700,000, $1,000,000, $839,000 and $0.06,
respectively.
<F3> Includes a write-down of software costs of $1,605,000.
<F4> The nine months ended June 30, 1999 is the first reporting period which
includes results of operations of our cold drawn tubing facility which
began operations in October 1998.
<F5> EBITDA represents earnings before interest, income taxes, depreciation and
amortization. We believe EBITDA is a widely accepted, supplemental
financial measurement used by many investors and analysts to analyze and
compare companies' performances. However, EBITDA should not be considered
as an alternative to income from operations or to cash flows from
operating, investing or financing activities, as determined in accordance
with generally accepted accounting principles. EBITDA should also not be
construed as an indication of a company's operating performance or as a
measure of liquidity. Management's discretionary use of funds depicted by
EBITDA may be limited by working capital, debt service and capital
expenditure requirements and by restrictions related to legal
requirements, commitments and uncertainties. Because EBITDA excludes some,
but not all, items that affect net income and because these measures may
vary among companies, the EBITDA data presented above may not be
comparable to similarly titled measures of other companies.
<F6> Includes only "prime" products which exclude scrap and secondary sales,
product returns and selling allowances.

<PAGE>
<F7> As adjusted to give effect to our sale of 2,000,000 shares of common
stock under this prospectus at a public offering price of $16.25 per share,
the application of the net proceeds and assumed borrowings under our
existing revolving credit facility of $4.7 million, which represents our
expected amount of additional funds necessary to fund the construction
and equipping of our new large-diameter facility. See "Use of Proceeds"
for a description of our plans for the offering proceeds.
</TABLE>

<PAGE>
<PAGE>
RISK FACTORS

Investing in our common stock will provide you with an equity
ownership in Maverick. Performance of your shares will reflect the
performance of our business related to, among other things, our
competition, general, economic and market conditions and industry
conditions. The price of our stock may decline and could lower the
value of your investment. You should carefully consider the
following factors as well as other information contained in this
prospectus before deciding whether to invest in shares of our common
stock.

FLUCTUATIONS IN OIL AND NATURAL GAS PRICES COULD ADVERSELY AFFECT US
BECAUSE WE SELL A SIGNIFICANT PORTION OF OUR PRODUCTS TO THE ENERGY
INDUSTRY.

Our principal products consist of oil country tubular goods and
line pipe. Sales of these products to the energy industry constitute
the most significant source of our revenues. In fact, revenues from
the sale of oil country tubular goods and line pipe to the energy
industry accounted for approximately 56%, 70%, 77% and 72% of our
total sales for the nine months ended June 30, 1999, fiscal 1998,
fiscal 1997 and fiscal 1996, respectively. Demand for these products
depends primarily upon the number of oil and natural gas wells being
drilled, completed and worked over in the United States and Canada
and the depth and drilling conditions of those wells. The level of
these activities are primarily dependent on current and anticipated
oil and natural gas prices. Many factors, such as the supply and
demand for oil and natural gas, general economic conditions and
global weather patterns, affect these prices. As a result, the
future level and volatility of oil and natural gas prices are
uncertain.

Since January 1998, oil and natural gas prices have been
declining and drilling levels have fallen significantly, resulting
in our incurring operating losses in each of the first three
quarters of fiscal 1999. Although oil and gas prices and, to a
lesser extent, drilling levels have recently improved, we expect to
incur an operating loss in the quarter ending September 30, 1999. We
expect the loss to be modestly lower than that incurred in our third
fiscal quarter. We cannot assure you that this recent recovery of
prices and drilling activity will be sustained or what its longer-term
effect will be on our business.

THE VOLATILITY AND CYCLICAL NATURE OF STEEL PRICES MAY ADVERSELY
AFFECT OUR BUSINESS.

Purchased steel represents slightly more than two-thirds of our
costs of goods sold. As a result, the steel industry, which is
highly volatile and cyclical in nature, affects our business both
positively and negatively. Numerous factors, most of which are
beyond our control, drive the cycles of the steel industry and
influence steel prices. Some of these factors are:

* general economic conditions;

* industry capacity utilization;

* import duties and other trade restrictions; and

* currency exchange rates.

Consistent with the cyclical nature of the steel industry, our
major supplier of steel announced three price decreases from
mid-September 1998 through November 1998 and has announced five
price increases since December 1998. Changes in steel prices can
affect the pricing levels of our products. In response to any
increases in steel costs, we seek to maintain our profit margin by
attempting to increase the price of our products. However, increases
in the prices of our products often do not fully compensate for
steel price increases and generally lag several months behind
increases in steel prices. As a result, we typically have a limited
ability to recover increases in steel costs.

<PAGE>
WE MAY LOSE BUSINESS TO COMPETITORS WHO ARE LARGER THAN US OR WHO
PRODUCE THEIR OWN STEEL.

Some of our competitors are larger and have greater financial
and marketing resources and business diversification than us. These
companies may be better able than us to successfully endure
downturns in either the energy or industrial sectors. Also, many of
our larger competitors are integrated steel producers--producers who
make their own raw materials rather than purchase their raw
materials in the open market. During periods of strong steel demand,
we may be at a competitive disadvantage to these integrated
competitors. As a result, we may lose business to any of these
competitors. The oil country tubular goods and structural product
markets are largely commodity in nature and as a result, price
competition is a particular importance.

THE LEVEL OF IMPORTS OF OIL COUNTRY TUBULAR GOODS INTO THE U.S.
MARKET, WHICH HAS BEEN REDUCED BY TRADE RELIEF NOW IN PLACE, IMPACTS
DEMAND FOR OUR PRODUCTS.

The level of imports of oil country tubular goods, which has varied
significantly over time, affects the domestic oil country tubular
goods market. High levels of imports reduce the volume sold by domestic
producers and tend to suppress selling prices, both of which have an
adverse impact on our business. We believe that U.S. import levels are
affected by, among other things:

* U.S. and overall world demand for oil country tubular goods;

* the trade practices of and government subsidies to foreign
producers; and

* the presence or absence of antidumping and countervailing
duty orders.

Since 1986, the level of imports of oil country tubular goods from
Canada, Israel and Taiwan has been greatly reduced by the existence of
antidumping duty orders covering imports from these countries and a
countervailing duty order covering imports from Israel. In addition,
since 1995, the level of imports of oil country tubular goods from
Argentina, Italy, Japan, Korea and Mexico has been greatly reduced by
the existence of antidumping duty orders covering imports from these
countries and a countervailing duty order covering imports from Italy.
The orders also have had a beneficial impact on prices for oil country
tubular goods in the U.S. market.

Antidumping and countervailing duty orders require special duties
to be imposed in amounts designed to offset unfair pricing and government
subsidization, respectively. Once an order is in place, each year
foreign producers, importers, domestic producers and other parties may
request an "administrative review" to determine the duty rates to be
applied to imports during the preceding year, as well as the duty
deposit rates for future imports from the companies covered by the review.
In addition, a company that did not ship to the United States during the
original period examined by the U.S. government may request a "new
shipper review" to obtain its own duty rate on an expedited basis.

Antidumping and countervailing duty orders may be revoked as a result
of periodic "sunset reviews." An individual exporter also may obtain
revocation as to itself under certain circumstances. The U.S. government
is now conducting sunset reviews of the orders covering Canada and Taiwan,
which are expected to be completed by May 2000. The U.S. government is
scheduled to conduct sunset reviews of the orders covering Argentina,
Italy, Japan, Korea and Mexico beginning in August 2000. These reviews are
expected to be completed by August 2001. The U.S. government will revoke
the antidumping and countervailing duty orders covering imports from Israel
effective January 1, 2000, because the domestic industry did not request
sunset reviews of these orders based on its belief that imports from Israel
are not significant in the U.S. oil country tubular goods market. If the
orders covering imports from Argentina, Canada, Italy, Japan, Korea, Mexico
and Taiwan are revoked in full or in part or the duty rates lowered, we
could be exposed to increased competition from imports that could have a
material adverse effect on our business.

<PAGE>

INDUSTRY INVENTORY LEVELS AFFECT OUR SALES AND NET INCOME.

Industry inventory levels of our products, and in particular oil
country tubular goods, can change significantly from period to
period. These changes can have a direct adverse effect on the demand
for new production of energy and industrial products when customers
draw from inventory rather than purchase new products. Although
industry inventory levels of oil country tubular goods have steadily
declined through the nine months ended June 30, 1999, we believe
that industry-wide oil country tubular goods inventory is still at
or above normal levels in relation to current demand. Additionally,
through the nine months ended June 30, 1999, months of supply of
inventory, which defines the level of inventory in terms of current
monthly demand, have fluctuated due to contracting demand. The above
normal industry inventory levels and upward fluctuations in months of
supply of inventory have had and may continue to have an adverse impact
on us.

OUR PLANS FOR THE NEW LARGE-DIAMETER FACILITY MAY NOT BE SUCCESSFUL.

An important part of our growth strategy is our ability to
successfully expand our current product lines, offer new product
lines and enter new markets. We are devoting significant resources
to this strategy. To this end, we are currently planning to open a
new large-diameter facility that will produce products with larger
diameters than we currently manufacture. Opening the new facility
may expose us to risks including:

* intense competition in the larger diameter product lines;

* the current industry-wide overcapacity in these product lines;
and

* potential unforeseen or higher than expected costs.

Any of these risks could adversely affect or prevent the success of
the new facility.

OUR COLD DRAWN TUBING BUSINESS MAY NOT BE SUCCESSFUL.

Our recent entry into the cold drawn tubing market has required
capital expenditures of approximately $13.7 million as of June 30,
1999. We have not generated a profit to date and cannot assure you
that we will be successful in achieving significant sales levels or
profitability in the cold drawn tubing market.

SEASONAL FLUCTUATIONS WHICH AFFECT OUR CUSTOMERS MAY AFFECT DEMAND
FOR OUR PRODUCTS.

We, as well as the oil country tubular goods industry in
general, experience seasonal fluctuations in demand for our
products. For instance, weather conditions during the first half of
the calendar year normally make drilling operations more difficult.
For this reason, domestic drilling activity and the corresponding
demand for our oil country tubular goods generally will be lower
during our second and third fiscal quarters, as compared with the
first and fourth fiscal quarters. We also believe we experience
seasonal fluctuations in demand for our industrial products,
particularly those sold to the automotive industry. However, the
timing of such fluctuations may differ from fluctuations experienced
in the oil country tubular goods industry.

WE DEPEND ON A FEW SUPPLIERS FOR A SIGNIFICANT PORTION OF OUR STEEL,
AND A LOSS OF ONE OR MORE SIGNIFICANT SUPPLIERS COULD AFFECT OUR
ABILITY TO PRODUCE OUR PRODUCTS.

In fiscal 1998, we purchased 94% of the steel for our Arkansas
facilities from a single supplier, and 80% of the steel for our
Texas facility from three suppliers. This same pattern has continued
through the first nine months of fiscal 1999. The loss of any of
these suppliers or interruption of production at one or more of the
suppliers could have a material adverse effect on our business,
financial condition and results of operations.

<PAGE>
WE DEPEND ON A FEW DISTRIBUTORS FOR A SIGNIFICANT PORTION OF OUR NET
SALES OF OIL COUNTRY TUBULAR GOODS, AND A LOSS OF ONE OR MORE
SIGNIFICANT DISTRIBUTORS COULD AFFECT OUR ABILITY TO SELL OUR
PRODUCTS.

In fiscal 1998 and fiscal 1996, one distributor, National
Oilwell Supply, Inc., accounted for 14% and 16%, respectively, of
our net sales. In fiscal 1997, two distributors, National Oilwell
and Master Tubulars, Inc., accounted for 25% of our net sales. Four
distributors, including National Oilwell, have recently combined to
become Sooner Pipe & Supply Corp., one of the largest distributors
of oil country tubular goods. Sooner has accounted for 14% of our
net sales for the nine months ended June 30, 1999. We cannot yet
determine whether this combination will have any significant impact
on our sales or margins. The loss of any these distributors could
have a material adverse effect on our business, financial condition
and results of operations.

THE OPERATIONS OF OUR CUSTOMERS EXPOSE US TO POTENTIAL PRODUCTS
LIABILITY CLAIMS.

Drilling for oil and natural gas involves a variety of risks
that can result in significant losses. Actual or claimed defects in
our products may give rise to claims against us for these losses.
The use of structural tubing can also involve risks. Actual or
claimed defects in these pipe and tubing products can also expose us
to claims for damages. We maintain insurance coverage against
potential product liability claims in amounts which we believe to be
adequate. We have not historically incurred material product
liability costs, nor have we experienced difficulties in obtaining
or maintaining adequate product liability insurance coverage.
However, we may incur product liability in excess of our insurance
coverage or incur other uninsured costs, and we may not be able to
maintain adequate insurance coverage levels in the future.

COMPLIANCE WITH AND CHANGES TO LAWS REGULATING THE OPERATION OF OUR
BUSINESS COULD ADVERSELY AFFECT OUR PERFORMANCE.

Our business is subject to numerous local, state and federal
laws and regulations concerning environmental and safety matters. We
cannot assure you that future changes and compliance within these
laws and regulations will not have a material effect on our
operations.

PROVISIONS IN OUR CORPORATE DOCUMENTS AND DELAWARE LAW COULD DELAY
OR PREVENT A CHANGE IN CONTROL OF MAVERICK.

The existence of some provisions in our corporate documents and
Delaware law could delay or prevent a change in control of Maverick,
even if that change might be beneficial to our stockholders. Our
certificate of incorporation and bylaws contain provisions that may
make acquiring control of Maverick difficult, including:

* provisions limiting the right to call special meetings of our
stockholders;

* provisions regulating the ability of our stockholders to bring
matters for action at annual meetings of our stockholders;

* a prohibition against action by our stockholders by written
consent; and

* the authorization to issue and set the terms of preferred
stock.

In addition, we have adopted a stockholder rights plan that would
cause extreme dilution to any person or group who attempts to
acquire a significant interest in Maverick without advance approval
of our Board of Directors, while Delaware law would impose some
restrictions on mergers and other business combinations between us
and any holder of 15% or more of our outstanding common stock. See
"Description of Capital Stock."

<PAGE>
USE OF PROCEEDS

We estimate that the net proceeds we will receive from this
offering of common stock will be approximately $30.3 million. We
anticipate using the net proceeds of this offering, together with
the additional funds required from one or more of the sources
disclosed below, to:

* purchase approximately $25 million of equipment for use at our
new large-diameter facility; and

* pay approximately $10 million in expenses to relocate some of
the equipment described above and construct the new facility.

Pending our use of the net proceeds we receive
from this offering, we may invest the proceeds in short-term
investments or repay a portion of our outstanding indebtedness under
our revolving credit facility.

We expect the net proceeds from this offering to be less than the
amount required to construct and equip our new large-diameter facility
by approximately $4.7 million. We expect to provide the additional
amount required through borrowings under a contemplated industrial
revenue bond financing from the Arkansas Development and Finance
Authority. If we are unable to obtain this industrial revenue bond
financing, we expect to provide the required additional funding
principally through borrowings under our existing revolving credit
facility. We expect to fund the working capital requirements for the
large-diameter facility from a combination of cash flow from operations
and borrowings under the revolving credit facility.

We are currently seeking debt financing of up to $10 million
from the Arkansas Development and Finance Authority. This agency has
the authority to provide industrial revenue bond financing at
attractive interest rates for projects such as our new large-diameter
facility. To the extent we obtain this industrial revenue bond
financing, we will use any proceeds of this offering not otherwise
required to fund the construction and equipping of the new facility
to instead reduce our outstanding indebtedness under our revolving
credit facility.

Our revolving credit facility will expire on September 30, 2003
and bears interest at either the prevailing prime rate or an
adjusted Eurodollar rate, plus an interest margin, depending upon
certain financial measurements. As of June 30, 1999, the applicable
annual interest rate was 7.0%, and as of August 31, 1999 we had
$11.0 million available to us under the revolving credit facility.
See "Management Discussion and Analysis of Financial Condition and
Results of Operations--Liquidity and Capital Resources" for more
information about our revolving credit facility.

PRICE RANGE OF COMMON STOCK

Our common stock is traded on the Nasdaq National Market under
the symbol "MAVK." The following table summarizes the high and low
closing sales prices of our common stock, as reported by the Nasdaq
National Market, for the periods indicated.

<TABLE>
<CAPTION>
PRICE RANGE
--------------------
HIGH LOW
-------- --------
<S> <C> <C>
FISCAL YEAR 1999
First Quarter......................................... 8 15/16 5 5/32
Second Quarter........................................ 7 5/16 5 1/2
Third Quarter......................................... 15 1/4 5 11/16
Fourth Quarter (through September 30)................. 22 11 7/8

FISCAL YEAR 1998
First Quarter......................................... 50 3/4 20 5/16
Second Quarter........................................ 25 3/4 14 5/8
Third Quarter......................................... 18 3/8 10 9/16
Fourth Quarter........................................ 11 1/4 5 3/8

FISCAL YEAR 1997
First Quarter......................................... 8 1/4 5 5/8
Second Quarter........................................ 9 1/2 6 1/8
Third Quarter......................................... 19 3/8 8 3/4
Fourth Quarter........................................ 41 3/4 17 1/8
</TABLE>

On September 30, 1999, the reported last sale price of our
common stock was $16.625 per share. As of July 31, 1999, there were 279
holders of record of our common stock, including brokerage firms and
other nominees.

<PAGE>
DIVIDEND POLICY

Our board of directors has not declared or paid any cash
dividends since our incorporation. Our board of directors does not
currently intend to declare any cash dividends in the foreseeable
future. Any payment of cash dividends in the future will depend
upon:

* our financial condition;

* our capital requirements;

* any contractual restrictions;

* our earnings; and

* any other factor our board of directors deems relevant.

The terms of our revolving credit facility restrict the amount of
dividends we can pay to our stockholders.

CAPITALIZATION

The following table sets forth our capitalization as of June 30,
1999, and as adjusted to reflect the offering of our common stock
and the application of the net proceeds from this offering as
described in "Use of Proceeds."

<TABLE>
<CAPTION>
JUNE 30, 1999
-------------------------
ACTUAL AS ADJUSTED<F1>
-------- ---------------
(IN THOUSANDS, EXCEPT
SHARE AMOUNTS)
<S> <C> <C>

Current maturities of capital lease obligations............. $ 694 $ 694
======== ========
Long-term debt, less current maturities:
Capital lease obligations............................... $ 7,669 $ 7,669
Revolving credit facility............................... 22,300 26,994
-------- --------
Total long-term debt, less current maturities....... 29,969 34,663
-------- --------
Stockholders' equity
Preferred stock, $0.01 par value, 5,000,000 shares
authorized............................................ -- --
Common stock, $0.01 par value, 40,000,000 shares
authorized, 15,437,474 shares issued and outstanding,
actual; and 17,437,474 shares issued and outstanding,
as adjusted........................................... 154 174
Additional paid-in capital.............................. 44,216 74,502
Retained earnings....................................... 37,005 37,005
-------- --------
Total stockholders' equity.......................... 81,375 111,681
-------- --------
Total capitalization................................ $111,344 $146,344
======== ========
<FN>
- -------------------
<F1> Reflects the issuance of 2,000,000 shares of common stock by us at a
public offering price of $16.25 per share, resulting in estimated net
proceeds of $30.3 million, of which $20,000 (equal to the par value of the
shares issued) is reflected in common stock and the balance is reflected
in additional paid-in capital. We intend to use the proceeds from the
issuance of the common stock to fund a significant portion of the cost of
constructing and equipping a new large-diameter facility. We estimate the
total cost of this project to be $35 million. We expect to provide the
additional funding of $4.7 million required to construct and equip our new
large-diameter facility from the proceeds of our contemplated industrial
revenue bond financing from the Arkansas Development and Finance Authority,
which may provide up to $10 million of additional borrowings. To the extent
that these proceeds exceed the amount required for the large-diameter
facility, we expect to use the excess to reduce outstanding borrowings under
the revolving credit facility. If we are unable to obtain this industrial
revenue bond financing, we expect to provide the required additional
funding principally through borrowings under our existing revolving credit
facility. See "Use of Proceeds" for further discussion of our plans for the
offering proceeds. For purposes of this table, we assume borrowings under
our revolving credit facility of $4.7 million as discussed in this footnote.
</TABLE>

<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

In the table below, we provide you with selected consolidated
financial data of Maverick. We have prepared this information using
the audited consolidated financial statements of Maverick for the
five years ended September 30, 1998 and unaudited consolidated
financial statements of Maverick for the nine-month period ended
June 30, 1998 and 1999. The unaudited financial statements include
all adjustments, consisting of normal recurring accruals, which we
consider necessary for a fair presentation of the financial position
and results of operations for those periods. Operating results for
the nine-month period ended June 30, 1999 are not necessarily
indicative of the results that may be expected for the entire year
ending September 30, 1999.

When you read this selected financial data, it is important that
you read along with it the consolidated financial statements and
related notes included herein, as well as "Management's Discussion
and Analysis of Financial Condition and Results of Operations."

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED SEPTEMBER 30, ENDED JUNE 30,
---------------------------------------------------- -------------------
1994 1995<F1> 1996<F2> 1997 1998 1998 1999
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales................................. $124,843 $167,896 $204,182 $291,060 $265,389 $213,617 $118,410
Cost of goods sold........................ 117,833 159,865 182,042 252,803 232,038 183,843 118,047
-------- -------- -------- -------- -------- -------- --------
Gross profit.............................. 7,010 8,031 22,140 38,257 33,351 29,774 363
Selling, general and administrative....... 4,896 7,728 10,198 13,966 13,210 9,335 10,528
Write-down of software costs.............. -- -- -- -- 1,605 -- --
-------- -------- -------- -------- -------- -------- --------
Total selling, general and
administrative.......................... 4,896 7,728 10,198 13,966 14,815 9,335 10,528
Start-up costs............................ 392 245 -- -- -- -- 2,496<F3>
-------- -------- -------- -------- -------- -------- --------
Income (loss) from operations............. 1,722 58 11,942 24,291 18,536 20,439 (12,661)
Interest expense.......................... 1,125 3,164 2,522 2,067 1,731 1,274 1,261
Other income.............................. -- 772 -- -- -- 61 360
-------- -------- -------- -------- -------- -------- --------
Income (loss) before income taxes......... 597 (2,334) 9,420 22,224 16,805 19,226 (13,562)
Provision (credit) for income taxes....... 168 -- 1,882 7,339 5,420 6,619 (4,874)
-------- -------- -------- -------- -------- -------- --------
Net income (loss)......................... $ 429 $ (2,334) $ 7,538 $ 14,885 $ 11,385 $ 12,607 $ (8,688)
======== ======== ======== ======== ======== ======== ========
Diluted earnings (loss) per share......... $ 0.04 $ (0.16) $ 0.50 $ 0.97 $ 0.73 $ 0.81 $ (0.56)
Average shares deemed outstanding......... 12,845 14,920 15,000 15,282 15,564 15,635 15,437

OTHER DATA:
Depreciation and amortization............. $ 3,395 $ 4,691 $ 5,201 $ 5,697 $ 6,172 $ 4,313 $ 5,471
Capital expenditures...................... 20,759 5,592 5,497 9,537 22,181 8,053 11,976
EBITDA<F4>................................ 5,117 5,521 17,143 29,988 24,708 24,813 (6,830)

BALANCE SHEET DATA:
Working capital........................... 23,111 30,272 32,652 44,992 60,362 60,477 37,712
Total assets.............................. 99,434 106,494 125,556 162,064 156,885 150,160 145,390
Current maturities of long-term debt...... 1,880 2,795 1,843 604 653 640 694
Long-term debt (less current
maturities)............................. 19,640 18,045 11,901 8,879 8,226 8,366 7,669
Revolving credit facility................. 4,000 15,000 13,250 10,000 27,400 17,000 22,300
Stockholders' equity...................... 51,837 49,503 57,247 77,868 90,063 90,636 81,375

<PAGE>
<F4> EBITDA represents earnings before interest, income taxes, depreciation and
amortization. We believe EBITDA is a widely accepted, supplemental
financial measurement used by many investors and analysts to analyze and
compare companies' performances. However, EBITDA should not be considered
as an alternative to income from operations or to cash flows from
operating, investing or financing activities, as determined in accordance
with generally accepted accounting principles. EBITDA should also not be
construed as an indication of a company's operating performance or as a
measure of liquidity. Management's discretionary use of funds depicted by
EBITDA may be limited by working capital, debt service and capital
expenditure requirements and by restrictions related to legal
requirements, commitments and uncertainties. Because EBITDA excludes some,
but not all, items that affect net income and because these measures may
vary among companies, the EBITDA data presented above may not be
comparable to similarly titled measures of other companies.
</TABLE>
14

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

Our products include oil country tubular goods and line pipe
which are used in the energy industry. We also make structural
tubing and standard pipe for industrial applications. During the
first quarter of fiscal 1999, we began the production of cold drawn
tubing products for industrial applications. At June 30, 1999, sales
of cold drawn tubing had not reached material levels.

Energy Products. Demand for our energy related products depends
primarily upon the number of oil and natural gas wells being
drilled, completed and worked over in the United States and Canada
and the depth and drilling conditions of these wells. The level of
these activities are primarily dependent on oil and natural gas
prices. Domestic end-users obtain oil country tubular goods from
domestic and foreign pipe producers and from draw-downs of their or
distributors' inventories. According to published industry reports,
domestic drilling remained relatively constant from fiscal 1997 to
fiscal 1998 averaging approximately 900 rigs over those two years
with gas-related drilling increasing by 11.0% and oil related
drilling declining by 16.4%. However, for the nine months ended June
30, 1999, domestic drilling declined 37.9% with natural gas and oil
related drilling decreasing by 26.5% and 57.5%, respectively.
Average energy prices decreased during fiscal 1998, with natural gas
decreasing 8.6% and oil decreasing 25.7%. Energy prices continued to
decline through the nine months ended June 30, 1999, with natural
gas decreasing 18.9% and oil decreasing 14.1% from the same period
in the prior year. The decreases in energy prices had a negative
effect on drilling levels in the third and fourth quarter of fiscal
1998 and the first three quarters of fiscal 1999. At the end of
fiscal 1998, drilling was at 754 rigs, down 24.4% from its fiscal
1997 year-end level of 998 rigs, and continued to decline to 488
rigs which occurred in April 1999.

The following table illustrates certain factors related to
industry-wide domestic drilling activity, domestic energy prices,
domestic oil country tubular goods consumption, shipments, imports
and inventories for the periods presented:

<TABLE>
<CAPTION>
FISCAL YEAR NINE MONTHS
ENDED SEPTEMBER 30, ENDED JUNE 30,
-------------------------- ----------------
1996 1997 1998 1998 1999
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
U.S. DRILLING ACTIVITY:
Average rig count................................ 759 905 903 943 586
AVERAGE U.S. ENERGY PRICES:
Oil per barrel (West Texas Intermediate)......... $20.33 $21.83 $16.30 $17.03 $14.60
Natural gas per MMBTU
(Henry Hub).................................... $ 2.53 $ 2.55 $ 2.33 $ 2.43 $ 1.97
U.S. OIL COUNTRY TUBULAR GOODS CONSUMPTION (IN TONS):
U.S. producer shipments (000's).................. 1,750 2,018 1,549 1,318 477
Imports (000's).................................. 209 363 401 314 101
Inventory (increase)/decrease (000's)............ (80) (299) (66) (217) 298
Used pipe (000's)................................ 95 187 139 111 83
Total consumption (000's).................... 1,974 2,269 2,023 1,526 959
</TABLE>

The rig count in the table is based on weekly rig count
reporting from Baker Hughes, Inc. calculated as follows: Fiscal 1996
- - 52 weeks ended September 27, 1996; Fiscal 1997 - 52 weeks ended
September 26, 1997; Fiscal 1998 - 53 weeks ended October 2, 1998; 9
months ended June 30, 1998 - 39 weeks ended June 26, 1998; 9 months
ended June 30, 1999 - 39 weeks ended July 2, 1999. U.S. consumption
of oil country tubular goods are management estimates based on our
estimate of per rig consumption of oil country tubular goods
multiplied by the Baker Hughes rig
15

<PAGE>
count. Total U.S. consumption (in thousands of tons) as reported by
Pipe Logix, Inc., an independent domestic oil country tubular goods
industry reporting service, for fiscal 1996, 1997, 1998, and the nine
months ended June 30, 1998 was 1,606, 1,943, 1,939, and 1,515 (nine
months ended June 30, 1999 not available). Imports are as reported by
Duane Murphy and Associates in "The OCTG Situation Report." Inventory
(increase)/decrease are management estimates based upon independent
research by Duane Murphy and Associates. Inventory (increase)/decrease
(in thousands of tons) as reported by Pipe Logix, Inc. for fiscal 1996,
1997, 1998, and the nine months ended June 30, 1998 was (263), (717),
(116), and (203) (nine months ended June 30, 1999 not available). Used
pipe quantities are calculated by multiplying 8.3 recoverable tubing and
casing tons (as determined by independent research performed by Duane
Murphy and Associates) by the number of abandoned oil and gas wells as
determined by the completed wells per year as reported by the American
Petroleum Institute adjusted for the net change in active wells as
reported by World Oil. U.S. producer shipments are management estimates
calculated based on the components listed above. Energy prices in
the table are monthly average period prices as reported by Spears
and Associates for West Texas Intermediate grade crude oil
calculated by averaging the closing price each Friday during the
month and the Henry Hub monthly natural gas cash price calculated by
averaging weekly prices as reported by Natural Gas Week.

Competition from imports increased to an estimated 19.8% market
share during fiscal 1998 from an estimated 16.0% market share in
fiscal 1997. We believe that this increase is primarily attributable
to higher oil country tubular goods prices in the United States during
the first six months of the year. However, during the nine months
ended June 30, 1999, estimated import penetration declined to 10.5%
as drilling activity declined.

During fiscal 1998, industry inventory increases resulted in an
estimated additional demand of 3.3% of total domestic oil country
tubular goods consumption. However, this is significantly below the
13.2% of estimated additional demand from inventory increases in
1997, reflecting the downturn in drilling in 1998 as compared to
increased drilling activity during 1997. For the first nine months
of fiscal 1999, industry inventory decreases adversely affected
demand by satisfying an estimated 31.1% of consumption. We believe
that industry inventories are at or above normal levels in relation
to demand at June 30, 1999, as months of supply of inventory have
increased by approximately 2.7% from fiscal year end to 7.5 months.

During fiscal 1998, as a result of relatively constant drilling
activity, increased imports, and a smaller increase in industry
inventories, we estimate that total domestic shipments of oil
country tubular goods declined by 23.4% as compared to fiscal 1997.
During this period, our shipments of oil country tubular goods were
down 21.5% primarily due to decreased exports to Canada, where the
downturn in drilling was more significant than in the United States.
We estimate that our share of domestic oil country tubular goods
shipments increased to approximately 14% during fiscal 1998 from
approximately 13% during fiscal 1997.

During the nine months ended June 30, 1999, as a result of
declining drilling activity and a substantial decline in industry
inventories, partially offset by decreased imports, we estimate that
total domestic shipments declined by 63.7% as compared to the nine
months ended June 30, 1998. During the nine-month period in fiscal
1999, our shipments of domestic oil country tubular goods were down
45% from the comparable period in the preceding year. However, our
export sales, primarily to Canada, declined 59.9%. Accordingly, we
estimate that our share of domestic oil country tubular goods
shipments increased to approximately 20% during the nine months
ended June 30, 1999 from approximately 13% during the comparable
period in 1998.

Published information suggests that demand for line pipe
increased during fiscal 1998 by 30.9%. However, domestic shipments
only rose by 20% as import market share rose from 28.4% to 34.4%.
For the nine months ended June 30, 1999 as compared to the same
period for 1998,
16

<PAGE>
demand was down 7.9%. However, during this time, import penetration
remained relatively unchanged resulting in domestic shipments
decreasing by 7.5%.

Industrial Products. Given the numerous applications for our
industrial products, sources of demand for these products are
diversified. Demand generally depends on the general level of
economic activity in the construction, transportation, agricultural,
material handling and recreational segments, the use of structural
tubing as a substitute for other structural steel forms, such as
I-beams and H-beams, and draw downs of existing customer
inventories.

We estimate that the demand for structural tube products
increased by 11.2% in fiscal 1998 and total domestic shipments rose
by 10.7% as import market share increased slightly. For the nine
months ended June 30, 1999 as compared to the same period in 1998,
we estimate that demand increased 1.1% and total domestic shipments
remained flat as import market share increased slightly. According
to published reports, the standard pipe market demand increased by
2% in fiscal 1998, while total domestic shipments declined by 2.8%
as the import market share increased from 25.0% to 28.5%. For the
nine months ended June 30, 1999 as compared to the same period in
1998, standard pipe demand fell 17.9%, domestic shipments decreased
21.6% and the import market share increased from 27.5% to 33.5%.

General. Pricing of our products was mixed during fiscal 1998.
Pricing of oil country tubular goods rose by approximately 4.9%
during the year due to increased product pricing early in the year
and a favorable product mix. However, oil country tubular goods
pricing during the fourth fiscal quarter was down 3.4%. Line pipe
and standard pipe product pricing decreased by 4.5% and 2.7%,
respectively, primarily due to high levels of imports in fiscal
1998. Structural product pricing remained relatively constant.
During the nine months ended June 30, 1999, prices for all of our
products declined, with oil country tubular goods down 17.4%, line
pipe down 19.7%, standard pipe down 11.9%, and structural tubing
down 10.0%.

Steel costs included in cost of goods sold decreased during
fiscal 1998 by $18 per ton, or 5.3%, and decreased an additional
$41, or 12.6%, by June 30, 1999. Replacement costs for steel
fluctuated during fiscal 1998 as the cost increased by $10 per ton
in February and remained at that level until July. Our major
supplier of steel announced three price decreases from mid-
September 1998 to November 1998, reducing our replacement cost of
steel by $50 per ton. These price reductions were reflected in our
cost of goods sold in the second and third quarters of fiscal 1999.
However, this same supplier has announced five price increases since
December 1998. These price changes will increase our replacement
cost modestly through the end of December 1999. We estimate that
these cost increases will not be reflected in cost of goods sold
until the fourth quarter of fiscal 1999 and first quarter of fiscal
2000.

The supply of steel in the United States increased significantly
during calendar 1998, primarily due to previous capacity additions
and increased import levels. We anticipate that these market
conditions should help keep steel costs relatively low during the
remainder of fiscal 1999. However, steel trade cases filed by
domestic steel producers with the U.S. International Trade
Commission in September 1998 have been a contributing factor to the
recent steel cost increases and could have an additional adverse
impact on our future replacement costs of steel. As a result of
these factors, anticipated future steel prices may impact margin
levels of our products.

The oil country tubular goods market conditions described above
affected us and our competitors significantly during fiscal 1998 and
the first nine months of fiscal 1999. As our recent experience
indicates, oil and natural gas prices are volatile and can have a
substantial effect upon drilling levels and resulting demand for our
energy related products. The future demand levels and pricing for
structural and other industrial related products is also uncertain.
Although we believe that drilling activity will ultimately recover
from the currently depressed level, the timing and extent of such
recovery is uncertain.

<PAGE>
RESULTS OF OPERATIONS

The following table sets forth, for the periods presented,
information relating to our operations expressed as a percentage of
net sales:

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED SEPTEMBER 30, ENDED JUNE 30,
----------------------------- -----------------
1996 1997 1998 1998 1999
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
Net sales.................................. 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of goods sold......................... 89.2 86.9 87.4 86.1 99.7
----- ----- ----- ----- -----
Gross profit............................... 10.8 13.1 12.6 13.9 0.3
Selling, general and administrative........ 5.0 4.8 5.0 4.4 8.9
Start up costs............................. -- -- -- -- 2.1
Loss on write-down of software
development costs........................ -- -- .6 -- --
----- ----- ----- ----- -----
Total selling, general and administrative
and start up costs....................... 5.0 4.8 5.6 4.4 11.0
----- ----- ----- ----- -----
Income (loss) from operations.............. 5.8 8.3 7.0 9.6 (10.7)
Interest expense, net...................... 1.2 .7 .7 0.6 0.7
----- ----- ----- ----- -----
Income (loss) before income taxes.......... 4.6 7.6 6.3 9.0 (11.4)
Provision (credit) for income taxes........ .9 2.5 2.0 3.1 (4.1)
----- ----- ----- ----- -----
Net income (loss).......................... 3.7 5.1 4.3 5.9 (7.3)
===== ===== ===== ===== =====
</TABLE>

Nine Months Ended June 30, 1999 Compared to Nine Months Ended
June 30, 1998

Overall Company. Net sales of $118.4 million decreased $95.2
million, or 44.6%, during the nine months ended June 30, 1999 as
compared to the prior year period. These results were attributable
primarily to a decrease of 31.6% in total product shipments, from
338,310 tons in the first nine months of fiscal 1998 to 231,494 tons
in the first nine months of fiscal 1999, and an overall decrease of
19.0% in the average selling prices of our products.

Cost of goods sold of $118.0 million decreased $65.8 million, or
35.8%, during the first nine months of fiscal 1999 over the
comparable prior year period. The overall decrease was due primarily
to decreased product shipments. However, the overall unit cost per
ton of products sold decreased 4.4% (from an average of $543 to $519
per ton) in the first nine months of fiscal 1999 as compared with
the same period in fiscal 1998. This decrease was due to a decrease
in steel costs of $43 per ton, or 13.3%, partially offset by an
increase in conversion costs from less favorable fixed cost
absorption due to lower production. See "Overview" for a description
of the effect of steel prices on our results.

We earned a gross profit of $363,000 during the first nine
months of fiscal 1999 compared to a gross profit of $29.8 million in
the prior year period. Gross profit, as a percentage of net sales
was 0.3% for the nine month period ended June 30, 1999 as compared
to 13.9% for the prior year period. The change in the gross profit
is due to the factors discussed above.

During September 1998, we acquired assets that are being
utilized in the production of cold drawn tubular products at a
facility in Beaver Falls, Pennsylvania. We incurred net costs of
$2.5 million in the first nine months of fiscal 1999 related to the
commencement of operations at this facility. These costs are
comprised primarily of salary and related costs for production,
sales and administrative personnel prior to the fully integrated
operation of the facility.

Selling, general and administrative expenses increased by $1.2
million, or 12.8%, in the first nine months of fiscal 1999 over the
prior year period. These costs were impacted by an increase

<PAGE>
in the allowance for doubtful accounts (which reflects the
deterioration of a specific accounts receivable balance) and wage
increases, partially offset by a decrease in industrial products
selling commissions. Also, due to the significant decline in net
sales revenue caused by the market conditions discussed above,
selling, general and administrative expenses as a percentage of net
sales in the first nine months of fiscal 1999 were 8.9%, as compared
to 4.4% for the comparable prior year period.

Interest expense remained relatively flat in the first nine
months of fiscal 1999 as compared to the comparable prior year
period. Our long-term debt to capitalization ratio improved from
28.3% to 26.9% during this time frame.

The benefit from income taxes was $4.9 million for the nine
months ended June 30, 1999, as compared to the prior year periods
when we recorded a provision of $6.6 million. This change is
attributable to our generation of pre-tax losses of $13.6 million in
the first nine months of fiscal 1999 as compared to pre-tax income
in the first nine months of fiscal 1998 of $19.2 million.

We have available acquired net operating loss carryforwards of
$2,320,000 as of June 30, 1999 which may be used to offset future
taxable income. Due to our current operating losses, these
carryforwards must be utilized in fiscal year 2000. A failure to
utilize this net operating loss prior to its expiration would require
us to record a change to earnings for the amount of the deferred
tax asset not utilized. As permitted under the provisions of Statement
of Financial Accounting Standards No. 109, "Accounting for Income
Taxes," realization of this deferred tax asset depends on generating
approximately $3 million of taxable income during fiscal 2000. If we
fail to generate this level of taxable income from our pre-tax earnings,
we intend to implement a reasonable tax planning strategy which we
expect will allow us to generate sufficient taxable income to utilize
our net operating loss carryforwards expiring in fiscal 2000.

As a result of the decreased gross profit and the other factors
discussed above, we generated a net loss of $8.7 million in the
first nine months of fiscal 1999, a decrease of $21.3 million from
$12.6 million reported for the comparable prior year period.
Although oil and gas prices and, to a lesser extent, drilling levels
have recently improved, we expect to incur an operating loss in the
quarter ending September 30, 1999, although the loss is expected to
be modestly lower than the $2.6 million loss incurred in our fiscal
third quarter.

Energy Products Segment. Energy product sales of $66.8 million
decreased $86.5 million, or 56.4%, for the first nine months of
fiscal 1999 as compared with the prior year period. Energy product
shipments decreased 97,360 tons, or 45.1%, from 215,656 tons to
118,296 tons. Our domestic shipments of oil country tubular goods
fell 45.2% for the nine months ended June 30, 1999 as compared to
the prior year period due to excessive levels of industry inventory
and a declining rig count (from 770 active rigs to 563 active rigs).
Our export shipments, primarily to Canada, decreased 59.9%, from
24,896 tons in the nine months ended June 30, 1998 to 9,975 tons in
the nine months ended June 30, 1999, as the average level of
Canadian drilling fell 46.0% from 363 active rigs to 196 active
rigs. Line pipe shipments decreased by 24.0% for the nine months
ended June 30, 1998 as a result of increased import penetration from
the comparable prior year period. The average net selling price for
energy products was $565 per ton, a decrease of $146 per ton. The
decrease was due primarily to the market conditions discussed above
and a change in mix to lower priced products. See "Overview" for a
discussion of changes in prices.

Energy products cost of goods sold of $70.7 million decreased
$60.8 million, or 46.2% for the first nine months of fiscal 1999,
compared with the prior year period. The gross loss for energy
products of $3.9 million for the nine month period ended June 30,
1999 compares to a gross profit of $21.7 million for the nine months
ended June 30, 1998. Energy products gross loss percentage was 5.9%
for the first nine months of fiscal 1999 as compared to a gross
profit margin percentage of 14.2% for the prior year period.

<PAGE>
Additional downward pressure on energy selling prices could
require us to further reduce the carrying value of our inventory.
While we believe that our inventory is in line with our anticipated
future sales levels, any significant decrease in prices would have a
negative impact on conversion costs recorded in cost of goods sold.

Industrial Products Segment. Industrial products sales of $51.6
million decreased $8.7 million, or 14.6%, for the first nine months
of fiscal 1999 as compared with the prior year period. Industrial
products shipments decreased 9,456 tons, or 7.7%, from 122,654 tons
to 113,198 tons. Intensified competitive pressures due to capacity
additions contributed to the decrease in sales and shipments of
industrial products. The average net selling price for industrial
products during the first nine months of fiscal 1999 was $456, down
$36 per ton as compared to the same period of the prior year. This
decrease for the first nine months of fiscal 1999 was due primarily
to declining steel prices.

Cost of goods sold of $47.3 million decreased $5.0 million, or
9.5%, in the first nine months of fiscal 1999 as compared with the
prior year period. Gross profit for industrial products of $4.3
million decreased $3.7 million, or 46.2% over the same periods. The
decreased gross profits were due to lower selling prices and reduced
operating efficiencies, partially offset by lower steel costs.
Industrial products gross profit margin percentage declined to 8.4%
for the first nine months of fiscal 1999 as compared to 13.3% for
the first nine months of fiscal 1998.

Fiscal Year 1998 Compared to Fiscal Year 1997

Overall Company. In fiscal 1998, net sales decreased $25.7
million, or 8.8%, from the preceding fiscal year. These results were
attributable primarily to a decrease of 8.9% in total product
shipments, from 469,958 tons in fiscal 1997 to 428,216 tons in
fiscal 1998. Overall average selling prices remained relatively
constant during fiscal 1998.

Cost of goods sold decreased $20.8 million, or 8.2%, in fiscal
1998 as compared to fiscal 1997. The overall decrease was due
primarily to decreased product shipments. However, the overall unit
cost per ton of products sold increased 0.7% (from an average of
$538 to $542 per ton) in fiscal 1998. This increase was due
primarily to an increase in conversion costs from a higher cost
product mix and less favorable fixed cost absorption due to lower
production. The increase in conversion costs was mostly offset by a
decrease in steel costs by $18 per ton, or 5.3% in fiscal 1998. See
"Overview" for a description of the effect of steel prices on
results.

Gross profit decreased $4.9 million, or 12.8%, in fiscal 1998 as
compared to fiscal 1997. Gross profit as a percentage of net sales
was 12.6% for fiscal 1998, as compared to 13.1% for fiscal 1997.

Selling, general and administrative expenses increased $849,000,
or 6.1%, from fiscal 1997 to fiscal 1998. These expenses increased
principally as a result of the write-down of software development
costs of $1.6 million in fiscal 1998. These costs were also
increased by higher sales commissions on industrial products sales
and partially offset by decreased employee incentive compensation
and decreased selling expenses related to lower energy sales
volumes. Selling, general and administrative expenses as a
percentage of net sales increased from 4.8% in fiscal 1997 to 5.6%
in fiscal 1998.

Interest expense decreased $336,000, or 16.3%, in fiscal 1998 as
compared to fiscal 1997 as a result of decreased average borrowings,
decreased interest rates and additional amounts of interest expense
capitalized on additions to property, plant and equipment. The
decreased borrowings were principally the result of principal
repayments from funds generated from operations.

The provision for income taxes decreased $1.9 million in fiscal
1998 as compared to fiscal 1997 as a result of the reduced level of
income before income taxes recorded in fiscal 1998, as compared to
fiscal 1997.

<PAGE>
At September 30, 1998, we had available net operating loss
carryforwards of $2.3 million which we may use to offset future
taxable income, of which $1.2 million was available at the beginning
of fiscal 1999. In addition, at September 30, 1998, we had
alternative minimum tax credit carryforwards of $598,000 available
for income tax purposes. See Note 8 of the Notes to the Consolidated
Financial Statements as of September 30, 1998.

As a result of the foregoing factors, net income decreased $3.5
million from net income of $14.9 million, or $0.97 diluted earnings
per share, in fiscal 1997 to net income of $11.4 million, or $0.73
diluted earnings per share, in fiscal 1998.

Energy Products Segment. Energy product sales decreased $39.0
million, or 17.4%, from the preceding fiscal year. Oil country
tubular goods shipments decreased 66,282 tons, or 21.5%, from
308,428 to 242,146. Our domestic shipments of oil country tubular
goods fell 14.7% due to excessive levels of industry inventory and a
declining rig count throughout the fiscal year. Our export sales,
primarily to Canada, decreased by 37.1%, from 41,092 tons in fiscal
1997 to 25,866 tons in fiscal 1998, as Canadian drilling activity
fell from 392 rigs at the end of fiscal 1997 to 161 rigs at the end
of fiscal 1998. Line pipe shipments decreased by 20.4% principally
due to increased import penetration. The average selling price for
energy products was $702, an increase of $34 per ton. The increase
was principally due to higher product pricing early in the year and
improved mix of higher value products.

Energy products cost of goods sold decreased $30.6 million, or
15.9%, from the preceding fiscal year. Gross profit for energy
products decreased approximately $8.4 million or 27.0%. Energy
products gross profit percentage was 12.3%, as compared to 13.9% in
fiscal 1997.

Industrial Products Segment. Industrial products sales
increased $13.4 million, or 19.9%, from the preceding fiscal year.
Industrial products shipments increased 22.2%, from 135,029 tons in
fiscal 1997 to 164,973 tons in fiscal 1998. The average selling
price of industrial products was $488, a decrease of $10 per ton.
This decrease was principally due to the decline in standard pipe
pricing caused by an increase in the level of imported product.

Industrial products cost of goods sold increased $9.8 million,
or 16.3%, from the preceding fiscal year. Industrial products gross
profit increased $3.5 million, or 49.9%. The improved gross profit
was primarily attributable to declining steel costs and improved
operating efficiencies during fiscal 1998, partially offset by
slightly lower selling prices. Industrial products gross profit
percentage was 13.1%, as compared to 10.5% in fiscal 1997.

Fiscal Year 1997 Compared to Fiscal Year 1996

Overall Company. In fiscal 1997, net sales increased $86.9
million, or 42.5%, from the preceding fiscal year. These results
were attributable primarily to an increase of 36.1% in total product
shipments, from 345,232 tons in fiscal 1996 to 469,958 tons in
fiscal 1997. Total sales and total shipments were positively
impacted by our strengthened position in the industrial products
market. Overall average selling prices increased during fiscal 1997
by 4.7% (from an average of $591 to $619 per ton). This increase
augmented the increase in volume of total sales.

Cost of goods sold increased $70.8 million, or 38.9%, in fiscal
1997 as compared to fiscal 1996. The overall increase was due
primarily to increased product shipments. However, the overall unit
cost per ton of products sold increased 2.0% (from an average of
$527 to $538 per ton) in fiscal 1997. This increase was due
primarily to an increase in delivered steel costs in the first half
of fiscal 1997, resulting in an increase in the average prime steel
cost of goods sold of $17 per ton. See "Overview." The increase in
steel costs was partially offset by the operating efficiencies we
achieved and improved fixed cost absorption.

<PAGE>
Gross profit increased $16.1 million, or 72.8%, in fiscal 1997
as compared to fiscal 1996. Gross profit as a percentage of net
sales was 13.1% for fiscal 1997, as compared to 10.8% for fiscal
1996.

Selling, general and administrative expenses increased $3.7
million, or 36.9%, from fiscal 1996 to fiscal 1997. These expenses
increased principally as a result of increased employee incentive
compensation, salary increases, increased selling expenses related
to higher sales volumes and the increase in sales commissions on
industrial products. Selling, general and administrative expenses as
a percentage of net sales decreased from 5.0% in fiscal 1996 to 4.8%
in fiscal 1997.

Interest expense decreased $455,000, or 18.0%, in fiscal 1997 as
compared to fiscal 1996 as a result of decreased borrowings. The
decreased borrowings were principally the result of principal
repayments from internally generated funds.

The provision for income taxes increased $5.5 million in fiscal
1997 as compared to fiscal 1996 as a result of our generating $12.8
million in additional income before income taxes in fiscal 1997, as
compared to fiscal 1996.

As a result of the foregoing factors, net income increased $7.4
million from net income of $7.5 million, or $0.50 per diluted share,
in fiscal 1996 to net income of $14.9 million, or $0.97 per diluted
share, in fiscal 1997.

Energy Products Segment. Energy product sales increased $76.3
million, or 51.7%, from the preceding fiscal year. Oil country
tubular goods shipments increased 105,937 tons, or 52.3%. During
fiscal 1997, an increase in consumption of oil country tubular goods
resulted from the average rig count rising by 148, or 19.5%, and a
build in existing inventories held by distributors. Also export
sales, primarily to Canada, increased by 95.8%, from 20,985 tons in
fiscal 1996 to 41,092 tons in fiscal 1997, as Canadian drilling rose
by 39.9%. Line pipe shipments decreased by 12.0% principally due to
increasing import penetration. The average selling price for energy
products was $668, an increase of $28 per ton. The increase was
principally due to higher product pricing and improved sales of
higher value products.

Energy products cost of goods sold increased $62.3 million, or
47.7%, from the preceding fiscal year. Gross profit for energy
products increased approximately $14.1 million or 82.3%. Energy
products gross profit percentage was 13.9%, as compared to 11.6% in
fiscal 1996.

Industrial Products Segment. Industrial products sales
increased $10.6 million, or 18.6%, from the preceding fiscal year.
Industrial products shipments increased 17.7%, from 114,728 tons in
fiscal 1996 to 135,029 tons in fiscal 1997. The average selling
price of industrial products was $498, an increase of $4 per ton.
This increase was principally due to improved product pricing.

Industrial products cost of goods sold increased $8.5 million or
16.5%, from the preceding fiscal year. Industrial products gross
profit increased $2.0 million or 40.3%. The improved gross profit
percentages were primarily attributable to improved product pricing
and improved operating efficiencies during fiscal 1997. Industrial
products gross profit percentage was 10.5%, as compared to 8.9% in
fiscal 1996.

LIQUIDITY AND CAPITAL RESOURCES

Working capital at June 30, 1999 was $37.7 million and the ratio
of current assets to current liabilities was 2.2 to 1, as compared
to September 30, 1998 when working capital was $60.4 million and the
current ratio was 3.3 to 1. The decrease in working capital was due
principally to a $15.7 million decrease in inventory and an $8.4
million increase in accounts payable, partially offset by a $1.4
million decrease in deferred revenue and a $2.2 million decrease in
accrued expenses and other liabilities. The above changes in
inventory and deferred revenue are due

<PAGE>
primarily to the decreased volume of energy business. The change in
accounts payable is due to the recent increase in steel purchasing
activity.

Cash provided by operating activities was $17.3 million for the
nine months ended June 30, 1999. During fiscal 1998, 1997 and 1996,
net cash provided by operations was $3.1 million, $16.7 million and
$14.2 million, respectively. In fiscal 1998, net cash provided by
operations, supplemented by funds drawn from the revolving credit
facility, was used to fund capital expenditures. In 1997 and 1996,
the net cash provided by operations was primarily used to fund
capital expenditures and the pay-down of net long-term borrowings.

Cash used in investing activities in the nine months ended June
30, 1999 and fiscal 1998, 1997 and 1996 was $12.0 million, $22.2
million, $9.4 million and $5.5 million, respectively, which was used
for the purchase of property, plant, and equipment. In fiscal 1998,
$11.5 million was spent on the purchase of the production facility
for cold drawn tubing.

For the nine months ended June 30, 1999, cash used by financing
activities was $5.6 million. Outstanding borrowings on our revolving
credit facility decreased $5.1 million primarily due to the
reduction in inventory. Our other long-term indebtedness, including
current maturities, was reduced by approximately $516,000. During
fiscal 1998, 1997 and 1996, cash provided (used) by financing
activities was $17.0 million, ($5.0) million and ($8.6) million,
respectively. Cash provided by financing activities in fiscal 1998
was primarily attributable to a $17.4 million net increase in our
revolving credit facility used to fund the purchase of the
production facility for cold drawn mechanical tubing and other
working capital needs. The increase in our revolving credit facility
was offset by other regularly scheduled term debt payments. Cash
used by financing activities in fiscal 1997 was primarily
attributable to the pay-off of a $3.7 million term note used to
finance the relocation of the energy facility to Arkansas, a $3.3
million net decrease in our revolving credit facility and other
regularly scheduled term debt payments. These debt pay-downs were
partially offset by $2.5 million of proceeds from the exercise of
stock options. The cash used by financing activities in fiscal 1996
was primarily attributed to the pay-off of a $5.5 million term note
(the proceeds of which were used in 1995 to finance the Hickman
structural facility) and a $1.8 million net pay-down of our
revolving credit facility.

Our capital budget for fiscal 1999 has been reduced to
approximately $13.0 million, of which $12.0 million was expended
during the nine months ended June 30, 1999. Such amount includes
progress payments of $2.6 million related to a new furnace for our
cold drawn tube facility. Because we leased the furnace, these
progress payments were reimbursed to us. In addition to completing
the cold drawn tube facility, the budgeted funds are also being
utilized principally to acquire equipment for our other
manufacturing facilities and to purchase and install a new
enterprise resource planning system. As of June 30, 1999, we had an
additional $900,000 committed for the purchase of equipment.

We expect that we will meet our ongoing working capital and
capital expenditure requirements from a combination of cash flows
from operations, which constitutes our primary source of liquidity,
the net proceeds from this offering and available borrowings under
our revolving credit facility. The revolving credit facility
provides for maximum borrowings up to the lesser of the eligible
borrowing base or $50 million, and bears interest at either the
prevailing prime rate or an adjusted Eurodollar rate, plus an
interest margin, depending upon certain financial measurements. The
revolving credit facility was amended as of March 31, 1999 to revise
financial covenants in order to reflect the current economic
environment in our energy related markets and to provide additional
availability in our borrowing base. These financial covenants
include a limit of earnings before income taxes loss of $2.5
million. The revolving credit facility is secured by our accounts
receivable, inventories and equipment and will expire on September
30, 2003. As of June 30, 1999, the applicable interest rate under
the revolving credit facility was 7.0% per annum. We had $17.5
million in unused availability under the revolving credit facility
and

<PAGE>
had $485,000 in cash and cash equivalents at June 30, 1999. As of
August 31, 1999, the amount outstanding under this facility was
$31.2 million with $11.0 million in remaining unused availability.

We currently are seeking up to $10 million in financing from
the Arkansas Development and Finance Authority for use in the
construction and equipping of our large diameter mill. We may not,
however, be able to obtain this financing on favorable terms or at
all.

YEAR 2000 READINESS DISCLOSURE

General. The advent of the year 2000 poses certain
technological challenges resulting from a reliance in computer
technologies on two digits rather than four digits to represent the
calendar year (e.g., "98" for "1998"). Computer technologies
programmed in this manner, if not corrected, could produce
inaccurate or unpredictable results or system failures in connection
with the transition from 1999 to 2000, when dates will begin to have
a lower two-digit number than dates in the prior century. This
problem, the so-called "year 2000 problem" or "Y2K problem," may
have a material adverse effect on our financial condition, results
of operations, business or business prospects because we rely
extensively on computer technology to manage financial information
and, to a lesser extent, to operate our manufacturing equipment.

Our State of Readiness. We have developed a Year 2000 Action
Plan to deal with the year 2000 problem. Our plan specifies a range
of tasks and goals which we will achieve by various dates before the
year 2000. The principal tasks and goals include:

* assessment of our computer systems;

* remediation of any identified problems; and

* testing of our systems.

To date, we are on target with our plan and are meeting our
major deadlines. Our year 2000 staff has regularly apprised senior
management and our board of directors of our progress. As a result,
senior management provides input and guidance on a regular basis.

Information Technology Systems. We rely extensively on computer
technology for our information management systems. We have completed
our assessment of our internal information technology systems to
identify those which are in need of modification or renovation to
minimize disruptions or failures related to the Y2K problem. As a
result of this assessment, we identified several older information
technology systems that presented certain risks of failure or
malfunction in connection with the year 2000 problem, including
systems related to sales and inventory management. Accordingly, we
are in the process of converting to a new enterprise resource
planning system which will replace the older systems and, we
believe, will adequately function through the transition from 1999
to 2000. We anticipate completing the remediation and testing phases
of this aspect of our plan before December 1999.

Non-Information Technology Systems. We completed our
assessment, remediation and testing phases of our plan with respect
to internal non-information technology systems, including our
manufacturing machinery and equipment. During our assessment of
these non-information technology systems, we did not identify any
significant issues related to the Y2K problem. As a result, we do
not anticipate any further remediation of this equipment in
connection with the Y2K problem.

Third-Party Providers and Customers. We have monitored the year
2000 preparedness of our third party providers and servicers,
utilizing various methods for testing and verification. However, our
ability to evaluate is limited to some extent by the willingness of
vendors to supply information and the ability of vendors to verify
the year 2000 preparedness of their own systems or their
sub-providers. We have requested certifications of year 2000
preparedness from principal

<PAGE>
software and equipment providers. In those cases where a vendor has
not been able to certify its product's preparedness with respect to
the Y2K problem, we have taken steps to bring the system into
compliance or to replace the system.

We have inquired on the year 2000 status of our customers. As is
the case with other similarly situated companies, if several current
or future customers fail to prepare adequately for the Y2K problem,
our financial condition, results of operations, business or business
prospects could be adversely impacted.

The Costs to Address Our Year 2000 Issues. As discussed above,
we are in the process of converting to a new enterprise resource
planning system. We acquired this system, which is year 2000
compliant, in order to enhance our ability to make more informed
decisions regarding sales and inventory, optimize inventory levels
and minimize costs. The cost of this system, including the cost of
software and related internal cost, is expected to be $5.0 million,
of which approximately $3.9 million has been expended through June
30, 1999. The cost of this system will be funded primarily from
general operating cash flows.

We have postponed some of our minor computer-related projects
that we otherwise might have completed during calendar years 1998
and 1999, due to our shifting of resources directed to the
replacement of the enterprise resource planning systems and other
year 2000 related projects. We do not believe this postponement will
have any significant effect on our operations or customer service.

Year 2000 Risks We Face and Our Contingency Plans. Our failure
to successfully implement our plan could result in an interruption
in or failure of certain normal business activities or operations.
Even if we successfully complete our plan, we may also be exposed to
the failure of some of our customers, suppliers or vendors to
prepare adequately for the Y2K problem. These failures could
materially adversely affect our results of operations, liquidity and
financial condition. Currently, we are on schedule and believe that
our successful completion of the assessment, remediation and testing
phases should significantly reduce the risks we face with respect to
the Year 2000 problem.

We believe that it is difficult to fully assess the risks of the
year 2000 issue due to numerous uncertainties surrounding the issue.
We believe that the primary risks are external to us and relate to
the year 2000 readiness of customers, suppliers and transportation
providers. In the most reasonably-likely worst case scenario, our
customers may not purchase our products if their drilling or
fabricating equipment fail to operate, we may not be able to access
our bank accounts or make or receive payments and our transportation
providers may not be able to make timely shipments to customers.

In order to reduce these risks, we have developed certain
contingency plans. As part of our contingency plans, we would use
various manual procedures that bypass computer applications.
However, implementing these contingency plans could have an adverse
effect on our liquidity, financial condition and results of
operation due to reduced productivity and efficiency associated with
the manual procedures. Some catastrophic events, such as the loss of
utilities or the failure of certain governmental bodies to function,
are outside the scope of our contingency plans, although we
anticipate that we would respond to any catastrophe in a manner
designed to minimize disruptions in customer service, and in full
cooperation with our peer providers, community leaders and service
organizations.

BUSINESS

OUR COMPANY

The following table summarizes our current manufacturing
facilities and the products they produce:

<TABLE>
<CAPTION>
FACILITY PRODUCTS SIZES<F1>
---------------- --------------------------- ----------------
<S> <C> <C>
Hickman, AR Oil country tubular goods 1 1/2" - 5 1/2"
Line pipe 1 1/2" - 5 9/16"
Standard pipe 2" - 5"

Hickman, AR Structural tubing 1 1/2" - 8"

Conroe, TX Oil country tubular goods 4 1/2" - 9 5/8"
Line pipe 4 1/2" - 8"
Structural tubing 4 1/2" - 8"
Standard pipe 6" - 8"

Beaver Falls, PA Cold drawn tubular products 1 7/8" - 12"

<FN>
- -------------------
<F1> Represents outside diameter measurement. Structural tubing can
have a square, rectangular, or round cross-section.
</TABLE>

OUR BUSINESS STRATEGY

Increase market share by expanding our existing product
lines. We believe that the expansion of our product lines in both
the energy and industrial segments of our business will allow us to
increase our market share by capitalizing on our existing customer
relationships to market additional products. Our planned
construction and equipping of the new large-diameter facility
discussed below is an important part of this strategy.

Continually improve the efficiency of our manufacturing
process. We intend to continue to pursue our objective of being a
low-cost, high-volume producer of quality steel-tubular products by
seeking to:

* maintain product manufacturing cost controls;

* maximize production yields from raw materials;

* make capital expenditures designed to lower costs and improve
quality;

* minimize unit production costs through effective utilization
of plant capacity; and

* minimize freight costs.

* offer broad-based product lines;

* focus on product availability;

* deliver competitively priced quality products; and

* provide a high level of customer support before and after the
sale.

PRODUCT LINE EXPANSION

* utilization of lower-cost, non-union labor;

* access to rail, truck and barge transportation;

* proximity to the Nucor Corporation steel mill, Maverick's
primary steel supplier; and

* shared overhead.

We recently entered into a definitive agreement for the purchase
of a significant portion of the equipment required for the new
large-diameter facility for a purchase price of $11.75 million.
Although consummation of this purchase is subject to various
conditions, we expect to close the transaction in January 2000. We
believe we will begin limited production of select industrial
products and energy products at the new facility by July 2000 with
full production capability of all products by October 2000.

THE ENERGY PIPE INDUSTRY

General. Oil country tubular goods consist of drill pipe,
production casing, surface casing and production tubing. Drill pipe
is used and may be reused to drill wells. Production casing forms
the structural wall in oil and gas wells to provide support and
prevent caving during drilling operations and is generally not
removed after it has been installed in a well. Surface casing is
used to protect water-bearing formations during the drilling of a
well. Production tubing is placed within the casing and is used to
convey oil and natural gas to the surface. In addition, production
tubing may be replaced during the life of a producing well.

The domestic oil country tubular goods market is affected by
several factors, the most significant being the number of oil and
natural gas wells being drilled. The level of drilling activity is
largely a function of current prices for oil and natural gas and the
industry's future price expectations. These prices are determined by
various supply and demand factors, such as

consumption levels, current inventory levels, weather, import
levels, production economics and future expectations. The following
chart shows the price of oil and natural gas since August 1996:

[GRAPH]

The most commonly cited indicator of the level of domestic
drilling activity is the Baker Hughes rig count which represents the
number of active oil and natural gas rigs currently being used in
the U.S. Since July 1987, the Baker Hughes rig count hit a high in
December 1990 of 1179 and a low in April 1999 of 488. However, by
September 10, 1999, the active rig count increased 41% from this low
to 690. The following chart shows the U.S. rig count at each month
end since August 1996 and our shipments of oil country tubular goods
for the same period:

[GRAPH]

The oil country tubular goods market is also affected by the
level of industry inventories maintained by manufacturers,
distributors and end users. When customers draw down on inventory
rather than purchase new products, this has an adverse effect on the
demand for new production. Conversely, when distributors and end
users increase inventory levels, this has a positive effect on
demand for new production. For calendar years 1996 and 1997,
increasing industry inventory levels added an estimated 4.3% and
14.6%, respectively, to oil country tubular goods demand for new
production. However, for calendar 1998, declining industry inventory
levels satisfied 8.5% of oil country tubular goods consumption. For
the six months ended June 30, 1999, industry inventory levels
continued to decline, but remained at or above current levels of
demand at June 30, 1999.

Import levels of foreign oil country tubular goods also
significantly affects the oil country tubular goods market. High
levels of imports, reduce the volumes sold by domestic producers and
tend to suppress selling prices. We believe that domestic import
levels are affected by, among

other things, overall world demand for oil country tubular goods,
the trade practices of and government subsidies to foreign producers
and the presence or absence of governmentally imposed trade restrictions
in the U.S. Since 1986, the level of imports of oil country tubular
goods from Canada and Taiwan has been reduced by the existence of duties
imposed by the United States government. The U.S. International Trade
Commission is scheduled to review these duties in 1999. In addition,
since 1995, the level of imports of oil country tubular goods from
Argentina, Italy, Japan, Korea and Mexico have also been reduced by the
existence of anti-dumping duties. The U.S. International Trade
Commission is scheduled to review these duties in 2000. If these
duties expire or are renewed on a less stringent basis, we could be
exposed to increased competition from imports.

The following table illustrates certain factors related to
industry-wide domestic drilling activity, domestic oil country
tubular goods consumption, shipments, imports and inventories during
the calendar years presented:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------
1993 1994 1995 1996 1997 1998
----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
U.S. DRILLING ACTIVITY:
Average rig count................................ 754 775 723 779 943 831
===== ===== ===== ===== ===== =====
U.S. OIL COUNTRY TUBULAR GOODS CONSUMPTION (IN TONS):
U.S. producer shipments (000's).................. 1,122 1,122 1,413 1,742 2,097 1,217
Imports (000's).................................. 353 342 180 231 412 343
Inventory (increase)/decrease (000's)............ (170) 95 2 (84) (349) 156
Used pipe (000's)................................ 233 139 144 78 223 111
----- ----- ----- ----- ----- -----
Total U.S. consumption (000's)............... 1,538 1,698 1,739 1,967 2,383 1,827
===== ===== ===== ===== ===== =====
</TABLE>

The rig count in the table is based on weekly rig count
reporting from Baker Hughes, Inc. calculated by averaging the 52
weeks ending with the last week in December of each year. U.S.
consumption of oil country tubular goods are based on our estimate
of per rig consumption of oil country tubular goods multiplied by
the Baker Hughes rig count. Total U.S. consumption (in thousands of
tons) as reported by Pipe Logix, Inc., an independent domestic oil
country tubular goods industry reporting service, for calendar year
1993, 1994, 1995, 1996, 1997, and 1998 was 1,445, 1,494, 1,475,
1,668, 2,025, and 1,775. Imports are as reported by Duane Murphy
and Associates in "The OCTG Situation Report." Inventory (increase)/
decrease are management estimates based upon independent research by
Duane Murphy and Associates. Inventory (increase)/decrease (in
thousands of tons) as reported by Pipe Logix, Inc. for calendar year
1993, 1994, 1995, 1996, 1997, and 1998 was (340), (204), (133), (366),
(671), and 136. Used pipe quantities are calculated by multiplying 8.3
recoverable tubing and casing tons (as determined by independent
research performed by Duane Murphy and Associates) by the number of
abandoned oil and gas wells as determined by the completed wells per
year as reported by the American Petroleum Institute adjusted for the
net change in active wells as reported by World Oil. U.S. producer
shipments are calculated using the above components.

Manufacturers produce oil country tubular goods in numerous
sizes, weights, grades and end finishes. We believe that most oil
country tubular goods are produced to American Petroleum Institute
specifications. The grade of pipe used in a particular application
depends on technical requirements for strength, corrosion resistance
and other performance qualities. Oil country tubular goods are
generally classified into groupings of "carbon" and "alloy" grades.
Carbon grades of oil country tubular goods have yield strength
levels of 75,000 pounds per square inch or less and are generally
used in oil and natural gas wells drilled to depths less than 8,000
feet. Alloy grades of oil country tubular goods have yield strength
levels of 75,000 pounds per square

inch or more and are generally used in oil and natural gas wells
drilled to depths in excess of 8,000 feet, or for high temperature
wells, highly corrosive wells or for critical applications.

Carbon and alloy grades of oil country tubular goods are
available from both electric resistance welded and seamless pipe
producers. Electric resistance welded pipe is produced by processing
flat rolled steel into strips which are cold-formed, welded,
heat-treated or seam-annealed and end-finished with threads and
couplings. Seamless products are produced by individually heating
and piercing solid steel billets into pipe and then end finishing
such pipe into oil country tubular goods in a manner similar to
electric resistance welded pipe. We believe that the seamless
manufacturing process involves higher costs than the welded process
and that, as a result, seamless products are generally priced higher
than comparable welded products.

Based on published industry statistics, electric resistance
welded products, which did not have significant market penetration
prior to the mid-1970's, now account for approximately half of the
tonnage of domestic oil country tubular goods consumed annually. We
believe electric resistance welded products have captured a
significant majority of the carbon grade oil country tubular goods
market, while seamless products retain a significant majority of the
alloy grade oil country tubular goods market. We also believe that
further significant market penetration of welded products will
depend upon increased market acceptance of welded products and
technological advances in the types of raw materials and equipment
utilized in the electric resistance welding process.

Line pipe products are used for surface production flow lines,
gathering systems and pipeline transportation and distribution
systems for oil, natural gas and other fluids. Line pipe is produced
in both welded and seamless form. Line pipe markets are dependent
not only on the factors which influence the oil country tubular
goods market, but also on the level of pipe line construction
activity, line pipe replacement requirements, new residential
construction and utility purchasing programs.

Our Products. We manufacture oil country tubular goods used for
production tubing, production casing, and surface casing, and we
also manufacture line pipe. We do not make drill pipe. We produce
all of our oil country tubular goods and line pipe using only the
electric resistance welding process.

The following table shows our oil country tubular goods and line
pipe shipments in tons, net sales (000's) and as a percentage of
overall net sales measured in dollars:

<TABLE>
<CAPTION>
OIL COUNTRY TUBULAR GOODS LINE PIPE
------------------------------------- ------------------------------------
% OF MAVERICK % OF MAVERICK
PERIOD TONS NET SALES NET SALES TONS NET SALES NET SALES
- ------ ------- --------- ------------- ------ --------- -------------
<S> <C> <C> <C> <C> <C> <C>
First nine months of
fiscal 1999............. 104,888 $ 61,024 51.5% 13,408 $ 5,771 4.9%
Fiscal 1998............... 242,146 173,329 65.3% 21,097 11,496 4.3%
Fiscal 1997............... 308,427 208,932 71.8% 26,501 14,947 5.1%
Fiscal 1996............... 202,491 133,259 65.3% 28,013 14,296 7.0%
</TABLE>

Our decreased sales of oil country tubular goods in fiscal 1998
were due to declining demand and a smaller industry inventory
increase. Our decreased sales of oil country tubular goods for the
first nine months of fiscal 1999 were due to declining demand and
draw downs of industry inventories. Our decreased sales of line pipe
in fiscal 1997, fiscal 1998 and the first nine months of fiscal 1999
were due in large part to competition from imported pipe.

Our energy products meet or exceed applicable American
Petroleum Institute standards. In addition, similar to other
producers, we manufacture oil country tubular goods in custom or
proprietary grades. We design and engineer our custom and
proprietary oil country tubular goods to be used in similar
applications as products meeting American Petroleum Institute
standards
30

and to provide performance features comparable to products meeting
those standards. We warrant our American Petroleum Institute
casing and tubing to be free of defects in material or workmanship
in accordance with the Institute's applicable specifications and our
proprietary grade products to be free of defects in accordance with
our published standards. We have not incurred significant costs in
connection with this warranty. We maintain insurance coverage against
potential claims in an amount which we believe to be adequate.

We manufacture finished products in both carbon and alloy steel
grades. Virtually all of our products are fully completed or
"end-finished" at our facilities. In contrast, some of our
competitors outsource the end-finishing of their products or do not
end-finish their products at all, thus adding to their freight and
handling costs. The end-finish process includes, as appropriate,
upsetting, beveling, threading, pressure testing and the application
of couplings. Our fully finished oil country tubular goods are ready
to be installed in oil or natural gas wells. By end-finishing our
products, we are better able to control quality, cost and service to
customers. Both of our energy facilities provide heat-treatment
capabilities necessary for the production of alloy grade pipe. Our
alloy grade tubing and casing products accounted for 24%, 21% and
27% of the tons of energy products sold in fiscal 1998, 1997 and
1996, respectively (excludes full body normalized product). Carbon
grade tubing and casing and line pipe products accounted for the
balance of these tons.

We manufacture oil country tubular goods and line pipe ranging
in size from two inches to 9 5/8 inches in outside diameter.
Excluding drill pipe, which we do not manufacture, approximately 61%
of the total oil country tubular goods and line pipe tonnage
produced in the western hemisphere in calendar 1997 fell into this
size range. Approximately 19% of the total tonnage produced was
greater than 9 5/8 inches through sixteen inches in outside
diameter, and the remaining 20% was outside this size range.

Our planned construction and enhancement of the large-diameter
facility will enable us to manufacture oil country tubular goods and
line pipe in sizes ranging from two inches to sixteen inches in
diameter. This capability will broaden our product line of line pipe
and of oil country tubular goods. We expect the product line expansion
to allow us to increase market share by selling to our existing customers
with minimal increases in cost, improve our bargaining position with
existing distributors and increase complementary product sales of
existing products by offering larger sizes.

Marketing. We sell oil country tubular goods and line pipe
primarily throughout the United States and Canada to numerous
distributors, which then resell the pipe to major and independent
oil and natural gas production, gathering and pipeline companies.
Sales to Canadian customers were $17.9 million, $26.3 million and
$12.9 million, respectively. Sales to other foreign customers in
fiscal 1998, 1997 and 1996 made up an additional $900,000, $400,000
and $300,000, respectively. Our marketing philosophy emphasizes
delivering competitively priced quality products and providing a
high level of service to our customers. With the completion of our
new large-diameter facility, we plan to also market ourselves as a
broad line supplier of oil country tubular goods and line pipe
products. We maintain inventories of finished goods that are housed
at both of our production facilities and at field locations close to
areas of drilling activity which allows us to provide timely
delivery of our products.

As of June 30, 1999 and June 30, 1998, our backlog orders were
approximately $27.7 million and $26.5 million, respectively. All of
the backlog orders as of June 30, 1999 are expected to be filled by
the end of fiscal 1999. We consider only $2.2 million and $4.6
million of our backlog orders, respectively to be firm as remaining
orders may generally be cancelled without penalty. Our backlog
orders as of any particular date may not be indicative of our actual
operating results for any fiscal period. We cannot give any
assurance that the amount of backlog at any particular date will
ultimately be realized.

At June 1, 1999 the average price we charged for our oil country
tubular goods had decreased to $559 per ton from $665 per ton in
November 1998 and $760 per ton in late 1997. Effective June 30, 1999
and September 1, 1999 we increased the price of our oil country tubular
goods $20 per ton and $80 per ton, respectively. These increases have
allowed us to increase our price per ton to levels close to the November
1998 level. We cannot assure you that any of our price increases will hold.

In fiscal 1998, 1997 and 1996, one distributor, National
Oilwell, Inc., accounted for 14%, 14% and 16% of our net sales,
respectively. In fiscal 1997, another distributor, Master Tubulars,
Inc., accounted for 11% of our net sales. Four distributors,
including National-Oilwell, have recently combined to become Sooner
Pipe & Supply Corp., one of the largest distributors of oil country
tubular goods. Sooner has accounted for 14% of our net sales for the
nine months ended June 30, 1999. We currently use several
distributors and believe that additional qualified distributors are
available to assist us in meeting the end-users' needs. While we
believe that we could replace any one distributor, including Sooner
or Master Tubulars with other qualified distributors, the loss of
Sooner or Master Tubulars could have a material adverse effect on
our net sales or results of operations.

Manufacturing. We manufacture oil country tubular goods and
line pipe products at our facilities in Conroe, Texas and Hickman,
Arkansas. We expect to begin the production of additional energy
products at our new large-diameter facility adjacent to our Hickman,
Arkansas, facilities by October 2000. The facilities are
strategically located to serve the energy markets in the United
States. We can currently produce at a consolidated maximum rate of
approximately 669,000 tons of finished products per year with
approximately 477,000 tons currently dedicated to energy related
products. After completion of our new large-diameter facility, we
expect these amounts to increase to 919,000 and 627,000 tons per
year, respectively. We operated our energy facilities at a capacity
utilization of approximately 55% during fiscal 1998. During the nine
months ended June 30, 1999, capacity utilization fell to 33%.

In order to control our manufacturing costs, we attempt to
maximize production yields from purchased steel and reduce unit
labor costs. In fiscal 1998 and for the first nine months of fiscal
1999, purchased steel represented approximately 67% and 60%,
respectively, of our cost of goods sold. For fiscal 1998 and for the
first nine months of fiscal 1999, direct and indirect labor costs
accounted for approximately 10% and 13%, respectively, of the cost
of goods sold. We control labor costs by automating some of our
activities and by seeking to optimize product throughput and
scheduling. We maintain an innovative compensation plan at our
Hickman, Arkansas and Conroe, Texas manufacturing facilities,
whereby employees receive quarterly bonuses for superior
productivity and cost savings. In addition, some employees are
eligible to receive annual profitability bonuses based on our
consolidated earnings. The maximum achievable incentives and bonuses
range from 15% to 75% of an employee's salary or wages.

During fiscal 1998, we spent $7.5 million on new capital
equipment for our energy facilities. Our capital budget for fiscal
1999 is $6.3 million, of which $2.6 million has been spent as of
June 30, 1999. During fiscal 2000, we expect to spend approximately
$35 million to construct and equip a new large-diameter facility
that will produce, in part, oil country tubular goods and line pipe
in larger sizes than we currently produce. We expect these capital
expenditures to result in manufacturing cost savings, quality
improvements and/or expanding or maintaining production capabilities
and product lines.

Competition. The suppliers of oil country tubular goods and
line pipe products face a highly competitive market. We believe that
the principal competitive factors affecting our business are price,
quality, delivery, availability and service. We believe we enjoy an
excellent reputation for quality products and outstanding customer
service. We compete with several domestic and numerous foreign
producers of oil country tubular goods, some of which have greater
financial
32

resources than we do. In the oil country tubular goods market, our
more significant competitors are Lone Star Steel Company and Newport
Steel Company, which produce electric resistance welded pipe and
United States Steel Corporation and North Star Steel Company,
which primarily produce seamless pipe. We also compete in the line
pipe market with these same competitors, and with foreign producers
of oil country tubular goods, most of which are units of large
foreign steel makers. During calendar years 1996, 1997, 1998 and the
first six months of 1999, we estimate that domestic oil country
tubular goods market penetration by imports was 11.7%, 17.3%, 18.8%,
and 8.7%, respectively, of tons consumed.

THE STRUCTURAL TUBE AND STANDARD PIPE INDUSTRY

General. Our structural tubing products are used in the
following applications:

* construction, including handrails, building columns, and
bridge frames;

* transportation, including boat trailers;

* agricultural, including farm implement components, and tillage
equipment;

* material handling, including storage rack systems and
conveying systems support; and

* recreational, including exercise equipment.

In addition, structural tubing is an attractive alternative to
other structural steel forms, such as I-beams and H-beams.
Structural tubing products offer strength and other product
characteristics similar to beams, but with less steel content,
resulting in lower costs to the end user in many applications.

Structural tubing and standard pipe are produced by processing
flat rolled steel into strips which are cold-formed, welded,
heat-treated or seam-annealed. The machinery and equipment used for
the manufacture of structural tubing products are similar to that
used for the manufacture of oil country tubular goods. Structural
tubing and standard pipe are not, however, subject to the same
degree of tolerances as are oil country tubular goods, which
results in lower production costs related to testing and inspection
than for oil country tubular goods. Moreover, structural tubing does
not require end finishing, flash elimination from the welding
process or seam-annealing. Because less finishing is required of
structural tubing products as compared to oil country tubular goods,
the average cost per ton to convert steel into structural tubing is
significantly less than oil country tubular goods.

We believe that demand for structural tubing is influenced
primarily by the level of general economic activity in the United
States. We estimate that domestic consumption of structural tubing
during calendar 1998, 1997 and 1996 was 2.0 million, 1.9 million and
1.7 million tons, respectively.

Standard pipe products are used in industrial applications such
as steam, water, air and gas lines, and plumbing and heating. As
with structural tubing, we believe that demand for standard pipe is
influenced primarily by the level of general economic activity in
the United States. We estimate that domestic consumption of standard
pipe during calendar 1998, 1997 and 1996 was 2.6 million, 2.7 million
and 2.6 million tons, respectively. In recent years, standard pipe
has faced limited new competition from plastic pipe in certain
applications.

Our Products. We produce square, rectangular and round
structural tubing at our facilities in sizes ranging from one and
one half to eight inch square and the equivalent sizes in
rectangular and round tubing. Our products range in thicknesses from
0.120 to 0.500 inches. Because of the large number of applications
for structural tubing and standard pipe, the number of different
products produced for the industrial market is considerably larger
than that produced for the oil country tubular goods market. The
annual capacity at our Hickman structural facility is

approximately 192,000 tons. We were operating at approximately 86%
of our structural capacity during fiscal 1998 and 79% of capacity
during the first nine months of fiscal 1999.

The following table shows our structural tubing and standard
pipe shipments in tons, net sales (000's) and as a percentage of
overall net sales measured in dollars:

<TABLE>
<CAPTION>
STRUCTURAL TUBING STANDARD PIPE
------------------------------------- ------------------------------------
% OF MAVERICK % OF MAVERICK
PERIOD TONS NET SALES NET SALES TONS NET SALES NET SALES
- ------ ------- --------- ------------- ------ --------- -------------
<S> <C> <C> <C> <C> <C> <C>
First nine months of fiscal
1999...................... 96,300 $41,750 35.3% 14,171 $ 6,492 5.5%
Fiscal 1998................. 142,779 68,892 26.0 22,196 11,632 4.4
Fiscal 1997................. 111,735 54,639 18.8 23,294 12,542 4.3
Fiscal 1996................. 81,959 40,767 20.0 32,769 15,860 7.8
</TABLE>

Completion of the new large-diameter facility will increase the
size range of our structural tube and standard pipe offering, thus
allowing us to market a broader line of products for industrial
applications. As a result of this new facility, we expect to gain
additional complementary sales by offering larger sizes, while
limiting the amount of additional expenses. We also believe this new
facility will allow us to market ourselves as a broad line producer
of structural tubing and standard pipe.

Marketing. The structural tubing and standard pipe markets are
somewhat regional in nature, primarily because order sizes are
smaller and lead-time requirements are shorter than for oil country
tubular goods. We currently sell principally to distributors, but
since fiscal 1997, we significantly increased our sales to large
end-user customers. As in the case of oil country tubular goods, our
marketing strategy emphasizes delivering competitively priced
quality products and providing a high level of service to our
customers. In addition, we expect our marketing ability will be
enhanced by the addition of larger diameter pipe and tubing that we
will produce upon completion of our large-diameter facility. Because
the application of structural tubing and standard pipe products is
diverse, and a short lead time is required for customer satisfaction,
we maintain inventory levels, in terms of months of supply, comparable
to those for oil country tubular goods. This finished goods inventory
will consist of a larger number of items than in the case of oil
country tubular goods. We use experienced manufacturing representatives
in our sales efforts.

As of June 30, 1999 and June 30, 1998, our backlog orders were
$6.2 million and 8.2 million, respectively. All of the backlog
orders as of June 30, 1999 are expected to be filled by the end of
fiscal 1999. We do not consider any of our backlog orders to be
firm as they may generally be cancelled without penalty. Our backlog
orders as of any particular date may not be indicative of our actual
operating results for any fiscal period. We cannot give any assurance
that the amount of backlog at any given time ultimately will be
realized.

Manufacturing. We are currently producing structural square and
rectangular shaped tubing products in our structural tube facility
located in Hickman, Arkansas. We are also currently producing
structural round tubing products and standard pipe at our two energy
facilities in Conroe, Texas and Hickman, Arkansas and expect to
begin production of larger sized structural tubing and standard pipe
upon completion of our large-diameter facility to be located
adjacent to our Hickman, Arkansas location by July 2000.

Based upon historical product relationships and our assumptions
about the market, we estimate that the sizes of structural tubing
products we currently are capable of manufacturing account for more
than 85% of the domestic tonnage of all sizes of domestic structural
tubing products consumed. Similarly, after completing the new large-
diameter facility, we estimate that we should be capable of
manufacturing sizes that account for more than 97% of the domestic
tonnage consumed.

Based on an industry source, we believe that the types of
standard pipe products we are capable of manufacturing account for
approximately 25% of the domestic tonnage of all types of standard
pipe products consumed. After completing the new large-diameter
facility, we expect to be capable of manufacturing more than 41% of
the domestic tonnage of all sizes of products consumed.

Consistent with our manufacturing strategy for oil country
tubular goods production, we believe we are a low-cost, high-volume
producer of quality structural tubing and standard pipe products. We
believe that the application of our efficient manufacturing process
originally developed for the production of oil country tubular
goods, the labor costs at our Arkansas facility and the strategic
location of the facility provide a conversion cost advantage
relative to the majority of existing domestic structural tubing and
standard pipe manufacturers.

During the first nine months of fiscal 1999 and during fiscal
1998, we spent approximately $917,000 and $722,000, respectively, on
additional equipment needed for manufacturing.

Competition. Although a significant market for structural
tubing is located within a 400 mile radius of our Hickman structural
facility, no other major structural tubing facility is currently
located within this area. Foreign competition, primarily from
Canada, represented 23%, 22% and 23% of total domestic sales of
structural tubing in calendar 1998, 1997 and 1996, respectively. We
compete primarily against several domestic and numerous foreign
producers of structural tubing. Our more significant structural tube
competitors are Leavitt Tube Company, Inc., Welded Tube Corporation
of America, Copperweld, Bull Moose Tube Corporation and Ex-L-Tube,
Inc.

A significant market for standard pipe also exists. Foreign
competition has had a large presence in the standard pipe market.
Foreign competition represented approximately 31%, 24% and 25% of
total domestic sales of standard pipe in calendar 1998, 1997 and
1996, respectively. Our more significant domestic competitors are
Wheatland Tube Company, Armco, Inc. Sawhill Tubular Division,
Laclede Steel Company and IPSCO Tubulars, Inc.

We believe that the principal competitive factors affecting our
structural tubing and standard pipe businesses are price, product
availability, delivery and service.

THE COLD DRAWN TUBING INDUSTRY

General. The cold drawn tubing market is made up of mechanical
or pressure tubing used for applications that require closer
tolerances and/or a better surface finish than ordinary electrical
resistance welded or seamless tubing. The following table describes
some of these applications:

<TABLE>
<CAPTION>
INDUSTRIAL USES OILFIELD USES CONSUMER USES
--------------- ------------- -------------
<C> <C> <C>
* Hydraulic, pneumatic * Mud pumps * Motorcycle forks
and gas cylinder stock
* Precision pumps * Exercise equipment
* Power takeoff and auger
shafts * Perforating tubes * Office furniture

* Electric motor housings * Subsurface pump shells * Playground equipment

* Conveyor rollers * Coupling stock * Bicycles

* Axles * Boat trailers
</TABLE>

Cold drawn tubing starts with either a plain-end electric
resistance welded or seamless tube. The source tube is then pulled
through a die and over a mandrel to create precise outside and
inside diameters or wall tolerances and to create a smoother finish.

The cold drawn tubing market is driven primarily by the general
economy. Other factors include agricultural prices and infrastructure
construction due to the large quantity of cold drawn tubing consumed
in cylinder manufacturing for agriculture and construction machinery.
We believe the market size is currently about 516,000 tons per year.
Imports have typically satisfied less than 5% of consumption.

The market is made up of three segments based upon outside
diameter and wall thickness of the tube, as follows:

<TABLE>
<CAPTION>
OUTSIDE DIAMETER WALL THICKNESS
---------------- --------------
<S> <C> <C>
Group 1.............................. through 4" through .134"
Group 2.............................. 4" through 7 1/2" through .320"
Group 3.............................. above 7 1/2" all
</TABLE>

Our Products. We primarily manufacture and sell cold drawn
tubing products in the Group 2 and Group 3 market segments as shown
above. As of June 30, 1999, the sales of our cold drawn tubing
products had not reached material levels.

Marketing. Our current customer base for cold drawn tubing
products is primarily steel service centers. Generally, because cold
drawn tubing products are components of larger products, order sizes
range from 5,000 to 10,000 pounds, which is smaller than our typical
order sizes for structural tubing or oil country tubular goods. We
almost always manufacture cold drawn tubing products to order
resulting in a finished goods inventory that is smaller than our
finished goods inventory of structural or energy products.
Currently, the industry lead time for cold drawn tubing products is
approximately six to seven weeks.

As of June 30, 1999 our backlog of cold drawn tubing orders was
approximately $1 million. We do not consider any of our backlog to
be firm. Our backlog orders as of any particular date may not be
indicative of our actual operating results for any fiscal period.
We cannot give any assurance that the amount of backlog at any given
time ultimately will be realized.

Manufacturing. In fiscal 1998, we acquired assets used in the
production of cold drawn tubular products at our production facility
in Beaver Falls, Pennsylvania. This facility began production during
the first quarter of fiscal 1999. We expect to supply approximately
75% of this facility's raw material requirements from our other
production facilities. We purchase the remainder from outside
sources, which include both smaller diameter pipe that is less than
1 9/10" and larger diameter pipe that is greater than 10" and
seamless pipe.

During the first nine months of fiscal 1999, we spent
approximately $2.5 million on additional equipment for the Beaver
Falls facility. We currently have approximately 75,000 tons of
drawing capacity annually.

Competition. A significant market for drawn tubing is located
within a 500 mile radius of the Pennsylvania facility. Our primary
competitors in this market are Alliance Midwest, Copperweld, Lone
Star Steel, LTV, Metal Matic, Pacific Tube, Plymouth Tube,
Pittsburgh Tube, Vision Metals and Webco. We believe that the
principal competitive factors affecting our cold drawn tubular
product business are price, quality, product availability, delivery
and service.

RAW MATERIALS

We make all steel purchases at our headquarters in order to
optimize pricing, quality, availability and delivery of our raw
materials. During 1998, we consumed approximately 2.5% of the total
amount of hot rolled steel produced in the United States.
Accordingly, we believe that we are generally considered to be a
significant purchaser by our steel suppliers. We maintain favorable
working relationships with our steel suppliers and believe that we
are treated favorably with respect to volume allocations and
deliveries. We presently purchase the majority of our steel

from several domestic suppliers, with approximately 75% of consolidated
purchases made from Nucor Corporation. Nucor's mill in Hickman, Arkansas
is directly connected by rail to our Hickman facilities, thus eliminating
our raw material freight costs for raw materials purchased from Nucor.
During fiscal 1998, we began purchasing some of our raw materials from
foreign suppliers due to their competitive pricing. To date, we have not
experienced any significant disruption in our supply of raw materials.

EMPLOYEES

As of June 30, 1999, we employed approximately 892 persons, of
whom approximately 20% were salaried and approximately 80% were
employed on an hourly basis. None of our employees are represented
by a union. We consider our employee relations to be excellent.

PROPERTIES

We lease approximately 40,000 square feet of office space in
Chesterfield, Missouri, for our executive offices under a lease
which expires in 2008. We own a 21,000 square foot office facility
located on a 14-acre site in Union, Missouri that is leased to an
unaffiliated third party. We use 110 acres of our 160-acre site in
Hickman, Arkansas for two facilities with approximately 315,000
square feet of oil country tubular goods manufacturing and storage
space. A 275,000 square foot structural tube manufacturing plant is
located adjacent to the existing oil country tubular goods facility.
Approximately 120,000 square feet of this facility is used for
manufacturing with the remainder used for inventory and material
storage and shipping. We lease both facilities under separate
leases, each providing us an option to purchase which is exercisable
on the expiration dates of the leases. The expiration dates are
August 1, 2007 for the oil country tubular goods facility and
March 1, 2004 for the structural tube facility. Approximately 50
acres remain in Hickman, Arkansas for future expansion, including
the 40 acres required for the new large-diameter facility. We also
own 117 acres and a 244,000 square foot manufacturing facility located
in Conroe, Texas. Of the 117 acres, approximately 30 acres are used
for manufacturing and storage and 60 acres are available for future
expansion. We lease a 21 acre site and a 370,000 square foot
manufacturing facility in Beaver Falls, Pennsylvania for the production
of cold drawn tubing at this site during early fiscal 1999. The
expiration date for this lease is September 17, 2001. Each manufacturing
facility that we operate is served by truck, has its own rail spur,
other than the Beaver Falls facility, and is within proximity of barge
facilities.

We believe the facilities are in good condition, are adequately
insured and are suitable for our planned level of operations.

LEGAL PROCEEDINGS

From time to time, we are involved in litigation relating to
claims arising out of our operations in the normal course of our
business. We maintain insurance coverage against potential claims in
an amount that we believe to be adequate. We believe that we are not
presently a party to any litigation in which the outcome would have
a material adverse effect on our business or operations.

ENVIRONMENTAL MATTERS

We are subject to federal, state and local environmental laws
and regulations concerning, among other things, wastewater disposal
and air emissions. We believe that we are currently in material
compliance with all applicable environmental regulations.

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth certain information with respect
to our directors and executive officers:

<TABLE>
<CAPTION>
NAME AGE TITLE
- ---- --- -----
<S> <C> <C>
Gregg M. Eisenberg................ 49 Chairman of the Board, President, Chief Executive
Officer and Director
Sudhakar Kanthamneni.............. 52 Vice President--Manufacturing and Technology
Barry R. Pearl.................... 50 Vice President--Finance and Administration, Treasurer,
Secretary and Chief Financial Officer
T. Scott Evans.................... 52 Vice President--Commercial Operations
William E. Macaulay............... 54 Director
David H. Kennedy.................. 52 Director
C. Robert Bunch................... 45 Director
C. Adams Moore.................... 66 Director
Wayne P. Mang..................... 62 Director
John M. Fox....................... 59 Director
</TABLE>

Set forth below are descriptions of the backgrounds of our executive
officers and directors.

Gregg M. Eisenberg has served as Chairman of the Board since
February 1996. He has served as President, Chief Executive Officer
and a director of Maverick since 1988. Prior to joining Maverick in
1983, he was employed with Central Steel Tube Company for six years.
He is a former director and past chairman of the Committee on Pipe
and Tube Imports.

Sudhakar Kanthamneni has served as Vice President--Manufacturing
and Technology of Maverick since August 1992. From May 1991 to
August 1992, Mr. Kanthamneni served as Maverick's Vice
President--Manufacturing. Prior to joining Maverick in 1987, he was
employed with Central Steel Tube Company for ten years.

Barry R. Pearl has served as Vice President--Finance and
Administration, Treasurer, Secretary and Chief Financial Officer
since June 1998. He was formerly employed by Santa Fe Pacific
Pipeline Partners, L.P. in Orange, California where he was the
Senior Vice President and Chief Financial Officer from January 1995
until March 1998 and Senior Vice President, Business Development
from 1992 to January 1995.

T. Scott Evans has served as Vice President--Commercial
Operations of Maverick since September 1992. Prior to joining
Maverick in 1988 as General Sales Manager, he was employed with
Wolverine Tube Corporation. From January 1981 to June 1986, Mr.
Evans was employed with Republic Steel Corporation.

William E. Macaulay has served as Chairman and Chief Executive
Officer of First Reserve Corp. since 1983; he is also a director of
Weatherford International, Inc., National-Oilwell, Inc., Pride
International, Inc. and Superior Energy Services, Inc.

David H. Kennedy served as Managing Director of First Reserve
Corp. from 1981 to 1998; he is also a director of Berkley Petroleum
Corporation and Pursuit Resources, Inc.

C. Robert Bunch has been a Partner in the law firm of King &
Pennington, L.L.P. since 1997; from June 1995 to May 1996, he
served as the Executive Vice President and Chief Operating Officer
of Oyo Geospace Corporation; from June 1994 to May 1995, he was an
attorney with the

law firm of Scott, Douglass & Luton, L.L.P.; from July 1993 to May
1994, he served as the President of Geo-Capital Resources, L.C.;
from June 1992 to June 1993, he was the Senior Vice President of
Siberian American Limited Liability Company.

C. Adams Moore has been an independent consultant in the steel
distribution and fabrication businesses since February 1992; from
January 1983 to February 1992, he was Vice President of Sales of
Bethlehem Steel Corporation and President of Bethlehem Steel Export
Corporation; he is also a director of Fisher Tank Company and Warren
Fabricating Corporation.

Wayne P. Mang has served as a "Non-Executive" Chairman and
Director of Laclede Steel Co. since 1997; from 1982 to 1991, he was
President and Chief Executive Officer Metals Group of Federal
Industries Ltd.; he was the President and Chief Operating Officer of
Russel Metals from 1991 to May 1997.

John M. Fox has served as the President, Chief Executive Officer
and as a member of the Board of Directors of Markwest Hydrocarbon,
Inc. since 1988 and 1996, respectively; he was the founder of
Western Gas Resources, Inc. and its Executive Vice President and
Chief Operating Officer from 1972 to 1986.

PRINCIPAL STOCKHOLDERS

The following table sets forth information regarding the
beneficial ownership of our common stock as of July 31, 1999 by:

* each person or group we have reason to believe owns
beneficially more than five percent of the outstanding shares
of common stock;

* each of our executive officers and each of our directors; and

* all of our executive officers and directors as a group.

Unless otherwise indicated, each of the persons or entities
listed below exercises sole voting and investment power over the
shares that each of them beneficially owns.

<TABLE>
<CAPTION>
PERCENT OF CLASS
AMOUNT AND NATURE CURRENTLY ----------------------------------
OF BENEFICIAL EXERCISABLE PRIOR TO AFTER
NAME AND ADDRESS OWNERSHIP<F1> OPTIONS<F2> OFFERING OFFERING
- ---------------- ----------------- ----------- ------------------------ --------
<S> <C> <C> <C> <C>
Directors and named executive officers

Gregg M. Eisenberg.............................. 124,708 30,000 <F*> <F*>
William E. Macaulay............................. 26,500<F3><F4> 26,500 <F*> <F*>
David H. Kennedy................................ 46,500 26,500 <F*> <F*>
C. Robert Bunch................................. 24,900 22,500 <F*> <F*>
C. Adams Moore.................................. 18,500 18,500 <F*> <F*>
Barry R. Pearl.................................. 10,000 -- <F*> <F*>
T. Scott Evans.................................. 58,286 36,000 <F*> <F*>
Sudhakar Kanthamneni............................ 91,008 80,000 <F*> <F*>
Wayne P. Mang................................... 15,000 15,000 <F*> <F*>
John M. Fox..................................... 21,000 15,000 <F*> <F*>
All current directors and executive officers as
a group (10 persons).......................... 436,402 270,000 2.78% 2.46%

Beneficial owners in excess of 5% of the
outstanding common stock <F5>
<S> <C> <C> <C> <C> <C>
Woodbourne Partners, L.P. Sole Voting: 1,250,000 --
10 South Broadway, Shared Voting: 90,000 --
Suite 2000 Sole Investment: 1,250,000 --
St. Louis, MO 63102 Shared Investment: 90,000 -- 8.68% 7.68%

<FN>
- ------------------------
<F*> Represents less than 1% of the class.

<F1> Includes currently exercisable options.

<F2> Reflects the number of shares of common stock issuable upon the exercise
of options which are presently exercisable or will first become
exercisable within 60 days of July 31, 1999.

<F3> Excludes: (a) 300,000 shares of common stock owned by American Gas and Oil
Investors, Limited Partnership ("AmGO") and (b) 200,000 shares of common stock
owned by AmGO II, Limited Partnership ("AmGO II"). First Reserve Corp. is the
managing general partner of AmGO and AmGO II. William E. Macaulay is a director
of Maverick and serves as Chairman and Chief Executive Officer of First Reserve
Corp. Mr. Macaulay disclaims beneficial ownership of these shares.

<F4> Excludes 24,000 shares of common stock owned by Linda R. Macaulay, the
wife of Mr. Macaulay. Mr. Macaulay disclaims beneficial ownership of these
shares.

<F5> Based on a Schedule 13D filed with the SEC by Woodbourne Partners, L.P. on
March 12, 1999.
</TABLE>

DESCRIPTION OF OUR CAPITAL STOCK

Our certificate of incorporation currently authorizes us to
issue 40,000,000 shares of common stock and 5,000,000 shares of
preferred stock. Each authorized share has a par value of $.01. Our
board does not presently intend to seek the approval of our
stockholders before we issue any of our currently authorized stock,
unless it is required by law or the applicable rules of any stock
exchange or market. Please see our certificate of incorporation and
our bylaws, both of which are included as exhibits to the registration
statement of which this prospectus is a part and which qualify the
following summary.

COMMON STOCK

Each share of common stock has one vote on all matters to be
voted upon by our stockholders. No share of common stock affords any
cumulative voting or preemptive rights or is convertible,
redeemable, assessable or entitled to the benefits of any sinking or
repurchase fund. Holders of common stock will be entitled to
dividends in such amounts and at such times as our board, in its
discretion, may declare out of funds legally available for the
payment of dividends. See "Price Range of Common Stock and Dividend
Policy" for more information about our dividend policy. In the event
of our liquidation, dissolution or winding up, the holders of our
common stock are entitled to share ratably in all of our assets
remaining after payment of liabilities, subject to prior
distribution rights of our preferred stock, if any, then
outstanding.

PREFERRED STOCK

Our board has the authority, without action by our stockholders,
to designate and issue shares of our currently authorized preferred
stock in one or more series and to designate the rights, preferences
and privileges of each series, which may be greater than the rights
of our common stock. The rights any class or series of our preferred
stock may evidence include:

* general or special voting rights;

* preferential liquidation or preemptive rights;

* preferential cumulative or noncumulative dividend rights;

* redemption or put rights; and

* conversion or exchange rights.

We may issue shares of, or rights to purchase, preferred stock the
terms of which might:

* adversely affect voting or other rights evidenced by our
common stock;

* restrict dividends on our common stock;

* discourage an unsolicited proposal to acquire us; or

* facilitate a particular business combination involving us.

Any such action could discourage a transaction that some or a
majority of our stockholders might believe to be in their best
interests or in which our stockholders might receive a premium for
their stock over its then market price.

We have designated 1,000,000 shares of our preferred stock as
Series I junior participating preferred stock, which may be issued
in connection with the exercise of the rights described below. Each
one one-hundredth of a share of Series I junior participating
preferred stock that may be issued on the exercise of the rights
described below will be economically similar to a share of common
stock.

STOCKHOLDER RIGHTS PLAN

Each share of common stock offered by this prospectus includes
one right to purchase from us one one-hundredth of a share of our
Series I junior participating preferred stock at an exercise price
of $50.00 per share, subject to adjustment. The rights are not
exercisable until after the "separation time," as we describe below,
occurs. Please see our rights agreement with Harris Trust and
Savings Bank, as rights agent, which is included as an exhibit to
the registration statement of which this prospectus is a part and
which qualifies the following summary of the rights.

The rights are attached to all certificates representing our
currently outstanding common stock and will attach to all common
stock certificates we issue prior to the separation time. The
separation time would occur, except in some cases, on the earlier
of:

* the day that a public announcement that a person or group of
affiliated or associated persons (collectively, an "acquiring
person") has acquired or obtained the right to acquire
beneficial ownership of 20% or more of the outstanding common
stock; or

* 10 days following the start of a tender or exchange offer that
would result, if closed, in a person becoming an acquiring
person.

Our board may defer the separation time in some circumstances, and
some inadvertent acquisitions will not result in a person becoming
an acquiring person if the person promptly divests itself of
sufficient common stock.

Until the separation time occurs:

* common stock certificates will evidence the rights;

* the rights will be transferable only with those certificates;

* those certificates will contain a notation incorporating the
rights agreement by reference; and

* the surrender for transfer of any of those certificates also
will constitute the transfer of the rights associated with the
stock that certificate represents.

The rights will expire at the close of business on July 23,
2008, unless we earlier redeem or exchange them as we describe
below.

As soon as practicable after the separation time, the rights
agent will mail certificates representing the rights to holders of
record of common stock as of the close of business on that date and,
from and after that date, only separate rights certificates will
represent the rights. We will not issue rights with any shares of
common stock we issue after the separation time, except as our board
otherwise may determine.

A "flip-in event" will occur under the rights agreement when a
person becomes an acquiring person otherwise than through a
"permitted offer" as described in the rights agreement. The rights
agreement defines "permitted offer" to mean a tender or exchange
offer for all outstanding shares of common stock at a price and on
terms that a majority of the independent members of our board
determines to be adequate and otherwise in our best interests and
the best interests of our stockholders.

Anytime prior to the earlier of any person becoming an acquiring
person and the expiration of the rights, we may redeem the rights in
whole, but not in part, at a redemption price of $.01 per right. At
our option, we may pay the redemption price in cash, shares of
common stock or other securities of Maverick. If our board timely
orders the redemption of the rights, the rights will terminate on
the effectiveness of that action. If a flip-in event occurs and we
do not redeem the rights, each right, other than any right that has
become null and void, will become exercisable, at the time we no
longer may redeem it, to receive the number of shares of common
stock (or, in some cases, other property) which has a "market price"
(as the rights agreement defines that term) equal to two times the
exercise price of the right.

A "flip-over event" will occur under the rights agreement when,
at any time from and after the time a person becomes an acquiring
person:

* we are acquired in a merger or other business combination
transaction, other than specified mergers that follow a
permitted offer of the type we describe above;

* 50% or more of our assets or earning power is sold or
transferred; or

* an acquiring person increases its percentage beneficial
ownership by more than one percent of common stock or other
class of stock or engages in self-dealing transactions with
us, as described in the rights agreement.

If a flip-over event occurs, each holder of a right will have
the right to receive upon exercise of the right common stock of the
surviving or purchasing company or of the acquiring person which has
a then market value equal to two times the exercise price of the
right. However, rights held by an acquiring person become void.

At any time after the occurrence of a flip-in event and prior to
a person's becoming the beneficial owner of 50% or more of our
outstanding common stock, we may exchange each outstanding right for
our stock at an exchange rate of either one share of common stock or
one one-hundredth of a share of Series I junior participating
preferred stock for each right owned, subject to adjustment.

We may supplement or amend the rights agreement without the
approval of any holders of the rights:

* to make any change prior to a flip-in event other than to
change the exercise price, the redemption price or the
expiration of the rights;

* to make any change following a flip-in event that does not
materially adversely affect the interests of holders of
rights; or

* to cure any ambiguity, defect or inconsistency.

The holder of a right cannot vote, receive dividends or take any
actions as a stockholder until the right is exercised.

The rights will have anti-takeover effects. They will cause
severe dilution to any person or group that attempts to acquire us
without the approval of our board. As a result, the overall effect
of the rights may be to render more difficult or discourage any
attempt to acquire us, even if that acquisition may be favorable to
the interests of our stockholders. Because our board can redeem the
rights or approve a permitted offer, the rights should not interfere
with a merger or other business combination that our board approves.
We have issued the rights to protect our stockholders from coercive
or abusive takeover tactics and to afford our board more negotiating
leverage in dealing with prospective acquirers.

STATUTORY BUSINESS COMBINATION PROVISION

As a Delaware corporation, we are subject to Section 203 of the
Delaware General Corporation Law. Section 203 prevents an
"interested stockholder," which is defined generally as a person
owning 15% or more of a Delaware corporation's outstanding voting
stock or any affiliate or associate of that person, from engaging in
a broad range of "business combinations" with the corporation for
three years following the date that person became an interested
stockholder unless:

* before that person became an interested stockholder, the board
of directors of the corporation approved the transaction in
which that person became an interested stockholder or approved
the business combination;

* on completion of the transaction that resulted in that
person's becoming an interested stockholder, that person owned
at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced, other than
stock held by (1) directors who are also officers of the
corporation or (2) any employee stock plan that does not

provide employees with the right to determine confidentially
whether shares held subject to the plan will be tendered in a
tender or exchange offer; or

* following the transaction in which that person became an
interested stockholder, both the board of directors of the
corporation and the holders of at least 66 2/3% of the
outstanding voting stock of the corporation not owned by that
person approved the business combination.

Under Section 203, the restrictions described above also do not
apply to specific business combinations proposed by an interested
stockholder following the announcement or notification of designated
extraordinary transactions involving the corporation and a person
who had not been an interested stockholder during the previous three
years or who became an interested stockholder with the approval of a
majority of the corporation's directors, if a majority of the
directors who were directors prior to any person becoming an
interested stockholder during the previous three years or were
recommended for election or elected to succeed those directors by a
majority of those directors approve or do not oppose that
extraordinary transaction.

OTHER MATTERS

Delaware law authorizes Delaware corporations to limit or
eliminate the personal liability of their directors to them and
their stockholders for monetary damages for breach of a director's
fiduciary duty of care. The duty of care requires that, when acting
on behalf of the corporation, directors must exercise an informed
business judgment based on all material information reasonably
available to them. Absent these limitations, directors of Delaware
corporations are accountable to those corporations and their
stockholders for monetary damages for conduct constituting gross
negligence in the exercise of their duty of care. Delaware law
enables Delaware corporations to limit available relief against its
directors to equitable remedies such as injunction or rescission.
Our certificate of incorporation limits the liability of our
directors to us or our stockholders to the fullest extent Delaware
law permits, and no member of our board will be personally liable
for monetary damages for breach of the member's fiduciary duty as a
director, except for liability:

* for any breach of the member's duty of loyalty to us or our
stockholders;

* for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law;

* for unlawful payments of dividends or unlawful stock
repurchases or redemptions as provided in Section 174 of the
Delaware General Corporation Law; or

* for any transaction from which the member derived an improper
personal benefit.

This provision could have the effect of reducing the likelihood of
derivative litigation against our directors and may discourage or
deter our stockholders or management from bringing a lawsuit against
our directors for breach of their duty of care, even though such an
action, if successful, might otherwise have benefited our
stockholders and us. Our certificate of incorporation and our bylaws
provide indemnification to our officers and directors and other
specified persons with respect to their conduct in various
capacities.

Our certificate of incorporation provides that our stockholders
may act only at an annual or special meeting of stockholders and may
not act by written consent. Our certificate of incorporation and our
bylaws provide that only our board or a committee of our directors
designed by our board may call a special meeting of our stockholders.
A 75% vote of the outstanding voting stock is required to amend the
certificate of incorporation with respect to action of the stockholders
by written consent and the calling of special meetings of our
stockholders.

Our bylaws provide that there will be at least five and no more
than 15 directors of Maverick, as determined by the board from time
to time. Our certificate of incorporation provides that directors
may be removed only for cause. This provision, along with the
provisions of our bylaws authorizing the board to fill vacant
directorships, will prevent stockholders from removing incumbent
directors without cause and filling the resulting vacancies with
their own nominees.

STOCKHOLDER PROPOSALS

Our bylaws contain advance-notice and other procedural
requirements that apply to stockholder nominations of persons for
election to the board at any annual meeting of stockholders and to
stockholder proposals that stockholders take any other action at any
annual meeting. A stockholder proposing to nominate a person for
election to the board or proposing that any other action be taken
must give our corporate secretary written notice of the proposal not
less than 45 days and not more than 90 days prior to the anniversary
date of the date on which we first mailed our proxy materials for
the preceding annual meeting of stockholders. These stockholder
proposal deadlines are subject to exceptions if the pending annual
meeting date differs by more than specified periods from the
anniversary date of the prior year's annual meeting. Our bylaws
prescribe the specific information any advance written stockholder
notice must contain. We refer to our bylaws, which are included as
an exhibit to the registration statement that includes this
prospectus and which qualifies this summary by this reference.

TRANSFER AGENT AND REGISTRAR

Harris Trust and Savings Bank currently serves as the transfer
agent and registrar for the common stock.

UNDERWRITING

Subject to the terms and conditions of an underwriting agreement,
the underwriters named below, through their representatives, Raymond
James & Associates, Inc. and Morgan Keegan & Company, Inc., have
severally agreed to purchase from us the respective number of shares
of common stock set forth opposite their names below.

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITER SHARES
- ----------- ---------
<S> <C>
Raymond James & Associates, Inc............................. 900,000
Morgan Keegan & Company, Inc................................ 900,000
A.G. Edwards & Sons, Inc.................................... 40,000
Jefferies & Company......................................... 40,000
George K. Baum & Company.................................... 40,000
The Robinson-Humphrey Company, LLC.......................... 40,000
Stifel, Nicolaus & Company, Incorporated.................... 40,000
---------
Total................................................... 2,000,000
=========
</TABLE>

The underwriting agreement provides that the obligations of the
underwriters are subject to certain conditions precedent, including
the absence of any material adverse change in our business and the
receipt of certain certificates, opinions and letters from us and
our counsel and independent auditors. The nature of the
underwriters' obligation is such that they are committed to purchase
all shares of common stock offered hereby if any of such shares are
purchased.

We have granted an option to the underwriters, exercisable for
30 days after the date of this prospectus, to purchase up to an
aggregate of 300,000 shares of common stock at the public offering
price, less the underwriting discounts and commissions, set forth on
the cover page of this prospectus. The underwriters may exercise
this option solely to cover over-allotments, if any, made on the
sale of the common stock. To the extent that the underwriters
exercise this option, each underwriter will be obligated, subject to
certain conditions, to purchase a number of additional shares of
common stock proportionate to such underwriter's initial amount set
forth in the table above.

The following table summarizes the underwriting discounts and
commissions to be paid by us to the underwriters in connection with
this offering. This information is presented assuming either no
exercise or full exercise of the underwriters' option to purchase
additional shares of common stock.

<TABLE>
<CAPTION>
PAID BY MAVERICK TUBE
CORPORATION
---------------------------------
NO EXERCISE FULL EXERCISE
----------- -------------
<S> <C> <C>
Per common share............................................ $0.934 $0.934
Total....................................................... $1,868,000 $2,148,200
</TABLE>

We have been advised by the representatives that the
underwriters propose to offer the shares of common stock to the
public at the public offering price set forth on the cover page of
this prospectus and to certain dealers at such price less a
concession not in excess of $0.56 per share. The underwriters
may allow, and such dealers may reallow, a concession not in excess
of $0.10 per share to certain other dealers. The offering of the
shares of common stock is made for delivery when, as and if accepted
by the underwriters and subject to prior sale and to withdrawal,
cancellation or modification of this offering without notice. The
underwriters reserve the right to reject an order for the purchase
of shares in whole or in part.

We and our executive officers and directors have agreed that
for a period of 180 days after the date of this prospectus, we and
they will not, without the prior written consent of Raymond James &
Associates, Inc. directly or indirectly:

* offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant for the sale of or
otherwise dispose of or transfer any shares of our common stock
or securities convertible into or exchangeable or exercisable
for shares of our common stock, whether now owned or acquired
after the date of this prospectus by any such person or with
respect to which any such person acquires after the date of
this prospectus the power of disposition, or file any
registration statement under the Securities Act with respect
to any of the foregoing; or

* enter into any swap or other agreement or any other agreement
that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of shares of our common
stock whether any such swap or transaction is to be settled by
delivery of our common stock or other securities in cash or
otherwise.

The foregoing restrictions, however, do not apply to:

* shares of common stock being sold under the prospectus;

* any grant of options by us for our common stock under our
stock option plans; or

* any shares of common stock issued by us pursuant to the
exercise of stock options currently outstanding or granted
under our stock option plans.

Until the offering of the shares of common stock is completed,
rules of the SEC may limit the ability of the underwriters and
certain selling group members to bid for and purchase the common
stock. As an exception to these rules, the underwriters may engage
in certain transactions that stabilize the price of the common
stock. These transactions may include short sales, stabilizing
transactions and purchases to cover positions created by short
sales. Short sales involve the sale by the underwriters of a greater
number of shares of common stock than they are required to purchase
in the offering. Stabilizing transactions consist of certain bids or
purchases made for the purpose of preventing or retarding a decline
in the market price of the common stock while the offering is in
progress.

The underwriters also may impose a penalty bid. This occurs when
a particular underwriter repays to the underwriters a portion of the
underwriting discount received by it because the representatives
have repurchased shares sold by or for the account of such
underwriter in stabilizing or short covering transactions.

These activities by the underwriters may stabilize, maintain or
otherwise affect the market price of the common stock. As a result,
the price of the common stock may be higher than the price that
otherwise might exist in the open market. If these activities are
commenced, they may be discontinued by underwriters without notice
at any time. These transactions may be effected on the Nasdaq
National Market, or otherwise.

Certain of the underwriters or their affiliates have in the past
and may in the future provide investment banking or other services
for us.

We estimate that the total expenses of this offering, excluding
underwriting discounts and commissions, will be approximately
$325,000.

We have agreed to indemnify the several underwriters against
certain liabilities, including liabilities under the Securities Act,
and to contribute to payments which the underwriters may be required
to make in respect thereof.

LEGAL MATTERS

Gallop, Johnson & Neuman, L.C., St. Louis, Missouri will render
its opinion as to the validity of the issuance of the common stock
offered in this prospectus. Certain legal matters in connection with
the shares being offered hereby will be passed upon for the
underwriters by Baker & Botts, L.L.P., Houston, Texas.

EXPERTS

Ernst & Young LLP, independent auditors, have audited our
consolidated financial statements and schedule at September 30, 1997
and 1998, and for each of the three years in the period ended
September 30, 1998, as set forth in their report. We have included
and incorporated by reference our financial statements in the
prospectus and elsewhere in the registration statement and have
incorporated by reference our financial statement schedule in the
prospectus in reliance on Ernst & Young LLP's report, given on their
authority as experts in accounting and auditing.

INCORPORATION OF DOCUMENTS BY REFERENCE

The SEC allows us to "incorporate by reference" the information
we file with them, which means that we can disclose important
information to you by referring to these documents. The information
incorporated by reference is considered to be part of this
prospectus except to the extent the information is superceded by
information in this prospectus, and later information that we file
with the SEC will automatically update and supercede this
information.

We incorporate by reference the documents listed below and any
documents that we subsequently file with the Commission under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934, as amended until this offering is completed:

* Our Annual Report on Form 10-K for the fiscal year ended
September 30, 1998;

* Our amendment to our Annual Report on Form 10-K/A, filed
December 16, 1998;

* Our Quarterly Reports on Form 10-Q for the periods ended
December 31, 1998, March 31, 1999, and June 30, 1999; and

* The description of our common stock contained in our
Registration Statement on Form 8-A filed October 31, 1990;

* The description of our preferred share purchase rights
contained in our Registration Statement on Form 8-A filed
August 5, 1998; and

* Our amendment to our Registration Statement on Form 8-A/A,
filed July 7, 1999.

Our SEC file number is 0-30146. You may request a copy of these
filings, at no cost, by writing or telephoning us at the following
address: 16401 Swingley Ridge Road, Seventh Floor, Chesterfield,
Missouri 63017, Attention: Secretary, Telephone: (636) 733-1600.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and special reports, proxy statements
and other information with the SEC. You may read and copy any
document we file at the following locations:

* At the public reference room of the SEC at 450 Fifth Street,
N.W., Washington, DC 20549;

* At the public reference rooms at the SEC's regional offices at
Seven World Trade Center, 13th Floor, New York, New York 10048
or Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661;

* By writing to the SEC, Public Reference Section, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, DC 20549;

* At the offices of the Nasdaq Stock Market, Inc., 8513 Key West
Avenue, Rockville, Maryland 20850; or

* From the SEC's web site at www.sec.gov.

Please call the SEC at 1-800-SEC-0330 for further information on
the public reference rooms. Some of these locations may charge a
prescribed or modest fee for copies.

We have filed with the SEC a registration statement on Form S-3
under the Securities Act of 1933, as amended, with respect to the
shares of common stock offered under this prospectus. As permitted
by the SEC, this prospectus, which constitutes a part of the
registration statement, does not contain all the information
included in the registration statement. You may obtain this
additional information from the locations described above.
Statements contained in this prospectus as to the contents of any
contract or other document are not necessarily complete. You should
refer to the contract or other document for all the details.

INDEX TO FINANCIAL STATEMENTS

PAGE
----

Report of Independent Auditors.............................. F-1

Consolidated Balance Sheets as of September 30, 1998 and
1997 and (unaudited) June 30, 1999........................ F-2

Consolidated Statements of Operations for the years ended
September 30, 1998, 1997 and 1996 and (unaudited) for the
nine months ended June 30, 1999 and 1998.................. F-3

Consolidated Statements of Stockholders' Equity for the
years ended September 30, 1998, 1997 and 1996 and
(unaudited) for the nine months ended June 30, 1999....... F-4

Consolidated Statements of Cash Flows for the years ended
September 30, 1998, 1997 and 1996 and (unaudited) for the
nine months ended June 30, 1999 and 1998.................. F-5

Notes to Consolidated Financial Statements.................. F-6

REPORT OF INDEPENDENT AUDITORS

Board of Directors and Stockholders
Maverick Tube Corporation

We have audited the accompanying consolidated balance sheets of
Maverick Tube Corporation and subsidiaries as of September 30, 1997
and 1998, and the related consolidated statements of operations,
stockholders' equity, and cash flows for each of the three years in
the period ended September 30, 1998. These financial statements are
the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements based on our
audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the consolidated
financial position of Maverick Tube Corporation and subsidiaries at
September 30, 1997 and 1998, and the consolidated results of their
operations and their cash flows for each of the three years in the
period ended September 30, 1998, in conformity with generally
accepted accounting principles.

/s/ Ernst & Young LLP

St. Louis, Missouri
October 28, 1998

F-1

<TABLE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE DATA)
<CAPTION>
SEPTEMBER 30,
-------------------- JUNE 30,
1997 1998 1999
-------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS:

Current assets:
Cash and cash equivalents.............................. $ 2,886 $ 748 $ 485
Accounts receivable, less allowances of $388 and $391
in 1997 and 1998 and (unaudited) $713 at June 30,
1999, respectively................................... 27,714 15,515 15,200
Inventories............................................ 69,436 61,685 46,024
Deferred income taxes.................................. 5,104 1,827 1,725
Income taxes refundable................................ -- 5,078 3,138
Prepaid expenses and other current assets.............. 798 1,200 1,739
-------- -------- --------
Total current assets....................................... 105,938 86,053 68,311
Property, plant and equipment.............................. 55,506 69,879 76,475
Other assets............................................... 620 953 604
-------- -------- --------
$162,064 $156,885 $145,390
======== ======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY:

Current liabilities:
Accounts payable....................................... $ 31,477 $ 12,301 $ 20,731
Accrued expenses and other liabilities................. 12,614 9,153 6,969
Deferred revenue....................................... 16,251 3,584 2,205
Current maturities of long-term debt................... 604 653 694
-------- -------- --------
Total current liabilities.................................. 60,946 25,691 30,599
Long-term debt, less current maturities.................... 8,879 8,226 7,669
Revolving credit facility.................................. 10,000 27,400 22,300
Deferred income taxes...................................... 4,371 5,505 3,447
Commitments and contingencies (Notes 6, 12 and 13)......... -- -- --
Stockholders' Equity:
Preferred stock, $.01 par value; 5,000,000 authorized
shares............................................... -- -- --
Common stock, $.01 par value; 40,000,000 authorized
shares; 15,410,974 and 15,437,474 shares issued and
outstanding in 1997 and 1998 and (unaudited)
15,437,474 at June 30, 1999, respectively............ 154 154 154
Additional paid-in capital............................. 43,406 44,216 44,216
Retained earnings...................................... 34,308 45,693 37,005
-------- -------- --------
77,868 90,063 81,375
-------- -------- --------
$162,064 $156,885 $145,390
======== ======== ========

(See accompanying notes.)
</TABLE>

F-2

<TABLE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<CAPTION>
NINE MONTHS
YEAR ENDED SEPTEMBER 30, ENDED JUNE 30,
-------------------------------- --------------------
1996 1997 1998 1998 1999
-------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net sales............................. $204,182 $291,060 $265,389 $213,617 $118,410
Cost of goods sold.................... 182,042 252,803 232,038 183,843 118,047
-------- -------- -------- -------- --------
Gross profit.......................... 22,140 38,257 33,351 29,774 363
Selling, general and administrative... 10,198 13,966 14,815 9,335 10,528
Start-up costs........................ -- -- -- -- 2,496
-------- -------- -------- -------- --------
Income (loss) from operations......... 11,942 24,291 18,536 20,439 (12,661)
Interest expense, net................. 2,522 2,067 1,731 1,213 901
-------- -------- -------- -------- --------
Income (loss) before income taxes..... 9,420 22,224 16,805 19,226 (13,562)
Provision (credit) for income taxes... 1,882 7,339 5,420 6,619 (4,874)
-------- -------- -------- -------- --------
Net income (loss)..................... $ 7,538 $ 14,885 $ 11,385 $ 12,607 $ (8,688)
======== ======== ======== ======== ========
Basic earnings (loss) per share....... $ .50 $ .99 $ .74 $ .82 $ (.56)
======== ======== ======== ======== ========
Diluted earnings (loss) per share..... $ .50 $ .97 $ .73 $ .81 $ (.56)
======== ======== ======== ======== ========

(See accompanying notes.)
</TABLE>

F-3

<TABLE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(IN THOUSANDS, EXCEPT SHARE DATA)

<CAPTION>
COMMON STOCK ADDITIONAL
-------------------- PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS
---------- ------ ---------- --------
<S> <C> <C> <C> <C>
Balance at October 1, 1995......................... 14,880,458 $149 $37,469 $11,885
Net income.................................... -- -- -- 7,538
Exercise of stock options..................... 63,684 1 205 --
---------- ---- ------- -------
Balance at September 30, 1996...................... 14,944,142 150 37,674 19,423
Net income..................................... -- -- -- 14,885
Exercise of stock options...................... 466,832 4 2,482 --
Tax benefit associated with the exercise of
nonqualified stock options................... -- -- 3,250 --
---------- ---- ------- -------
Balance at September 30, 1997...................... 15,410,974 154 43,406 34,308
Net income..................................... -- -- -- 11,385
Exercise of stock options...................... 26,500 -- 162 --
Tax benefit associated with the exercise of
nonqualified stock options................... -- -- 648 --
---------- ---- ------- -------
Balance at September 30, 1998...................... 15,437,474 154 44,216 45,693
Net loss<F*>................................... -- -- -- (8,688)
---------- ---- ------- -------
Balance at June 30, 1999<F*>....................... 15,437,474 $154 $44,216 $37,005
========== ==== ======= =======
<FN>
- -------------------
<F*> Unaudited

(See accompanying notes.)
</TABLE>

F-4

<TABLE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<CAPTION>
NINE MONTHS
YEAR ENDED SEPTEMBER 30, ENDED JUNE 30,
--------------------------------- --------------------
1996 1997 1998 1998 1999
-------- -------- --------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss)............................... $ 7,538 $ 14,885 $ 11,385 $ 12,607 $ (8,688)
Adjustments to reconcile net income (loss) to
net cash provided (used) by operating
activities:
Depreciation and amortization............... 5,201 5,697 6,172 4,313 5,471
Deferred income taxes....................... 585 2,577 1,161 165 (1,956)
Provision for losses on accounts
receivable................................ 339 44 3 (132) 322
Loss (gain) on sale of equipment............ (3) 50 49 -- --
Loss on write-down of software development
costs..................................... -- -- 1,605 -- --
Changes in operating assets and liabilities:
Accounts receivable..................... 175 (9,358) 12,196 10,849 (7)
Inventories............................. (17,352) (18,812) 7,751 3,250 15,661
Prepaid expenses and other current
assets................................ 5 59 (1,582) (379) 1,659
Other assets............................ 207 (67) (381) -- --
Accounts payable........................ 5,623 8,435 (19,176) (13,545) 8,430
Accrued expenses and other
liabilities........................... 3,746 5,136 (3,461) (6,176) (2,184)
Deferred revenue........................ 8,176 8,075 (12,667) (11,639) (1,379)
-------- -------- --------- -------- --------
Cash provided (used) by operating activities.... 14,240 16,721 3,055 (687) 17,329

INVESTING ACTIVITIES
Expenditures for property, plant and
equipment..................................... (5,497) (9,537) (10,717) (8,053) (11,976)
Expenditures for purchase of production
facility...................................... -- -- (11,464) -- --
Proceeds from disposals of equipment............ 3 96 30 -- --
Collection of notes receivable.................. 15 18 -- -- --
-------- -------- --------- -------- --------
Cash used by investing activities............... (5,479) (9,423) (22,151) (8,053) (11,976)

FINANCING ACTIVITIES
Proceeds from long-term borrowings and notes.... 64,250 92,400 121,000 81,751 33,100
Principal payments on long-term borrowings and
notes......................................... (73,095) (99,911) (104,204) (75,228) (38,716)
-------- -------- --------- -------- --------
(8,845) (7,511) 16,796 6,523 (5,616)
Proceeds from exercise of stock options......... 206 2,486 162 162 --
-------- -------- --------- -------- --------
Cash provided (used) by financing activities.... (8,639) (5,025) 16,958 6,685 (5,616)
-------- -------- --------- -------- --------
Increase (decrease) in cash and cash
equivalents................................... 122 2,273 (2,138) (2,055) (263)
Cash and cash equivalents at beginning of
year.......................................... 491 613 2,886 2,886 748
-------- -------- --------- -------- --------
Cash and cash equivalents at end of year........ $ 613 $ 2,886 $ 748 $ 831 $ 485
======== ======== ========= ======== ========
Supplemental disclosures of cash flow
information:
Cash paid (received) during the year for:
Interest (net of amounts capitalized of
$81, $268, $355, $254 and $428,
respectively)......................... $ 2,677 $ 2,138 $ 1,733 $ 1,257 $ 1,198
Income taxes............................ 1,370 4,020 6,242 5,824 (5,277)

(See accompanying notes.)
</TABLE>

F-5

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

INFORMATION PERTAINING TO THE NINE MONTHS ENDED JUNE 30, 1999
IS UNAUDITED.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements. The interim financial information
as of June 30, 1999 and for the nine months ended June 30, 1999 and
1998 is unaudited and reflects all adjustments, consisting of only
normal recurring items, which management considers necessary for a fair
presentation. Also, all information in the footnotes dated subsequent
to September 30, 1998 is unaudited. The results for the interim periods
are not necessarily indicative of the results for the full year.

Principles of Consolidation. The consolidated financial
statements include the accounts of Maverick Tube Corporation and its
wholly owned subsidiaries (collectively referred to as the Company).
All significant intercompany accounts and transactions have been
eliminated.

Revenue Recognition. The Company records revenue from product
sales when the product is shipped from its facilities. Prior to
January 1, 1996, the Company had recorded revenue on the sale of
energy products to certain customers at the time the goods were set
aside for storage at the customer's request. Included in the results
of operations for the year ended September 30, 1996 was a one-time
effect of this change in practice which resulted in a reduction in
net sales, gross profit, net income and basic and diluted net income
per common share of $8,700,000, $1,000,000, $839,000 and $0.06,
respectively.

Inventories. Inventories are principally valued at the lower of
average cost or market.

Property, Plant and Equipment. Property, plant and equipment
are stated on the basis of cost. Depreciation is computed under the
straight-line method over the respective assets' useful lives.
Useful lives of the Company's assets are as follows:

<TABLE>
<S> <C>
Land and leasehold improvements.............. 10 to 20 years
Buildings.................................... 20 to 40 years
Transportation equipment..................... 4 to 5 years
Machinery and equipment...................... 5 to 12 years
Furniture and fixtures....................... 3 to 7 years
</TABLE>

Income Taxes. Deferred taxes are provided on an asset and
liability method whereby deferred tax assets are recognized for
deductible temporary differences and operating loss and other tax
credit carryforwards and deferred tax liabilities are recognized for
taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and liabilities
and their tax bases.

Stock-Based Compensation. As permitted by Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for
Stock-Based Compensation," the Company follows Accounting Principles
Board Opinion No. 25 and related interpretations in accounting for
its director and employee stock options. The Company grants stock
options for a fixed number of shares to directors and employees with
an exercise price equal to the fair value of the shares at the time
of the grant. Accordingly, the Company has not recognized
compensation expense for any of its stock option grants. If the
Company had elected to recognize compensation cost based on the fair
value of the options granted at the grant date as prescribed by SFAS
No. 123, net income and earnings per share for 1996, 1997 or 1998
would not have been reduced by a material amount. The compensation
cost associated with the fair value of the options calculated in
1996, 1997 and

F-6

<PAGE>
<PAGE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

1998 is not necessarily representative of the potential effects on
reported net income in future years.

Use of Estimates. The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to periodically make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those
estimates.

Earnings per Common Share. Effective December 31, 1997, the
Company adopted SFAS No. 128, "Earnings per share." SFAS No. 128
replaced the calculation of primary and fully diluted earnings
per share with basic and dilutive earnings per share. Basic
earnings per share excludes any dilutive effects of options. Diluted
earnings per share is very similar to the previously reported fully
diluted earnings per share. All earnings per share amounts have been
presented and, where appropriate, restated to conform to the SFAS
No. 128 requirements.

The reconciliation for diluted earnings per share for the years
ended September 30, 1996, 1997 and 1998 is as follows (in
thousands):

<TABLE>
<CAPTION>
1996 1997 1998
------- ------- -------
<S> <C> <C> <C>
Average shares outstanding utilized in the computation of
basic earnings per share.................................. 14,940 15,018 15,437
Dilutive effect of outstanding stock options................ 60 264 127
------- ------- -------
Average shares utilized in the computation of diluted
earnings per share........................................ 15,000 15,282 15,564
======= ======= =======
Net income used in basic and diluted earnings per share..... $ 7,538 $14,885 $11,385
======= ======= =======
</TABLE>

Business Segments. The Company's two identifiable segments are
energy products, consisting of Oil Country Tubular Goods (OCTG) and
line pipe products sold primarily to customers in the energy
industry, and industrial products, consisting primarily of
structural tubing and standard pipe products. Energy products are
used in the completion of new wells and the handling and
transporting of the oil and natural gas produced from these wells.
Industrial products are sold to customers in various industries
including construction, agriculture and transportation. The
Company's products are sold primarily to a network of distributors
and are sold throughout the United States and Canada.

Sales commission expenses are charged directly to the associated
business segments. Remaining selling, general and administrative
expenses are allocated based upon the net sales dollars generated by
each segment.

In 1997, the Financial Accounting Standards Board issued SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related
Information." SFAS No. 131 specifies the presentation and disclosure
requirements for business segment information. The Company is
required to adopt this statement in fiscal 1999 and has determined
that SFAS No. 131 will have no significant impact on the Company's
disclosures.

Cash Equivalents. The Company's policy is to consider demand
deposits and short-term investments with a maturity of three months
or less when purchased as cash equivalents.

F-7

<PAGE>
<PAGE>
MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Financial Instruments. Financial instruments consist of cash
and cash equivalents, accounts receivable, accounts payable and
long-term debt obligations. The carrying value of amounts reported
in the consolidated balance sheets for cash and cash equivalents,
accounts receivable and accounts payable approximate fair value.
Management's estimate of the fair value of long-term debt
obligations is discussed in Note 6 to the consolidated financial
statements.

2. START-UP COSTS (UNAUDITED)

During September 1998, the Company acquired assets to be used
in the production of cold drawn tubular products at a production
facility in Beaver Falls, Pennsylvania. The Company incurred net
costs of $2,496,000 in the first nine months of fiscal 1999 related
to the commencement of operations at this facility. These costs are
comprised primarily of salary and related costs for the production,
sales and administrative personnel prior to the fully integrated
operation of the facility.

3. PURCHASE OF PRODUCTION FACILITY

On September 18, 1998, the Company acquired assets that will be
used in the production of cold drawn tubular products at a
production facility in Beaver Falls, Pennsylvania from PMAC, Ltd.
for $11,464,000. This facility is expected to begin production
during the Company's first quarter of fiscal 1999.

4. WRITE-DOWN OF SOFTWARE DEVELOPMENTS COSTS

During the year ended September 30, 1998, the Company recorded a
pretax charge of $1,605,000 in selling, general and administrative
expense for the write-down of certain software development costs
relating to information systems being replaced by a new enterprise
resource planning system.

5. STOCK SPLIT

On August 1, 1997, the Company declared a two-for-one stock
split effected in the form of a 100% stock dividend to all
stockholders of record as of August 12, 1997. The dividend was paid
on August 21, 1997 and increased the number of shares outstanding
from 7,544,071 to 15,088,142. Approximately $75,000 was transferred
from retained earnings to common stock to record this dividend. All
share and per share amounts, including stock option information, in
the accompanying consolidated financial statements have been
restated to reflect this stock dividend.

F-8

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. LONG-TERM DEBT AND REVOLVING CREDIT FACILITY

Long-term debt and revolving credit facility at September 30,
1997 and 1998 and (unaudited) at June 30, 1999 consists of the
following (in thousands):

<TABLE>
<CAPTION>
JUNE 30,
1997 1998 1999
------- ------- --------
<S> <C> <C> <C>
Capital lease obligation, secured by property, plant and
equipment (net book value $9,359,000 at September 30,
1998); payable in monthly installments (including
interest at 8.0%) of $59,479; final payment due on
August 1, 2007............................................ $ 4,875 $ 4,540 $ 4,239
Capital lease obligation, secured by property and plant (net
book value $6,629,000 at September 30, 1998); interest of
7.5% payable monthly; payable in monthly principal
installments of approximately $20,000 (plus interest)
commencing on March 1, 1996; increasing to $31,250 in
years two through seven and increasing to $240,417 in
year eight; final payment due on February 1, 2004......... 4,608 4,339 4,124
Revolving credit notes, secured by all accounts receivable
and inventories; due on September 30, 2003; interest
payable monthly at either prime or the Eurodollar rate,
adjusted by an interest margin, depending upon certain
financial measurements.................................... 10,000 27,400 22,300
------- ------- -------
19,483 36,279 30,663
Less current maturities..................................... (604) (653) (694)
------- ------- -------
$18,879 $35,626 $29,969
======= ======= =======
</TABLE>

In September 1998, the Company entered a new revolving credit
facility. The new revolving credit agreement provides for advances
up to the lesser of $50,000,000 or the eligible borrowing base as
defined in the facility agreement. At September 30, 1998, there was
$27,400,000 outstanding under this line of credit at an interest
rate of 6.61 percent.

In addition, the Company had an outstanding letter of credit
under this revolving credit agreement of $350,000 at September 30,
1998 (which expires in September 1999). Additional available
borrowings at that date were $4,913,000. The agreement includes
restrictive covenants relating to levels of funded debt and other
financial measurements and restricts the amount of dividends that
can be paid on common stock. The revolving credit agreement requires
an annual commitment fee based upon certain financial measurements.

F-9

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. LONG-TERM DEBT AND REVOLVING CREDIT FACILITY (CONTINUED)

The present value of future minimum lease payments under the
capital lease obligations as of September 30, 1998 is as follows (in
thousands):

<TABLE>
<CAPTION>
PRESENT VALUE
TOTAL MINIMUM OF MINIMUM
LEASE PAYMENTS INTEREST LEASE PAYMENTS
-------------- -------- --------------
<S> <C> <C> <C>
1999................................................... $ 1,313 $ 660 $ 653
2000................................................... 1,320 612 708
2001................................................... 1,315 555 760
2002................................................... 1,315 493 822
2003................................................... 2,711 371 2,340
Thereafter............................................. 4,072 476 3,596
------- ------ ------
$12,046 $3,167 $8,879
======= ====== ======
</TABLE>

Property, plant and equipment at September 30, 1997 and 1998
include $17,483,000 and $18,295,000, respectively, under leases that
have been capitalized. Accumulated depreciation for these assets was
$1,815,000 and $2,307,000 at September 30, 1997 and 1998,
respectively.

The fair value of the Company's long-term debt is based on
estimates using discounted cash flow analyses, based on quoted
market prices for similar issues. The estimated fair value of debt
at September 30, 1998 was $36,802,000.

7. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment at September 30, 1997 and 1998 and
(unaudited) at June 30, 1999 consist of the following (in
thousands):

<TABLE>
<CAPTION>
JUNE 30,
1997 1998 1999
-------- -------- --------
<S> <C> <C> <C>
Land........................................................ $ 1,519 $ 1,520 $ 1,520
Land and leasehold improvements............................. 521 1,132 1,132
Buildings................................................... 22,212 23,392 24,297
Transportation equipment.................................... 1,204 1,356 1,375
Machinery and equipment..................................... 54,470 71,534 82,079
Furniture and fixtures...................................... 2,780 2,838 3,344
-------- -------- --------
82,706 101,772 113,747
Less accumulated depreciation............................... (27,200) (31,893) (37,272)
-------- -------- --------
$ 55,506 $ 69,879 $ 76,475
======== ======== ========
</TABLE>

F-10

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

8. INVENTORIES

Inventories at September 30, 1997 and 1998 and (unaudited) at
June 30, 1999 consist of the following (in thousands):

<TABLE>
<CAPTION>
JUNE 30,
1997 1998 1999
------- ------- --------
<S> <C> <C> <C>
Finished goods.............................................. $41,188 $34,674 $25,409
Work-in-process............................................. 3,589 2,868 1,830
Raw materials............................................... 14,065 12,042 9,703
In-transit materials........................................ 6,911 7,003 4,209
Storeroom parts............................................. 3,683 5,098 4,873
------- ------- -------
$69,436 $61,685 $46,024
======= ======= =======
</TABLE>

Finished goods at September 30, 1997 and 1998 and (unaudited) at
June 30, 1999 include $13,590,000, $3,538,000 and $2,323,000,
respectively of customer-obligated inventory.

9. INCOME TAXES

The components of the provision for income taxes for the years
ended September 30, 1996, 1997 and 1998 are as follows (in
thousands):

<TABLE>
<CAPTION>
1996 1997 1998
------ ------ ------
<S> <C> <C> <C>
Current:
Federal................................................. $1,297 $3,804 $4,120
State................................................... -- 958 139
Deferred.................................................... 585 2,577 1,161
------ ------ ------
$1,882 $7,339 $5,420
====== ====== ======
</TABLE>

The difference between the effective income tax rate and the
U.S. federal income tax rate for the years ended September 30, 1996,
1997 and 1998 is explained as follows (in thousands):

<TABLE>
<CAPTION>
1996 1997 1998
------ ------ ------
<S> <C> <C> <C>
Provision at statutory tax rate............................. $3,203 $7,845 $5,714
State and local taxes, net of federal tax benefit........... -- 958 139
Alternative minimum tax..................................... 1,282 (510) --
Operating loss carryforwards................................ (1,192) -- --
Decrease in valuation allowance............................. (1,590) (1,147) --
Benefit of foreign sales corporation........................ -- -- (354)
Other items................................................. 179 193 (79)
------ ------ ------
$1,882 $7,339 $5,420
====== ====== ======
</TABLE>

The 1996 and 1997 decreases in the valuation allowance relates
primarily to the utilization of alternative minimum tax credit
carryforwards. Realization of the Company's deferred tax assets is
dependent on generating sufficient taxable income prior to the
expiration of the net operating loss carryforwards. Although
realization is not assured, management believes it is more likely
than not that the net deferred tax assets will be realized.

F-11

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9. INCOME TAXES (CONTINUED)

Temporary differences which give rise to deferred tax assets and
liabilities at September 30, 1997 and 1998 are as follows (in
thousands):

<TABLE>
<CAPTION>
1997 1998
------ -------
<S> <C> <C>
Deferred tax assets:
Various accrued liabilities and reserves.............. $1,419 $ 1,280
Net operating loss carryforwards...................... 1,288 818
Alternative minimum tax carryforwards................. 390 598
Tax benefit associated with the exercise of
nonqualified stock options.......................... 3,250 --
------ -------
Total deferred tax assets......................... 6,347 2,696

Deferred tax liabilities:
Accelerated depreciation.............................. 5,101 5,712
Asset valuations...................................... 513 662
------ -------
Total deferred tax liabilities.................... 5,614 6,374
------ -------
Net deferred tax assets (liabilities)............. $ 733 $(3,678)
====== =======
</TABLE>

The Company has available acquired net operating loss
carryforwards of $2,320,000 at September 30, 1998 which it may use
to offset future taxable income. The acquired net operating loss
carryforwards are limited to approximately $1,160,000 annually. Any
unused amounts can be carried forward to increase the limitation in
the following taxable year. These net operating loss carryforwards
expire in 2000. The total carryforwards will be applied to financial
statement earnings after temporary differences. At September 30,
1998, the Company had alternative minimum tax credit carryforwards
of $598,000 available for income tax purposes. These credit
carryforwards do not expire.

10. DEFINED CONTRIBUTION PLANS

The Company sponsors a defined contribution 401(k) plan that is
available to substantially all employees. The plan may be amended or
terminated at any time by the Board of Directors. The Company,
although not required to, has provided matching contributions to the
plan for the years ended September 30, 1996, 1997 and 1998 of
$343,000, $590,000 and $704,000, respectively.

The Company also began sponsoring two deferred compensation
plans covering officers and key employees in 1996. One plan provides
for discretionary contributions based solely upon the Company's
profitability and the individuals' gross wages. The other plan
provides for fixed contributions to certain officers of the Company.
The Company contribution to these plans for the years ended
September 30, 1996, 1997 and 1998 was $192,000, $200,000 and
$310,000, respectively.

F-12

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. SEGMENT INFORMATION

The following table sets forth data for the years ended
September 30, 1996, 1997 and 1998 for the reportable industry
segments of energy products and industrial products. Intersegment
sales are not material. Identifiable assets are those used in the
Company's operations in each segment.

<TABLE>
<CAPTION>
ENERGY INDUSTRIAL
PRODUCTS PRODUCTS CORPORATE TOTAL
-------- ---------- --------- --------
<S> <C> <C> <C> <C>
1996:
Net sales......................................... $147,555 $56,627 $ -- $204,182
Operating income.................................. 10,529 1,413 -- 11,942
Identifiable assets............................... 87,091 32,033 6,432 125,556
Depreciation and amortization..................... 3,375 1,331 495 5,201
Capital expenditures.............................. 3,757 894 846 5,497

1997:
Net sales......................................... $223,879 $67,181 $ -- $291,060
Operating income.................................. 17,641 6,650 -- 24,291
Identifiable assets............................... 116,433 34,565 11,066 162,064
Depreciation and amortization..................... 3,760 1,455 482 5,697
Capital expenditures.............................. 8,385 363 789 9,537

1998:
Net sales......................................... $184,824 $80,565 $ -- $265,389
Operating income (loss)........................... 14,680 5,461 (1,605)<F*> 18,536
Identifiable assets............................... 99,357 46,095 11,433 156,885
Depreciation and amortization..................... 4,255 1,448 469 6,172
Capital expenditures.............................. 7,512 12,186 2,483 22,181

<FN>
- -------------------
<F*> During the year ended September 30, 1998, the Company recorded a pre-tax
charge of $1.6 million in selling, general and administrative expense for
the write-down of certain software development costs relating to
information systems being replaced by a new enterprise resource planning
system.
</TABLE>

Transactions with one significant energy customer for the years
ended September 30, 1996 and 1998 represented approximately 16
percent and 14 percent of total sales, respectively. Transactions
with two significant energy customers for the year ended September
30, 1997 represented approximately 25 percent of total sales.

Export sales were $13,244,000, $26,665,000 and $18,828,000 for
the years ended September 30, 1996, 1997 and 1998, respectively.
These energy sales were primarily to Canadian customers.

F-13

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

12. OPERATING LEASES

The Company rents office facilities and equipment under various
operating leases. Future minimum payments under noncancellable
operating leases with initial or remaining terms in excess of one
year, are as follows at September 30, 1998 (in thousands):

Rent expense for all operating leases was $973,000, $1,222,000
and $1,937,000 for the years ended September 30, 1996, 1997 and
1998, respectively.

13. CONTINGENCIES

Various claims, incidental to the ordinary course of business,
are pending against the Company. In the opinion of management, after
consultations with legal counsel, resolution of these matters is not
expected to have a material effect on the accompanying financial
statements.

14. STOCK OPTION PLANS

The Company sponsors two employee stock option plans (the "1990
Plan" and the "1994 Plan") allowing for incentive stock options and
nonqualified stock options. The Company also sponsors a stock option
plan for eligible directors (the "Director Plan") allowing for
non-qualified stock options. The 1990 Plan, 1994 Plan and the
Director Plan provide that 340,000, 1,000,000 and 200,000 shares,
respectively, may be issued under the plans at an option price not
less than the fair market value of the stock at the time the option
is granted. The 1990 Plan, 1994 Plan, and the Director Plan expire
in December 2000, November 1999 and November 2004, respectively. The
options vest pursuant to the schedule set forth for each option.
Effective August 29, 1997, the Compensation Committee of the Board
of Directors removed the exercise restriction with respect to
certain options granted in 1995 which made them immediately
exercisable. At September 30, 1997 and 1998, 272,500 and 607,500
shares were available for grant under the option plans.

The fair value of the options granted was estimated at the date
of grant using a Black-Scholes option pricing model with the
following weighted average assumptions for fiscal years ended
September 30, 1996, 1997 and 1998, respectively: risk-free interest
rate of 6.05%, 5.53% and 5.57%; no dividend payments expected;
volatility factors of the expected market price of the Company's
common stock of 0.478, 0.478 and 0.555; and a weighted-average
expected life of the options of 4.7 years, 1.0 year and 7.2 years.

The Black-Scholes option valuation model was developed for use
in estimating the fair value of traded options which have no vesting
restrictions and are fully transferable. In addition, option
valuation models require the input of subjective assumptions
including the expected stock price volatility. Because the Company's
stock options have characteristics significantly different from
those of traded options and because changes in the subjective input
assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide
a reliable single measure of the fair value of its stock options.

F-14

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

14. STOCK OPTION PLANS (CONTINUED)

The following table summarizes option activity and related
information for years ended September 30, 1996, 1997 and 1998:

<TABLE>
<CAPTION>
WEIGHTED WEIGHTED
SHARES UNDER AVERAGE AVERAGE
OPTION EXERCISE PRICE FAIR VALUE
------------ -------------- ----------
<S> <C> <C> <C>
Options outstanding at October 1, 1995.................. 798,000 $ 5.26
Options exercised....................................... (63,684) 3.25
Options expired......................................... (146,316) 5.37
Options granted......................................... 284,000 5.29 $2.42
-------- ------
Options outstanding at September 30, 1996............... 872,000 5.39
Options exercised....................................... (466,832) 5.33
Options expired......................................... (3,000) 5.92
Options granted......................................... 37,500 8.50 $1.80
-------- ------
Options outstanding at September 30, 1997............... 439,668 5.71
Options exercised....................................... (26,500) 6.13
Options expired......................................... (60,000) 5.31
Options granted......................................... 125,000 15.11 $2.20
-------- ------
Options outstanding at September 30, 1998............... 478,168 $ 8.20
======== ======
</TABLE>

The following table summarizes information about fixed stock
options outstanding at September 30, 1998:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
--------------------------------------------- -------------------------
RANGE OF WEIGHTED-AVERAGE WEIGHTED- WEIGHTED-
EXERCISE REMAINING AVERAGE AVERAGE
PRICES OPTIONS CONTRACTUAL LIFE EXERCISE PRICE OPTIONS EXERCISE PRICE
- -------- ------- ---------------- -------------- ------- --------------
<S> <C> <C> <C> <C> <C>
$4.00 to $5.88................ 181,986 3.4 years $ 4.57 71,986 $ 5.44
$6.13 to $8.50................ 171,182 3.2 $ 7.00 81,182 $ 7.42
$11.38 to $21.75.............. 125,000 7.8 $15.11 45,000 $21.75
------- --------- ------ ------- ------
$4.00 to $21.75............... 478,168 4.5 $ 8.20 198,168 $ 9.96
======= ========= ====== ======= ======
</TABLE>

15. SHAREHOLDER RIGHTS PLAN

In July 1998, the Company's Board of Directors adopted a common
stock shareholder rights plan ("Right") which entitles each
shareholder of record to receive a dividend distribution of common
stock upon the occurrence of certain events. The Right becomes
exercisable the day that a public announcement is made that a person
or group of affiliated or associated persons has acquired, or
obtained the right to acquire, beneficial ownership of 20% or more
of the outstanding shares of common stock, or 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 share of common stock. When
exercisable, each Right entitles the holder to purchase $100 worth
of the Company's common stock for $50. Until a Right is exercised or
exchanged, the holder thereof will have no rights as a shareholder
of the Company, including, without limitation, the right to receive
dividends. The Right is subject to redemption by the Company's Board
of Directors for $.01 per Right at any time prior to the date which
a person or

F-15

MAVERICK TUBE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

15. SHAREHOLDER RIGHTS PLAN (CONTINUED)

group acquires beneficial ownership of 20% or more of the Company's
common stock or subsequent thereto at the option of the Board of
Directors. The Rights expire July 23, 2008.

16. QUARTERLY FINANCIAL DATA (UNAUDITED)

The results of operations by quarter for 1997 and 1998 were as
follows (in thousands):

<TABLE>
<CAPTION>
QUARTER ENDED
------------------------------------------------------
DECEMBER 31, MARCH 31, JUNE 30, SEPTEMBER 30,
1996 1997 1997 1997
------------ --------- -------- -------------
<S> <C> <C> <C> <C>
1997
Net sales...................................... $64,190 $66,920 $74,669 $85,281
Gross profit................................... 6,663 7,692 9,794 14,108
Net income..................................... 2,608 2,978 3,938 5,361
Basic earnings per share....................... .18 .20 .26 .35
Diluted earnings per share..................... .18 .19 .25 .35
<CAPTION>
QUARTER ENDED
------------------------------------------------------
DECEMBER 31, MARCH 31, JUNE 30, SEPTEMBER 30,
1997 1998 1998 1998
------------ --------- -------- -------------
<S> <C> <C> <C> <C>
1998
Net sales...................................... $86,479 $70,548 $56,590 $51,773
Gross profit................................... 13,774 10,329 5,671 3,578
Net income (loss).............................. 6,570 4,707 1,330 (1,221)<F*>
Basic earnings (loss) per share................ .43 .30 .09 (.08)<F*>
Diluted earnings (loss) per share.............. .42 .30 .09 (.08)<F*>

<FN>
- -------------------
<F*> During the quarter ended September 30, 1998, the Company recorded a
pre-tax charge of $1.6 million in selling, general and administrative
expense for the write-down of certain software development costs relating
to information systems being replaced by a new enterprise resource
planning system.
</TABLE>

17. SUBSEQUENT EVENTS (UNAUDITED)

The Company entered into an Asset Purchase Agreement dated
September 3, 1999 to purchase mill equipment at a purchase price of
$11.75 million. This equipment will be used by the Company in
connection with the construction and equipping of a new large
diameter pipe and tubing facility adjacent to its existing
facilities in Hickman, Arkansas. The Company estimates that the
total cost for this project will be $35 million. The funding for
this project will be raised primarily from a public offering of
common stock of the Company.

F-16

[PHOTO]

Hickman, Arkansas

Maverick Plants are located in Hickman, Arkansas; Conroe, Texas;
and Beaver Falls, Pennsylvania. Sold through a network of
distributors and service centers, Maverick products are used
throughout the United States and Canada.

[PHOTO]

Conroe, Texas

==========================================================
- ----------------------------------------------------------

TABLE OF CONTENTS

PAGE
----

Forward-looking Statements...................... 3

Prospectus Summary.............................. 4

Risk Factors.................................... 8

Use of Proceeds................................. 12

Price Range of Common Stock..................... 12

Dividend Policy................................. 13

Capitalization.................................. 13

Selected Consolidated Financial Data............ 14

Management's Discussion and Analysis of
Financial Condition and Results
of Operations................................. 15

Business........................................ 26

Management...................................... 38

Principal Stockholders.......................... 40

Description of Our Capital Stock................ 40

Underwriting.................................... 46

Legal Matters................................... 48

Experts......................................... 48

Incorporation of Documents by
Reference..................................... 48

Where You Can Find More
Information................................... 49

Index to Consolidated Financial Statements...... 50

- ----------------------------------------------------------
==========================================================

==========================================================
- ----------------------------------------------------------

2,000,000 SHARES

[Maverick Logo]

COMMON STOCK

-------------------

P R O S P E C T U S

-------------------

RAYMOND JAMES &
ASSOCIATES, INC.

MORGAN KEEGAN &
COMPANY, INC.

SEPTEMBER 30, 1999

- ----------------------------------------------------------
==========================================================