SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
/X/ Definitive Proxy Statement Rule 14a-6(e)(2) )
/ / Definitive Additional Materials
/ / Soliciting Materials Pursuant to Rule 14a-11(c) or Rule 14a-12
MAVERICK TUBE CORPORATION
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No Fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a) (2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
MAVERICK TUBE CORPORATION
16401 Swingley Ridge Road, Seventh Floor
Chesterfield, Missouri 63017
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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To the Stockholders of:
MAVERICK TUBE CORPORATION
Our Annual Meeting of Stockholders ("Annual Meeting") will be held at The
Doubletree Hotel and Conference Center, 16625 Swingley Ridge Road, Chesterfield,
Missouri 63017, on Monday, February 7, 2000 at 4:00 P.M., Central Standard Time,
for the following purposes:
1. To elect seven (7) directors to serve until the next annual meeting of
stockholders and until their successors are elected and qualified;
2. To consider and act upon a proposal to approve the Maverick Tube
Corporation 1999 Director Stock Option Plan; and
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
The Board of Directors has fixed the close of business on December 9, 1999,
as the date for the determination of stockholders entitled to notice of and to
vote at the Annual Meeting. A complete list of the stockholders entitled to vote
at the Annual Meeting will be open to the examination of stockholders for any
purpose germane to the Annual Meeting during ordinary business hours for a
period of ten days prior to the Annual Meeting at our office, 16401 Swingley
Ridge Road, Seventh Floor, Chesterfield, Missouri 63017.
A copy of our Annual Report for fiscal year 1999 accompanies this Notice.
By Order of the Board of Directors,
/s/ Barry R. Pearl
Barry R. Pearl
Secretary
December 17, 1999
Chesterfield, Missouri
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WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, PLEASE DATE
AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
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<PAGE>
MAVERICK TUBE CORPORATION
16401 Swingley Ridge Road, Seventh Floor
Chesterfield, Missouri 63017
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PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS TO BE HELD FEBRUARY 7, 2000
As used in this Proxy Statement, unless the context otherwise requires, the
terms "we," "us," "our" or "Maverick" refers to Maverick Tube Corporation.
This Proxy Statement and the accompanying form of proxy are furnished in
connection with the solicitation of proxies by our Board of Directors, for use
at the Annual Meeting of Stockholders to be held on February 7, 2000, or any
adjournment thereof (the "Annual Meeting"). Shares represented by properly
executed proxies received in time for the Annual Meeting will be voted as
directed by our stockholders and, if no directions are given, will be voted as
follows: "FOR" the election of each of the seven persons named herein as
nominees for directors of Maverick, as set forth in ITEM 1 and as indicated in
the enclosed form of proxy, and "FOR" the approval of our 1999 Director Stock
Option Plan, as set forth in ITEM 2 and as indicated in the enclosed form of
proxy.
Any stockholder executing a proxy that is solicited hereby has the power to
revoke it prior to the voting of the proxy. Revocation may be made by attending
the Annual Meeting and voting the shares of stock in person, or by delivering to
our Secretary, at the principal office of Maverick prior to the Annual Meeting,
a written notice of revocation or a later-dated, properly executed proxy. This
Proxy Statement and enclosed form of proxy are first being mailed or delivered
to our stockholders on or about December 17, 1999.
Solicitation of proxies will be made primarily by mail. The cost of
solicitation of proxies will be paid by us and will also include reimbursement
paid to brokerage firms and others for their reasonable out-of-pocket expenses
of forwarding solicitation materials to their principals.
On December 9, 1999, the record date of the determination of stockholders
entitled to vote at the Annual Meeting, there were 17,768,474 shares of our
common stock, par value $.01 per share ("Common Stock") outstanding. Each share
of Common Stock is entitled to one vote on each matter submitted to a vote of
the stockholders. A majority of the outstanding shares present or represented by
proxy will constitute a quorum at the Annual Meeting. Votes that are withheld in
the election of directors, abstentions on all other matters properly brought
before the Annual Meeting and proxies relating to "street name" shares which are
not voted by brokers on one or more, but less than all, matters (so-called
"broker non-votes") will be considered as shares present for purposes of
determining a quorum. With regard to the election of directors, votes that are
withheld will be excluded entirely from the vote and will have no effect. With
regard to any other matters, abstentions (including proxies which deny
discretionary authority on any other matters properly brought before this
meeting) will be counted as shares present and entitled to vote and will have
the same effect as a vote against any such other matters. Broker non-votes will
not be treated as shares represented at the Annual Meeting as to such matter(s)
not voted on and therefore will have no effect.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information as of December 9, 1999 with
respect to each person known to us to be the beneficial owner of more than five
percent (5%) of our outstanding shares of Common Stock:
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent
Beneficial Owner(1) Beneficial Ownership of Class
<S> <C> <C> <C>
Woodbourne Partners, L.P. Sole Voting: 0 7.03%
10 South Broadway, Suite 2000 Shared Voting: 0
St. Louis, MO 63102 Dispositive: 1,250,000
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<FN>
(1) Based on a Schedule 13D filed with the Securities and Exchange Commission by
Woodbourne Partners, L.P. on March 12, 1999.
</FN>
</TABLE>
Management Ownership of Our Common Stock
Under regulations of the Securities and Exchange Commission, persons who
have power to vote or to dispose of our shares, either alone or jointly with
others, are deemed to be beneficial owners of those shares. The following table
shows, as of December 9, 1999, the beneficial ownership of (1) each of the
executive officers named in the Summary Compensation Table, (2) each present
director and executive officer of Maverick and (3) all present directors and
executive officers as a group, of shares of our Common Stock. The individuals
named have furnished this information to us.
<TABLE>
<CAPTION>
Number of Shares Currently
Name of Individual or Beneficially Exercisable Percent
Number in Group Owned Options(1) of Class
- ---------------------- ----------------- -------------- ----------
<S> <C> <C> <C>
Gregg M. Eisenberg 124,708 30,000 *
William E. Macaulay 26,500(2&3) 26,500 *
David H. Kennedy 46,500 7,500 *
C. Robert Bunch 24,900 22,500 *
C. Adams Moore 18,500 18,500 *
Barry R. Pearl 10,000 0 *
T. Scott Evans 58,286 36,000 *
Sudhakar Kanthamneni 91,008 80,000 *
Wayne P. Mang 15,000 15,000 *
John M. Fox 21,000 15,000 *
------- -------
All current directors and
executive officers as a group
(10 persons) 416,402 251,000 2.30%
(of 17,768,474 shares)
- ----------
* Represents less than 1% of the class.
<FN>
(1) 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
December 9, 1999. Such shares are included in the number of shares of Common
Stock indicated under the column captioned "Number of Shares Beneficially
Owned" above.
(2) 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 who is a Director of Maverick also serves as Chairman and Chief
Executive Officer of First Reserve Corp. William E. Macaulay disclaims
beneficial ownership of these shares.
(3) Excludes: (a) 3,850 shares of Common Stock owned by Anne R. Macaulay; and
(b) 3,850 shares of Common Stock owned by Elizabeth R. Macaulay. Mr.
Macaulay disclaims beneficial ownership of these shares.
</FN>
</TABLE>
ITEM 1 -- ELECTION OF DIRECTORS
The term of office of each of the seven current members of our Board of
Directors expires at the 2000 Annual Meeting. It is the intention of the persons
named in the accompanying proxy, unless otherwise directed, to vote such proxies
for the election of each of the seven nominees named below as our directors to
serve until the 2001 Annual Meeting of Stockholders and until their successors
are elected and qualified. If any persons named below should become unavailable
for election as a director, the holders of the proxies reserve the right to
substitute another nominee of their choice. THE BOARD OF DIRECTORS RECOMMENDS A
VOTE IN FAVOR OF EACH OF THE SEVEN NOMINEES NAMED BELOW.
The following table sets forth information with respect to each nominee for
election as a director, each of whom has agreed to serve if elected.
<TABLE>
<CAPTION>
Principal Occupation
and Business Experience
During Past 5 Years and Served as a
Name Age Other Directorships Director Since
- ---- --- ------------------------- ----------------
<S> <C> <C> <C>
Gregg M. Eisenberg 49 Chairman of the Board since February 1996; President, 1988
Chief Executive Officer and a Director of the Company
since 1988.
William E. Macaulay 54 Chairman and Chief Executive Officer of First 1987
Reserve Corp. since 1983; Director of Weatherford,
Inc., National-Oilwell, Inc., Pride International,
Inc., Superior Energy Services, Inc. and
Trans Montaigne, Inc.
David H. Kennedy 50 Independent energy consultant since January, 1999; 1996
Managing Director of First Reserve Corp. from
1981 to 1998; Director of Berkley Petroleum Corpora-
tion and Pursuit Resources, Inc.
C. Robert Bunch 45 Vice President and Chief Administrative Officer of 1991
Input/ Output, Inc. since November 1999; Partner,
in the law firm of King & Pennington, L.L.P. from
1997 to 1999; Executive Vice President and Chief
Operating Officer of Oyo Geospace Corporation (June
1995-May 1996); Attorney, Scott, Douglass & Luton,
L.L.P. (June 1994-May 1995); President, Geo-Capital
Resources, L.C. (July 1993-May 1994).
C. Adams Moore 66 Independent consultant in the steel distribution 1996
and fabrication businesses since February 1992; Vice
President of Sales of Bethlehem Steel Corporation
and President of Bethlehem Steel Export Corporation
(January 1983-February 1992); Director of Fisher
Tank Company and Warren Fabricating Corporation.
Wayne P. Mang 62 President & Chief Operating Officer Russel Metals 1997
(1991-May 1997); "Non-Executive" Chairman and
Director of Laclede Steel Co. since 1997; President
& Chief Executive Officer Metals Group of
Federal Industries Ltd. (1982-1991).
John M. Fox 59 President, Chief Executive Officer and a member 1997
of the Board of Directors of Markwest Hydrocarbon,
Inc. since 1988 and 1996 respectively; Founder of
Western Gas Resources, Inc. and Executive Vice
President and Chief Operating Officer (1972-1986).
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our executive officers and directors to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Such individuals are
required by SEC regulation to furnish us with copies of all Section 16(a) forms
they file. To our knowledge, based solely on our review of the copies of such
forms furnished to us, we believe all Section 16(a) filing requirements
applicable to our directors and executive officers were complied with during
fiscal 1999 and were filed timely.
Board Committees
Our Board of Directors has established an Audit Committee currently
consisting of Messrs. Kennedy (Chairman), Moore and Fox and a Compensation
Committee currently consisting of Messrs. Bunch (Chairman), Moore and Mang. The
primary role of the Audit Committee is to assist the Board of Directors in
fulfilling its responsibilities to our stockholders, potential stockholders and
the investment community, with regard to financial reporting and the adequacy of
internal controls, policies and procedures and to function as a committee for
the Board of Directors to report on, among other things, the independence of our
independent public accountants. The purpose of the Compensation Committee is to
act on behalf of the Board of Directors with respect to the compensation of
directors and executive officers. The Compensation Committee also administers
Maverick's option and other benefit plans.
During the fiscal year ended September 30, 1999, the Board of Directors held
five meetings, the Audit Committee held two meetings and the Compensation
Committee held two meetings. During such fiscal year each incumbent director
attended no fewer than 75% of the aggregate of (i) the total number of meetings
of the Board of Directors held during the period and (ii) the meetings held
during the period by the Committees of the Board of Directors on which he
served.
Compensation of Directors
We pay an annual retainer of $20,000 to each non-employee director. In
addition, we pay to each non-employee director for each Board of Directors
meeting attended, and for each committee meeting attended, compensation of
$1,500 and $750, respectively. We also pay the ordinary and necessary
out-of-pocket expenses incurred by non-employee directors to attend Board of
Directors and Committee meetings. Pursuant to our Director Stock Option Plan, as
amended, which was approved by our stockholders in February, 1995 (the
"Directors' Plan"), in fiscal 1999, each director of Maverick, other than Mr.
Eisenberg, received an option to acquire 7,500 shares of Common Stock at an
exercise price equal to the fair market value of such shares at the time of
grant. The Directors' Plan expired on November 16, 1999 and no further options
may be granted under such plan.
The Board of Directors has adopted, subject to approval by our stockholders,
the Maverick Tube Corporation 1999 Director Stock Option Plan. See ITEM 2 for
the terms of this proposal.
Compensation Committee Interlocks and Insider Participations
No member of the Compensation Committee is now an officer or an employee of
Maverick or any of its subsidiaries or has been at any time an officer of
Maverick or any of its subsidiaries.
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information relating to compensation paid to
or accrued for the benefit of our Chief Executive Officer and each of our three
current executive officers (together identified as the "named executive
officers") for all services rendered in all capacities to us during each of our
last three completed fiscal years. No compensation was paid in the form of
restricted stock awards, stock appreciation rights or payouts pursuant to
long-term incentive plans during any of the last three fiscal years.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Fiscal Other Annual Securities All Other
Name and Year Salary Bonus Compensation Underlying Compensation/
Principal Position Ended ($)(1) ($)(2) ($)(3) Options(#) ($)(4&5)
- ---------------------------- ------- --------- -------- -------------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Gregg M. Eisenberg 1999 302,000 34,424 -- 90,000 39,296
Chairman of the Board, 1998 290,000 29,779 -- -- 38,858
President and Chief 1997 265,000 193,292 -- -- 37,424
Executive Officer
Barry R. Pearl 1999 172,000 19,605 94,024(7) 25,000 4,661
Vice President- 1998 47,596(6) 4,811 -- 80,000 --
Finance and Administration, 1997 N/A N/A N/A N/A N/A
Treasurer, Secretary and
Chief Financial Officer
T. Scott Evans 1999 172,000 18,149 -- 60,000 31,233
Vice President- 1998 165,000 15,233 -- -- 31,399
Commercial Operations 1997 150,000 108,635 -- -- 30,142
Sudhakar Kanthamneni 1999 177,000 21,850 -- 60,000 46,273
Vice President- 1998 170,000 16,135 -- -- 46,852
Manufacturing and Technology 1997 155,000 115,042 -- -- 35,312
- ----------
<FN>
(1) Includes that portion of salary deferred at the named executive officer's
election under the Maverick Tube Corporation Savings for Retirement Plan
(our "401(k) Plan").
(2) Executive officers of Maverick may earn bonuses under our Performance Bonus
Plan (quarterly) and Profitability Bonus Plan (annually) if certain
performance criteria, which are established annually, are met.
(3) Except as otherwise noted, other annual compensation paid or distributed to
each of the named executive officers did not in any year exceed the lesser
of $50,000 or 10% of his respective annual salary and bonus.
(4) Includes amounts contributed by us under our 401(k) Plan and additional
compensation deferred under the Executive Deferred Compensation Plan
established in fiscal 1996 for the benefit of certain executive officers.
The Executive Deferred Compensation Plan provides for annual fixed deferred
compensation awards (together with interest thereon) all of which are
payable on the fifth anniversary of the first award, provided that the
executive officer remains employed by us, or upon the executive officer's
death or a change in control of Maverick. During fiscal 1999, deferred
compensation awards of $15,000, $15,000 and $30,000 were made to Messrs.
Eisenberg, Evans and Kanthamneni, respectively.
(5) Includes additional amounts deferred under the Deferred Compensation Plan
established in fiscal 1996 for the benefit of our executive officers and
certain key managers. The Deferred Compensation Plan was established in
order to retain the services of and provide long term performance incentive
to certain key employees of Maverick. The awards are established annually
based on performance and profitability goals and cannot exceed 6% of the
participant's base salary.
(6) Barry R. Pearl joined us on June 15, 1998 and became Chief Financial Officer
of Maverick at that time. Accordingly, compensation information for the
fiscal year 1998 relates only to the period Mr. Pearl was employed by us.
(7) Represents the costs associated with the relocation of Mr. Pearl to the
St. Louis area in connection with his employment by Maverick.
</FN>
</TABLE>
<PAGE>
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
Individual Grants
------------------------------------------------------- Potential Realizable
Number of % of Total Value at Assumed
Securities Options Annual Rates of
Underlying Granted to Exercise, or Stock Price Appreciation
Options Employees in Base Price Expiration for Option Term(1)
Name Granted (#)(2) Fiscal Year ($/Sh) Date 5% 10%
- -------------------- --------------- ------------- -------------- ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Gregg M. Eisenberg... 90,000 22.7% 7.125 11-11-08 $ 994,789 $2,345,661
Barry R. Pearl....... 25,000 6.3% 7.125 11-11-08 $ 276,330 $ 651,573
T. Scott Evans....... 60,000 15.1% 7.125 11-11-08 $ 663,193 $1,563,774
Sudhakar Kanthamneni. 60,000 15.1% 7.125 11-11-08 $ 663,193 $1,563,774
- ----------
<FN>
(1) The potential realizable values shown illustrate the values that might be
realized upon exercise immediately prior to the expiration of the option's
term using 5 percent and 10 percent appreciation rates set by the Securities
and Exchange Commission, compounded annually and therefore are not intended
to forecast possible future appreciation, if any, of our stock price.
Additionally, these values do not take into consideration certain provisions
of the option which could affect value, such as the nontransferability or
the termination thereof following termination of employment.
(2) Each option will become exercisable with respect to one-third of the total
number of shares subject to the option on November 11, 2001 and will become
exercisable with respect to an additional one-third of the total number of
shares on November 11, 2002 and November 11, 2003. Each option also becomes
fully exercisable within 30 days of a Change of Control of Maverick. See
"Employment Arrangements with Executive Officers."
</FN>
</TABLE>
<TABLE>
AGGREGATED OPTION EXERCISES IN
LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
<CAPTION>
Value of
Number of Securities Unexercised
Underlying Unexercised In-the-Money
Options at Options at
Fiscal Year-End (#) Fiscal Year-End ($)
Shares Acquired Exercisable/ Exercisable/
Name on Exercise (#) Value Realized ($) Unexercisable Unexercisable(1)
- --------------------- ---------------- --------------------- ---------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
Gregg M. Eisenberg... 0 0 30,000/130,000 $300,000/$1,360,000
Barry R. Pearl....... 0 0 0/105,000 $0/ $657,500
T. Scott Evans....... 0 0 36,000/90,000 $369,372/ $948,750
Sudhakar Kanthamneni. 0 0 80,000/100,000 $885,417/$1,075,000
- ----------
<FN>
(1) Represents the market value of the underlying Common Stock at the close of business on September 30, 1999, less the aggregate
exercise price.
</FN>
</TABLE>
Employment Arrangements with Executive Officers
Other than the employment agreement with Mr. Pearl discussed below, we are
not a party to any employment agreements with our officers or employees. We have
entered into Severance Agreements with each of the named executive officers.
With respect to Messrs. Eisenberg, Evans, and Kanthamneni, such Severance
Agreements provide for severance pay upon the involuntary termination of the
named executive officer (other than for cause) of an amount equal to one-half of
the executive officer's then base annual salary. The amount of severance pay Mr.
Pearl would be entitled to under these circumstances and prior to a "Change of
Control" as discussed below, is governed by the terms of his employment
agreement with us. The Severance Agreements also provide for severance pay to
the named executive officer if, within 30 months following a "Change of Control"
of Maverick, the employment of the named executive officer with us (or our
successor) is terminated by us (or our successor) other than for cause or is
terminated by the named executive officer for "good reason." In this event, the
executive shall be entitled to a lump-sum severance payment equal to two and
one-half times the sum of (i) his then Base Salary, and (ii) the value of his
bonus under our Performance Bonus Plan, assuming that the specified performance
criteria for the year in question had been met. Additionally, the executive will
be entitled to the continuation of certain benefits (such as health, life and
disability insurance) for the 30 month period, and a "gross-up" payment in
respect of "excess parachute payments", if any, resulting from payments under
the Severance Agreement. A "Change of Control" is defined in the Severance
Agreements to mean, generally, the occurrence of certain events which result in
the acquisition by an entity, or group of entities acting in concert, of
thirty-five percent (35%) or more of our outstanding Common Stock. The term
"good reason" is defined in the Severance Agreements to mean, generally, a
significant reduction of the duties or salaries, a required relocation of the
named executive officer, the occurrence of certain breaches of the agreement by
us or the determination of the executive officer that the business philosophy or
policies of Maverick or its successor are not compatible with those of the
executive officer. Additionally, the option agreements with each of the named
executive officers with respect to options granted in November, 1995, September,
1996 and November 1998 under our 1994 and 1990 Stock Option Plans respectively,
and pursuant to Mr. Pearl's employment agreement, shall become exercisable
immediately upon the occurrence of certain events which would result in a Change
of Control.
In connection with our employment of Barry R. Pearl, we entered into an
employment agreement with Mr. Pearl providing for (i) a base salary of $165,000
per year subject to upward adjustments by the Board, and (ii) the participation
by Mr. Pearl in our bonus, incentive compensation and similar programs generally
available to our executive officers, consisting of our "Performance Bonus Plan,"
(earned on a quarterly basis) and our "Profitability Bonus Plan," (earned on an
annual basis) each of which are performance based bonus programs whereby the
amount of bonus is determined by reference to specified criteria which is
established in advance. In addition, Mr. Pearl was granted an option to purchase
80,000 shares of our Common Stock under our 1994 Stock Option Plan at an option
price equal to the closing price of the Common Stock on The NASDAQ Stock Market
on the day immediately preceding the grant thereof. Such option is exercisable
by Mr. Pearl, in whole or in part, at any time on or after June 15, 2001 and
ending on June 15, 2008 (its expiration date). We may terminate Mr. Pearl's
employment for cause (as defined in the employment agreement) or without cause.
If his employment is terminated for cause or if Mr. Pearl resigns, his salary
and bonus rights will cease on the date of the termination or resignation. If we
terminate Mr. Pearl's employment without cause, Mr. Pearl is entitled to receive
a lump sum payment equal to his then current base salary and his bonus through
the date of such termination, on a pro rata basis. Mr. Pearl's employment
agreement also requires that he refrain from disclosing information confidential
to us or engaging, directly or indirectly, in activities which would be
competitive with us to any significant extent at any time during his employment
or for a period of one year from the date of any termination of his employment
with us.
Certain Relationships and Related Transactions
Certain funds managed by First Reserve Corp. hold a substantial minority
equity interest in National-Oilwell, Inc.("National-Oilwell") whose Tubular
Products Division was a significant customer of Maverick. William E. Macaulay,
a director of Maverick, is also a director of National Oilwell. In fiscal 1999,
National Oilwell accounted for 7.5 percent of our net sales. National-Oilwell
sold its Tubular Products Division on June 17, 1999.
In connection with his relocation to the St. Louis area, we loaned to Barry
R. Pearl, our Chief Financial Officer, pending the sale of his former residence,
the amount of $370,000 on an interest free basis. The loan was to be repaid in
full on the earlier occurrence of: (i) the sale of Mr. Pearl's former residence;
or (ii) June 10, 1999. This loan was repaid in full on March 1, 1999.
In fiscal 1999, we paid club membership fees and certain other expenses
(totaling approximately $96,438.00) to a country club in which Mr. Eisenberg,
our Chairman and Chief Executive Officer, and Messrs. Evans and Kanthamneni, our
Vice President -Commercial Operations and Vice President -- Manufacturing and
Technology, own a 20%, 2% and 2% equity interest, respectively. These fees and
other expenses relate to club memberships used by certain officers and employees
of Maverick in connection with business development activities and to foster
customer relations. These membership fees and other expenses incurred by our
executive officers and key employees were on substantially the same terms as
those prevailing at the time for all members of the club. We expect to continue
to pay similar membership fees and other expenses to this country club in fiscal
2000.
COMPENSATION COMMITTEE REPORT
Our Compensation Committee is committed to providing a comprehensive
compensation package designed to attract and retain quality executive officers,
instill a long-term commitment to us and ensure that the interests of management
and our stockholders are aligned. With this in mind, the Compensation
Committee's principal objective is to link executive compensation to corporate
performance. However, the Committee also considers progress on strategic and
other qualitative goals when determining base salaries of our executive
officers. The Committee's compensation policies include the following:
o establishing compensation levels competitive with those of similar-size
manufacturing companies;
o balancing our short-term and long-term goals and performance and those of
our executive officers; and
o linking executive officer compensation to increasing shareholder value
through stock options.
Given the Compensation Committee's policies, our executive officers'
compensation packages primarily include three elements: (1) base salary; (2)
cash bonuses; and (3) stock options.
Base Salaries
Base salaries for our executive officers are initially determined by
evaluating the responsibilities of the position held and the experience of the
individual, and by referring to the relevant competitive marketplace for
executive management, which includes a comparison to a self-selected group of
other manufacturing companies of a size similar to that of Maverick. The
comparative group is not limited to companies which comprise the published
industry index or peer group shown in our stock performance graph presented
below. Rather, the Compensation Committee believes that the relevant marketplace
for executive management is broader than that represented by other companies in
our industry. The base salary for each of our executive officers is targeted
generally at or below the mid-point within the comparative group. When
determining base salary, the Compensation Committee also takes into account
other aspects of the entire compensation package afforded by us to the
individual officer, which include matching contributions under our 401(k) Plan,
incentive compensation programs, deferred compensation and certain perquisites.
Base salaries are reviewed annually and adjusted after considering executive
officer salaries of the comparative group (as discussed previously), our
performance for the year, the individual executive's contribution to that
performance, achievement of individual performance objectives and years of
service with us. The Compensation Committee exercises judgment and discretion in
the information it reviews and the analysis it considers. In reviewing base
salaries of our executive officers other than the Chief Executive Officer, the
Compensation Committee also takes into account the views of Gregg M. Eisenberg,
Chairman, President and Chief Executive Officer, whose views typically are
subjective, such as his perception of the individual's performance, the
importance of his role and functional responsibilities to the overall well-being
of Maverick and any planned changes in functional responsibilities.
In determining Mr. Eisenberg's base salary for fiscal 2000, the Compensation
Committee considered several factors. These factors, to which the Committee did
not attribute specific values or weights, included (i) our financial performance
during fiscal 1999 relative to our peers in the oil service business, (ii)
competitive salary and bonus levels for Chief Executive Officers at comparably
sized public companies in similar businesses as well as general inflation of
salaries in the economy, (iii) completion of the start-up of our new cold drawn
products business and (iv) our position in the market place. Based on these
considerations, the Compensation Committee set Mr. Eisenberg's base salary for
fiscal 2000 at $315,000, which reflects a 4.3% increase over fiscal 1999. Mr.
Eisenberg was also awarded deferred cash compensation of $15,000 during fiscal
1999 under our Deferred Compensation Program.
Bonuses
Our executive officers are eligible for quarterly cash bonuses under the
terms of our Performance Bonus Plan, not to exceed 15% of base salary, based on
the achievement of specified objective criteria related to, among other things,
sales and manufacturing results. In fiscal 1999, the specified criteria were
attained and Mr. Eisenberg and the other executive officers received quarterly
cash bonuses.
Our executive officers are also eligible for annual cash bonuses, under the
terms of our Profitability Bonus Plan. Under this plan, the Compensation
Committee establishes bonuses as a percentage of base salary, which for fiscal
1999 was limited to 60% of base salary in the case of our executive officers.
The criteria for annual bonuses in fiscal 1999 were the achievement by us of a
specified earnings per share target and the achievement of certain other
performance goals. In fiscal 1999, we did not meet the specified earnings per
share target and no annual bonus payments were made to our executives.
Stock Options
The granting of stock options is a key part of our overall compensation
program designed to provide our executive officers and other key employees with
incentives to maximize our long-term financial performance and align their
interests with those of our stockholders.
In determining whether and how many options should be granted, the Committee
may consider the seniority of and contributions of executive officers and key
employees, as well as the number of options already held and such other factors
as it deems appropriate. However, the Compensation Committee has not established
target awards governing the receipt, timing or size of option grants under our
stock option plans, other than to set a maximum limit. Thus, a determination by
the Compensation Committee with respect to the granting of stock options is
subjective in nature.
The Compensation Committee's primary consideration for determining the
number of shares covered by options provided during fiscal 1999 to Mr. Eisenberg
and our other executive officers, was to encourage the long-term retention and
performance of these officers.
Respectfully submitted,
COMPENSATION COMMITTEE OF THE
BOARD OF DIRECTORS OF
MAVERICK TUBE CORPORATION
C. Robert Bunch, Chairman
C. Adams Moore, Member
Wayne P. Mang, Member
<PAGE>
STOCK PERFORMANCE
Set forth below is a line graph comparing the cumulative total shareholder
return since October 1, 1994 through September 30, 1999 on our Common Stock
against the cumulative total return of the NASDAQ Stock Market -- U.S. and our
peer group as selected by us, as well as the Philadelphia Exchange Oil Service
Index. Included in the peer group are our direct public competitors whose main
operations are the manufacturing of tubular products and consist of Lone Star
Steel Co., North Star Steel Co. and Prudential Steel, Ltd. The Philadelphia
Exchange Oil Service Index has been provided for informational purposes only.
<TABLE>
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG MAVERICK TUBE CORPORATION, THE NASDAQ STOCK MARKET (U.S.),
A PEER GROUP AND THE PHILADELPHIA EXCHANGE OIL SERVICE INDEX
<CAPTION>
Philadelphia
Measurement Period Maverick Tube NASDAQ Stock Exchange Oil
(fiscal Year Covered) Corporation Peer Group Market (U.S.) Service
- --------------------- ---------------- ------------ -------------- ------------
<S> <C> <C> <C> <C>
9/94 100 100 100 100
9/95 79 95 138 140
9/96 138 140 164 261
9/97 815 685 225 560
9/98 136 176 229 246
9/99 328 304 372 330
<FN>
*$100 INVESTED ON 9/30/94 IN STOCK OR INDEX -- INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING SEPTEMBER 30.
</FN>
</TABLE>
<PAGE>
ITEM 2 -- APPROVAL OF THE MAVERICK TUBE CORPORATION 1999 DIRECTOR STOCK OPTION
PLAN
Our Board of Directors has adopted, subject to the approval by our
stockholders, the Maverick Tube Corporation 1999 Director Stock Option Plan (the
"1999 Directors' Plan") which provides for the granting of non-qualified stock
options to the non-employee directors of Maverick. The total number of shares of
Common Stock issuable under the 1999 Directors' Plan is not to exceed 300,000
shares, subject, generally, to adjustment in the event of any change in the
outstanding shares of Common Stock by reason of a stock dividend, stock split,
recapitalization, merger, consolidation or similar changes affecting Maverick's
stockholders.
We had the Directors' Plan, which provided for the automatic yearly grant,
on the first business day after the annual meeting of stockholders, to each
non-employee director of a non-qualified stock option to acquire 7,500 shares of
our Common Stock. The Directors' Plan also provided for the automatic grant of a
non-qualified stock option to a director who served as a director at the
beginning of a fiscal year and subsequently became a non-employee director of
Maverick during such fiscal year. The Directors' Plan expired on November 16,
1999 and no further options may be granted under this plan. While the Directors'
Plan was in effect, options to acquire a total of 159,500 shares of our Common
Stock were granted. The 1999 Directors' Plan, the terms of which are
substantially the same as those of the Directors' Plan, is intended to replace
the Directors' Plan.
The purpose of the 1999 Directors' Plan is to enable us to continue to
provide incentive to qualified persons who are otherwise unaffiliated with
Maverick to become and remain our directors, and to encourage ownership of our
Common Stock by these persons. The Board of Directors believes the 1999
Directors' Plan will directly promote the interests of Maverick and its
stockholders because the incentives and rewards made available to outside
directors thereunder would be directly related to the share value of our Common
Stock. The vote required to approve the 1999 Directors' Plan is a majority of
the shares of Maverick's Common Stock present, in person or by proxy, and voting
at the Annual Meeting.
The complete text of the 1999 Directors' Plan is set forth in Appendix A to
this Proxy Statement. The following summary is qualified in its entirety by
reference to the full text of the 1999 Directors' Plan.
Description of 1999 Directors' Plan
The 1999 Directors' Plan provides for the automatic yearly grant, on the
first business day after the annual meeting of stockholders, to each
non-employee director of a non-qualified stock option to acquire 7,500 shares of
our Common Stock. A non-employee director is a director of Maverick who is not
an officer or employee of Maverick or of any subsidiary thereof and who is not a
director, officer or employee of a corporation, partnership, trust or other
entity that is a beneficial owner (as defined in Section 13(d)(3) of the
Securities Act of 1933, as amended) of ten percent or more of our Common Stock.
Options granted under the 1999 Directors' Plan are exercisable at a price equal
to the fair market value of our Common Stock on the date of the grant, and are
generally exercisable at any time after six months from the date of grant until
the earlier of the date the director ceases to be a director for any reason or
five years. Director stock options will survive for a limited period of time if
the director ceases to be a director due to his or her death, disability or
normal retirement from the Board of Directors.
The Board of Directors may amend or revise the 1999 Directors' Plan, or the
term of any option granted thereunder, without stockholder approval unless such
amendment or revision would require stockholder approval to continue to meet the
requirements of Rule 16b-3 under the Securities Exchange Act of 1934, as
amended, or as may otherwise be required by the market on which our Common Stock
is traded (e.g., The Nasdaq Stock Market). No amendment, revision or termination
of the 1999 Directors' Plan shall impair the rights or obligations of any
options previously granted without the consent of the optionee. No option may be
granted under the 1999 Directors' Plan more than five years after its effective
date, which was November 16, 1999.
The market value of our Common Stock, as of December 9, 1999, was $21.25.
Currently, six of Maverick's seven directors qualify as non-employee directors
and thus may participate in the 1999 Directors' Plan. If the 1999 Directors'
Plan is approved by our stockholders, on February 8, 2000 each of the six
non-employee directors will receive an option to acquire 7,500 shares of our
Common Stock at a per share exercise price equal to the fair market value of our
Common Stock on that date, with similar grants to be made to the then
non-employee directors of Maverick in each following year.
Federal Income Tax Consequences
In general, no income will be recognized upon the grant of an option under
the 1999 Directors' Plan. As a non-qualified option, the exercise thereof is a
taxable event which requires the optionee to recognize ordinary income in an
amount equal to the difference between the then fair market value of the shares
and the exercise price, and we generally will be entitled to a deduction for
Federal income tax purposes, equal to the amount of income taxable to the
optionee upon the exercise of the option.
Our Board of Directors believes the adoption of the 1999 Directors' Plan is
in the best interests of Maverick and its stockholders and, accordingly,
recommends a vote FOR this proposal, which is ITEM 2 on the accompanying proxy
card. Proxies received in response to the Board's solicitation will be voted FOR
approval of the 1999 Directors' Plan if no specific instructions are included
thereon for ITEM 2.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Ernst & Young LLP, our independent public accountants for the fiscal year
ended September 30, 1999, has been selected as our independent public
accountants for the fiscal year ending September 30, 2000. Representatives of
Ernst & Young LLP are expected to attend the Annual Meeting and will have the
opportunity to make statements and respond to appropriate questions from
stockholders.
STOCKHOLDER PROPOSALS
Under our By-laws, any stockholder who wishes to bring a matter before an
annual meeting of stockholders must deliver a written notice to our Secretary
not less than 45 days nor more than 90 days before the anniversary date of the
day that proxy materials were first mailed for the prior year's annual meeting
of stockholders, provided the actual date of the annual meeting of stockholders
is within 30 days of the anniversary date of the prior year's annual meeting.
The written notice must contain the name and record address of the stockholder
submitting the proposal, a brief description of the proposal sought to be raised
at the meeting, the number of shares of our stock beneficially owned by the
proposing stockholder and certain other information specified in our By-laws.
Failure to comply with this advance notice requirement will preclude the
stockholder from submitting the proposal to the meeting. For the 2001 Annual
Meeting of Stockholders, such written notice must be given not later than
November 2, 2000, and not earlier than September 18, 2000. In addition, under
the SEC's proxy rules, if a stockholder wishes to bring a matter before an
annual meeting of stockholders but does not provide written notice of the
proposal to us at least 45 days before the anniversary date of the day that
proxy materials were first mailed for the prior year's annual meeting of
stockholders, any proxies received by the Board of Directors from stockholders
in response to its solicitation will be voted by our designated proxies in their
discretion on such matter (if the matter is allowed to be brought before the
meeting, consistent with our By-laws described above), regardless of whether
specific authority to vote on such matter has been received from the
stockholders submitting such proxies. Thus, any stockholder who wishes to submit
a proposal at the 2001 Annual Meeting of Stockholders and also wishes to avoid
the possibility of discretionary voting by our proxies on such matter must give
written notice to our Secretary on or before November 2, 2000.
Under the Securities and Exchange Commission's proxy rules, any stockholder
proposal to be presented at the 2001 Annual Meeting of Stockholders must be
received by our Secretary at our principal executive offices not later than
August 19, 2000, for inclusion in the Board of Director's Proxy Statement and
form of proxy related to that meeting. Each proposal submitted should be
accompanied by the name and address of the stockholder submitting the proposal,
the number of shares of Common Stock owned by him of record or beneficially and
the date on which the shares were acquired. If the proponent is not a
stockholder of record, proof of beneficial ownership should also be submitted.
Each proposal must be a proper subject for action and comply with the proxy
rules of the Securities and Exchange Commission.
A COPY OF OUR ANNUAL REPORT TO STOCKHOLDERS FOR FISCAL YEAR 1999 ACCOMPANIES
THIS PROXY STATEMENT.
A COPY OF OUR ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR 1999, AS FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION (INCLUDING RELATED FINANCIAL STATEMENTS
AND SCHEDULES) IS AVAILABLE TO STOCKHOLDERS WITHOUT CHARGE, UPON WRITTEN REQUEST
TO MAVERICK TUBE CORPORATION, 16401 SWINGLEY RIDGE ROAD, SEVENTH FLOOR,
CHESTERFIELD, MISSOURI 63017; ATTN.: SECRETARY.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. STOCKHOLDERS WHO DO NOT
EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON ARE REQUESTED TO COMPLETE, SIGN
AND RETURN THE ENCLOSED PROXY AS SOON AS POSSIBLE.
OTHER BUSINESS
Our Board of Directors knows of no business which will be presented for
consideration at the Annual Meeting other than as set forth in the Notice which
accompanies this Proxy Statement. However, if any other matters properly come
before the meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgment.
By Order of the Board of Directors,
/s/ Barry R. Pearl
BARRY R. PEARL
Secretary
<PAGE>
APPENDIX A
MAVERICK TUBE CORPORATION
1999 DIRECTOR STOCK OPTION PLAN
Section 1. Establishment and Purpose.
Maverick Tube Corporation (the "Company") hereby establishes a stock option
plan to be named the Maverick Tube Corporation 1999 Director Stock Option Plan.
The purpose of the Plan is to provide (i) further inducement to qualified
persons to become and remain Eligible Directors of the Company, and (ii)
additional incentive to Eligible Directors of the Company by encouraging them to
acquire shares of Stock upon the exercise of the Options granted hereunder in
return for services rendered by them to the Company, thereby increasing such
Eligible Directors' proprietary interest in the business of the Company. Options
granted under the Plan will not be incentive stock options within the meaning of
Section 422 of the Code.
Section 2. Definitions.
(a) Act means the Securities Exchange Act of 1934, as amended and in effect
from time to time.
(b) Administrator means the person, board of directors, committee or entity
performing the functions of the administrator of the Plan as provided for
herein, as designated by the Board from time to time and, in absence of such
designation, the Board shall be the Administrator.
(c) Board means the Board of Directors of the Company.
(d) Code means the Internal Revenue Code of 1986, as amended and in effect
from time to time.
(e) Company means Maverick Tube Corporation, a corporation organized and
existing under the laws of the State of Delaware.
(f) Eligible Director means, at any given time, a director of the Company
who is not an officer or employee of the Company or of any subsidiary thereof
and who is not a director, officer or employee of a corporation, partnership,
trust or other entity that is a beneficial owner (as defined in Section 13(d)(3)
of the Act) of ten percent or more of the Stock of the Company.
(g) Fair Market Value of a share of Stock means, for any particular date,
(i) for any period during which the Stock shall not be listed for trading on a
national securities exchange, but when the Stock is authorized as a Nasdaq
National Market security, the last transaction price per share as quoted by The
Nasdaq Stock Market (the "Nasdaq"), (ii) for any period during which the Stock
shall not be listed for trading on a national securities exchange or authorized
as a Nasdaq National Market security, but when the Stock is authorized as a
Nasdaq Small Cap Market security, the closing bid price as reported by the
Nasdaq, (iii) for any period during which the Stock shall be listed for trading
on a national securities exchange, the closing price per share of Stock on such
exchange as of the close of such trading day or (iv) the market price per share
of Stock as determined by a nationally recognized investment banking firm
selected by the Board of Directors in the event neither (i), (ii) nor (iii)
above shall be applicable. If Fair Market Value is to be determined as of a day
when the securities markets are not open, the Fair Market Value on that day
shall be the Fair Market Value on the preceding day when the markets were open.
(h) Option means an option granted under this Plan to acquire Stock.
(i) Optionee means the person to whom an Option is granted.
(j) Option Agreement means the agreement between the Company and an Optionee
setting forth the terms and provisions of an Option.
(k) Option Date means the date as of which an Option is granted, which shall
be the first business day after the 2000 annual meeting of stockholders of the
Company and the first business day after each subsequent annual meeting of the
stockholders of the Company.
(l) Period of Exercisability means the period during which an Option may
be exercised as determined under Section 6 of this Plan.
(m) Plan means the Maverick Tube Corporation 1999 Director Stock Option
Plan.
(n) Post-Death Representative(s) means the executor(s), administrator(s) or
personal representative(s) of the Optionee's estate or the person or person(s)
to whom the Optionee's rights under his or her Option pass by the Optionee's
will or the laws of descent and distribution.
(o) Rule 16b-3 means Rule 16b-3 promulgated by the Securities and Exchange
Commission under the Act, as amended from time to time, or any successor rule.
(p) Stock means authorized and unissued shares of $0.01 par value common
stock of the Company or shares reacquired by the Company held in its treasury.
Section 3. Administration.
The Plan is intended to be a "formula plan" under Rule 16b-3. The
Administrator shall administer the Plan on behalf of the Company. The
Administrator may adopt, amend, and rescind from time to time such
administrative rules, and may take from time to time such actions, with or
without notice to affected Optionees, as the Administrator may deem appropriate
to implement or interpret the provisions of the Plan or to exercise any
authority, discretion or power explicitly or implicitly granted to the
Administrator under the Plan; provided however, that no such rules or actions
may be inconsistent with the provisions of the Plan or Rule 16b-3. The
Administrator may make rules or take action pursuant to this Section by any
appropriate means.
Section 4. Shares Subject to the Plan.
(a) Subject to the provisions of Section 10 hereof, a maximum of 300,000
shares of Stock may be issued pursuant to the exercise of Options granted under
the Plan.
(b) At any time during the existence of the Plan, there shall be reserved
for issuance upon the exercise of Options granted under the Plan an amount of
Stock (subject to adjustment as provided in Section 10 hereof) equal to the
total number of shares then issuable pursuant to all such Option grants which
shall have been made prior to such time. The Company in its discretion may use
reacquired shares held in the treasury in lieu of authorized but unissued
shares.
(c) If an Option terminates, in whole or in part, by expiration or for any
reason other than exercise of such Option, the shares previously reserved for
issuance upon grant of the Option shall again be available for issuance as if
such shares had never been subject to an Option.
Section 5. Granting of Options.
(a) Each person who is an Eligible Director on an Option Date (commencing on
the Option Date for 2000) shall receive an Option to acquire 7,500 shares of
Stock at a per share purchase price equal to the Fair Market Value of the Stock
on the Option Date. In each subsequent year, each person who is an Eligible
Director on the Option Date shall receive an Option to acquire 7,500 shares of
Stock at a per share purchase price equal to the Fair Market Value of the Stock
on the Option Date.
(b) All Options granted under the Plan shall be granted as of an Option
Date. Promptly after each Option Date, the Company shall notify the Optionee of
the grant of the Option, and shall hand deliver or mail to the Optionee an
Option Agreement, duly executed by and on behalf of the Company, with the
request that the Optionee execute and return the Option Agreement within thirty
days after the Option Date. If the Optionee shall fail to execute and return the
Option Agreement within said thirty-day period, his or her Option shall be
automatically terminated, except that if the Optionee dies within said
thirty-day period, such Option Agreement shall be effective notwithstanding the
fact that it has not been signed prior to death.
Section 6. Terms of Options.
Notwithstanding any other provision of the Plan, each Option shall be
evidenced by an Option Agreement, which shall include the substance of the
following terms and conditions:
(a) The option price for each share of Stock covered by an Option shall be
an amount equal to 100 percent of the Fair Market Value of a share of Stock on
the Option Date of such Option.
(b) The Option shall not be transferable by the Optionee other than by will
or by the laws of descent and distribution or pursuant to a qualified domestic
relations order as defined by the Code or the regulations thereunder. The
designation of a beneficiary does not constitute a transfer. The Option shall be
exercisable during the Optionee's lifetime only by the Optionee.
(c) The Option shall be exercisable, in whole or in part, at any time and
from time to time on or after the date which is six months after the Option Date
and before its expiration, which shall occur upon the earlier of (i) the date on
which an Optionee ceases to hold office as a director of the Company for any
reason other than retirement, death or disability, (ii) the date that is three
months after the effective date of the Optionee's retirement from service on the
Board, (iii) the date that is one year after the date on which the Optionee's
service on the Board ceases due to death or disability, (iv) the date on which
the Optionee ceases to qualify as an Eligible Director for any reason other than
retirement, death or disability, and (v) the fifth anniversary of the Option
Date.
(d) An Option may be exercised only during the Period of Exercisability
determined under Section 6(c) hereof.
Section 7. No Right to Remain a Director.
The grant of an Option shall not create any right in any person to remain as
a director of the Company.
Section 8. Exercise of Options.
(a) An Option may be exercised in whole or in part during the Period of
Exercisability, except as otherwise may be provided in the Option Agreement, by
giving written notice to the Company stating the number of shares of Stock for
which the Option is being exercised, accompanied by payment in full of the
aggregate purchase price for the shares of Stock being purchased. Payment of the
aggregate purchase price for the shares of Stock may be made (i) in cash for the
full amount of such purchase price, (ii) by delivery to the Company of
certificates representing shares of Stock owned by the Optionee for longer than
six months and registered in the Optionee's name, having a Fair Market Value as
of the date of exercise and tender equal to the full amount of such purchase
price, or (iii) a combination of (i) and (ii) which collectively equals the full
amount of such purchase price.
(b) An Optionee shall have none of the rights of a stockholder with respect
to shares of Stock subject to an Option until shares of Stock are issued to him
or her upon the exercise of such Option.
Section 9. General Provisions.
The Company shall not be required to issue or deliver any certificate for
shares of Stock to an Optionee upon the exercise of an Option prior to:
(a) (i) if requested by the Company, the filing with the Company by the
Optionee or the Optionee's Post-Death Representative of a representation in
writing that at the time of such exercise it was his or her then present
intention to acquire such shares for investment and not for resale, and/or (ii)
the completion of any registration or other qualification of such shares of
Stock under any State or Federal securities laws or rulings or regulations of
any governmental regulatory body which the Company shall determine to be
necessary or advisable; and
(b) the obtaining of any other consent, approval or permit from any State or
Federal governmental agency which the Administrator may, in its sole and
absolute discretion upon the advice of counsel, determine to be necessary or
advisable.
Section 10. Adjustment Provisions.
The existence of the Plan and the Options granted hereunder shall not affect
in any way the right or power of the Board or the stockholders of the Company to
make or authorize any adjustment, recapitalization, reorganization or other
change in the Company's capital structure or its business, any merger or
consolidation of the Company with or into another entity, any issuance of bonds,
debentures, preferred or prior preference stocks ahead of or affecting the Stock
or the rights thereof, the dissolution or liquidation of the Company for any
sale or transfer of all or any part of its assets or business, or any other
corporate act or proceeding.
The shares with respect to which Options may be granted are shares of Stock
as presently constituted. If, however, the outstanding shares of Stock are
subdivided or consolidated, or such shares are exchanged for a different number
or kind of shares or securities of the Company through a reorganization, merger,
recapitalization, reclassification, stock dividend, stock split, combination of
shares or other similar transaction, the aggregate number of shares of Stock
subject to the Plan as provided in Section 4 hereof, and the shares of Stock
subject to issuance under outstanding Options under the Plan shall be
appropriately and proportionately adjusted by the Administrator. Any such
adjustment in an outstanding Option shall be made without change in the
aggregate purchase price applicable to the unexercised portion of the Option but
with an appropriate adjustment in the price for each share or other unit of any
security covered by the Option.
Notwithstanding anything to the contrary contained in this Section 10, upon
the dissolution or liquidation of the Company, or upon a reorganization, merger
or consolidation of the Company with one or more corporations as a result of
which the Company is not the surviving corporation (or, in the case of a
three-party merger where the Company, while the surviving corporation, becomes a
subsidiary of another corporation), or upon a sale of substantially all of the
assets of the Company, then the Plan shall terminate on the date and any Options
granted under the Plan shall terminate on the date before the consummation of
the transaction, and the Administrator shall have the right, but shall not be
obligated, to accelerate the time in which any Option may be exercised prior to
such termination, unless provision shall be made in writing in connection with
such transaction for the continuance of the Plan, for the assumption of Options
previously granted, or the substitution for such Options with new options to
purchase the stock of a successor corporation, or parent or subsidiary thereof,
with appropriate adjustments as to number and kind of shares and the option
price, in which event the Plan and Options previously granted shall continue in
the manner and under the terms so provided; provided, however, that the
Administrator and the Board shall have the authority to amend this Section to
require that a successor assume all obligations under any outstanding Options.
Adjustments under this Section 10 shall be made by the Administrator, and
any determination of the Administrator as to what adjustments shall be made, and
the extent thereof, shall be final, binding and conclusive. No fractional shares
of Stock shall be issued under the Plan or in connection with any such
adjustment.
Except as may otherwise be expressly provided in the Plan, the issuance by
the Company of shares of capital stock of any class or securities convertible
into shares of capital stock of any class for cash, property, labor, or
services, upon direct sale, upon the exercise of rights or warrants to subscribe
therefore, or upon conversion of shares or obligations of the Company
convertible into such shares of capital stock or other securities, and in any
case whether or not for fair value, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of shares of Stock
available under the Plan or subject to Options therefore granted or the purchase
price per share with respect to outstanding Options.
Section 11. Duration, Amendment and Termination.
(a) The Board may at any time terminate the Plan or make such amendments
thereto as it shall deem advisable and in the best interests of the Company,
without further action on the part of the stockholders of the Company; provided,
however, that no such termination or amendment shall, without the consent of the
Optionee, adversely affect or impair the rights of such Optionee, and provided
further, that no amendment requiring stockholder approval in order to meet the
requirements of Rule 16b-3 shall be effective unless such stockholder approval
is obtained, and provided further that the provisions relating to eligible
persons, the amount and price of awards and the timing of awards may not be
amended more than once every six months except to comport with changes in the
Code or the Employee Retirement Income Security Act of 1974, as amended or the
rules thereunder.
(b) The period during which Options may be granted under the Plan shall
terminate on November 16, 2004, unless the Plan earlier shall have been
terminated as provided above.
Section 12. Stockholder Approval.
The Plan became effective on November 16, 1999, subject to approval by the
stockholders of the Company at its annual meeting to be held on or about
February 7, 2000, or any adjournment thereof.
Section 13. Miscellaneous.
(a) An Optionee shall have no rights as a stockholder with respect to shares
issuable upon exercise of an Option until the date of the issuance of shares to
the Optionee pursuant to such exercise. No adjustment will be made for dividends
or other distributions or rights for which the record date is prior to the date
of such issuance.
(b) Nothing contained in the Plan shall be construed as giving any Optionee,
such Optionee's beneficiaries, or any other person any equity or other interest
of any kind in any assets of the Company or any subsidiary or creating a trust
of any kind or a fiduciary relationship of any kind between the Company or any
subsidiary and any such person.
(c) Nothing contained in the Plan shall be construed to prevent the Company
or any subsidiary from taking any corporate action that is deemed by the Company
or such subsidiary to be appropriate or in its best interests, whether or not
such action would have an adverse effect on the Plan or any Option granted under
the Plan. No Optionee, beneficiary or other person shall have any claim against
the Company or any subsidiary as a result of any such action.
(d) The proceeds received by the Company from the sale of shares of Stock
pursuant to the Plan shall be used for general corporate purposes.
(e) All rights and obligations under the Plan shall be governed by, and the
Plan shall be construed in accordance with, the laws of the State of Delaware
without regard to the law of conflicts. Titles and headings to sections in the
Plan are for purposes of reference only, and shall in no way limit, define or
otherwise affect the meaning or interpretation of any provisions of the Plan.
(f) The Company shall have the right to take such action as may be necessary
in connection with any exercise of Options to satisfy any applicable obligation
to withhold amounts pursuant to Federal, State, or local tax law. The
Administrator may permit shares of Stock having an aggregate value equal to or
less than the amount required to be withheld to be used to satisfy tax
withholding requirements, and such shares shall be valued at the Fair Market
Value per share as of the date of such exercise.
(g) It is intended that the Options that may be granted and Stock issuable
under the Plan will be registered under the Securities Act of 1933, as amended.
At the time any shares of Stock are issued or transferred pursuant to the
exercise of an Option, such shares will have been accepted for trading on The
NASDAQ Stock Market or such other national securities exchange on which the
Company's Stock is then predominantly traded.
APPENDIX TO MAVERICK'S PROXY STATEMENT FOR 2000 ANNUAL MEETING OF STOCKHOLDERS
Proxy Card for 2000 Annual Meeting of Stockholders
<PAGE>
(FRONT OF PROXY CARD)
MAVERICK TUBE CORPORATION
This Proxy is Solicited By the Board of Directors
For The Annual Meeting of Stockholders - February 7, 2000
The undersigned hereby appoints GREGG M. EISENBERG and BARRY R. PEARL, and each
of them the true and lawful attorneys-in-fact, agents and proxies of the under-
signed, with full power of substitution, to vote on behalf of the undersigned
all of the shares of stock of MAVERICK TUBE CORPORATION which the undersigned is
entitled to vote at the Annual Meeting of Stockholders of the Company to be held
at The Doubletree Hotel and Conference Center, 16625 Swingley Ridge Road,
Chesterfield, Missouri 63017 at 4:00 P.M., Central Standard time on Monday,
February 7, 2000, and at all adjournments thereof, hereby revoking any proxy
heretofore given with respect to such stock, and the undersigned authorizes and
instructs said proxies to vote as follows:
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
(Continued and to be signed on reverse side.)
(BACK OF PROXY CARD)
MAVERICK TUBE CORPORATION
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
1. Election of Directors, Nominees: 01-Gregg M. For Withhold For All
Eisenberg, 02-William E. Macaulay, 03-C. Robert All All Except
Bunch, 04-C. Adams Moore, 05-David H. Kennedy,
06-Wayne P. Mang and 07-John M. Fox
____________________________________________________ / / / / / /
(To withold authority for any Individual nominee,
print that nominee's name on the line provided above
and mark the box under "For All Except")
2. Proposal to approve the Maverick Tube Corporation
1999 Director Stock Option Plan. For Against Abstain
/ / / / / /
3. In their discretion, the proxies are authorized to
vote upon such other matters as may properly come
before the meeting and all adjournments thereof.
Dated:_____________________________________________________,_______
Signature(s)_______________________________________________________
___________________________________________________________________
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE STOCKHOLDER(S) SIGNING SAME. IF NO DIRECTION IS GIVEN, THIS
PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.
Please sign exactly as name appears on this Proxy Card. When shares are held by
joint tenants both should sign. When signing as attorney-in-fact, personal
representative, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by an authorized
person.
- -------------------------------------------------------------------------------
FOLD AND DETACH HERE
YOUR VOTE IS IMPORTANT
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE
