PROSPECTUS
$125,000,000
TRICO MARINE SERVICES, INC.
We may use this prospectus to offer the following securities for
sale:
* Common stock;
* Preferred stock;
* Depositary shares;
* Debt securities which will be subordinated to our senior
debt and convertible into our common stock;
* Guarantees by one or more of our subsidiaries of the debt
securities we issue; and
* Warrants to purchase our common stock.
We will provide the specific terms of the securities we are
offering in supplements to this prospectus. A supplement may also
update or change information contained in this prospectus. This
prospectus may not be used to sell securities unless accompanied by a
prospectus supplement. You should read this prospectus and any
related prospectus supplements carefully before you invest in our
securities.
We may sell securities directly to one or more purchasers or to
or through underwriters, dealers or agents. We will identify any
underwriters, dealers or agents involved in the sale of securities in
the accompanying prospectus.
Our common stock is traded on the Nasdaq National Market under
the symbol "TMAR."
YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED UNDER THE
CAPTION "RISK FACTORS" BEGINNING ON PAGE 4 BEFORE INVESTING IN OUR
SECURITIES.
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED
THESE SECURITIES OR DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR
COMPLETE. IT IS ILLEGAL FOR ANYONE TO TELL YOU OTHERWISE.
The date of this prospectus is April 13, 2000.
TABLE OF CONTENTS
PAGE
WHERE YOU CAN FIND MORE INFORMATION.................................. 3
THE COMPANY.......................................................... 3
FORWARD-LOOKING STATEMENTS........................................... 4
RISK FACTORS......................................................... 4
USE OF PROCEEDS...................................................... 6
RATIO OF EARNINGS TO FIXED CHARGES................................... 7
DESCRIPTION OF COMMON STOCK.......................................... 13
DESCRIPTION OF PREFERRED STOCK....................................... 14
DESCRIPTION OF DEPOSITARY SHARES..................................... 17
DESCRIPTION OF DEBT SECURITIES....................................... 17
DESCRIPTION OF WARRANTS.............................................. 25
PLAN OF DISTRIBUTION................................................. 27
LEGAL MATTERS........................................................ 28
EXPERTS.............................................................. 28
___________________________
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND IN ANY ACCOMPANYING PROSPECTUS SUPPLEMENT.
NO ONE HAS BEEN AUTHORIZED TO PROVIDE YOU WITH DIFFERENT INFORMATION.
THE SECURITIES ARE NOT BEING OFFERED IN ANY JURISDICTION WHERE THE
OFFER IS NOT PERMITTED.
YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE
FRONT OF THE DOCUMENTS.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with
the U.S. Securities and Exchange Commission using a shelf registration
process. Under this shelf process, we may sell any combination of the
securities described in this prospectus in one or more offerings up to a
total dollar amount of $125,000,000.
This prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will provide a
prospectus supplement that will contain specific information about the
terms of that offering. The prospectus supplement may also add to or
update other information contained in this prospectus. You should read
both this prospectus and the accompanying prospectus supplement together
with additional information described below under the heading "Where You
Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. Our SEC filings are available to the
public over the Internet at the SEC's web site at http://www.sec.gov. You
may also read and copy any document we file at the public reference rooms
at the SEC's offices at the following locations:
Judiciary Plaza 7 World Trade Center Northwestern Atrium Center
450 Fifth Street, NW New York, NY 10048 500 West Madison Street
Washington, DC 20549 Chicago, IL 60661
Please call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms.
We have filed a registration statement and related exhibits with the
SEC under the Securities Act of 1933. The registration statement contains
additional information about us and our securities. You may read the
registration statement and exhibits without charge at the SEC's public
reference rooms, and you may obtain copies from the SEC at prescribed
rates.
The SEC allows us to "incorporate by reference" the information we
file with it, which means that we can disclose important information to you
by referring to documents on file with the SEC. Some information that we
currently have on file is incorporated by reference and is an important
part of this prospectus. Some information that we file later with the SEC
will automatically update and supersede this information.
We incorporate by reference the following documents that we have filed
with the SEC pursuant to the Securities Exchange Act of 1934:
* Annual Report on Form 10-K for the fiscal year ended December 31,
1999 (filed March 30, 2000); and
* All documents filed by us with the SEC pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
after the date of this prospectus and prior to the termination of
this offering.
At your request, we will provide you with a free copy of any of these
filings (except for exhibits, unless the exhibits are specifically
incorporated by reference into the filing). You may request copies by
writing or telephoning us at:
2401 Fountainview Drive, Suite 920
Houston, Texas 77057
(713) 780-9926
Attention: Investor Relations
THE COMPANY
We are a leading provider of marine support vessels to the oil and gas
industry in the U.S. Gulf of Mexico, the North Sea and Latin America. The
services provided by our diversified fleet include:
* the transportation of drilling materials, supplies and crews to
drilling rigs and other offshore facilities;
* towing drilling rigs and equipment from one location to another;
and
* support for the construction, installation, maintenance and
removal of offshore facilities.
Since our initial public offering in May 1996, we have pursued a
strategy of growth through acquisitions. As a result of these
acquisitions, we are now the second largest owner and operator of supply
boats in the Gulf and a leading operator in the North Sea. In December
1997, we acquired all of the outstanding stock of Saevik Supply ASA, a then
publicly-traded Norwegian company, for approximately $293.7 million,
subsequently renamed Trico Supply ASA. The acquisition of Trico Supply
firmly established our company in the North Sea market area and
significantly expanded our international operations. Since our initial
public offering, we have also acquired 37 supply boats for use in the Gulf
at an aggregate cost of $177.0 million. We currently have a total fleet of
100 vessels, including 54 supply vessels, 11 large capacity platform supply
vessels, seven large anchor handling, towing and supply vessels, 13 crew
boats, six lift boats and nine line-handling vessels.
FORWARD-LOOKING STATEMENTS
Some of the information included in this prospectus and in the
documents we have incorporated by reference contains, and any prospectus
supplement may contain, "forward-looking statements." Forward-looking
statements include, among other things, business strategy and expectations
concerning industry conditions, market position, future operations,
margins, profitability, liquidity and capital resources. Forward-looking
statements generally can be identified by the use of words such as "may,"
"will," "expect," "intend," "estimate," "anticipate" or "believe" or the
negative thereof or similar language.
These forward-looking statements are based on assumptions that we
believe are reasonable, but they are open to a wide range of uncertainties
and business risks, many of which are outside our control, including, but
not limited to, those discussed under the heading "Risk Factors" below. As
a result, our actual results of operations may differ materially from those
expressed or implied by any forward-looking statements. You are cautioned
not to place undue reliance on these forward-looking statements, which
speak only as of the date they are made. We will not update or revise any
forward-looking statements unless the securities laws require us to do so.
RISK FACTORS
AN INVESTMENT IN OUR SECURITIES INVOLVES SIGNIFICANT RISKS. YOU
SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS BEFORE YOU DECIDE TO
BUY ANY OF OUR SECURITIES. YOU SHOULD ALSO CAREFULLY READ AND CONSIDER ALL
OF THE INFORMATION WE HAVE INCLUDED, OR INCORPORATED BY REFERENCE, IN THIS
PROSPECTUS BEFORE YOU DECIDE TO BUY ANY OF OUR SECURITIES.
MARKET VOLATILITY MAY ADVERSELY AFFECT OPERATIONS
Demand for our services depends heavily on activity in offshore oil
and gas exploration, development and production. The level of exploration
and development activity has traditionally been volatile as a result of
fluctuations in oil and natural gas prices and their uncertainty in the
future. For example, as a result of the decline in oil industry activity in
the Gulf due to the depressed oil prices experienced during 1998 and early
1999, day rates and utilization of our Gulf supply boat fleet decreased
dramatically. Although day rates and utilization rates began to recover in
the fourth quarter of 1999 in response to increased industry activity in
the Gulf, we are unable to predict whether the recovery will continue.
The North Sea market is also susceptible to changes in industry
activity due to energy price volatility. Although the use of long-term
contracts in the North Sea generally delays the reaction to fluctuations in
energy prices, in 1999 we experienced decreased day rates and utilization
of our North Sea fleet. As a result of the delay caused by the use of long-
term contracts, we expect that a recovery of day rates and fleet
utilization in the North Sea will lag the recovery of other market areas. A
decline in the worldwide demand for oil and gas or prolonged low oil or
natural gas prices in the future could hinder the recovery and depress
offshore drilling and development activity. A prolonged low level of
activity in the Gulf and other areas where we operate is likely to
adversely affect the demand for our marine support services and our
financial condition and results of operations.
Charter rates for marine support vessels also depend on the supply of
vessels. Excess vessel capacity in the industry can result primarily from
the construction of new vessels and the mobilization of vessels between
market areas. During the last few years there has been a significant
increase in construction of vessels of the type operated by us, for use
both in the Gulf and the North Sea. The addition of new capacity to the
worldwide offshore marine fleet has increased competition in those markets
where we operate. This new capacity, coupled with a prolonged period of low
oil and gas prices in the future, would likely have a material adverse
effect on our financial condition and results of operations.
WE OPERATE IN A HIGHLY COMPETITIVE INDUSTRY
Our business is highly competitive. Certain of our competitors have
significantly greater financial resources than us and more experience
operating in international areas. Competition in the marine support
services industry primarily involves factors such as:
* price, service and reputation of vessel operators and crews; and
* the quality and availability of vessels of the type and size
needed by the customer.
OPERATING HAZARDS MAY INCREASE OPERATING COSTS; LIMITED INSURANCE COVERAGE
Marine support vessels are subject to operating risks such as
catastrophic marine disaster, adverse weather conditions, mechanical
failure, collisions, oil and hazardous substance spills and navigation
errors. The occurrence of any of these events may result in damage to or
loss of our vessels and our vessels' tow or cargo or other property and in
injury to passengers and personnel. Such occurrences may also result in a
significant increase in operating costs or liability to third parties. We
maintain insurance coverage against certain of these risks, which our
management considers to be customary in the industry. We cannot assure
you, however, that we can renew our existing insurance coverage at
commercially reasonable rates or that such coverage will be adequate to
cover future claims that may arise.
COMPLIANCE WITH GOVERNMENTAL REGULATIONS MAY IMPOSE ADDITIONAL EXPENDITURES
Federal, state and local regulations, as well as certain international
conventions, private industry organizations and agencies and laws and
regulations in jurisdictions where our vessels operate and are registered,
materially affect our operations. These regulations govern worker health
and safety and the manning, construction and operation of vessels. These
organizations establish safety criteria and are authorized to investigate
vessel accidents and recommend approved safety standards. If we fail to
comply with the requirements of any of these laws or the rules or
regulations of these agencies and organizations, this could adversely
affect our operations.
Our operations also are subject to federal, state and local laws and
regulations that control the discharge of pollutants into the environment
and that otherwise relate to environmental protection. While our insurance
policies provide coverage for accidental occurrence of seepage and
pollution or clean up and containment of the foregoing, pollution and
similar environmental risks generally are not fully insurable. We may
incur substantial costs in complying with such laws and regulations, and
noncompliance can subject us to substantial liabilities. The laws and
regulations applicable to us and our operations may change. If we violate
any of such laws or regulations, this could result in significant liability
to us. In addition, any amendment to such laws or regulations that
mandates more stringent compliance standards would likely cause an increase
in our vessel operating expenses.
SEASONALITY MAY ADVERSELY AFFECT OPERATIONS
Our marine operations are seasonal and depend, in part, on weather
conditions. In the Gulf, we have historically enjoyed our highest
utilization rates during the second and third quarters, as mild weather
provides favorable conditions for offshore exploration, development and
construction. Adverse weather conditions during the winter months
generally curtail offshore development operations and can particularly
impact lift boat utilization rates. Activity in the North Sea is also
subject to delays during periods of adverse weather, but is not affected by
seasonality to the extent activity in the Gulf is affected. Accordingly,
the results of any one quarter are not necessarily indicative of annual
results or continuing trends.
AGE OF FLEET
The average age of our vessels (based on the date of construction) is
approximately 19 years for our Gulf fleet and approximately 11 years for
our North Sea fleet. Expenditures required for the repair, certification
and maintenance of a vessel typically increase with vessel age. These
expenditures may increase to a level at which they are no longer
economically justifiable. We cannot assure you that we will be able to
maintain our fleet by extending the economic life of existing vessels
through major refurbishment or by acquiring new or used vessels.
CURRENCY FLUCTUATIONS COULD ADVERSELY AFFECT RESULTS OF OPERATIONS
The acquisition of Trico Supply substantially increased the percentage
of our operations conducted in currencies other than the United States
dollar. Changes in the value of foreign currencies relative to the United
States dollar could adversely affect our results of operations and
financial position. In addition, transaction gains and losses could
contribute to fluctuations in our results of operations. Our international
operations are subject to a number of risks inherent to any business
operating in foreign countries. These risks include, among others:
* political instability;
* potential vessel seizure or nationalization of assets;
* currency restrictions and exchange rate fluctuations; and
* import and export quotas and other forms of public and
governmental regulation.
All of these risks are beyond our control. We cannot predict the
nature and the likelihood of any such events. However, if such an event
should occur, it could have a material adverse effect on our financial
condition and results of operations.
WE DEPEND ON KEY PERSONNEL
We depend on the continued services of our executive officers and other key
management personnel. If we were to lose any of these officers or other
management personnel, such a loss could adversely affect our operations.
USE OF PROCEEDS
Unless we state otherwise in a prospectus supplement, we will use the
net proceeds from the sale of the securities for general corporate
purposes, which may include the repayment of debt, acquisitions, capital
expenditures and working capital. We may temporarily invest funds we
receive from the sale of the securities that we do not immediately need for
these purposes.
RATIO OF EARNINGS TO FIXED CHARGES
Our ratio of earnings to fixed charges was as follows for the years
and period indicated:
YEARS ENDED DECEMBER 31,
----------------------------------------------------
1995 1996 1997 1998 1999
---- ---- ---- ---- ----
----(1) 7.7x 7.1x 2.0x ----(2)
-----------------
(1) Earnings were insufficient to cover fixed charges, and fixed
charges exceeded earnings by approximately $2.0 million.
(2) Earnings were insufficient to cover fixed charges, and fixed
charges exceeded earnings by approximately $48.6 million.
Our ratios of earnings to fixed charges were computed based on:
* "earnings," which consist of consolidated income or loss from
continuing operations plus income taxes and fixed charges, except
capitalized interest; and
* "fixed charges," which consist of consolidated interest on
indebtedness, including capitalized interest, amortization of debt
discount and expense, and the estimated portion of rental expense
attributable to interest.
DESCRIPTION OF COMMON STOCK
GENERAL
As of the date of this prospectus, our certificate of incorporation
authorized us to issue up to 40,000,000 shares of common stock, par value
$0.01 per share. As of March 21, 2000, 28,390,416 shares of common stock
and no shares of preferred stock were outstanding. Our common stock is
listed on the Nasdaq National Market under the symbol "TMAR."
VOTING RIGHTS
Each share of common stock is entitled to one vote on all matters
presented for a vote of stockholders. Holders of our common stock do not
have any cumulative voting rights.
DIVIDENDS
Subject to any preferences accorded to the holders of our preferred
stock, if and when issued by the board of directors, holders of our common
stock are entitled to dividends at such times and amounts as the board of
directors may determine.
OTHER RIGHTS
In the event of a voluntary or involuntary liquidation, dissolution or
winding up of our company, prior to any distributions to the holders of our
common stock, our creditors and the holders of our preferred stock, if any,
will receive any payments to which they are entitled. Subsequent to those
payments, the holders of our common stock will share ratably, according to
the number of shares held by them, in our remaining assets, if any.
Shares of our common stock are not redeemable and have no
subscription, conversion or preemptive rights.
PROVISIONS OF OUR CERTIFICATE OF INCORPORATION AND BY-LAWS
Our certificate of incorporation contains provisions that are designed
in part to make it more difficult and time-consuming for a person to obtain
control of our company unless they pay a required value to our
stockholders. Some provisions also are intended to make it more difficult
for a person to obtain control of our board of directors. These provisions
reduce the vulnerability of our company to an unsolicited takeover
proposal. On the other hand, these provisions may have an adverse effect
on the ability of stockholders to influence the governance of our company.
In addition, our certificate of incorporation contains provisions that
enable our board to limit the amount of our common stock that may be owned
by persons who are not U.S. citizens, which may adversely affect the
liquidity of our common stock in certain situations.
We have summarized the provisions described in the preceding paragraph
below, but you should read our certificate of incorporation and bylaws for
a more complete description of the rights of holders of our common stock.
CLASSIFIED BOARD OF DIRECTORS. Our certificate of incorporation
divides the members of our board of directors into three classes serving
three-year staggered terms. The classification of directors has the effect
of making it more difficult for our stockholders to change the composition
of our board. At least two annual meetings of stockholders may be required
for the stockholders to change a majority of the directors, whether or not
a majority of our stockholders believes that this change would be
desirable.
SUPERMAJORITY VOTING/FAIR PRICE REQUIREMENTS. Our certificate of
incorporation provides that a supermajority vote of our stockholders and
the approval of our directors as described below are required for:
* any merger, consolidation or share exchange of our company or of any
of our subsidiaries with any person or entity, or any affiliate of
that person or entity, who beneficially owns 10% or more of our voting
stock, or who is one of our affiliates or associates and beneficially
owned 10% or more of our voting stock within the two years prior to
the transaction (an "interested party");
* any sale, lease, transfer, exchange, mortgage, pledge, loan, advance
or other disposition of our assets or the assets of any of our
subsidiaries having a market value of 5% or more of the total market
value of our outstanding common stock or our company's net worth as of
the end of the most recently ended fiscal quarter, whichever is less,
in one or more transactions with or for the benefit of an interested
party;
* the adoption of any plan or proposal for our liquidation or
dissolution or the liquidation or dissolution of any of our
subsidiaries;
* the issuance or transfer by us or any of our subsidiaries of
securities having a fair market value of $1 million or more to any
interested party, except for the exercise of warrants or rights to
purchase securities offered pro rata to all holders of our voting
stock;
* any recapitalization, reclassification, merger, consolidation or
similar transaction of our company or any of our subsidiaries that
would increase an interested party's voting power in our company or
any of our subsidiaries by 5% or more;
* any loans, advances, guarantees, pledges or other financial assistance
or any tax credits or advantages provided by our company or any of our
subsidiaries to any interested party; or
* any agreement providing for any of the transactions described above.
To effect any of the transactions described above, the following
shareholder and director approvals are required:
* the vote of the holders of 80% of our outstanding voting stock;
* the vote of the holders of 75% of our outstanding voting stock,
excluding stock owned by interested parties;
* a majority of our directors currently in office; and
* a majority of our directors who are not affiliates of the interested
party and who were members of our board prior to the time the
interested party became an interested party or directors appointed by
these board members.
However, the requirements for approval of our directors and a
supermajority vote of our stockholders described above are NOT APPLICABLE
if:
* our board approves the transaction prior to the time the interested
party becomes an interested party and the vote includes the
affirmative vote of a majority of our directors who are not affiliates
of the interested party and who were members of our board prior to the
time the interested party became an interested party; or
* all of the following conditions are met:
* the aggregate amount of consideration received by our stockholders in
the transaction meet the "fair price" criteria described in our
certificate of incorporation; and
* after an interested party becomes an interested party and prior to the
completion of the transaction:
* we have not failed to declare or pay dividends on any
of our outstanding preferred stock;
* the interested party has not received benefits (except
proportionately as a stockholder) of any loans,
advances or other financial assistance or tax advantage
provided by us;
* we have not reduced the annual rate of dividends paid
on our common stock, except as necessary to reflect
adjustments or stock splits, and has not failed to
increase the annual rate of dividends to adjust for any
recapitalization, reclassification, reorganization or
similar transaction; and
* the interested party has not become the beneficial owner
of additional shares of our voting stock except as part
of the transaction that resulted in the interested party
becoming an interested party or as a result of a pro
rata stock dividend.
NO STOCKHOLDER ACTION BY WRITTEN CONSENT. Under Delaware law, unless
a corporation's certificate of incorporation specifies otherwise, any
action that could be taken by its stockholders at an annual or special
meeting may be taken without a meeting and without notice to or a vote of
other stockholders, if a consent in writing is signed by holders of
outstanding stock having voting power that would be sufficient to take such
action at a meeting at which all outstanding shares were present and voted.
Our certificate of incorporation provides that stockholder action may be
taken only at an annual or special meeting of stockholders. As a result,
our stockholders may not act upon any matter except at a duly called
meeting.
ADVANCE NOTICE OF STOCKHOLDER NOMINATIONS AND STOCKHOLDER BUSINESS.
Our bylaws permit stockholders to nominate a person for election as a
director or bring other matters before a stockholders' meeting only if
written notice of an intent to nominate or bring business before a meeting
is given a specified time in advance of the meeting.
SUPERMAJORITY VOTING/AMENDMENTS TO CERTIFICATE OF INCORPORATION. The
affirmative vote of at least 80% of our outstanding voting stock is
required to amend, alter, change or repeal the provisions in our
certificate of incorporation relating to the following:
* the powers and composition of the board of directors, including
the classification of the board, the removal of directors and the
procedure filing board vacancies as described below;
* the supermajority voting and fair price requirements described
above;
* the restrictions on foreign ownership of our voting stock
described below;
* the limitation of liability of, and indemnification for, officers
and directors;
* the supermajority vote required to amend our certificate of
incorporation and bylaws; and
* the amendment of our bylaws. (Our bylaws also may be amended by
the vote of a majority of our directors currently in office and a
majority vote of our directors who were members of our board
prior to the time an interested party became an interested
party.)
However, the 80% stockholder vote described above will not be required
if:
* our directors adopt resolutions amending, altering or repealing
the provisions in our certificate of incorporation described
above, and the vote of directors adopting these resolutions
includes:
* a majority of our board of directors; and
* a majority of our board of directors in office prior to the time
an interested party became an interested party or directors
appointed by these directors; and
* the amendment, alteration or repeal of the provisions described
above is approved by the vote of holders of a majority of our
outstanding voting stock.
DELAWARE SECTION 203. We are a Delaware corporation and are
therefore subject to Section 203 of the Delaware General Corporation Law.
Section 203 imposes a three-year moratorium on the ability of Delaware
corporations to engage in a wide range of specified transactions with any
"interested stockholder." An interested stockholder includes, among other
things, any person other than the corporation and its majority-owned
subsidiaries who owns 15% or more of any class or series of stock entitled
to vote generally in the election of directors. However, the moratorium
will not apply if, among other things, the transaction is approved by:
* the corporation's board of directors prior to the date the
interested stockholder became an interested stockholder; or
* the holders of two-thirds of the outstanding shares of each class
or series of stock entitled to vote generally in the election of
directors, not including those shares owned by the interested
stockholder.
REMOVAL OF DIRECTORS; FILLING VACANCIES ON BOARD OF DIRECTORS; SIZE OF
THE BOARD. Our directors may be removed, with cause, by the vote of 80% of
the holders of all classes of stock entitled to vote at an election of
directors, voting together as a single class. Our directors may not be
removed without cause by stockholders. Vacancies in a directorship may be
filled only by the vote of a majority of the remaining directors and a
majority of all directors who were members of our board at the time an
interested party became an interested party. A newly created directorship
resulting from an increase in the number of directors may only be filled by
the board. Any director elected to fill a vacancy on the board serves for
the remainder of the full term of the class of directors in which the new
directorship was created or in which the vacancy occurred. The number of
directors is fixed from time to time by the board.
SPECIAL MEETINGS OF THE STOCKHOLDERS. Our bylaws provide that special
meetings of stockholders may be called only by either (1) our Chairman, (2)
our President, or (3) by a vote of the majority of our board of directors.
Our stockholders do not have the power to call a special meeting.
LIMITATION OF DIRECTORS' LIABILITY. Our certificate of incorporation
contains provisions eliminating the personal liability of our directors to
our company and our stockholders for monetary damages for breaches of their
fiduciary duties as directors to the fullest extent permitted by Delaware
law. Under Delaware law and our certificate of incorporation, our
directors will not be liable for a breach of his or her duty except for
liability for:
* a breach of his or her duty of loyalty to our company or our
stockholders;
* acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law;
* dividends or stock repurchases or redemptions that are unlawful under
Delaware law; and
* any transaction from which he or she receives an improper personal
benefit.
These provisions pertain only to breaches of duty by directors as
directors and not in any other corporate capacity, such as officers. In
addition, these provisions limit liability only for breaches of fiduciary
duties under Delaware corporate law and not for violations of other laws
such as the federal securities laws.
As a result of these provisions in our certificate of incorporation,
our stockholders may be unable to recover monetary damages against
directors for actions taken by them that constitute negligence or gross
negligence or that are in violation of their fiduciary duties. However,
our stockholders may obtain injunctive or other equitable relief for these
actions. These provisions also reduce the likelihood of derivative
litigation against directors that might have benefited our company.
LIMITATIONS ON OWNERSHIP OF OUR STOCK BY PERSONS WHO ARE NOT U.S.
CITIZENS. Federal maritime laws (including the Merchant Marine Act of
1920, the Merchant Marine Act of 1936, and the Shipping Act of 1916)
provide that vessels may only transport passengers and merchandise between
points in the United States (referred to as Aoperating in the coastwise
trade@) if they are owned by U.S. citizens. For such purposes, a
corporation is considered a U.S. citizen if at least 75% of its outstanding
stock is owned by persons or organizations who are U.S. citizens. We have
significant operations in the coastwise trade, and as a result we are
subject to these requirements. If we were to fail to comply with these
maritime laws, we would not be permitted to continue to operate vessels in
the coastwise trade. Therefore, to facilitate compliance, our certificate
of incorporation contains provisions which are designed to enable us to
regulate the ownership of our capital stock by persons who are not U.S.
citizens, including the following:
* Any transfer of shares of our capital stock that our board of
directors determines would result in non-U.S. citizens controlling
more than 24% of our common stock (the Apermitted percentage@) will be
void and not effective, except for the purpose of enabling us to
effect the other remedies described below.
* If our board of directors determines at any time that there is a risk
that restrictions will be imposed on our ability to operate in the
coastwise trade as a result of non-U.S. citizens beneficially owning
shares of our common stock in excess of the permitted percentage, or
otherwise as a result of the nationality of any beneficial owner of
our common stock, then:
* shares of common stock owned by the person whose ownership has
created the risk shall not be entitled to voting rights until the
board of directors has determined that the risk no longer exists;
* dividends with respect to shares owned by the person whose ownership
has created the risk are to be withheld by us until the board of
directors has determined that the risk no longer exists; and
* we are permitted (but not required) to redeem shares of common stock
owned by the person whose ownership has created the risk.
RIGHTS PLAN
GENERAL. Under our rights plan, each share of common stock has
attached to it one right. The rights are governed by a rights agreement
between us and ChaseMellon Shareholder Services, L.L.C., as rights agent,
dated as of February 19, 1998. The right is represented by a certificate
which is the same certificate representing the common stock. Each right
entitles the registered holder to purchase from us one one-thousandth of a
share of our series AA participating cumulative preference stock. Because
of the nature of the series AA preferred stock's dividend, liquidation and
voting rights, the value of each one one-thousandth interest in a share of
series AA preference stock purchasable upon exercise of each right should
approximate the value of a share of common stock. The series AA preference
stock has a par value of $0.01 per share and is sold at a purchase price of
$105. The purchase price is subject to adjustment. Until the distribution
date, the rights will be transferred with and only with our common stock
certificates. The rights are not exercisable until after the distribution
date and are subject to redemption or exchange as described below. The
rights expire at the close of business on February 19, 2008, unless we
redeem them earlier. Holding unexercised rights gives you no rights as a
stockholder, including, without limitation, the right to vote or to receive
dividends.
DISTRIBUTION DATE; SEPARATION OF RIGHTS FROM COMMON STOCK. The rights
will separate from our common stock and a distribution date will occur upon
the earlier of two possible times. The first such time is 10 business days
following a public announcement that a person or group of affiliated or
associated persons (an "acquiring person") has acquired, or has the right
to acquire, the ownership of 15% or more of the outstanding shares of our
common stock (the "share acquisition date"). The second possible time is
10 business days (or such later date as determined by our board of
directors prior to any person becoming an acquiring person) following the
commencement of a tender or exchange offer which would result in a person
or group owning 15% or more of our outstanding shares of common stock.
TRIGGERING EVENT. In the event that we are acquired in a merger or
other business combination transaction or 50% or more of our consolidated
assets or earning power are sold after a person or group has become an
acquiring person, we will provide that each holder of a right will have the
right to receive, upon exercise of the right at the current exercise price,
a number of shares of common stock of the acquiring company which at the
time of such transaction will have a market value of two times the exercise
price of the right. In the event that any person or group becomes an
acquiring person, we will provide that each holder of a right, other than
rights beneficially owned by the acquiring person (which will be null and
void), will have the right to receive upon exercise of the right at the
current exercise price, a number of shares of our common stock having a
market value of two times the exercise price of the right.
REDEMPTION OR EXCHANGE OF RIGHTS. At any time prior to the share
acquisition date, we may redeem the rights in whole, but not in part, at a
price of $0.01 per right. The redemption of the rights may be made
effective at such time, on such basis and with such conditions as our board
of directors may establish in its sole discretion.
At any time after the share acquisition date but prior to the
acquisition by an acquiring person of 50% or more of our outstanding common
stock, our board may exchange the rights (other than the rights held by the
acquiring person, which will become null and void), in whole or in part,
for common stock or series AA preference stock at a ratio of one share of
common stock per right or one one-thousandth of a share of series AA
preference stock per right.
ANTI-TAKEOVER EFFECTS. The rights may cause substantial dilution of
shareholder voting strength to a person or group that acquires 15% or more
of our common stock or otherwise attempts to acquire us in a manner that
constitutes a triggering event. The rights should not affect any
prospective offeror who is willing:
* to make an offer for all of our outstanding shares of common
stock and other voting securities at a price and terms that are
in the best interests of us and our stockholders as determined
by our board of directors; or
* to negotiate with the board of directors because as part of any
negotiated transaction the rights would either be redeemed or
otherwise made inapplicable to the transaction.
The rights should also not interfere with any merger or other business
combination approved by the board of directors since the board may, at its
option, choose to redeem the outstanding rights at the $.01 redemption
price. The board may exercise this option at any time prior to the share
acquisition date.
STOCKHOLDERS' AGREEMENT
In April 1999, in connection with the private sale of shares of our
common stock to affiliates of Inverness Management LLC, a privately held
investment firm, we entered into a stockholders' agreement granting certain
rights to such investors. The stockholders' agreement will terminate on
May 6, 2009.
REGISTRATION RIGHTS. Under the stockholders' agreement, the Inverness
affiliates are entitled to require us to file a registration statement
under the Securities Act to sell not less than 20% of the common stock they
own. We are only required to make one such stand-alone registration during
any 12-month period, and no more than three such registrations during the
term of the agreement. The Inverness affiliates also may require us to file
a shelf registration statement covering shares of our common stock held by
them having a value of at least $3 million. We are only required to make
one registration pursuant to a shelf registration statement during any 12-
month period, but there is otherwise no limit on the number of shelf
registration requests that the Inverness affiliates can make.
Under the stockholders' agreement, the Inverness affiliates also have
the right to include their shares of our common stock in any other
registration statement we file involving our common stock. We have
obtained written waivers from the Inverness affiliates of their right to
include their shares of our common stock in the registration statement of
which this prospectus forms a part.
If the Inverness affiliates sell or otherwise dispose of more than 90%
of the securities they purchased from us, they no longer have the right to
require us to register any of the shares of our common stock they hold.
BOARD REPRESENTATION. Under the stockholders' agreement, the
Inverness affiliates have the right to designate two persons for nomination
for election to our board of directors so long as they own an aggregate of
4,000,000 shares of our common stock and one person if they own less than
4,000,000 but more than 500,000 shares of our common stock. If the
Inverness affiliates own less than 500,000 shares, they will not have the
right to designate any persons for nomination for election to our board.
RESTRICTIONS ON ACTIVITIES OF INVERNESS AFFILIATES. Under the
stockholders' agreement, the Inverness affiliates agreed not to acquire any
shares of our stock in addition to those they acquired in the 1999 private
offering without the prior consent of our board of directors. Such
investors also agreed to certain restrictions on the sale of their shares
of common stock, including limitations on sales to other companies engaged
in the oilfield services industry. The Inverness affiliates also agreed
not to solicit proxies or take certain other actions relating to
transactions involving us that would result in a change of control.
DESCRIPTION OF PREFERRED STOCK
Each series of preferred stock will have specific terms that we will
describe in a prospectus supplement. The description may not contain all
information that is important to you. The complete terms of the preferred
stock will be contained in our certificate of incorporation and the
certificate of designations relating to the applicable series of preferred
stock. These documents have been or will be included or incorporated by
reference as exhibits to the registration statement of which this
prospectus is a part. You should read our certificate of incorporation and
the applicable certificate of designations.
Our certificate of incorporation authorizes us to issue, without
stockholder approval, up to 5,000,000 shares of preferred stock, par value
$0.01 per share. As of the date of this prospectus, we have not issued any
preferred stock. Our board of directors may from time to time authorize us
to issue one or more series of preferred stock and may fix the
designations, terms, and relative rights and preferences, including the
dividend rate, voting rights, conversion rights, redemption and sinking
fund provisions and liquidation values of each of these series.
Thus, our board of directors could authorize us to issue preferred
stock with voting, conversion and other rights that could adversely affect
the voting power and other rights of holders of our common stock or other
series of preferred stock. Also, the issuance of preferred stock could
have the effect of delaying, deferring or preventing a change in control of
our company.
The particular terms of any series of preferred stock that we offer
with this prospectus will be described in the prospectus supplement
relating to that series of preferred stock. Those terms may include:
* the specific designation, number of shares, rank and purchase
price;
* any liquidation preference per share;
* any redemption, payment or sinking fund provisions;
* any dividend rates (or method of calculation) and the dates on
which any dividends will be payable;
* any voting rights;
* whether the preferred stock is convertible or exchangeable and,
if so,
* the securities into which the preferred stock is convertible
or exchangeable,
* the terms and conditions upon which conversions or exchanges
will be effected, including the initial conversion or
exchange prices or rates,
* the conversion or exchange period, and
* any other related provision;
* the place or places where dividends and other payments on the
preferred stock will be payable; and
* any additional voting, dividend, liquidation, redemption, sinking
fund or other rights, preferences, privileges, limitations and
restrictions.
As described under "Description of Depositary Shares" below, we may,
at our option, elect to offer depositary shares evidenced by depositary
receipts. Each depositary receipt will represent an interest in a share of
a particular series of preferred stock that we will issue and deposit with
a depositary. The interest represented by the depositary receipt will be
described in the applicable prospectus supplement.
DESCRIPTION OF DEPOSITARY SHARES
We summarize below some of the provisions that will apply to the
depositary shares unless the applicable prospectus supplement provides
otherwise. The summary may not contain all information that is important
to you. The complete terms of the depositary shares will be contained in
the depositary receipts and the deposit agreement relating to the
applicable series of preferred stock. These documents have been or will be
included or incorporated by reference as exhibits to the registration
statement of which this prospectus is a part. You should read the
depositary receipts and the depositary agreement. You should also read the
prospectus supplement, which will contain additional information and which
may update or change some of the information below.
GENERAL
We may, at our option, elect to have shares of preferred stock
represented by depositary shares. The shares of any series of preferred
stock underlying the depositary shares will be deposited under a separate
deposit agreement that we will enter into with a bank or trust company of
our choosing. The prospectus supplement relating to a series of depositary
shares will give the name and address of the depositary. Subject to the
terms of the deposit agreement, each owner of a depositary share will be
entitled to all the rights and preferences of the preferred stock
underlying the depositary share in proportion to the applicable interest in
the preferred stock underlying the depositary share.
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Each depositary share will represent the
applicable interest in a number of shares of a particular series of the
preferred stock described in the applicable prospectus supplement.
Unless otherwise provided in the applicable prospectus supplement,
upon surrender of depositary shares at the office of the depositary and
upon payment of the charges provided in the deposit agreement, a holder of
depositary shares will be entitled to the number of whole shares of
preferred stock evidenced by the surrendered depositary shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute all cash dividends or other cash
distributions received in respect of the preferred stock to the record
holders of depositary shares representing the preferred stock in proportion
to the number of the depositary shares owned by the holders on the relevant
record date.
In the event of a distribution other than in cash, the depositary will
distribute the property received by it to the record holders of depositary
shares entitled to the property. Alternatively, the depositary may, with
our approval, sell the property and distribute the net proceeds from the
sale to the record holders of depositary shares.
The deposit agreement will also contain provisions relating to the
manner in which any subscription or similar rights we offer to holders of
preferred stock will be made available to holders of depositary shares.
CONVERSION AND EXCHANGE
If any preferred stock underlying depositary shares is convertible or
exchangeable, each record holder of depositary shares will have the right
or obligation to convert or exchange the depositary shares in the manner
provided in the deposit agreement and described in the applicable
prospectus supplement.
REDEMPTION
If the preferred stock underlying depositary shares is subject to
redemption, the depositary shares will be redeemed from the redemption
proceeds received by the depositary. The redemption price per depositary
share will be equal to the aggregate redemption price payable with respect
to the number of shares of preferred stock underlying the depositary
shares. Whenever we redeem preferred stock from the depositary, the
depositary will redeem as of the same redemption date a proportionate
number of depositary shares representing the shares of preferred stock that
we redeemed. If less than all the depositary shares are to be redeemed,
the depositary shares to be redeemed will be selected by lot or pro rata as
we may determine.
After the date fixed for redemption, the depositary shares called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of the depositary shares will cease, except the right to receive
the redemption price. Any funds we deposit with the depositary for any
depositary shares which the holders fail to redeem will be returned to us
after two years from the date the funds are deposited.
VOTING
Upon receipt of notice of any meeting or action in lieu of any meeting
at which the holders of any shares of preferred stock underlying the
depositary shares are entitled to vote, the depositary will mail the
information contained in the notice to the record holders of the depositary
shares relating to the preferred stock. Each record holder of the
depositary shares on the record date, which will be the same date as the
record date for the preferred stock, will be entitled to instruct the
depositary as to the exercise of the voting rights pertaining to the number
of shares of preferred stock underlying the holder's depositary shares.
The depositary will endeavor, insofar as practicable, to vote the number of
shares of preferred stock underlying the depositary shares in accordance
with these instructions, and we will agree to take all action that the
depositary deems necessary to enable the depositary to do so.
AMENDMENT
The depositary receipt evidencing the depositary shares and any
provision of the deposit agreement may at any time be amended by agreement
between us and the depositary. However, any amendment that materially and
adversely alters the rights of the existing holders of depositary shares
will not be effective unless the amendment has been approved by the record
holders of at least a majority of the depositary shares then outstanding.
CHARGES OF DEPOSITARY
We will pay all transfer and other taxes and governmental charges that
arise solely from the existence of the depositary arrangements. We will
pay charges of the depositary in connection with the initial deposit of the
preferred stock and any exchange or redemption of the preferred stock.
Holders of depositary shares will pay all other transfer and other taxes
and governmental charges, and, in addition, any other charges that are
expressly provided in the deposit agreement to be for their accounts.
RESIGNATION AND REMOVAL OF DEPOSITARY
The depositary may resign at any time by delivering to us notice of
its election to do so, and we may at any time remove the depositary. Any
resignation or removal will take effect upon the appointment of a successor
depositary and its acceptance of the appointment. We will appoint the
successor depositary within 60 days after delivery of the notice of
resignation or removal.
TERMINATION OF DEPOSIT AGREEMENT
The depositary may terminate, or we may direct the depositary to
terminate, the deposit agreement if 45 days has expired after the
depositary has delivered to us written notice of its election to resign and
we have not appointed a successor depositary. Upon termination of the
deposit agreement, the depositary will discontinue the transfer of
depositary receipts, will suspend the distribution of dividends, and will
not give any further notices (other than notice of the termination) or
perform any further acts under the deposit agreement. However, the
depositary will continue to deliver preferred stock certificates, together
with dividends and distributions and the net proceeds of any sales of
property, in exchange for depositary receipts surrendered. Upon our
request, the depositary will deliver to us all books, records, certificates
evidencing preferred stock, depositary receipts and other documents
relating to the deposit agreement.
MISCELLANEOUS
We, or at our option the depositary, will forward to the holders of
depositary shares all reports and communications that we are required to
furnish to the holders of preferred stock.
Neither we nor the depositary will be liable if the depositary is
prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the deposit agreement. Our obligations
and those of the depositary under the deposit agreement will be limited to
performance in good faith of our respective duties under the deposit
agreement. Neither we nor the depositary will be obligated to prosecute or
defend any legal proceeding regarding any depositary share or preferred
stock unless satisfactory indemnity has been furnished. We and the
depositary may rely upon written advice of counsel or accountants. We and
the depositary may also rely upon information provided to us by persons
presenting preferred stock for deposit, holders of depositary shares or
other persons we or the depositary believe to be competent. We and the
depositary may also rely upon documents we believe to be genuine.
DESCRIPTION OF DEBT SECURITIES
GENERAL
We may issue debt securities from time to time in one or more series.
The debt securities will be our unsecured obligations and will be
subordinated in right of payment to our senior indebtedness. The debt
securities will be convertible into our common stock. The debt securities
will be issued under an indenture between us and a trustee qualified under
the Trust Indenture Act, which will be supplemented (referred to as a
"supplemental indenture") with respect to each series of debt securities we
issue. We will set forth the name of the trustee in the applicable
prospectus supplement.
We have summarized below some of the provisions that will apply to the debt
securities unless the applicable prospectus supplement provides otherwise.
The summary may not contain all information that is important to you. The
indenture and each supplemental indenture have been or will be included or
incorporated by reference as exhibits to the registration statement of
which this prospectus is a part. You should read the indenture and any
supplemental indenture. You should also read the prospectus supplement,
which will contain additional information and which may update or change
some of the information below.
We will describe the specific terms of the series of debt securities
being offered in the related prospectus supplement. These terms will
include some or all of the following:
* the designation or title of the debt securities;
* any limit on the aggregate principal amount of the debt securities;
* the terms relating to the subordination of the debt securities;
* whether any of the debt securities are to be issuable as a global
security and whether global securities are to be issued in temporary
global form or permanent global form;
* the person to whom any interest on the debt security will be payable
if other than the person in whose name the debt security is registered
on the record date;
* the date or dates on which the debt securities will mature;
* the rate or rates of interest, if any, that the debt securities will
bear, or the method of calculation of the interest rate or rates;
* the date or dates from which any interest on the debt securities will
accrue, the dates on which any interest will be payable and the record
date for any interest payable on any interest payment date;
* the place or places where the principal of, and interest, premium and
additional amounts (if any) on, the debt securities will be payable;
* whether we will have the right or obligation to redeem or repurchase
any of the debt securities, and the terms applicable to any optional
or mandatory redemption or repurchase;
* the denominations in which the debt securities will be issuable;
* any index or formula used to determine the amount of payments of
principal of, and any premium, additional amounts (if any) and
interest on, the debt securities;
* if other than the principal amount, the portion of the principal
amount of the debt securities that will be payable if there is an
acceleration of the maturity of the debt securities;
* the terms relating to the conversion of the debt securities, including
the conversion price, the period during which the debt securities may
be converted and other terms of conversion;
* any sinking fund provisions applicable to the debt securities;
* the terms of any guarantee of the payment of principal of,
and premium, if any, and interest on, debt securities of the series;
* any restrictive covenants for the benefit of the holders of the debt
securities;
* the events of default with respect to the debt securities; and
* any other terms of the debt securities.
We may issue the debt securities as original issue discount
securities, which will be offered and sold at a substantial discount below
their stated principal amount. A prospectus supplement relating to
original issue discount securities will describe federal income tax
consequences and other special considerations applicable to them.
SUBORDINATION OF DEBT SECURITIES
The indebtedness evidenced by the debt securities will be subordinated
and junior in right of payment to the prior payment in full of amounts then
due on all of our senior indebtedness.
Our "senior indebtedness" includes the principal of, and any premium
and accrued and unpaid interest on, the following items, whether
outstanding on or created, incurred or assumed after the date of execution
of the indenture:
* our indebtedness for money borrowed (other than the debt
securities);
* our guarantees of indebtedness for money borrowed of any other
person; and
* indebtedness evidenced by notes, debentures, bonds or other
instruments of indebtedness for the payment of which we are
responsible or liable, by guarantees or otherwise.
Senior indebtedness also includes modifications, renewals, extensions
and refundings of any of the types of indebtedness, liabilities,
obligations or guarantees listed above, unless the relevant instrument
states that the indebtedness, liability, obligation or guarantee, or
modification, renewal, extension or refunding, is not senior in right of
payment to the subordinated securities.
We may not make any payment of principal of, or interest or any
premium on, the subordinated securities except for sinking fund payments as
described below if:
* any default or event of default with respect to any senior
indebtedness occurs and is continuing, or
* any judicial proceeding is pending with respect to any default in
payment of senior indebtedness.
We may make sinking fund payments during a suspension of principal or
interest payments on subordinated debt if we make these sinking fund
payments by redeeming or acquiring securities prior to the default or by
converting the securities.
If any debt security is declared due and payable before its specified
date, or if we pay or distribute any assets to creditors upon our
dissolution, winding up, liquidation or reorganization, we must pay all
principal of, and any premium and interest due or to become due on, all
senior indebtedness in full before the holders of debt securities are
entitled to receive or take any payment. Subject to the payment in full of
all senior indebtedness, the holders of the debt securities are to be
subrogated to the rights of the holders of senior indebtedness to receive
payments or distribution of our assets applicable to senior indebtedness
until the debt securities are paid in full.
By reason of this subordination, in the event of insolvency, our
creditors who are holders of senior indebtedness, as well as some of our
general creditors, may recover more, ratably, than the holders of the
debt securities.
The indenture will not limit the amount of senior indebtedness or debt
securities which we may issue.
With respect to any offering of debt securities, we will describe in
the accompanying prospectus supplement or the information incorporated by
reference the approximate amount of senior indebtedness outstanding as of
the end of our most recent fiscal quarter.
CONVERSION OF DEBT SECURITIES
The debt securities will be convertible into our common stock. This
means that if you hold debt securities, you will be permitted at certain
times specified in the related prospectus supplement to convert your debt
securities into common stock for a specified price. We will describe the
conversion price (or the method for determining the conversion price) and
the other terms applicable to conversion in the related prospectus
supplement.
GUARANTEES
One or more of our subsidiaries, as guarantors, may guarantee our
obligations under the debt securities. Any such guarantee will fully and
unconditionally guarantee our obligations under the debt securities on an
equal and ratable basis subject to the limitation described in the next
paragraph. In addition, any supplemental indenture may require us to cause
any domestic entity that becomes one of our subsidiaries after the date of
any supplemental indenture to enter into a supplemental indenture pursuant
to which such subsidiary shall agree to guarantee our obligations under the
debt securities. If we default in payment of the principal of, or premium,
if any, or interest on, the debt securities, the guarantors, jointly and
severally, will be unconditionally obligated to duly and punctually make
such payments.
Each guarantor's obligations will be limited to the maximum amount
that (after giving effect to all other contingent and fixed liabilities of
such guarantor any collections from, or payments made by or on behalf of,
any other guarantors) will result in the obligations of such guarantor
under the guarantee not constituting a fraudulent conveyance or fraudulent
transfer under Federal or state law. Each guarantor that makes a payment
or distribution under its guarantee shall be entitled to contribution from
each other guarantor in a pro rata amount based on the net assets of each
guarantor.
The prospectus supplement for a particular issue of debt securities
will describe any subsidiary guarantors and any material terms of the
guarantees for such series.
FORM, EXCHANGE, REGISTRATION AND TRANSFER OF DEBT SECURITIES
The debt securities will be issued:
* only in fully registered form;
* without interest coupons; and
* in denominations that are even multiples of $1,000 unless otherwise
specified in a prospectus supplement.
You may have your debt securities broken into more debt securities of
smaller denominations or combined into fewer debt securities of larger
denominations, as long as the total principal amount is not changed. This
is called an "exchange."
You may exchange or transfer debt securities at the office of the
trustee. The trustee acts as our agent for registering debt securities in
the names of holders and transferring debt securities. We may change this
appointment to another entity or perform it ourselves. The entity
performing the role of maintaining the list of registered holders is called
the "security registrar." The security registrar will also perform
transfers.
You will not be required to pay a service charge to transfer or
exchange debt securities, but you may be required to pay for any tax or
other governmental charge associated with the exchange or transfer. The
transfer or exchange will only be made if the security registrar is
satisfied with your proof of ownership.
If we have designated additional transfer agents, they are named in
the prospectus supplement. We may cancel the designation of any particular
transfer agent. We may also approve a change in the office through which
any transfer agent acts.
If the debt securities are redeemable and we redeem less than all of
the debt securities of a particular series, we may block the transfer or
exchange of debt securities during the period beginning 15 days before the
day we mail the notice of redemption and ending on the day of that mailing,
in order to freeze the list of holders to prepare the mailing. We may also
refuse to register transfers or exchanges of debt securities selected for
redemption, except that we will continue to permit transfers and exchanges
of the unredeemed portion of any security being partially redeemed.
PAYMENT AND PAYING AGENTS
We will pay interest to you if you are a direct holder listed in the
trustee's records at the close of business on a particular day in advance
of each due date for interest, even if you no longer own the security on
the interest due date. That particular day, usually about two weeks in
advance of the interest due date, is called the "regular record date" and
is stated in the prospectus supplement. Holders buying and selling debt
securities must work out between them how to compensate for the fact that
we will pay all the interest for an interest period to the one who is the
registered holder on the regular record date. The most common manner is to
adjust the sale price of the debt securities to allocate interest fairly
between buyer and seller. This allocated interest amount is called
"accrued interest."
We will pay interest, principal and any other money due on the debt
securities at the corporate trust office of the trustee. You must make
arrangements to have your payments picked up at or wired from that office.
We may also choose to pay interest by mailing checks.
GLOBAL SECURITIES
We may issue the debt securities in whole or in part in the form of
one or more global securities. A global security is a security, typically
held by a depositary such as the Depository Trust Company, that represents
the beneficial interests of a number of purchasers of such security. We
may issue the global securities in either temporary or permanent form. We
will deposit global securities with the depositary identified in the
prospectus supplement. Unless it is exchanged in whole or in part for debt
securities in definitive form, a global certificate may generally be
transferred only as a whole unless it is being transferred to certain
nominees of the depositary.
We will describe the specific terms of the depositary arrangement with
respect to a series of debt securities in a prospectus supplement. We
expect that the following provisions will generally apply to depositary
arrangements.
After we issue a global security, the depositary will credit on its
book-entry registration and transfer system the respective principal
amounts of the debt securities represented by such global security to the
accounts of persons that have accounts with such depositary
("participants"). The underwriters or agents participating in the
distribution of the debt securities will designate the accounts to be
credited. If we offer and sell the debt securities directly or through
agents, either we or our agents will designate the accounts. Ownership of
beneficial interests in a global security will be limited to participants
or persons that may hold interests through participants. Ownership of
beneficial interests in the global security will be shown on, and the
transfer of that ownership will be effected only through, records
maintained by the depositary and its participants.
We and the trustee will treat the depositary or its nominee as the
sole owner or holder of the debt securities represented by a global
security. Except as set forth below or in the applicable prospectus
supplement, owners of beneficial interests in a global security will not be
entitled to have the debt securities represented by such global security
registered in their names, will not receive or be entitled to receive
physical delivery of such debt securities in definitive form and will not
be considered the owners or holders of the debt securities. The laws of
some states require that certain purchasers of securities take physical
delivery of the securities. Such laws may impair the ability to transfer
beneficial interests in a global security.
Principal, any premium and any interest payments on debt securities
represented by a global security registered in the name of a depositary or
its nominee will be made to such depositary or its nominee as the
registered owner of such global security.
We expect that the depositary or its nominee, upon receipt of any payments,
will immediately credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal
amount of the global security as shown on the depositary's or its nominee's
records. We also expect that payments by participants to owners of
beneficial interest in the global security will be governed by standing
instructions and customary practices, as is the case with the securities
held for the accounts of customers registered in "street names" and will be
the responsibility of such participants.
If the depositary is at any time unwilling or unable to continue as
depositary and we do not appoint a successor depositary within ninety days,
we will issue individual debt securities in exchange for such global
security. In addition, we may at any time in our sole discretion determine
not to have any of the debt securities of a series represented by global
securities and, in such event, will issue debt securities of such series in
exchange for such global security.
Neither we, the trustee nor any paying agent will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in such global
security or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests. No such person will be liable for
any delay by the depositary or any of its participants in identifying the
owners of beneficial interests in a global security, and we, the trustee
and any paying agent may conclusively rely on instructions from the
depositary or its nominee for all purposes.
COVENANTS
With respect to each series of debt securities, we will be required
to:
* pay the principal of, and interest and any premium on, the
debt securities when due;
* maintain a place of payment;
* deliver a report to the trustee at the end of each fiscal
year reviewing our obligations under the indenture; and
* deposit sufficient funds with any paying agent on or before
the due date for any principal, interest or any premium.
The supplemental indenture for any particular series of debt
securities may contain covenants limiting our ability, or the ability of
our subsidiaries, to:
* incur additional debt (including guarantees);
* make certain payments;
* engage in other business activities;
* issue other securities;
* dispose of assets;
* enter into certain transactions with our subsidiaries and
other affiliates;
* undergo a change of control;
* incur liens; and
* enter into certain mergers and consolidations involving us
and our subsidiaries.
Any additional covenants will be described in the applicable
prospectus supplement.
Unless we state otherwise in the applicable prospectus supplement, we
will agree not to consolidate with or merge into any individual,
corporation, partnership or other entity (each, a "person") or sell, lease,
convey, transfer or otherwise dispose of all or substantially all of our
assets to any person, or permit any person to consolidate or merge into us
or sell, lease, convey, transfer or otherwise dispose of all or
substantially all of its assets to us unless:
* the person formed by or surviving the consolidation or merger (if not
us), or to which the sale, lease, conveyance, transfer or other
disposition is to be made is a corporation, limited liability company
or partnership organized and existing under the laws of the United
States or any state or the District of Columbia, and the person
assumes by supplemental indenture in a form satisfactory to the
trustee all of our obligations under the indenture;
* immediately after giving effect to the transaction and treating any
debt that becomes an obligation of ours or of any of our subsidiaries
as a result as having been incurred by us or our subsidiary at the
time of the transaction, no default or event of default shall have
occurred and be continuing; and
* we have delivered to the trustee an officer's certificate and opinion
of counsel, each stating that the merger, consolidation, sale or
conveyance and the supplemental indenture, if any, comply with the
indenture.
EVENTS OF DEFAULT WITH RESPECT TO THE DEBT SECURITIES
Unless we state otherwise in the applicable prospectus supplement, an
"event of default" with respect to the debt securities of any series means:
* our default for 30 days in payment of any interest on the debt
securities of the series;
* our default in payment of any principal or premium on the debt
securities of the series upon maturity or otherwise;
* our default, for 60 days after delivery of written notice, in the
observance or performance of any other agreement with respect to the
debt securities of the series;
* bankruptcy, insolvency or reorganization events relating to us or our
subsidiaries;
* the entry of a judgment in excess of the amount specified in the
indenture or any supplemental indenture against us or such
significant subsidiary which is not covered by insurance and not
discharged, waived or stayed; or
* any other event of default included in the indenture or any
supplemental indenture and described in the prospectus
supplement.
The consequences of an event of default, and the remedies available
under the indenture or any supplemental indenture, will vary depending upon
the type of event of default that has occurred.
Unless we state otherwise in the applicable prospectus supplement, the
indenture will provide that if an event of default has occurred and is
continuing and is due to
* our failure to pay principal, premium or additional amounts, if any,
or interest on, any series of debt securities under the indenture,
* our default in the performance of any agreements applicable to any
outstanding debt securities issued under the indenture or
* our failure to pay at maturity, or other default which results in the
acceleration of, any debt in an amount in excess of the dollar amount
listed in the indenture,
then either the trustee or the holders of the principal amount specified in
the indenture or any supplemental indenture of the outstanding debt
securities of each affected series (with each series treated as a separate
class) may declare the principal (or the portion of the principal that is
specified in the terms of the affected debt securities) of all the affected
debt securities and interest accrued to be due and payable immediately.
Unless we state otherwise in the applicable prospectus supplement, if
an event of default with respect to any series of debt securities has
occurred and is continuing and is due to a bankruptcy, insolvency or
reorganization event relating to us, then the principal (or such portion of
the principal as is specified in the terms of the debt securities) of and
interest accrued on all debt securities then outstanding will become due
and payable automatically, without further action by the trustee or the
holders.
Under conditions specified in the indenture and any supplemental
indenture, the holders of a majority of the principal amount of the debt
securities of each affected series (with each series treated as a separate
class) may annul or waive the declarations and past defaults described
above. These holders may not, however, waive a continuing default in
payment of principal of (or premium, if any) or interest on, or in respect
of the conversion of, debt securities.
The indenture will provide that the trustee, subject to the duty of
the trustee during a default to act with the required standard of care, has
no obligation to exercise any right or power granted to it under the
indenture at the request of holders of debt securities unless the holders
have indemnified the trustee. Subject to the provisions in the indenture
and any supplemental indenture for the indemnification of the trustee and
other limitations specified therein, the holders of a majority in principal
amount of the outstanding debt securities of each affected series (with
each series treated as a separate class) may direct the time, method and
place of conducting any proceeding for any remedy available to the trustee,
or exercising any trust or power conferred on the trustee with respect to
the series.
If you hold debt securities of any series, you will not be permitted
under the terms of the indenture or any supplemental indenture to institute
any action against us in connection with any default (except actions for
payment of overdue principal, premium, or interest or other amounts or to
enforce conversion rights) unless
* you have given the trustee written notice of the default and its
continuance;
* holders of not less than 25% in principal amount of the debt
securities of each affected series issued under the indenture (with
each series treated as a separate class) have made a written request
upon the trustee to institute the action and have offered the trustee
reasonable indemnity;
* the trustee has not instituted the action within 60 days of the
request; and
* the trustee has not received directions inconsistent with the written
request by the holders of a majority in principal amount of the
outstanding debt securities of all affected series issued under the
indenture (with each series treated as a separate class).
DEFEASANCE PROVISIONS APPLICABLE TO THE DEBT SECURITIES
Unless otherwise specified in a prospectus supplement, under the
indenture and any supplemental indenture, we, at our option
* will be discharged from obligations in respect of the debt
securities of a series (except for certain obligations to
register the transfer or exchange of debt securities, replace
stolen, lost or mutilated debt securities, maintain paying
agencies and hold moneys for payment in trust) or
* need not comply with certain restrictive covenants of the
indenture or supplemental indenture,
in each case if we deposit, in trust with the trustee, money or U.S.
government obligations which through the payment of interest and principal
will provide money sufficient to pay all the principal (including any
mandatory sinking fund payments) of, and interest and premium, if any, on
the debt securities of that series on the dates on which such payments are
due.
To exercise the above option, we must deliver to the trustee an
opinion of counsel that:
* the deposit and related defeasance would not cause the holders of
the debt securities of that series to recognize income, gain or
loss for federal income tax purposes and, in the case of a
discharge pursuant to the first bullet point above, the opinion
will be accompanied by a private letter ruling to that effect
from the IRS or a revenue ruling concerning a comparable form of
transaction to that effect published by the IRS, and
* if listed on any national securities exchange, the debt
securities would not be delisted from that exchange as a result
of the exercise of the option.
MODIFICATION AND WAIVER
We and the trustee may modify the terms of the indenture or any
supplemental indenture or waive certain provisions thereof with the consent
of the holders of not less than a majority in aggregate principal amount of
the debt securities of each series affected by the modification or waiver.
However, provisions of the indenture or any supplemental indenture may not
be waived or modified without the consent of the holder of each debt
security affected thereby if the modification or waiver would:
* change the stated maturity of the principal of, or premium, if
any, on, or any installment of principal, if any, of or interest
on, or any additional amounts payable with respect to, any debt
security;
* reduce the principal amount of, or premium or interest on, or any
additional amounts payable with respect to, any debt security;
* impair the right to institute suit for the enforcement of any
payment on or after the stated maturity of any debt securities
or, in the case of redemption, exchange or conversion, on or
after the redemption, exchange or conversion date or, in the case
of repayment at the option of any holder, on or after the date
for repayment, or in the case of a change in control, after the
change in control purchase date;
* reduce the percentage and principal amount of the outstanding
debt securities, the consent of whose holders is required in
order to take certain actions;
* change any of our obligation to maintain an office or agency in
the places and for the purposes required by the indenture;
* modify or affect in any manner adverse to the holders of the debt
securities the terms and conditions of our obligations regarding
the due and punctual payment of principal or, any premium on or
all interest on the debt securities; or
* modify any of the above provisions.
The holders of at least a majority in aggregate principal amount of
debt securities of any series may, on behalf of the holders of all debt
securities of that series, waive our compliance with certain restrictive
provisions of the indenture or supplemental indenture. The holders of not
less than a majority in aggregate principal amount of debt securities of
any series may, on behalf of all holders of debt securities of that series,
waive any past default and its consequences under the indenture with
respect to the debt securities of that series, except:
* a payment default with respect to debt securities of that series;
or
* a default of a covenant or provision of the indenture or
supplemental indenture that cannot be modified or amended without
the consent of the holder of each debt security of any series.
THE TRUSTEE
We will include information regarding the trustee in the prospectus
supplement relating to any series of debt securities. If any event of
default shall occur (and be continuing) under the indenture or any
supplemental indenture, the trustee will be required to use the degree of
care and skill of a prudent man in the conduct of his own affairs. The
trustee will be under no obligation to exercise any of its powers at the
request of any of the holders of the debt securities, unless the holders
shall have offered the trustee reasonable indemnity against the costs,
expenses and liabilities it might incur. The indenture, any supplemental
indenture, and the provisions of the Trust Indenture Act incorporated by
reference thereby contain limitations on the rights of the trustee, should
it become a creditor of ours, to obtain payment of claims or to realize on
property received by it in respect of any claims as security or otherwise.
DESCRIPTION OF WARRANTS
We summarize below some of the provisions that will apply to the
warrants unless the applicable prospectus supplement provides otherwise.
The summary may not contain all information that is important to you. The
complete terms of the warrants will be contained in the applicable warrant
certificate and warrant agreement. These documents have been or will be
included or incorporated by reference as exhibits to the registration
statement of which this prospectus is a part. You should read the warrant
certificate and the warrant agreement. You should also read the prospectus
supplement, which will contain additional information and which may update
or change some of the information below.
GENERAL
We may issue warrants to purchase common stock independently or
together with other securities. The warrants may be attached to or
separate from the other securities. We may issue warrants in one or more
series, each series of warrants will be issued under a separate warrant
agreement to be entered into between us and a warrant agent. The warrant
agent will be our agent and will not assume any obligations to any owner of
the warrants.
The prospectus supplement and the warrant agreement relating to any series
of warrants will include specific terms of the warrants. These terms
include the following:
* the title and aggregate number of warrants;
* the price or prices at which the warrants will be issued;
* the amount of common stock for which the warrant can be exercised and
the price or the manner of determining the price or other
consideration to purchase the common stock;
* the date on which the right to exercise the warrant begins and the
date on which the right expires;
* if applicable, the minimum or maximum amount of warrants that may be
exercised at any one time;
* if applicable, the designation and terms of the securities with which
the warrants are issued and the number of warrants issued with each
other security;
* any provision dealing with the date on which the warrants and related
securities will be separately transferable;
* any mandatory or optional redemption provision;
* the identity of the warrant agent; and
* any other terms of the warrants.
The warrants will be represented by certificates. The warrants may be
exchanged under the terms outlined in the warrant agreement. We will not
charge any service charges for any transfer or exchange of warrant
certificates, but we may require payment for tax or other governmental
charges in connection with the exchange or transfer. Unless the prospectus
supplement states otherwise, until a warrant is exercised, a holder will
not be entitled to any payments on or have any rights with respect to the
common stock issuable upon exercise of the warrant.
EXERCISE OF WARRANTS. To exercise the warrants, the holder must
provide the warrant agent with the following:
* payment of the exercise price;
* any required information described on the warrant certificates;
* the number of warrants to be exercised;
* an executed and completed warrant certificate; and
* any other items required by the warrant agreement.
The warrant agent will issue a new warrant certificate for any
warrants not exercised. Unless the prospectus supplement states otherwise,
no fractional shares will be issued upon exercise of warrants, but we will
pay the cash value of any fractional shares otherwise issuable.
The exercise price and the number of shares of common stock that each
warrant can purchase will be adjusted upon the occurrence of events
described in the warrant agreement, including the issuance of a common
stock dividend or a combination, subdivision or reclassification of common
stock. Unless the prospectus supplement states otherwise, no adjustment
will be required until cumulative adjustments require an adjustment of at
least 1%. From time to time, we may reduce the exercise price as may be
provided in the warrant agreement.
Unless the prospectus supplement states otherwise, if we enter into
any consolidation, merger, or sale or conveyance of our property as an
entirety, the holder of each outstanding warrant will have the right to the
kind and amount of shares of stock, other securities, property or cash
receivable by a holder of the number of shares of common stock into which
the warrants were exercisable immediately prior to the occurrence of the
event.
MODIFICATION OF THE WARRANT AGREEMENT. The common stock warrant
agreement will permit us and the warrant agent, without the consent of the
warrant holders, to supplement or amend the agreement in the following
circumstances:
* to cure any ambiguity;
* to correct or supplement any provision which may be defective or
inconsistent with any other provisions; or
* to add new provisions regarding matters or questions that we and the
warrant agent may deem necessary or desirable and which do not
adversely affect the interests of the warrant holders.
PLAN OF DISTRIBUTION
We may sell securities directly to one or more purchasers or to or
through underwriters, dealers or agents. The related prospectus supplement
will set forth the terms of each offering, including the name or names of
any underwriters, the purchase price and proceeds to us from such sale, any
underwriting discounts and other items constituting underwriters'
compensation, the initial public offering price and any discounts or
concessions allowed, reallowed or paid to dealers, and any securities
exchanges on which the securities may be listed.
We may distribute our securities from time to time in one or more
transactions at a fixed price or prices (which may be changed), at market
prices prevailing at the time of sale, at prices related to prevailing
market prices or at negotiated prices. Our prospectus supplement will
describe the method of distribution.
If underwriters are used in the sale, the underwriters may acquire the
securities for their own account and may resell them from time to time in
one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Securities may be offered to the public through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
underwriters without a syndicate. If an underwriting syndicate is used,
the managing underwriter or underwriters will be named in the prospectus
supplement. Unless otherwise set forth in the prospectus supplement, the
obligations of the underwriters to purchase securities will be subject to
certain conditions precedent, and the underwriters will be obligated to
purchase all securities offered if any are purchased. Any initial public
offering price and any discounts or concessions allowed, reallowed or paid
to dealers may be changed from time to time.
If a dealer is used in an offering of securities, we may sell the
securities to the dealer, as principal. The dealer may then resell the
securities to the public at varying prices to be determined by the dealer
at the time of sale. The terms of the transaction will be set forth in a
prospectus supplement.
Commissions payable by us to any agent involved in the offer or sale
of securities (or the method by which such commissions may be determined)
will be set forth in a prospectus supplement. Unless otherwise indicated
in the prospectus supplement, the agent will be acting on a best efforts
basis.
If so indicated in the prospectus supplement, we may authorize
underwriters, dealers or agents to solicit offers by certain specified
institutions to purchase securities from us pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the
future. These contracts will be subject to the conditions set forth in the
prospectus supplement, and the prospectus supplement will set forth the
commission payable by us for solicitation of the contracts.
Dealers and agents named in a prospectus supplement may be deemed to
be underwriters of the securities within the meaning of the Securities Act
of 1933. Underwriters, dealers and agents may be entitled under agreements
entered into with us to indemnification by us against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments that the underwriters, dealers or
agents may be required to make. Underwriters, dealers and agents may be
customers of, engage in transactions with, or perform services for us in
the ordinary course of business.
As of the date of this prospectus, only our common stock is traded on
the Nasdaq National Market. Except for our common stock, each security
sold using this prospectus will have no established trading market. Any
underwriters to whom securities are sold may make a market in the
securities, but will not be obligated to do so and may discontinue their
market making activities at any time. There can be no assurance that a
secondary market will be created for any of the securities that may be sold
using this prospectus or that any market created will continue.
LEGAL MATTERS
The validity of the securities will be passed upon for us by Jones,
Walker, Waechter, Poitevent, Carre`re & Dene`gre, L.L.P., New Orleans,
Louisiana and for any underwriters, dealers or agents by counsel which we
will name in the applicable prospectus supplement.
EXPERTS
The audited financial statements incorporated in this prospectus by
reference to our Annual Report on Form 10-K for the year ended December 31,
1999 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority
of said firm as experts in accounting and auditing.
