PROSPECTUS SUPPLEMENT For SEC Filing
(To Prospectus dated July 12, 1994) Purposes Only:
Rule 424(b)(5)
File No. 33-54389
STEWART & STEVENSON SERVICES, INC.
Common Stock, without par value
This Prospectus Supplement is being furnished to Creole International,
Inc., a Delaware corporation ("Creole"), and Creole's wholly owned subsidiaries
Creole Production Services, Inc., a Delaware Corporation, Creole Development
Corporation, Inc., a Texas corporation, Creole Industrial Products, Inc., a
Delaware corporation, and W.L. Somner Company, Inc., a Louisiana corporation
(collectively, the "Sellers"), in connection with the acquisition
("Acquisition") by Creole Acquisition Incorporated, a Delaware corporation
("Acquisition Subsidiary"), and Stewart & Stevenson Realty Corporation, a Texas
corporation ("Realty"), both of which are wholly owned subsidiaries of Stewart &
Stevenson Services, Inc., a Texas corporation (the "Company"), pursuant to the
Asset Purchase Agreement ("Agreement") to be entered into between the Sellers,
Acquisition Subsidiary, Realty and the Company. Pursuant to the Agreement,
Acquisition Subsidiary and Realty will acquire certain of the assets (the
"Assets") of Sellers and Sellers will receive shares of common stock, without
par value, of the Company ("Common Stock").
Creole and its subsidiaries are engaged primarily in the operation and
maintenance of oil and gas processing and power generation facilities; providing
engineering, planning, management, training and technical services; and
repairing, remanufacturing, installing, commissioning and testing processing
equipment. Creole's principal executive offices are located at 10555 Katy
Freeway, Houston, Texas 77024 and its telephone number is (713)
461-1316.
As consideration for the Acquisition of the Assets by Acquisition
Subsidiary and Realty, the Company will issue up to 200,000 shares of Common
Stock to the Sellers or such lesser number determined by dividing the Net Asset
Value (as defined in the Agreement) of the Assets by the Market Value (as
defined below) of the Common Stock. The shares of Common Stock issuable in the
Acquisition will be issued at a "Market Value" equal to the average of the high
and low trading price of the Common Stock as reported by the National
Association of Securities Dealers Automated Quotation National Market System
("Nasdaq NMS") for each day during the ten trading days prior to (but not
including) the closing date ("Closing Date") of the Acquisition.
The Common Stock is traded on the Nasdaq NMS under the symbol "SSSS". On
July 28, 1994, the last reported sales price of Common Stock, as reported by
Nasdaq NMS, was $ 38.75 per share.
THE SHARES OF COMMON STOCK HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES ADMINISTRATOR NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES ADMINISTRATOR
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The Date of this Prospectus Supplement is July 29, 1994.
Employment Agreement
On the Closing Date, the Acquisition Subsidiary will enter into a three-
year Employment Agreement with Richard L. Flowers, the current Chief Executive
Officer and sole stockholder of Creole.
Conditions to the Acquisition
In addition to the approvals by the requisite votes of Creole stockholders
and the receipt of regulatory approvals, environment reports, various legal
opinions, and consents, (i) the Company has no obligation to effect the
Acquisition unless (a) the Company is satisfied with the results of its due
diligence review and the calculation of Net Asset Value and (b) the Market Value
of the Common Stock is at least $40.00 per share on the Closing Date and (ii)
Creole has no obligation to effect the Acquisition unless Creole is satisfied
with the calculation of Net Asset Value. There can be no assurance that all of
the conditions set forth in the Agreement will be satisfied.
Certain Federal Income Tax Consequences
The Acquisition is not intended to qualify as a tax-free reorganization
under the Internal Revenue Code of 1986, as amended.
Government and Regulatory Approvals
Neither the Company nor Creole is aware of any governmental or regulatory
approvals required for consummation of the Acquisition, other than compliance
with applicable securities laws.
Accounting Treatment
The Acquisition is expected to be accounted for as a purchase in accordance
with generally accepted accounting principles.
Votes Required
In order for the Acquisition to be approved by Creole, it must be approved
by the holders of at least a majority of the outstanding shares of Creole common
stock. No vote of the stockholders of the Company is required to approve the
Acquisition.
Market for Common Stock
The Company will apply to include the Common Stock issuable to the Sellers
pursuant to the Acquisition for quotation on the Nasdaq NMS following the
Acquisition.
Preliminary Issuance of Common Stock
On the Closing Date, the Company and the Sellers will make a preliminary
estimation of the Net Asset Value of the Assets and the Company will make a
preliminary payment to the Sellers of the number shares of Common Stock issuable
to the Sellers based upon such estimate. Within 30 days of the Closing Date,
the Company and the Sellers will make a final determination of the Net Asset
Value of the Assets and an appropriate adjustment will then be made to the
number of shares of Common Stock issuable to the Sellers in the Acquisition.
