UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 22, 1997
USX Corporation
---------------
(Exact name of registration as specified in its charter)
Delaware 1-5153 25-0996816
- -------- ------ ----------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
600 Grant Street, Pittsburgh, PA 15219-4776
- -------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(412) 433-1121
--------------
(Registrant's telephone number,
including area code)
Item 2. Acquisition or Disposition of Assets.
On October 22, 1997, USX Corporation announced that it had entered into a
definitive agreement for USX to sell its stock in Delhi Gas Pipeline Corporation
and the other subsidiaries of USX that comprise all of the Delhi Group to Koch
Midstream Enterprises, Inc., an affiliate of Koch Industries, Inc. The
transaction involves a gross purchase price of $762 million, which, based upon
September 30, 1997, financial information, USX estimates will result in net
proceeds available for distribution to the holders of USX-Delhi Common Stock
("Delhi Stock") of between $19 and $21 cash per share of Delhi Stock.
The net proceeds are calculated in accordance with USX's Restated Certificate of
Incorporation (the "USX Certificate") which (in relevant part) defines net
proceeds as an amount equal to the gross proceeds of a disposition after any
payment of, or reasonable provision for, (i) any taxes payable by the
Corporation in respect of such disposition, (ii) any taxes payable by the
Corporation in respect of any dividend or redemption, (iii) any transaction
costs, including, without limitation, any legal, investment banking and
accounting fees and expenses, and (iv) any liabilities (contingent or otherwise)
of, or allocated to, the Delhi Group, including, without limitation, any
indemnity obligations incurred in connection with the disposition.
Set forth below is a sample calculation of the midpoint of the $19 to $21 per
share estimated range of net proceeds which is based on Delhi Group data as of
September 30, 1997. The estimate of the net proceeds included herein is a
forward-looking statement. A number of the factors used in the calculation may
change between September 30 and the effective date including, among other
things, the amount of debt attributed to the Delhi Group, which is impacted by
the Delhi Group's cash flow through the effective date, and the taxes to be
incurred, which are impacted by changes in the tax basis of the Delhi Group's
assets after September 30. Actual net proceeds will be based on data as of the
effective date, currently expected to be October 31, 1997. Accordingly, the
actual net proceeds may vary from the estimated range set forth below.
$ Millions
----------
Gross Purchase Price $762
Less: Estimated adjustments to purchase price for
liabilities retained by the Delhi Companies 27
----
Estimated Adjusted Purchase Price $735
Less: Estimated attributed debt, preferred stock, transaction
costs and other liabilities of the Delhi Group 317
Less: Estimated taxes payable1 220
----
Estimated net proceeds $198
Estimated net proceeds per share available for distribution2 $ 20
Under the USX Certificate, USX is required to elect one of three options to
return the value of the net proceeds received in the transaction to the Delhi
Group shareholders within sixty days of the closing of the transaction.
- -----------------
[FN]
1-Based on estimated tax basis of $165 million at September 30, 1997, and
assuming a tax rate of 38.5%.
2-Based on 9.45 million shares outstanding at September 30, 1997, and assuming
the settlement of outstanding employee stock options to purchase approximately
409,000 shares of Delhi Stock.
-2-
Following is an excerpted summary of the three options:
USX is required to
(A)declare and pay a dividend to the holders of Delhi Stock in an amount
equal to the net proceeds of such disposition; or
(B)redeem the outstanding shares of Delhi Stock with such net proceeds; or
(C)exchange each outstanding share of Delhi Stock for a number of fully paid
and nonassessable shares of Marathon Stock equal to 110% of the average
daily ratio of the market value of one share of Delhi Stock to the market
value of one share of Marathon Stock during a specified ten-business day
period.
Of the three options, USX currently anticipates that it will elect to use the
net proceeds to redeem all shares of Delhi Stock. USX is required to give
public notice of which option it has elected not less than thirty or more than
sixty days after the closing. Due to the time required to finalize the
calculation of the net proceeds, USX anticipates that it will give the required
notice thirty days after the closing of the transaction.
The transaction is subject to the receipt of Hart-Scott-Rodino approval and
other customary conditions. The parties expect the closing to occur in
November.
Lehman Brothers acted as financial advisor to USX in conjunction with the
transaction.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
2. Stock Purchase and Sale Agreement.
99. Press Release
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
USX CORPORATION
By /s/ Kenneth L. Matheny
--------------------------------
Kenneth L. Matheny
Vice President & Comptroller
Dated: October 23, 1997
-3-