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): May 14, 1997
HOWELL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8704 74-1223027
(State or other (Commission (IRS Employer
jurisdiction File Number) Identification No.)
of incorporation)
1111 Fannin, Suite 1500
Houston, Texas 77002
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (713) 658-4000
Item 5. Other Events.
Paul N. Howell, who founded Howell Corporation in 1955 and served as its
Chief Executive Officer and President, announced his retirement from those
positions effective May 14, 1997. Mr. Howell will remain a member of the
Corporation's Board of Directors. In conjunction with Mr. Howell's retirement,
Ronald E. Hall, Chairman of the Corporation's Board of Directors, resigned the
Chairmanship, but also will remain a member of the Board of Directors.
On May 14, 1997, the Board of Directors of the Corporation elected Donald
W. Clayton to serve as Chairman and Chief Executive Officer of the Corporation
and Richard K. Hebert to serve as President and Chief Operating Officer of the
Corporation. Messrs. Clayton and Hebert are co-founders of Voyager Energy
Corp., a privately-held exploration and production company based in Houston,
Texas. Mr. Clayton previously served as President and a Director of Burlington
Resources, President and Chief Executive Officer of Meridian Oil, and a senior
executive with The Superior Oil Company. Mr. Hebert, who currently serves as a
director of the Corporation, was formerly Executive Vice President and Chief
Operating Officer of Meridian Oil. Also joining the Corporation as its Vice
President - Corporate Planning and Development is John W. Brewster.
Mr. Brewster has over two decades of management experience with Santa Fe
Minerals, Odyssey Energy and Trafalgar House Oil and Gas, where he served as
President and Chief Executive Officer.
In order to assist the new management team, Mr. Howell has agreed at the
request of the Board of Directors to consult with the Corporation during a
transition period to be determined by the Board. During the transition period,
Mr. Howell will provide advice and assistance as requested by the Corporation
and will be paid a consulting fee of $5,000 per month.
Messrs Clayton, Hebert and Brewster will receive annual salaries of
$200,000, $200,000 and $115,000, respectively, and will participate in other
benefits made available to employees of the Corporation generally. Each of such
individuals entered into an indemnity agreement with the Corporation in the form
currently used by the Corporation for its officers and directors. The indemnity
agreement provides, among other things, that the Corporation shall indemnify an
officer or director when he is a party or threatened to be a party to an action,
suit or proceeding by reason of the fact that he is or was a director or officer
of the Corporation. The Corporation shall indemnify such director or officer
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with the action or proceeding. In no
event, however, shall indemnification be made if the officer or director is
adjudged liable to the Company.
In connection with the engagement of Messrs. Clayton and Hebert, the Board
of Directors adopted the Howell Corporation 1997 Nonqualified Stock Option Plan
(the "1997 Plan"), a new stock option plan for employees and directors, and
approved one-time grants of an aggregate of 538,800 shares of the Corporation's
common stock under the 1997 Plan to Messrs. Clayton, Hebert and Brewster and to
Robert T. Moffett, the Corporation's Vice President, General Counsel and
Secretary. The purposes of the 1997 Plan is to encourage ownership of the
common stock by the employees and directors of the Corporation, to provide
increased incentive for such employees and directors to render services to, and
to exert maximum effort for the business success of, the Corporation, and to
strengthen the identification of employees and directors with the stockholders
of the Corporation. Options with respect to all shares of common stock reserved
for issuance under the 1997 Plan have been issued, and options which are
forfeited or otherwise not exercised cease to be available for grants of
additional options under the 1997 Plan. Accordingly, no additional grants of
options are expected under the 1997 Plan.
Messrs. Clayton, Hebert, Brewster and Moffett were granted nonqualified
options to purchase 265,000, 255,000, 13,800 and 5,000 shares of the
Corporation's common stock, respectively. The options have a ten year term, and
shares of common stock become purchasable thereunder at the rate of 25% per year
commencing on the first anniversary of the date of the grants. These options
have an exercise price of $13.125 per share, which was the closing price per
share of the shares of the Corporation's common stock on the New York Stock
Exchange on May 13, 1997. The options become fully exercisable on the
occurrence of a change of control, as defined in the 1997 Plan. Upon
termination of employment, the optionee may exercise the vested portion of his
unexercised options for the shorter of six months or the stated expiration date
of the option, although the 1997 Plan gives the Board of Directors discretion to
extend the six month period (but not longer than the stated term of the option).
To the extent not vested, the options expire upon termination of employment,
although the 1997 Plan gives the Board of Directors the discretion to accelerate
the exercisability of such options. The options are not transferable by the
optionees and during their lifetimes are exercisable only by the optionees.
In addition, on May 14, 1997 the Stock Option Committee of the Board of
Directors approved the one-time grant of nonqualified options to purchase an
aggregate of 105,500 shares of common stock under the Corporation's 1988 Stock
Option Plan (the "1988 Plan") to all remaining employees working in the
Corporation's oil and gas operations. The options granted pursuant to the 1988
Plan have ten year terms, become exercisable at the rate of 25% per year
commencing on the first anniversary date of the grants, have an exercise price
of $13.125 per share and otherwise were made on substantially the same terms as
the grants of the options under the 1997 Plan. The purpose of these grants was
to retain the Corporation's employees, to motivate them to exert maximum effort
for the future success of the Corporation and to more closely align the
interests of the Corporation's employees with the interest of the Corporation's
stockholders. Finally, in recognition of Mr. Howell's service to the
Corporation since 1955, on May 14, 1997 the Stock Option Committee waived the
six month expiration period with respect to all of his nonqualified options
(120,830 shares) to purchase common stock previously granted to Mr. Howell under
the 1988 Plan, and accelerated the vesting of the unvested portion of such
options (aggregating 35,125 shares) so that all of such options are now
exercisable.
Also on May 14, 1997, the Corporation entered into a letter of intent to
acquire Voyager Energy Corp., the company founded by Messrs. Clayton and Hebert,
in a tax-free reorganization for approximately 340,000 shares of common stock of
the Corporation. The securities to be issued by the Corporation in the merger
would represent in the aggregate approximately 7% of the Corporation's common
stock currently outstanding, and the Corporation would assume approximately
$1.3 million in Voyager indebtedness as a result of the merger. Consummation of
the transaction is subject to the execution of a mutually satisfactory
definitive agreement, as well as the approval of the Board of Directors
(including the Audit Committee thereof) of the Corporation and the Corporation's
stockholders.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
The following is filed as an exhibit to this Current Report on Form
8-K.
Exhibit
Number Description
10.1 Howell Corporation 1997 Nonqualified Stock
Option Plan.
10.2 Form of option for use under Howell
Corporation 1997 Nonqualified Stock Option Plan.
10.3 Form of indemnity agreement entered into
between the Corporation and each of Messrs. Clayton, Hebert
and Brewster.
99.1 Letter of intent dated May 14, 1997 by and
between Howell Corporation and Voyager Energy Corp.
S I G N A T U R E
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.
HOWELL CORPORATION
Date: May 19, 1997 By: /s/ ROBERT T. MOFFETT
_________________________
Robert T. Moffett
Vice President, General Counsel
and Secretary
EXHIBIT INDEX
Exhibit
Number Description
10.1 Howell Corporation 1997 Nonqualified Stock
Option Plan.
10.2 Form of option for use under Howell
Corporation 1997 Nonqualified Stock Option Plan.
10.3 Form of indemnity agreement entered into between the
Corporation and each of Messrs. Clayton, Hebert
and Brewster.
99.1 Letter of intent dated May 14, 1997 by and
between Howell Corporation and Voyager Energy Corp.