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): August 7, 1998
SYNTROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
KANSAS 000-21911 43-1764632
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
1350 SOUTH BOULDER
SUITE 1100
TULSA, OKLAHOMA 74119-3295
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (918) 592-7900
SLH CORPORATION
5000 WEST 95TH STREET
SUITE 260
SHAWNEE MISSION, KANSAS 66207
(Registrant's former name and former address, if changed since last report)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
On August 6, 1998, the stockholders of SLH Corporation, a Kansas
corporation ("SLH"), and the stockholders of Syntroleum Corporation, an Oklahoma
corporation ("Syntroleum"), at separate meetings approved and adopted the
Agreement and Plan of Merger dated as of March 30, 1998 by and between
Syntroleum and SLH (the "Merger Agreement") and the transactions contemplated by
the Merger Agreement. Pursuant to the Merger Agreement, on August 7, 1998 (i)
Syntroleum merged (the "Merger") with and into SLH, with SLH being the surviving
corporation (the survivor of the Merger is referred to herein as the "Company"),
(ii) SLH changed its name to "Syntroleum Corporation," (iii) the officers of SLH
were replaced by the officers of Syntroleum, (iv) six of the eight SLH directors
were replaced by Syntroleum directors, (v) each outstanding share of common
stock, par value $0.001 per share, of Syntroleum (the "Syntroleum Common Stock")
was converted into the right to receive 1.28990 shares of common stock, par
value $0.01 per share, of the Company (the "Company Common Stock") and (vi) the
Company's Articles of Incorporation were amended to increase the number of
authorized shares of Company Common Stock from 30,000,000 shares to 150,000,000
shares and the number of authorized shares of the Company's preferred stock, par
value $0.01 per share, from 1,000,000 shares to 5,000,000 shares. The
transactions relating to the Merger are more fully described in the Joint Proxy
Statement/Prospectus filed with the Securities and Exchange Commission pursuant
to Rule 424 under the Securities Act of 1933, as amended, on July 6, 1998 (the
"Joint Proxy Statement/Prospectus"). The Joint Proxy Statement/Prospectus
constitutes a part of the Company's Registration Statement on Form S-4
(Registration No. 333-50253), as amended (the "Registration Statement").
As a result of the Merger, an aggregate of approximately 16,825,000
shares (which represent approximately 62.5% of the total of approximately
26,900,000 shares of Company Common Stock outstanding following the Merger) are
held by the former stockholders of Syntroleum. Management of the Company
currently beneficially owns an aggregate of 8,294,058 shares of Company Common
Stock (which represents approximately 30.5% of the outstanding shares of Company
Common Stock). Of this amount, 5,014,440 shares (18.6%) of Company Common Stock
are beneficially owned by Kenneth L. Agee (Chief Executive Officer and Chairman
of the Board of the Company), 1,443,055 shares (5.4%) of Company Common Stock
are beneficially owned by Mark A. Agee (President and Chief Operating Officer of
the Company), and an aggregate of 1,836,562 shares (6.5%) of Company Common
Stock are beneficially owned by other members of the Company's management. In
addition, 3,593,983 shares (13.4%) of Company Common Stock are beneficially
owned by Robert A. Day, a long-time stockholder of Syntroleum.
In connection with the Merger, the Rights Agreement by and between the
Company and American Stock Transfer & Trust Company dated as of January 31,
1997, as amended, was amended so that neither Kenneth L. Agee, nor Mark A. Agee,
nor members of their immediate families, nor any of their affiliates or
associates, individually or collectively, would be deemed to be "Acquiring
Persons" as that term is defined in the Rights Agreement.
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Pursuant to the Merger Agreement, Kenneth L. Agee, Mark A. Agee, Alvin
R. Albe, Jr., Frank M. Bumstead, Robert Rosene, Jr. and J. Edward Sheridan were
appointed as six of the eight directors of the Company (James R. Seward, SLH's
President and Chief Executive Officer, and P. Anthony Jacobs, SLH's Chairman of
the Board, who were directors of both companies prior to the Merger, have
remained as directors of the Company). In addition, the officers of Syntroleum
replaced the officers of SLH. The current officers of the Company are as
follows: Kenneth L. Agee (Chief Executive Officer and Chairman of the Board),
Mark A. Agee (President and Chief Operating Officer), Charles A. Bayens (Vice
President of Engineering and Vice President of Research and Development), Eric
Grimshaw (Vice President, General Counsel and Secretary), Peter V. Snyder, Jr.
(Vice President of Product Sales), Randall M. Thompson (Vice President and Chief
Financial Officer), and Larry J. Weick (Vice President of Licensing and Business
Development).
As a result of the foregoing, management of the Company or the former
stockholders of Syntroleum (to the extent they act together) could be deemed to
effectively control the Company.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Pursuant to the Merger Agreement, Syntroleum merged with and into SLH
on August 7, 1998. In connection with the Merger, each outstanding share of
Syntroleum Common Stock was converted into the right to receive 1.28990 shares
of Company Common Stock. The exchange ratio relating to the exchange of Company
Common Stock for Syntroleum Common Stock in the Merger was determined by
negotiations between management of SLH and management of Syntroleum and was
based upon a formula set forth in the Merger Agreement that established the
exchange ratio as equal to the ratio of the Implied Syntroleum Per Share Common
Stock Market Value divided by the SLH Per Share Common Stock Market Value. "SLH
Per Share Common Stock Market Value" was defined in the Merger Agreement as the
average closing price of Company Common Stock during the five trading days
ending on the business day immediately preceding the meeting of stockholders of
the Company held to vote upon the Merger Agreement (the "Company Stockholders
Meeting"), which was held on August 6, 1998. The "Implied Syntroleum Per Share
Common Stock Market Value" was defined in the Merger Agreement as equal to (i)
the difference between the SLH Market Capitalization and $50,520,000 (SLH's
total stockholders' equity as of March 31, 1998 (excluding the book value of the
shares of Syntroleum Common Stock that SLH owned, which was zero)) divided by
(ii) 5,950,000 (the number of shares of Syntroleum Common Stock that SLH owned).
The "SLH Market Capitalization" was defined in the Merger Agreement as the
product of (A) the average closing price of Company Common Stock during the five
trading days ending on the business day immediately preceding the Company
Stockholders Meeting and (B) 10,519,121 (the sum of the number of shares of
Company Common Stock outstanding on the date of the Merger Agreement, the number
of shares of Company Common Stock issuable pursuant to vested options (as of
such date) to purchase such shares and 250,000 shares (which reflected a portion
of the number of shares of Company Common Stock issuable pursuant to non-vested
options)). The SLH Per Share Common Stock Market Value was calculated to be
$17.7625, and the Implied Syntroleum Per Share Common Stock Market Value was
calculated to be $22.9119. The ratio of the Implied Syntroleum Per Share Common
Stock Market Value divided by the SLH Per Share Common Stock Market Value was
calculated to be
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1.28990 (the exchange ratio in the Merger). Approximately 16,825,000 shares of
Company Common Stock were issued in the Merger to former stockholders of
Syntroleum.
Prior to the Merger, SLH owned approximately 31% of the outstanding
shares of Syntroleum Common Stock. In addition, as indicated above, James R.
Seward, SLH's President and Chief Executive Officer, and P. Anthony Jacobs,
SLH's Chairman of the Board, were directors of Syntroleum prior to the Merger
and continue as directors of the Company following the Merger.
As a result of the Merger, the Company has acquired all of the assets
of Syntroleum and has become subject to all of its liabilities. Syntroleum is
the developer and owner of a proprietary process (the "Syntroleum Process")
designed to catalytically convert natural gas into synthetic liquid hydrocarbons
("gas-to-liquids" or "GTL"). Syntroleum has formed a joint venture with Enron
Capital & Trade Resources Corp. with respect to the development of a proposed
8,000 barrel-per-day GTL plant in Sweetwater County, Wyoming. Syntroleum has
also entered into a project development agreement with Texaco, Inc. ("Texaco")
and Brown & Root, Inc. with respect to the development of a small GTL plant. To
date, Syntroleum has entered into license agreements for the Syntroleum Process
with Texaco, Atlantic Richfield Company, Marathon Oil Company, YPF
International, Ltd., an affiliate of Argentina-based Yacimentos Petroliferos
Fiscales, S.A., Enron Capital & Trade Resources Corp. and Kerr-McGee
Corporation.
Syntroleum's business is more fully described in the Joint Proxy
Statement/Prospectus.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements of business acquired.
The financial statements of Syntroleum included on pages F-1 to F-15
of the Joint Proxy Statement/ Prospectus are incorporated herein by
reference.
(b) Pro forma financial information.
The unaudited pro forma financial information of Syntroleum and SLH
included on pages 33-37 of the Joint Proxy Statement/Prospectus are
incorporated herein by reference.
(c) Exhibits
*2.1 Agreement and Plan of Merger dated as of March 30, 1998 by and
between SLH and Syntroleum (incorporated by reference to
Appendix A to the Joint Proxy Statement/Prospectus).
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*4.1 Articles of Incorporation of the Company (incorporated by
reference to Exhibit 3(a) to the Form 10 of the Company filed
with the Securities and Exchange Commission on December 24,
1996).
4.2 Certificate of Merger filed on August 7, 1998.
*4.3 Bylaws of the Company (incorporated by reference to Exhibit
3(b) to the Form 10 of the Company filed with the Securities and
Exchange Commission on December 24, 1996).
*4.4 Rights Agreement dated as of January 31, 1997 (incorporated by
reference to Exhibit 4 to the Form 10/A of SLH filed with the
Securities and Exchange Commission on February 12, 1997).
*4.5 Amendment to Rights Agreement dated as of March 30, 1998
(incorporated by reference to Exhibit 4.2 to the Registration
Statement).
4.6 Second Amendment to Rights Agreement dated as of August 7, 1998.
*4.7 Certificate of Designations of Series A Junior Participating
Preferred Stock of SLH Corporation, dated February 19, 1997,
together with Statement of Increase, dated June 1, 1998
(incorporated by reference to Exhibit 4.3 to the Registration
Statement).
99.1 Press Release dated August 6, 1998.
99.2 Press Release dated August 7, 1998.
*99.3 Audited Consolidated Financial Statements of Syntroleum as of
December 31, 1996 and 1997 and for the years ended December 31,
1995, 1996 and 1997 (incorporated by reference to pages F-1 to
F-15 of the Joint Proxy Statement/Prospectus).
*99.4 Unaudited Consolidated Financial Statements of Syntroleum as of
March 31, 1998 and for the three-month periods ended March 31,
1997 and 1998 (incorporated by reference to pages F-1 to F-15 of
the Joint Proxy Statement/Prospectus).
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*99.5 Unaudited Pro Forma Combined Financial Statements of SLH and
Syntroleum as of March 31, 1998, for the year ended December 31,
1997 and for the three-month period ended March 31, 1998
(incorporated by reference to pages 33 to 37 of the Joint Proxy
Statement/Prospectus).
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*Incorporated by reference as indicated
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SIGNATURES
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.
SYNTROLEUM CORPORATION
By: /s/ Eric Grimshaw
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Name: Eric Grimshaw
Title: Vice President, General Counsel
and Secretary
Date: August 12, 1998
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