EXHIBIT (a)(5)(x)
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DISTRICT COURT, CITY AND COUNTY OF
DENVER, COLORADO
1437 Bannock Street
Denver, CO 80202
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Plaintiffs: ALAN TOMLINSON, On Behalf of Himself
and All Others Similarly Situated,
v. COURT USE ONLY
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Case Number: 01 CV 1245
Defendants: BARRETT RESOURCES CORP., PETER
A. DEA, DERRILL CODY, WILLIAM W. GRANT, III, Courtroom:
C. ROBERT BUFORD, JAMES M. FITZGIBBONS,
HENNIE L.J.M. GIESKES, and PHILIPPE S.E.
SCHREIBER,
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ATTORNEYS FOR PLAINTIFFS:
Robert J. Dyer III (5734)
Kip B. Shuman (23593)
Jeffrey A. Berens (28007)
John M. Martin (27099)
DYER & SHUMAN, LLP
801 East 17th Avenue (303) 861-3003
Denver, CO 80218-1417 Fax: (303) 830-6920
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CLASS ACTION COMPLAINT FOR
BREACH OF FIDUCIARY DUTY
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INTRODUCTION
1. This class action seeks injunctive relief to prevent Barrett Resources
Corp. ("Barrett" or the "Company") and its directors from agreeing to Shell's
offer to acquire Barrett which is designed to prevent shareholders of Barrett
from receiving the greatest consideration possible for their shares, including
their respective interests in the Company's natural gas properties. Defendants
are compelled by law to refrain from erecting any provisions which impede the
maximization of shareholder value and/or divert consideration to Barrett's
public shareholders.
JURISDICTION AND VENUE
2. This Court has jurisdiction over Barrett because Barrett conducts
business in this County and has material contacts with the State of Colorado as
it has devoted a material portion of its assets to the discovery of natural gas
in this State, owns property in this County, and has entered into contracts for
the requiring of performance by defendants in Colorado. Further, the above acts
were done in the normal and usual business of the Company. The amount in
controversy is less than $75,000. This action seeks equitable relief only. Thus,
this action is not governed by the Securities Litigation Uniform Standards Act
and is not removable.
3. Venue is proper in this Court because the conduct at issue took place
and had an effect in this County.
THE PARTIES
4. Plaintiff Alan Tomlinson is and has been at all relevant times the owner
of Barrett common stock.
5. Barrett explores for and produces natural gas and crude oil. The Company
produces oil and gas in the Rocky Mountain Region, the Mid-Continent Region, and
the Gulf of Mexico Region. Barrett also owns interests in and operates a natural
gas gathering system, a pipeline, and a natural gas processing plant.
6. a. Defendant Peter A. Dea ("Dea") is the Chairman and CEO of Barrett;
b. Defendant Derrill Cody ("Cody") is a director of the Company;
c. Defendant William W. Grant, III ("Grant") is a director of the
Company;
d. Defendant C. Robert Buford ("Buford") is a director of the Company;
e. Defendant Kevin Keenan ("Keenan") is a director of the Company;
f. Defendant James M. Fitzgibbons ("Fitzgibbons") is a director of the
Company;
g. Defendant Hennie L.J.M. Gieskes ("Gieskes") is a director of the
Company; and
h. Defendant Philippe S.E. Schreiber ("Schreiber") is a director of the
Company.
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7. The individual defendants named above in (P)6(a)-(h) (the "Individual
Defendants"), as officers and/or directors of the Company, owe the highest
fiduciary duties of good faith, loyalty, fair dealing, due care, and candor to
plaintiff and the other members of the Class (as defined below).
CLASS ACTION ALLEGATIONS
8. Plaintiff brings this action pursuant to Rule 23 of the Colorado Rules
of Civil Procedure, individually and on behalf of all other stockholders of the
Company (except the defendants herein and any persons, firm, trust, corporation,
or other entity related to or affiliated with them and their successors in
interest), who are or will be threatened with injury arising from defendants'
actions, as more fully described herein (the "Class").
9. This action is properly maintainable as a class action for the following
reasons:
a. The Class is so numerous that joinder of all members is
impracticable. As of November 8, 2000, there were 33 million shares of Barrett
common stock outstanding, owned beneficially by hundreds, if not thousands, of
shareholders.
b. There are questions of law and fact which are common to the Class and
which predominate over questions affecting any individual Class member. The
common questions include, inter alia, the following:
i. whether defendants have engaged and are continuing to engage in a
plan designed to obtain personal benefits for themselves and prevent
shareholders from obtaining the highest price possible for their shares at the
expense of the members of the Class;
ii. whether the defendants have complied with their fiduciary duties
to plaintiff and the other members of the Class, including their duties of fair
dealing, loyalty, due care, and candor; and
iii. whether plaintiff and the other members of the Class would be
irreparably harmed if defendants are not enjoined from the conduct described
herein.
c. Plaintiff is committed to prosecuting this action and has retained
competent counsel experienced in litigation of this nature. Plaintiff is an
adequate representative of the Class.
d. A class action is superior to any other method available for the fair
and efficient adjudication of this controversy since it would be impracticable
and undesirable for each member of the Class, who has suffered or will suffer
harm, to bring a separate action.
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e. Moreover, defendants have acted and will continue to act on grounds
generally applicable to the Class, thereby making appropriate final injunctive
or corresponding declaratory relief with respect to the Class as a whole.
BACKGROUND AND SUBSTANTIVE ALLEGATIONS
10. Barrett explores for and produces natural gas and crude oil. The
Company produces oil and gas in the Rocky Mountain Region, the Mid-Continent
Region, and the Gulf of Mexico Region. Barrett also owns interests in and
operates a natural gas gathering system, a pipeline, and a natural gas
processing plant.
11. Because of low inventories, natural gas prices in the U.S., the world's
largest energy-consuming country, have risen 90 percent in the last year. In
December, futures prices in New York reached a record $10.10 for each million
British Thermal Units, more than four times higher than a year earlier.
12. Shell sought to capitalize on Barrett's expansive reserves which
Barrett's shareholders were on the verge of benefiting from and offered to
acquire Barrett when its shares had come under pressure.
THE ACQUISITION OFFER
13. On March 7, 2001, Shell issued a press release stating it had offered
to buy Barrett for $2.2 billion. The press release provided:
Royal Dutch/Shell Group offered to buy Barrett Resources Corp., a Denver-
based natural gas producer, for $2.2 billion in a plan to boost its holding
in the U.S., where gas prices last year reached a record high.
Shell proposed $55 a share, or $1.8 billion,... before an approach was
made to Barrett directors. Barrett shares soared as high as $61.25 in
expectation of a better offer. Shell would also assume some $400 million
of debt, a statement said.
"Shell appreciates the seriousness with which Barrett's board is
approaching our proposal," said Walter van de Vijver, president of Shell
Exploration & Production Co., a unit of Shell Oil Co., in a statement.
"Absent a positive response from Barrett's board, Shell intends to commence
a fully funded, all cash tender offer for all outstanding Barrett shares."
14. The aforesaid offer is in furtherance of a fraudulent plan to acquire
Barrett while it was trading at depressed levels associated with general market
conditions which, if not enjoined, will result in the elimination of the public
stockholders' equity interest, as described herein.
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More particularly, for defendants to agree to the offer, it would be in
violation of their fiduciary duties and has been timed and structured unfairly
in that:
a. The offer is designed and intended to eliminate members of the class
as stockholders of the Company from continued equity participation in the
Company at a price per share which the Individual Defendants know or should know
is grossly unfair and inadequate;
b. The Individual Defendants have unique knowledge of the Company and
have access to information denied or unavailable to the Class, and without all
material information, Class members are unable to determine whether the price
offered in the transaction is fair; and
c. The offered price is $5 below where Barrett is now trading.
15. The announcement of the offer was timed to freeze out Barrett's public
shareholders in order to capture for Shell the Company's future potential
without paying an adequate or fair price to the Company's public shareholders.
16. The announcement of the offer was timed to place an artificial lid on
the market price of Barrett's stock so that the market would not reflect the
Company's improving potential, thereby purporting to justify an unreasonably low
price.
17. Shell has access to the internal financial information about Barrett,
its true value, expected increase in true value and the benefits of continued
ownership of the Company to which plaintiff and the Class are not privy. Shell
is using such inside information to benefit itself in this transaction, to the
detriment of the Company's public stockholders.
18. Unless enjoined by this Court, the Individual Defendants will breach
their fiduciary duties owed to plaintiff and the Class and will allow Shell to
consummate the offer to the irreparable harm of plaintiff and the Class.
19. Plaintiff and the Class have no adequate remedy at law.
PRAYER FOR RELIEF
WHEREFORE, plaintiff preliminarily and permanent demands injunctive relief
as follows:
(1) Declaring this to be a proper class action and naming plaintiff as
Class representative;
(2) Enjoining defendants from agreeing to Shell's offer to acquire Barrett
for $55 per share;
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(3) Ordering defendants to implement a fair and objective process to sell
the Company to ensure the maximization of shareholder value; and
(4) Granting such other and further equitable relief as may be just and
proper.
Dated: March 8, 2001 DYER & SHUMAN, LLP
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Robert J. Dyer III (5734)
Kip B. Shuman(23593)
Jeffrey A. Berens (28007)
John M. Martin (27099)
801 East 17th Avenue
Denver, CO 80218-1417
Telephone: 303/861-3003
303/830-6920 (fax)
MILBERG WEISS BERSHAD
HYNES & LERACH LLP
William S. Lerach
Darren J. Robbins
Randall H. Steinmeyer
600 West Broadway, Suite 1800
San Diego, CA 92101
Telephone: 619/231-1058
619/231-7423 (fax)
CAULEY, GELLER, BOWMAN
& COATES, LLP
Paul J. Geller
One Boca Place, Suite 421A
2255 Glades Road
Boca Raton, FL 33431
Telephone: 561/750-3000
561/750-3364 (fax)
Attorneys for Plaintiff
Plaintiff's Address
3791 Valley Oak Drive
Loveland, CO 80538
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