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):
January 18, 2000
3TEC ENERGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-21702 76-0624573
(Commission File Number) (IRS Employer Identification Number)
Two Shell Plaza, 777 Walker, Suite 2400, Houston, Texas 77002
(Address of Principal Executive Offices and Zip Code)
(713) 222-6275
(Registrant's Telephone Number, Including Area Code)
1221 Lamar, Suite 1020, Houston, Texas 77010
(Former Address)
ITEM 5. OTHER EVENTS.
Reverse Stock Split
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On January 18, 2000, 3TEC Energy Corporation ("3TEC") announced stockholder
approval of an amendment to 3TEC's Certificate of Incorporation to effect a
1-for-3 reverse stock split of the outstanding shares of 3TEC's $.02 par value
Common Stock. The reverse split was effective as of the beginning of business
on January 18, 2000. Until approximately February 15, 2000, 3TEC's Common Stock
will trade on the NASDAQ SmallCap Market under the symbol "TTEND" to distinguish
the post-split shares from the pre-split shares. Thereafter, the trading symbol
will revert to "TTEN."
As a result of the reverse stock split, the number of shares of Common
Stock subject to outstanding options and warrants granted by 3TEC will be
reduced by two-thirds, and the per share exercise price of the outstanding
options and warrants will be increased by a multiple of three, to place the
option and warrant holders in the same relative position they had before the
reverse stock split. Additionally, pursuant to the antidilution provisions of
the certificates of designation of 3TEC's Series B Preferred Stock and Series C
Preferred Stock (collectively, "Preferred Stock"), the conversion ratio of each
outstanding series has been automatically revised to one third of a share of
Common Stock for each outstanding share of Preferred Stock.
As previously described in 3TEC's definitive proxy statement filed with the
Securities and Exchange Commission on January 11, 2000, 3TEC entered into an
Agreement and Plan of Merger on December 21, 1999, with Magellan Exploration,
LLC ("Magellan") and the other parties named therein (the "Magellan Agreement").
Pursuant to the terms of the original Magellan Agreement, 3TEC was to issue as
consideration in the acquisition of Magellan 3,300,000 shares of Common Stock,
warrants to purchase 1,000,000 shares of Common Stock at an exercise price of
$10.00 per share, and 1,875,000 shares of Series D Preferred Stock having a
redemption value of $8.00 per share and convertible into 1,875,000 shares of
Common Stock. In addition, the Second Amendment to the Agreement and Plan of
Merger, entered into on February 2, 2000, decreased slightly the number of
shares to be issued by 3TEC in the transaction. The Magellan Agreement, as so
amended to reflect the effect of the reverse stock split and the share
reduction, provides, on a post-split basis, that 3TEC will issue 1,085,934
shares of its Common Stock, warrants to purchase 333,333 shares of Common Stock
at an exercise price of $30.00 per share, and 617,008 shares of its Series D
Preferred Stock having a redemption value of $24.00 per share, with each share
of Series D Preferred Stock being convertible into one share of post-split
Common Stock.
A form of the amendment to 3TEC's Certificate of Incorporation was filed as
Exhibit A to the definitive proxy statement filed by 3TEC on January 3, 2000.
The First Amendment and Second Amendment to the Magellan Agreement are filed as
Exhibits 2.1 and 2.2 hereto. The January 18, 2000, press release is filed
herewith as Exhibit 99.1.
Current Officers of 3TEC
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The board of directors of 3TEC have elected the following persons to serve
as officers of 3TEC:
MANAGEMENT
NAME AGE POSITION(S) HELD SINCE
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Floyd C. Wilson 52 Chairman, President, Chief Executive 1999
Officer and Treasurer
Stephen W. Herod 40 Executive Vice President, Chief Financial 1997
Officer, Secretary and Director
Richard K. Stoneburner 46 Vice President - Exploration 1999
Mark S. Holt 44 Vice President - Land 1999
Earl Ringeiser 65 Vice President - Production 1999
Terry W. Gautier 43 Controller 1999
FLOYD C. WILSON, Chairman, President and Chief Executive Officer,
joined us on August 27, 1999, concurrent with the investment by 3TEC Energy
Company LLC ("3TEC LLC"). Mr. Wilson founded 3TEC LLC in 1998. Mr. Wilson
began his career in the energy business in Houston in 1970 as a completion
engineer. He moved to Wichita in 1976 to start an oil and gas operating
company, one of several private energy ventures which preceded the
formation of 3TEC LLC. Mr. Wilson founded Hugoton Energy Corporation
("Hugoton") in 1987, and served as its Chairman, President, and Chief
Executive Officer. In 1994, Mr. Wilson took Hugoton public, and sold the
company in 1998 to Chesapeake Energy Corporation.
STEPHEN W. HEROD has served as our Executive Vice President, Chief
Financial Officer and Secretary since December 1999 and as a director since
July 1997. From July 1997 to December 1999, Mr. Herod was our Vice
President-Corporate Development. Mr. Herod served as Principal and a
director of Shore Oil Company from April 1992 until the merger of Shore
with us on June 30, 1997. He joined Shore's predecessor as Controller in
February 1991. Mr. Herod was employed by Conquest Exploration Company from
1984 until 1991 in various financial management positions, including
Operations Accounting Manager. From 1981 to 1984, Superior Oil Company
employed Mr. Herod as a financial analyst.
RICHARD K. STONEBURNER joined us in August 1999 and became Vice
President-Exploration in December 1999. Mr. Stoneburner was employed by
3TEC as District Geologist from 1998 to 1999. Prior to joining us, Mr.
Stoneburner worked as a geologist for Texas Oil & Gas, The Reach Group,
Weber Energy Corporation, Hugoton and, independently through his own
company, Stoneburner Exploration, Inc. Mr. Stoneburner has over 20 years of
experience in the energy field.
MARK S. HOLT joined us in August 1999 and became Vice President-Land
in December 1999. 3TEC LLC employed Mr. Holt as District Landman from 1998
to 1999. From 1985 to 1998, Mr. Holt was the owner of Holt Resources, which
provided land consulting services to various oil and gas companies and
operators. From 1979 to 1985, Mr. Holt was the Senior Landman for Sun Oil
Company.
EARL W. RINGEISEN joined us in August 1999 and became Vice
President-Production in December 1999. From 1998 to 1999, Chesapeake Energy
Corporation employed Mr. Ringeisen as their Kansas District Manager. Mr.
Ringeisen served as Hugoton's Vice President of Operations from 1993 to
1998. From 1987 to 1993, Mr. Ringeisen served as Production Superintendent
for Hugoton.
TERRY W. GAUTIER joined us as Controller in December 1999. From July
1990 to November 1999, Mr. Gautier was employed by Floyd Oil Company as
Vice President, Chief Accounting Officer and Controller. 3TEC purchased
substantially all of Floyd Oil Company's assets in November 1999. Prior to
joining Floyd Oil Company, Mr. Gautier was employed by Pelto Oil Company
for six years, serving the last two as Controller. From 1978 to 1983, Mr.
Gautier was an Audit Senior with Touche Ross and Co. He is a certified
public accountant.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. The following exhibits are filed herewith:
2.1 First Amendment to Agreement and Plan of Merger, effective as of
January 14, 2000, by and among 3TEC Energy Corporation, 3TM
Acquisition L.L.C., Magellan Exploration, LLC, ECIC Corporation, EnCap
Energy Capital Fund III, L.P., EnCap Energy Acquisition III-B, Inc.,
BOCP Energy Partners, L.P., and Pel-Tex Partners, L.L.C.
2.2 Second Amendment to Agreement and Plan of Merger, effective as of
February 2, 2000, by and among 3TEC Energy Corporation, 3TM
Acquisition L.L.C., Magellan Exploration, LLC, ECIC Corporation, EnCap
Energy Capital Fund III, L.P., EnCap Energy Acquisition III-B, Inc.,
BOCP Energy Partners, L.P., and Pel-Tex Partners, L.L.C.
99.1 Press Release dated January 18, 2000.
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.
3TEC Energy Corporation
(Registrant)
Date: February 3, 2000 By: /s/ Stephen W. Herod
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Stephen W. Herod
Executive Vice President and
Chief Financial Officer
INDEX TO EXHIBITS
2.1 First Amendment to Agreement and Plan of Merger, effective as of
January 14, 2000, by and among 3TEC Energy Corporation, 3TM
Acquisition L.L.C., Magellan Exploration, LLC, ECIC Corporation, EnCap
Energy Capital Fund III, L.P., EnCap Energy Acquisition III-B, Inc.,
BOCP Energy Partners, L.P., and Pel-Tex Partners, L.L.C.
2.2 Second Amendment to Agreement and Plan of Merger, effective as of
February 2, 2000, by and among 3TEC Energy Corporation, 3TM
Acquisition L.L.C., Magellan Exploration, LLC, ECIC Corporation, EnCap
Energy Capital Fund III, L.P., EnCap Energy Acquisition III-B, Inc.,
BOCP Energy Partners, L.P., and Pel-Tex Partners, L.L.C.
99.1 Press Release dated January 18, 2000.