-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DYeifn2t2Q2e/gNnFCXgYxATaFljEt3ZPOOlcxJD+2x85pw00nCA8Avk0vkYdt/2 zFjxstgnfoNUUS2AKWAeKw== 0000024240-05-000024.txt : 20050927 0000024240-05-000024.hdr.sgml : 20050927 20050927160130 ACCESSION NUMBER: 0000024240-05-000024 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20050927 DATE AS OF CHANGE: 20050927 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: VALHI INC /DE/ CENTRAL INDEX KEY: 0000059255 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INORGANIC CHEMICALS [2810] IRS NUMBER: 870110150 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-20934 FILM NUMBER: 051105498 BUSINESS ADDRESS: STREET 1: 5430 LBJ FRWY STREET 2: STE 1700 CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 9722331700 MAIL ADDRESS: STREET 1: THREE LINCOLN CENTER STREET 2: 5430 LBJ FREEWAY SUITE 1700 CITY: DALLAS STATE: TX ZIP: 75240 FORMER COMPANY: FORMER CONFORMED NAME: LLC CORP DATE OF NAME CHANGE: 19870329 FORMER COMPANY: FORMER CONFORMED NAME: LIBERTY LOAN CORP DATE OF NAME CHANGE: 19800414 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CONTRAN CORP CENTRAL INDEX KEY: 0000024240 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 5430 LBJ FRWY STREET 2: SUITE 1700 CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 9724504228 MAIL ADDRESS: STREET 1: 5430 LBJ FRWY STREET 2: SUITE 1700 CITY: DALLAS STATE: TX ZIP: 75240 SC 13D/A 1 vhi13d091905.txt SCHEDULE 13D/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13D Under the Securities Exchange Act of 1934 (Amendment No. 68)* VALHI, INC. (Name of Issuer) Common Stock, $0.01 par value (Title of Class of Securities) 918905 10 0 (CUSIP Number) STEVEN L. WATSON THREE LINCOLN CENTRE SUITE 1700 5430 LBJ FREEWAY DALLAS, TEXAS 75240-2694 (972) 233-1700 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) September 19, 2005 (Date of Event which requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [ ] *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). (Continued on following pages) CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Valhi Holding Company 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) OO 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Valhi Group, Inc. 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Nevada 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON National City Lines, Inc. 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON NOA, Inc. 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) Not Applicable 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Texas 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Dixie Holding Company 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) Not Applicable 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Dixie Rice Agricultural Corporation, Inc. 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) Not Applicable 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Louisiana 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Southwest Louisiana Land Company, Inc. 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) Not Applicable 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Louisiana 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,098,763 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,098,763 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,098,763 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.3% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Contran Corporation 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS (SEE INSTRUCTIONS) WC 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7 SOLE VOTING POWER -0- NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 106,538,163 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- 10 SHARED DISPOSITIVE POWER 106,538,163 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,538,163 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 91.6% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) CO CUSIP No. 918905 10 0 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harold C. Simmons 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP(SEE INSTRUCTIONS) (a) [ ] (b) [ ] 3 SEC USE ONLY 4 SOURCE OF FUNDS(SEE INSTRUCTIONS) Not applicable 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA 7 SOLE VOTING POWER 3,383 NUMBER OF SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 107,777,263 EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH 3,383 10 SHARED DISPOSITIVE POWER 107,777,263 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 3,383 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ X ] 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.0% 14 TYPE OF REPORTING PERSON(SEE INSTRUCTIONS) IN AMENDMENT NO. 68 TO SCHEDULE 13D This amended statement on Schedule 13D (this "Statement") relates to the common stock, par value $0.01 per share (the "Shares"), of Valhi, Inc., a Delaware corporation (the "Company"). Items 2, 3, 4, 5, 6 and 7 of this Statement are hereby amended as set forth below. As a result of the Company's repurchases of Shares, the aggregate ownership of the outstanding Shares of all of the reporting persons in this Statement increased by one percent on September 19, 2005. Item 2. Identity and Background Item 2 is amended as follows. (a) This Statement is filed (i) by Valhi Holding Company, ("VHC") as a direct holder of Shares, (ii) by virtue of the direct and indirect ownership of securities of VHC, by Valhi Group, Inc. ("VGI"), National City Lines, Inc. ("National"), NOA, Inc. ("NOA"), Dixie Holding Company ("Dixie Holding"), Dixie Rice Agricultural Corporation, Inc. ("Dixie Rice"), Southwest Louisiana Land Company, Inc. ("Southwest") and Contran Corporation ("Contran") and (iii) by virtue of positions he holds with Contran and certain of the other entities (as reported on this Statement), by Harold C. Simmons (collectively, the "Reporting Persons"). By signing this Statement, each Reporting Person agrees that this Statement is filed on its or his behalf. VHC, the Harold Simmons Foundation, Inc. (the "Foundation"), the Contran Deferred Compensation Trust No. 2 (the "CDCT No. 2") and The Combined Master Retirement Trust (the "CMRT") are the direct holders of approximately 91.3%, 0.9%, 0.4% and 0.1%, respectively, of the 116,265,978 Shares outstanding as of September 19, 2005 according to information furnished by the Company (the "Outstanding Shares"). VHC may be deemed to control the Company. VGI, National and Contran are the holders of approximately 87.4%, 10.3% and 2.3%, respectively, of the outstanding common stock of VHC. Together, VGI, National and Contran may be deemed to control VHC. National, NOA and Dixie Holding are the direct holders of approximately 73.3%, 11.4% and 15.3%, respectively, of the outstanding common stock of VGI. Together, National, NOA and Dixie Holding may be deemed to control VGI. Contran and NOA are the direct holders of approximately 85.7% and 14.3%, respectively, of the outstanding common stock of National and together may be deemed to control National. Contran and Southwest are the direct holders of approximately 49.9% and 50.1%, respectively, of the outstanding common stock of NOA and together may be deemed to control NOA. Dixie Rice is the direct holder of 100% of the outstanding common stock of Dixie Holding and may be deemed to control Dixie Holding. Contran is the holder of 100% of the outstanding common stock of Dixie Rice and may be deemed to control Dixie Rice. Contran is the holder of approximately 88.9% of the outstanding common stock of Southwest and may be deemed to control Southwest. Substantially all of Contran's outstanding voting stock is held by trusts established for the benefit of certain children and grandchildren of Harold C. Simmons (the "Trusts"), of which Mr. Simmons is the sole trustee, or held by Mr. Simmons or persons or other entities related to Mr. Simmons. As sole trustee of the Trusts, Mr. Simmons has the power to vote and direct the disposition of the shares of Contran stock held by the Trusts. Mr. Simmons, however, disclaims beneficial ownership of any shares of Contran stock that the Trusts hold. The Foundation directly holds approximately 0.9% of the Outstanding Shares. The Foundation is a tax-exempt foundation organized for charitable purposes. Harold C. Simmons is the chairman of the board of the Foundation and may be deemed to control the Foundation. The CDCT No. 2 directly holds approximately 0.4% of the Outstanding Shares. U.S. Bank National Association serves as the trustee of the CDCT No. 2. Contran established the CDCT No. 2 as an irrevocable "rabbi trust" to assist Contran in meeting certain deferred compensation obligations that it owed to Harold C. Simmons. If the CDCT No. 2 assets are insufficient to satisfy such obligations, Contran is obligated to satisfy the balance of such obligations as they come due. Pursuant to the terms of the CDCT No. 2, Contran (i) retains the power to vote the Shares held directly by the CDCT No. 2, (ii) retains dispositive power over such Shares and (iii) may be deemed the indirect beneficial owner of such Shares. The description of the CDCT No. 2 is qualified in its entirety by reference to the copy of the Amended and Restated Contran Deferred Compensation Trust No. 2 Agreement between Contran and U.S. Bank National Association filed as Exhibit 1 to Amendment No. 64 to this Statement, which agreement is incorporated herein by reference. The CMRT directly holds approximately 0.1% of the Outstanding Shares. The Company established the CMRT as a trust to permit the collective investment by master trusts that maintain the assets of certain employee benefit plans the Company and related companies adopt. Mr. Simmons is the sole trustee of the CMRT and a member of the trust investment committee for the CMRT. Mr. Simmons is a participant in one or more of the employee benefit plans that invest through the CMRT. Mr. Simmons is chairman of the board of the Company, VHC, VGI, National, NOA, Dixie Holding, Dixie Rice, Southwest and Contran. By virtue of the holding of the offices, the stock ownership and his service as trustee, all as described above, (a) Mr. Simmons may be deemed to control such entities and (b) Mr. Simmons and certain of such entities may be deemed to possess indirect beneficial ownership of the Shares directly held by certain of such other entities. However, Mr. Simmons disclaims beneficial ownership of the Shares beneficially owned, directly or indirectly, by any of such entities, except to the extent of his interest as a beneficiary of the CDCT No. 2 and his vested beneficial interest, if any, in the Shares held by the CMRT. Harold C. Simmons' spouse is the direct owner of 43,400 Shares. Mr. Simmons may be deemed to share indirect beneficial ownership of such Shares. He disclaims all such beneficial ownership. A trust of which Harold C. Simmons and his spouse are co-trustees and the beneficiaries of which are the grandchildren of his spouse is the direct holder of 36,500 Shares (the "Grandchildren's Trust"). Mr. Simmons, as co-trustee of the Grandchildren's Trust, has the power to vote and direct the disposition of the Shares the Grandchildren's Trust directly holds. Mr. Simmons disclaims beneficial ownership of any Shares that the Grandchildren's Trust holds. Harold C. Simmons is the direct owner of 3,383 Shares. The Company is the direct holder of approximately 83.1% of the outstanding common stock of NL Industries, Inc. ("NL") and may be deemed to control NL. NL and a subsidiary of NL directly own 3,522,967 Shares and 1,186,200 Shares, respectively. Pursuant to Delaware law, the Company treats the Shares that NL and its subsidiary own as treasury stock for voting purposes and for the purposes of this Statement are not deemed outstanding. Certain information concerning the directors and executive officers of the Reporting Persons, including offices held by Mr. Simmons, is set forth on Schedule B attached hereto and incorporated herein by reference. (c) VHC is engaged in holding Shares and, by virtue of the holding of its Shares, activities engaged in through the Company and its subsidiaries. (d) None of the Reporting Persons or, to the best knowledge of such persons, any of the persons named in Schedule B to this Statement has been convicted in a criminal proceeding in the past five years (excluding traffic violations or similar misdemeanors). (e) None of the Reporting Persons or, to the best knowledge of such persons, any person named in Schedule B to this Statement, was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which such person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Harold C. Simmons and all persons named on Schedule B to this Statement are citizens of the United States, except as otherwise indicated on such Schedule. Item 3. Source and Amount of Funds or Other Consideration Item 3 is amended as follows. On September 25, 2005, as part of the initial capitalization of VHC, VGI, National and Contran contributed the following Shares to VHC in exchange for the following shares of VHC common stock (the "VHC Contribution").
Shares of VHC Common Stock Shares Contributed Issued to Reporting Person to VHC Reporting Person - ----------------------------- ------------------ ---------------- Valhi Group, Inc............. 92,739,554 87,409 National City Lines, Inc..... 10,891,009 10,265 Contran Corporation.......... 2,468,200 2,326 ----------- ------- Total........................ 106,098,763 100,000 =========== =======
The Reporting Persons understand that the funds required by each person named in Schedule B to this Statement to acquire Shares were from such person's personal funds. Item 4. Purpose of Transaction Item 4 is amended as follows. The purpose of the VHC Contribution was to consolidate the ownership of Shares formerly held by VGI, National and Contran. Depending upon their evaluation of the Company's business and prospects, and upon future developments (including, but not limited to, performance of the Shares in the market, availability of funds, alternative uses of funds, the Reporting Persons' tax planning objectives and stock market and general economic conditions), any of the Reporting Persons or other entities or persons that may be deemed to be affiliated with Contran may from time to time purchase Shares, and any of the Reporting Persons or other entities or persons that may be deemed to be affiliated with Contran may from time to time dispose of all or a portion of the Shares held by such entity or person, or cease buying or selling Shares. Any such additional purchases or sales of the Shares may be in open market or privately negotiated transactions or otherwise. As described under Item 2, Harold C. Simmons, through Contran, may be deemed to control the Company. The Reporting Persons understand that prior purchases of Shares by each of the persons named in Schedule B to this Statement (other than Harold C. Simmons) were made for the purpose of each such person's personal investment. Certain of the persons named in Schedule B to this Statement, namely Eugene K. Anderson, Robert D. Graham, J. Mark Hollingsworth, William J. Lindquist, A. Andrew R. Louis, Kelly D. Luttmer, Bobby D. O'Brien, Harold C. Simmons, Glenn R. Simmons, John A. St. Wrba, Gregory M. Swalwell and Steven L. Watson are directors or officers of the Company and may acquire Shares from time to time pursuant to benefit plans that the Company sponsors or other compensation arrangements with the Company. Except as described in this Item 4, none of the Reporting Persons nor, to the best knowledge of such persons, any other person named in Schedule B to the this Statement has formulated any plans or proposals that relate to or would result in any matter required to be disclosed in response to paragraphs (a) through (j) of Item 4 of Schedule 13D. Item 5. Interest in Securities of the Issuer. Item 5 is amended as follows. (a) VHC, the Foundation, the CDCT No. 2, the CMRT, the spouse of Harold C. Simmons, the Grandchildren's Trust and Harold C. Simmons are the direct beneficial owners of 106,098,763, 1,044,200, 439,400, 115,000, 43,400, 36,500 and 3,383 Shares, respectively. By virtue of the relationships described under Item 2 of this Statement: (1) VHC, VGI, Dixie Holding, Dixie Rice, National, NOA and Southwest may each be deemed be the beneficial owner of the 106,098,763 Shares (approximately 91.3% of the Outstanding Shares) that VHC directly holds; (2) Contran may be deemed be the beneficial owner of the 106,538,163 Shares (approximately 91.6% of the Outstanding Shares) that VHC and the CDCT No. 2 directly hold; and (3) Harold C. Simmons may be deemed to be the beneficial owner of the 107,780,646 Shares (approximately 92.7% of the Outstanding Shares) that VHC, the Foundation, the CDCT No. 2, the CMRT, his spouse, the Grandchildren's Trust and he directly hold. Except for the 3,383 Shares that he holds directly and to the extent of his interest as a beneficiary of the CDCT No. 2 and his vested beneficial interest, if any, in Shares directly held by the CMRT, Mr. Simmons disclaims beneficial ownership of all Shares. (b) By virtue of the relationships described in Item 2: (1) VHC, VGI, Dixie Holding, Dixie Rice, National, NOA and Southwest may each be deemed to share the power to vote and direct the disposition of the 106,098,763 Shares (approximately 91.3% of the Outstanding Shares) that VHC directly holds; (2) Contran may be deemed to share the power to vote and direct the disposition of the 106,538,163 Shares (approximately 91.6% of the Outstanding Shares) that VHC and the CDCT No. 2 directly hold; (3) Harold C. Simmons may be deemed to share the power to vote and direct the disposition of 107,777,263 Shares (approximately 92.6% of the Outstanding Shares) that VHC, the Foundation, the CDCT No. 2, the CMRT, his spouse and the Grandchildren's Trust directly hold; and (4) Harold C. Simmons may be deemed to have sole power to vote and direct the disposition of 3,338 Shares that he directly holds. The Reporting Persons understand, based on ownership filings with the U.S. Securities and Exchange Commission or upon information provided by the persons listed on Schedule B to this Statement, that such persons may be deemed to own personally and beneficially the Shares as indicated on Schedule C to this Statement. (c) See the description of the VHC Contribution under Item 3, which is incorporated herein by reference. Additionally, on September 1, 2005, Glenn R. Simmons gifted away 6,000 Shares. (d) Each of VHC, the Foundation, the CDCT No. 2, the CMRT, the spouse of Harold C. Simmons, the Grandchildren's Trust and Harold C. Simmons has the right to receive and the power to direct the receipt of dividends from, and proceeds from the sale of, the Shares directly held by such entity or person. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer. Item 6 is amended as follows. Contran and National are parties to a $25.0 million revolving credit and letter of credit facility dated as of September 3, 1998, as amended and supplemented through October 29, 2004, with U.S. Bank National Association (the "U.S. Bank Facility"). Borrowings under the U.S. Bank Facility bear interest at the rate announced publicly from time to time by each bank as its base rate or at a rate of 1.75% over the London interbank offered rate of interest ("LIBOR"), are due October 28, 2005 or such extended maturity date as may be mutually agreed to, and are collateralized by, among other things, certain Shares. On September 16, 2005, no amounts had been borrowed and approximately $7.4 million of letters of credit were outstanding under the U.S. Bank Facility. Of the Shares contributed by National in the VHC Contribution, 7.0 million Shares were pledged under the U.S. Bank Facility. National contributed these 7.0 million Shares to VHC subject to the lien under the U.S. Bank Facility. VHC is now the owner of these 7.0 million shares subject to the pledge. Contran, National, VHC and U.S. Bank are currently in the process of preparing documents to reflect VHC's pledge of 7.0 million Shares, and the release of the 7.0 million Shares originally pledged by National, under the U.S. Bank Facility. The foregoing summary of the U.S. Bank Facility is qualified in its entirety by reference to Exhibits 1 through 5 to Amendment No. 63 to this Statement, Exhibits 11 and 12 to Amendment No. 64 to this Statement, Exhibit 16 to Amendment No. 65 to this Statement, and Exhibits 12 and 13 to Amendment No. 67 to this Statement, all of which are incorporated herein by this reference. Dixie Rice is a party to a $1.5 million credit facility dated as of August 18, 1986 with Southern Methodist University (the "SMU Facility"). Borrowings under the SMU Facility bear interest at the greater or 7.5% per annum or 76% of the Shearson Lehman Brothers, Inc. Bond Market Report -- Corporate Bond Index -- Long Term (Average) Yield, are due in forty equal quarterly installments beginning September 30, 1996 and ending on June 30, 2006 and are secured by certain Shares. As of September 16, 2005, $150,000 principal amount was outstanding under the SMU Facility and 50,000 Shares had been pledged under the SMU Facility. The Shares pledged under the SMU Facility are owned by VHC but loaned to Dixie Rice pursuant to a Collateral Agreement, dated August 25, 2005 between Dixie Rice and VHC (the "Collateral Agreement"). Effective August 25, 2005 pursuant to Collateral Agreement, Dixie Rice agreed to: (i) pay to VHC a fee equal to an annual rate of 0.5% of the average daily principal loan balance outstanding, during periods in which any portion of the Shares are pledged under the SMU Facility; and (ii) indemnify VHC against any loss or incremental cost resulting from the pledge of the Shares under the SMU Facility. The foregoing summary of the SMU Facility and the Collateral Agreement is qualified in its entirety by reference to Exhibit 11 to Amendment No. 59 to this Statement and Exhibit 13 to this Amendment No. 68 to this Statement, respectively, which are incorporated herein by this reference. Since 50,000 of the Shares contributed by Contran in the VHC Contribution were contributed subject to a similar previously disclosed collateral agreement between Contran and Dixie Rice, such old collateral agreement has been replaced by this new collateral agreement between VHC and Dixie Rice. Effective August 25, 2005 pursuant to three pledge agreements between Contran and VHC, VHC pledged in the aggregate to three deferred compensation trusts, including the CDCT No. 2, an aggregate of 6.92 million Shares to secure Contran's obligations under three deferred compensation agreements for the benefit of Harold C. Simmons or Glenn R. Simmons. Pursuant to the pledge agreements, Contran agreed to: (i) pay VHC quarterly a fee equal to 0.125% of the value of the Shares pledged under the respective agreement; and (ii) indemnify VHC against any loss or incremental cost resulting from the pledge of the Shares to the trusts under the pledge agreements or any transfer of the Shares to the trusts resulting from an obligation of Contran to pay Harold C. Simmons amounts under the related deferred compensation agreements. Prior to any transfer of any Shares to any of the trusts resulting from such obligations, VHC retains all rights to vote and receive dividends on the pledged Shares. The foregoing summary of the pledge agreements is qualified in its entirety by reference to Exhibits 14, 15 and 16 to this Amendment No. 68 to this Statement, respectively, which are incorporated herein by this reference. Since 6.92 million of the Shares contributed by VGI in the VHC Contribution were contributed subject to three similar previously disclosed pledge agreements between VGI and Contran, such old pledge agreements have been replaced by these three new pledge agreements between VHC and Contran. Item 7. Material to be Filed as Exhibits. Item 7 is amended and restated as follows. Exhibit 1 Contran Deferred Compensation Trust No. 2 (Amended and Restated), dated as of August 8, 2000, between Contran Corporation and U.S. Bank National Association (incorporated by reference to Exhibit 1 to Amendment No. 64 to this Statement). Exhibit 2 Loan Agreement dated as of September 3, 1998 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 1 to Amendment No. 63 to this Schedule 13D). Exhibit 3 Promissory Note dated September 3, 1998 in the original principal amount of $25 million payable to the order of U.S. Bank National Association and executed by Contran Corporation (incorporated by reference to Exhibit 2 to Amendment No. 63 to this Schedule 13D). Exhibit 4 Payment Guaranty dated September 3, 1998 executed by National City Lines, Inc. (incorporated by reference to Exhibit 3 to Amendment No. 63 to this Schedule 13D). Exhibit 5 Securities Pledge Agreement dated as of September 3, 1998 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4 to Amendment No. 63 to this Schedule 13D). Exhibit 6 Extension Agreement dated as of September 2, 1999 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 5 to Amendment No. 63 to this Statement). Exhibit 7 Extension and Amendment Agreement dated as of August 31, 2000 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 11 to Amendment No. 64 to this Statement). Exhibit 8 Extension and Amendment Agreement dated as of August 31, 2001 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 12 to Amendment No. 64 to this Statement). Exhibit 9 Extension and Amendment Agreement dated as of August 28, 2002 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 16 to Amendment No. 65 to this Statement). Exhibit 10 Amended and Restated Extension and Amendment Agreement dated as of October 24, 2003 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 12 to Amendment No. 67 to this Statement). Exhibit 11 Extension and Amendment Agreement dated as of October 29, 2004 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 13 to Amendment No. 67 to this Statement). Exhibit 12 Loan and Pledge Agreement, dated as of August 18, 1986, between Dixie Rice Agricultural Corporation, Inc. and Southern Methodist University (incorporated by reference to Exhibit 11 to Amendment No. 59 to this Statement). Exhibit 13* Collateral Agreement, dated as of August 25, 2005, between Dixie Rice Agricultural Corporation, Inc. and Valhi Holding Company. Exhibit 14* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 1. Exhibit 15* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 2. Exhibit 16* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 3.
- ---------- * Filed herewith. Signature After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Statement is true, complete and correct. Date: September 27, 2005 /s/ Harold C. Simmons ---------------------------- Harold C. Simmons Signing in his individual capacity only. Signature After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Statement is true, complete and correct. Date: September 27, 2005 /s/ Steven L. Watson ---------------------------- Steven L. Watson Signing in the capacities listed on Schedule "A" attached hereto and incorporated herein by reference. SCHEDULE A Steven L. Watson, as President or Executive Vice President of each of: CONTRAN CORPORATION DIXIE HOLDING COMPANY DIXIE RICE AGRICULTURAL CORPORATION, INC. NATIONAL CITY LINES, INC. NOA, INC. SOUTHWEST LOUISIANA LAND COMPANY, INC. VALHI HOLDING COMPANY VALHI GROUP, INC. SCHEDULE B The names of the directors and executive officers of Contran Corporation ("Contran"), Dixie Holding Company ("Dixie Holding"), Dixie Rice Agricultural Corporation, Inc. ("Dixie Rice"), National City Lines, Inc. ("National"), NOA, Inc. ("NOA"), Southwest Louisiana Land Company, Inc. ("Southwest"), Valhi Group, Inc. ("VGI") and Valhi Holding Company ("VHC") and their present principal occupations are set forth below. Except as otherwise indicated, the business address of each such person is 5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240.
Name Present Principal Occupation - -------------------------- ------------------------------------------------ Eugene K. Anderson Vice president of Contran, Dixie Holding, Dixie Rice, National, NOA, Southwest, Valhi, Inc. (the "Company"), VGI and VHC. Robert D. Graham Vice president of Contran, Dixie Holding, Dixie Rice, National, NOA, Southwest, the Company, VGI and VHC; and vice president, general counsel and secretary of Kronos Worldwide, Inc. ("Kronos Worldwide") and NL Industries, Inc. ("NL"), both subsidiaries of the Company. J. Mark Hollingsworth Vice president and general counsel of Contran, Dixie Holding, Dixie Rice, National, NOA, Southwest, the Company, VGI and VHC; general counsel of CompX International Inc., an affiliate of the Company ("CompX"); trust counsel of The Combined Master Retirement Trust, a trust the Company formed to permit the collective investment by trusts that maintain the assets of certain employee benefit plans the Company and related companies adopt (the "CMRT"); and acting general counsel of Keystone Consolidated Industries, Inc. ("Keystone"), an affiliate of Contran. William J. Lindquist Director and senior vice president of Contran, Dixie Holding, National, NOA, VGI and VHC; senior vice president of the Company, Dixie Rice and Southwest. A. Andrew R. Louis Secretary of Contran, CompX, Dixie Holding, Dixie Rice, National, NOA, Southwest, the Company, VGI and VHC. Kelly D. Luttmer Vice president and tax director of the Company, Contran, CompX, Dixie Holding, Dixie Rice, Kronos Worldwide, National, NL, NOA, Southwest, VGI and VHC. Andrew McCollam, Jr. (1) President and director of Southwest; director of Dixie Rice; and a private investor. Harold M. Mire (2) Vice president of Dixie Rice and Southwest. Bobby D. O'Brien Vice president, chief financial officer and director of Dixie Holding, National, NOA and VGI; and vice president and chief financial officer of the Company, Contran, Dixie Rice, Southwest and VHC. Glenn R. Simmons Vice chairman of the board of Contran, Dixie Holding, Dixie Rice, National, NOA, the Company, VGI and VHC; chairman of the board of CompX and Keystone; director and executive vice president of Southwest; and a director of Kronos Worldwide, NL and Titanium Metals Corporation, an affiliate of the Company ("TIMET"). Harold C. Simmons Chairman of the board of the Company, Contran, Dixie Holding, Dixie Rice, National, NOA, Southwest, VGI and VHC; chairman of the board and chief executive officer of Kronos Worldwide and NL; vice chairman of TIMET; and trustee and member of the trust investment committee of the CMRT. Richard A. Smith (2) Vice president of Dixie Rice. John A. St. Wrba Vice president and treasurer of the Company, Contran, Dixie Holding, Dixie Rice, Kronos Worldwide, National, NL, NOA, Southwest, VGI and VHC; and vice president and assistant treasurer of TIMET. Gregory M. Swalwell Vice president and controller of the Company, Contran, Dixie Holding, National, NOA, Southwest, VGI and VHC; vice president, finance and chief financial officer of Kronos Worldwide and NL; and vice president of Dixie Rice, Southwest and TIMET. Steven L. Watson Director and president of Contran, Dixie Holding, Dixie Rice, National, NOA, VGI and VHC; director, president and chief executive officer of the Company; director and executive vice president of Southwest; vice chairman of Kronos Worldwide; and a director of CompX, Keystone, NL and TIMET.
- ---------- (1) The principal business address for Mr. McCollam is 402 Canal Street, Houma, Louisiana 70360. (2) The principal business address for Messrs. Mire and Smith is 600 Pasquiere Street, Gueydan, Louisiana 70542-0010. SCHEDULE C Based upon ownership filings with the U.S. Securities and Exchange Commission or upon information provided by the persons listed on Schedule B to this Statement, such persons may be deemed to own personally and beneficially Shares, as outlined below:
Shares Options Name Held Held (1) Total - -------------------------- ----------- ----------- ----------- Eugene K. Anderson 1,446 51,400 52,846 Robert D. Graham -0- -0- -0- J. Mark Hollingsworth -0- 100,000 100,000 William J. Lindquist -0- 130,000 130,000 A. Andrew R. Louis -0- 69,600 69,600 Kelly D. Luttmer -0- 66,600 66,600 Andrew McCollam, Jr. 550 -0- 550 Harold M. Mire 1,137 -0- 1,137 Bobby D. O'Brien -0- 80,000 80,000 Glenn R. Simmons(2) 12,247 -0- 12,247 Harold C. Simmons(3) 83,283 -0- 83,283 Richard A. Smith 333 -0- 333 John A. St. Wrba -0- -0- -0- Gregory M. Swalwell 1,166 100,000 100,000 Steven L. Watson 17,246 100,000 117,246
- ---------- (1) Represents Shares issuable pursuant to the exercise within 60 days of the execution date of this Statement of stock options. (2) The Reporting Persons understand that the Shares indicated as held by Mr. Simmons also include 800 Shares held in his wife's retirement account, with respect to which Mr. Simmons disclaims beneficial ownership. (4) Includes 43,400 and 36,500 Shares directly held, respectively, by Harold C. Simmons' spouse and a trust of which Harold C. Simmons and his spouse are co-trustees and the beneficiaries of which are the grandchildren of his spouse. Mr. Harold C. Simmons also may be deemed to possess indirect beneficial ownership of the other Shares set forth in Item 5(a) of this Statement, held by other Reporting Persons. Mr. Simmons disclaims beneficial ownership of all Shares except for the 3,383 Shares that he holds directly and to the extent of his interest as a beneficiary of the CDCT No. 2 and his vested beneficial interest, if any, in Shares directly held by the CMRT.
EXHIBIT INDEX Exhibit 1 Contran Deferred Compensation Trust No. 2 (Amended and Restated), dated as of August 8, 2000, between Contran Corporation and U.S. Bank National Association (incorporated by reference to Exhibit 1 to Amendment No. 64 to this Statement). Exhibit 2 Loan Agreement dated as of September 3, 1998 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 1 to Amendment No. 63 to this Schedule 13D). Exhibit 3 Promissory Note dated September 3, 1998 in the original principal amount of $25 million payable to the order of U.S. Bank National Association and executed by Contran Corporation (incorporated by reference to Exhibit 2 to Amendment No. 63 to this Schedule 13D). Exhibit 4 Payment Guaranty dated September 3, 1998 executed by National City Lines, Inc. (incorporated by reference to Exhibit 3 to Amendment No. 63 to this Schedule 13D). Exhibit 5 Securities Pledge Agreement dated as of September 3, 1998 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4 to Amendment No. 63 to this Schedule 13D). Exhibit 6 Extension Agreement dated as of September 2, 1999 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 5 to Amendment No. 63 to this Statement). Exhibit 7 Extension and Amendment Agreement dated as of August 31, 2000 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 11 to Amendment No. 64 to this Statement). Exhibit 8 Extension and Amendment Agreement dated as of August 31, 2001 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 12 to Amendment No. 64 to this Statement). Exhibit 9 Extension and Amendment Agreement dated as of August 28, 2002 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 16 to Amendment No. 65 to this Statement). Exhibit 10 Amended and Restated Extension and Amendment Agreement dated as of October 24, 2003 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 12 to Amendment No. 67 to this Statement). Exhibit 11 Extension and Amendment Agreement dated as of October 29, 2004 among Contran Corporation, National City Lines, Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 13 to Amendment No. 67 to this Statement). Exhibit 12 Loan and Pledge Agreement, dated as of August 18, 1986, between Dixie Rice Agricultural Corporation, Inc. and Southern Methodist University (incorporated by reference to Exhibit 11 to Amendment No. 59 to this Statement). Exhibit 13* Collateral Agreement, dated as of August 25, 2005, between Dixie Rice Agricultural Corporation, Inc. and Valhi Holding Company. Exhibit 14* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 1. Exhibit 15* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 2. Exhibit 16* Pledge Agreement dated as of August 25, 2005 between Contran Corporation and Valhi Holding Company for the benefit of the Contran Deferred Compensation Trust No. 3.
- ---------- * Filed herewith. EX-13 3 exhibit13.txt EXHIBIT 13 COLLATERAL AGREEMENT This Collateral Agreement (this "Agreement") is made by and between Dixie Rice Agricultural Corporation, Inc., a Louisiana corporation ("Dixie"), and Valhi Holding Company, a Delaware corporation ("VHC"), as of the 25th day of August, 2005. Recitals A. Dixie and Southern Methodist University ("SMU") have entered into that certain Loan and Pledge Agreement dated August 18, 1986 (the "Loan Agreement"), pursuant to which SMU has agreed to advance Dixie up to $1,500,000.00 in loans. B. SMU requires, among other things, that Dixie pledge shares of stock with a market value of not less than two hundred percent (200%) of the outstanding principal balance of the loans advanced under the Loan Agreement. C. Dixie does not currently hold securities that will qualify as collateral under the Loan Agreement. D. On August 24, 2005, in order to assist Dixie with its pledge obligation, Contran Corporation, a Delaware corporation and an affiliate of Dixie and VHC ("Contran"), had pledged 50,000 shares (the "Old Shares") of the common stock, par value $0.01 per share (the "Valhi Common Stock"), of Valhi, Inc., a Delaware corporation, for a collateral fee Dixie paid to Contran. E. On August 25, 2005, Contran contributed the Old Shares to VHC subject to all existing liens. F. VHC has agreed to pledge 50,000 shares of the Valhi Common Stock as collateral under the Loan Agreement in exchange for the Old Shares. Agreement In consideration of the mutual premises, representations and covenants herein contained, the parties hereto mutually agree as follows. Section 1. VHC agrees to pledge, as collateral under the Loan Agreement, 50,000 shares of Valhi Common Stock owned by VHC, or such greater number of shares that shall have from time to time a market value of at least the value required by the Loan Agreement (the "New Shares"). Section 2. As consideration for pledging the New Shares, Dixie shall pay to VHC a fee equal to an annual rate of 0.5% of the average daily principal loan balance outstanding, during periods in which any portion of the New Shares are pledged, under the Loan Agreement, payable quarterly on each March 31, June 30, September 30, and December 31. Section 3. Dixie agrees to indemnify VHC against any loss or incremental cost resulting from the pledge of the New Shares under the Loan Agreement. Section 4. Dixie agrees to use its best efforts to deliver stock certificates representing the Old Shares to VHC shortly after the delivery of the New Shares to SMU. Section 5. The Agreement may be terminated by either party hereto by giving the other party thirty (30) days written notice of such termination. Executed as of the date first above written. DIXIE RICE AGRICULTURAL CORPORATION, INC. By:/s/ Bobby D. O'Brien -------------------------------------- Bobby D. O'Brien, Vice President VALHI HOLDING COMPANY By:/s/ Gregory M. Swalwell -------------------------------------- Gregory M. Swalwell, Vice President EX-14 4 exhibit14.txt EXHIBIT 14 PLEDGE AGREEMENT For the Benefit of the Contran Deferred Compensation Trust No. 1 This Pledge Agreement (this "Agreement") is made as of August 25, 2005 between Contran Corporation, a Delaware corporation ("Contran"), and Valhi Holding Company, a Delaware corporation and a subsidiary of Contran ("VHC"). Recitals A. Contran and Harold C. Simmons, the chairman of the board of Contran and a resident of Dallas, Texas ("Simmons"), have entered into that certain Amended and Restated 1993 Deferred Compensation Agreement as of January 1, 2004 (Originally Established December 29, 1993) (collectively with any further amendments, the "Deferred Compensation Agreement"). Pursuant to the Deferred Compensation Agreement, Contran has an obligation to pay Simmons upon the occurrence of certain events (a "Payout Event") the value of Simmons's deferred compensation account established by the Deferred Compensation Agreement, less the value of assets concurrently distributed to him at the time by the trustee of the Amended and Restated Contran Deferred Compensation Trust No. 1 as of January 1, 2004 (the "CDCT"). B. On January 1, 2004, Valhi Group, Inc., a Nevada corporation and a subsidiary of Contran ("VGI"), in order to assist Contran in funding it obligations under the Deferred Compensation Agreement, pledged 3.5 million shares (the "Old Shares") of the common stock, par value $0.01 per share ("Valhi Common Stock"), of Valhi, Inc., a Delaware corporation and also a subsidiary of VGI and Contran, registered in the name of VGI to the CDCT in consideration of a collateral fee and an indemnity from Contran pursuant to a Pledge Agreement dated January 1, 2004 between Contran and VGI. C. On August 25, 2005, VGI contributed the Old Shares to VHC, which contribution was subject to all existing liens. D. VHC desires to pledge 3.5 million shares of Valhi Common Stock registered in the name of VHC (the "New Shares") to the CDCT under the terms of this Agreement in anticipation of the delivery of the Old Shares to VHC. Agreement In consideration of the mutual premises, representations and covenants herein contained, the parties hereto mutually agree as follows. Section 1. The Pledge. VHC agrees to secure Contran's obligations under the Deferred Compensation Agreement by granting to the CDCT a security interest in the New Shares and delivering to the CDCT stock certificates for the New Shares with applicable stock powers duly executed in blank by VHC, all in a form reasonably satisfactory to the CDCT. VHC warrants that the New Shares, when delivered to the CDCT will be free and clear of all liens, claims and encumbrances whatsoever, except for such liens, claims and encumbrances on the New Shares created by this Agreement. The CDCT may at any time following the occurrence and during the continuation of a Payout Event cause any or all of the New Shares to be transferred of record into the name of the CDCT or its nominee and exercise any and all rights of a secured party holding a security interest in the New Shares under the uniform commercial code. Prior to the transfer of record of a New Share to the CDCT upon a Payout Event, VHC shall retain all rights to vote the New Share and receive dividends on the New Share. Section 2. The Pledge Fee. As consideration for pledging the New Shares, Contran shall pay to VHC on March 31, June 30, September 30 and December 31 of each year (if a business day, and if not, on the next successive business day as if made as of the end of such calendar quarter) a fee equal to 0.125% of the value of the New Shares based on the closing sales price per share for shares of Valhi Common Stock on the second to last day of such calendar quarter on which such shares traded as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which such shares may then trade. The initial fee payable on September 30, 2005 shall be pro rated based on the period from the date of this Agreement to September 30, 2005. Upon the termination of this Agreement, if the termination date is not as of the end of a calendar quarter, Contran shall pay on the termination date to VHC a pro rated fee based on the portion of the calendar quarter that the New Shares were pledged and the closing sales price per share of Valhi Common Stock on the second to last day on which shares of Valhi Common Stock traded prior to the termination date as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which such shares may then trade. Section 3. Indemnity. Contran agrees to indemnify VHC against any loss or incremental cost resulting from the pledge of the New Shares to the CDCT under this Agreement or the transfer of the New Shares to the CDCT upon a Payout Event. Section 4. Return of Old Shares. Contran agrees to use its best efforts to deliver stock certificates representing the Old Shares to VHC shortly after the delivery of the New Shares to the CDCT. Section 5. Termination. Either party hereto may terminate this Agreement by giving the other party thirty days advance written notice of such termination. On the termination date of this Agreement, Contran shall return the stock certificates representing the New Shares to VHC and the related stock powers that VHC originally tendered to Contran under this Agreement. Section 6. Applicable Law. This Agreement shall be governed by and construed in accordance with the domestic laws of the state of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the state of Texas. Executed as of the date first above written. CONTRAN CORPORATION VALHI HOLDING COMPANY By:/s/ Bobby D. O'Brien By:/s/ Gregory M. Swalwell -------------------------------- ----------------------------------- Bobby D. O'Brien, Vice President Gregory M. Swalwell, Vice President EX-15 5 exhibit15.txt EXHIBIT 15 PLEDGE AGREEMENT For the Benefit of the Contran Deferred Compensation Trust No. 2 This Pledge Agreement (this "Agreement") is made as of August 25, 2005 between Contran Corporation, a Delaware corporation ("Contran"), and Valhi Holding Company, a Delaware corporation and a subsidiary of Contran ("VHC"). Recitals A. Contran and Harold C. Simmons, the chairman of the board of Contran and a resident of Dallas, Texas ("Simmons"), have entered into that certain Amended and Restated 1984 Deferred Compensation Agreement as of January 1, 2004 (Originally Established October 31, 1984) (along with any further amendments, the "Deferred Compensation Agreement"). Pursuant to the Deferred Compensation Agreement, Contran has an obligation to pay Simmons upon the occurrence of certain events (a "Payout Event") the value of Simmons's deferred compensation account established by the Deferred Compensation Agreement, less the value of assets concurrently distributed to him at the time by the trustee of the Amended and Restated Contran Deferred Compensation Trust No. 2 as of January 1, 2004 (the "CDCT No. 2"). B. On January 1, 2004, Valhi Group, Inc., a Nevada corporation and a subsidiary of Contran ("VGI"), in order to assist Contran in funding it obligations under the Deferred Compensation Agreement, pledged 3.3 million shares (the "Old Shares") of the common stock, par value $0.01 per share ("Valhi Common Stock"), of Valhi, Inc., a Delaware corporation and also a subsidiary of VGI and Contran, registered in the name of VGI to the CDCT No. 2 in consideration of a collateral fee and an indemnity from Contran pursuant to a Pledge Agreement dated January 1, 2004 between Contran and VGI. C. On August 25, 2005, VGI contributed the Old Shares to VHC, which contribution was subject to all existing liens. D. VHC desires to pledge 3.3 million shares of Valhi Common Stock registered in the name of VHC (the "New Shares") to the CDCT No. 2 under the terms of this Agreement in anticipation of the delivery of the Old Shares to VHC. Agreement In consideration of the mutual premises, representations and covenants herein contained, the parties hereto mutually agree as follows. Section 1. The Pledge. VHC agrees to secure Contran's obligations under the Deferred Compensation Agreement by granting to the CDCT No. 2 a security interest in the New Shares and delivering to the CDCT No. 2 stock certificates for the New Shares with applicable stock powers duly executed in blank by VHC, all in a form reasonably satisfactory to the CDCT No. 2. VHC warrants that the New Shares, when delivered to the CDCT No. 2 will be free and clear of all liens, claims and encumbrances whatsoever, except for such liens, claims and encumbrances on the New Shares created by this Agreement. The CDCT No. 2 may at any time following the occurrence and during the continuation of a Payout Event cause any or all of the New Shares to be transferred of record into the name of the CDCT No. 2 or its nominee and exercise any and all rights of a secured party holding a security interest in the New Shares under the uniform commercial code. Prior to the transfer of record of a New Share to the CDCT No. 2 upon a Payout Event, VHC shall retain all rights to vote the New Share and receive dividends on the New Share. Section 2. The Pledge Fee. As consideration for pledging the New Shares, Contran shall pay to VHC on March 31, June 30, September 30 and December 31 of each year (if a business day, and if not, on the next successive business day as if made as of the end of such calendar quarter) a fee equal to 0.125% of the value of the New Shares based on the closing sales price per share for shares of Valhi Common Stock on the second to last day of such calendar quarter on which such shares traded as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which shares of Valhi Common Stock may then trade. The initial fee payable on September 30, 2005 shall be pro rated based on the period from the date of this Agreement to September 30, 2005. Upon the termination of this Agreement, if the termination date is not as of the end of a calendar quarter, Contran shall pay on the termination date to VHC a pro rated fee based on the portion of the calendar quarter that the New Shares were pledged and the closing sales price per share of Valhi Common Stock on the second to last day on which shares of Valhi Common Stock traded prior to the termination date as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which such shares may then trade. Section 3. Indemnity. Contran agrees to indemnify VHC against any loss or incremental cost resulting from the pledge of the New Shares to the CDCT No. 2 under this Agreement or the transfer of the New Shares to the CDCT No. 2 upon a Payout Event. Section 4. Return of Old Shares. Contran agrees to use its best efforts to deliver stock certificates representing the Old Shares to VHC shortly after the delivery of the New Shares to the CDCT No. 2. Section 5. Termination. Either party hereto may terminate this Agreement by giving the other party thirty days advance written notice of such termination. On the termination date of this Agreement, Contran shall return the stock certificates representing the New Shares to VHC and the related stock powers that VHC originally tendered to Contran under this Agreement. Section 6. Applicable Law. This Agreement shall be governed by and construed in accordance with the domestic laws of the state of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the state of Texas. Executed as of the date first above written. CONTRAN CORPORATION VALHI HOLDING COMPANY CONTRAN CORPORATION VALHI HOLDING COMPANY By:/s/ Bobby D. O'Brien By:/s/ Gregory M. Swalwell -------------------------------- ----------------------------------- Bobby D. O'Brien, Vice President Gregory M. Swalwell, Vice President EX-16 6 exhibit16.txt EXHIBIT 16 PLEDGE AGREEMENT For the Benefit of the Contran Deferred Compensation Trust No. 3 This Pledge Agreement (this "Agreement") is made as of August 25, 2005 between Contran Corporation, a Delaware corporation ("Contran"), and Valhi Holding Company, a Delaware corporation and a subsidiary of Contran ("VHC"). Recitals A. Contran and Glenn R. Simmons, the vice chairman of the board of Contran and a resident of Dallas, Texas ("Simmons"), have entered into certain nonqualified deferred compensation agreements, namely (collectively with any further amendments to these agreements, the "Deferred Compensation Agreements"): (1) The Deferred Compensation Agreement (Originally Established October 31, 1984) Amended and Restated as of January 1, 1999; (2) The Contran Corporation 2001 Deferred Compensation Agreement as of December 31, 2001; and (3) The Deferred Compensation Agreement as of January 1, 2003. Pursuant to the Deferred Compensation Agreements, Contran has an obligation to pay Simmons upon the occurrence of certain events (a "Payout Event") the value of Simmons's deferred compensation accounts established by the Deferred Compensation Agreements, less the value of assets concurrently distributed to him at the time by the trustee of the Amended and Restated Contran Deferred Compensation Trust No. 3 as of July 1, 2004 (the "CDCT"). B. On July 1, 2004, Valhi Group, Inc., a Nevada corporation and a subsidiary of Contran ("VGI"), in order to assist Contran in funding it obligations under the Deferred Compensation Agreements, pledged 300,000 shares (the "Old Shares") of the common stock, par value $0.01 per share ("Valhi Common Stock"), of Valhi, Inc., a Delaware corporation and also a subsidiary of VGI and Contran, registered in the name of VGI to the CDCT in consideration of a collateral fee and an indemnity from Contran pursuant to a Pledge Agreement dated July 1, 2004 between Contran and VGI. C. On August 25, 2005, VGI contributed the Old Shares to VHC, which contribution was subject to all existing liens. D. Based on the reduced obligations of Contran under the Deferred Compensation Agreements, VHC desires to pledge 120,000 shares of Valhi Common Stock registered in the name of VHC (the "New Shares") to the CDCT under the terms of this Agreement in anticipation of the delivery of the Old Shares to VHC. Agreement In consideration of the mutual premises, representations and covenants herein contained, the parties hereto mutually agree as follows. Section 1. The Pledge. VHC agrees to secure Contran's obligations under the Deferred Compensation Agreements by granting to the CDCT a security interest in the New Shares and delivering to the CDCT stock certificates for the New Shares with applicable stock powers duly executed in blank by VHC, all in a form reasonably satisfactory to the CDCT. VHC warrants that the New Shares, when delivered to the CDCT will be free and clear of all liens, claims and encumbrances whatsoever, except for such liens, claims and encumbrances on the New Shares created by this Agreement. The CDCT may at any time following the occurrence and during the continuation of a Payout Event cause any or all of the New Shares to be transferred of record into the name of the CDCT or its nominee and exercise any and all rights of a secured party holding a security interest in the New Shares under the uniform commercial code. Prior to the transfer of record of a New Share to the CDCT upon a Payout Event, VHC shall retain all rights to vote the New Share and receive dividends on the New Share. Section 2. The Pledge Fee. As consideration for pledging the New Shares, Contran shall pay to VHC on March 31, June 30, September 30 and December 31 of each year (if a business day, and if not, on the next successive business day as if made as of the end of such calendar quarter) a fee equal to 0.125% of the value of the New Shares based on the closing sales price per share for shares of Valhi Common Stock on the second to last day of such calendar quarter on which such shares traded as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which such shares may then trade. The initial fee payable on September 30, 2005 shall be pro rated based on the period from the date of this Agreement to September 30, 2005. Upon the termination of this Agreement, if the termination date is not as of the end of a calendar quarter, Contran shall pay on the termination date to VHC a pro rated fee based on the portion of the calendar quarter that the New Shares were pledged and the closing sales price per share of Valhi Common Stock on the second to last day on which shares of Valhi Common Stock traded prior to the termination date as reported by the New York Stock Exchange or such other principal exchange or other market quotation system on which such shares may then trade. Section 3. Indemnity. Contran agrees to indemnify VHC against any loss or incremental cost resulting from the pledge of the New Shares to the CDCT under this Agreement or the transfer of the New Shares to the CDCT upon a Payout Event. Section 4. Return of Old Shares. Contran agrees to use its best efforts to deliver stock certificates representing the Old Shares to VHC shortly after the delivery of the New Shares to the CDCT. Section 5. Termination. Either party hereto may terminate this Agreement by giving the other party thirty days advance written notice of such termination. On the termination date of this Agreement, Contran shall return the stock certificates representing the New Shares to VHC and the related stock powers that VHC originally tendered to Contran under this Agreement. Section 6. Applicable Law. This Agreement shall be governed by and construed in accordance with the domestic laws of the state of Texas, without giving effect to any choice of law or conflict of law provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the state of Texas. Executed as of the date first above written. CONTRAN CORPORATION VALHI HOLDING COMPANY By:/s/ Bobby D. O'Brien By:/s/ Gregory M. Swalwell -------------------------------- ----------------------------------- Bobby D. O'Brien, Vice President Gregory M. Swalwell, Vice President -----END PRIVACY-ENHANCED MESSAGE-----