-----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, GWzk7woqgZ7Q+Mg9m6oDdULyUvOOcm67hHwm5T6N4Apk7JHYnLNHuUjmc0kHS9Qo H2lxZAv45EEpz9DIV/M6+w== 0000950134-97-006951.txt : 19970923 0000950134-97-006951.hdr.sgml : 19970923 ACCESSION NUMBER: 0000950134-97-006951 CONFORMED SUBMISSION TYPE: SC 13E4 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19970922 SROS: NASD SROS: PSE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: BOX ENERGY CORP CENTRAL INDEX KEY: 0000874992 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 752369148 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4 SEC ACT: SEC FILE NUMBER: 005-46185 FILM NUMBER: 97683803 BUSINESS ADDRESS: STREET 1: 8201 PRESTON RD STREET 2: SUITE 600 CITY: DALLAS STATE: TX ZIP: 75225 BUSINESS PHONE: 2148908000 MAIL ADDRESS: STREET 1: 8201 PRESTON RD STREET 2: SUITE 600 CITY: DALLAS STATE: TX ZIP: 75225-6211 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: BOX ENERGY CORP CENTRAL INDEX KEY: 0000874992 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 752369148 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4 BUSINESS ADDRESS: STREET 1: 8201 PRESTON RD STREET 2: SUITE 600 CITY: DALLAS STATE: TX ZIP: 75225 BUSINESS PHONE: 2148908000 MAIL ADDRESS: STREET 1: 8201 PRESTON RD STREET 2: SUITE 600 CITY: DALLAS STATE: TX ZIP: 75225-6211 SC 13E4 1 SCHEDULE 13E4 TENDER OFFER STATEMENT 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13E-4 Issuer Tender Offer Statement (Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934) (Amendment No. ) BOX ENERGY CORPORATION (Name of Issuer) BOX ENERGY CORPORATION (Name of Person(s) Filing Statement) 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION 103168 AA 8 (Title of Class of Securities) (CUSIP Number of Class of Securities)
J. BURKE ASHER 8201 PRESTON ROAD, SUITE 600 DALLAS, TEXAS 75225 (214) 890-8000 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Person(s) Filing Statement) COPIES TO: C. WILLIAM BLAIR KELLY, HART & HALLMAN, P.C. 201 MAIN STREET, SUITE 2500 FORT WORTH, TEXAS 76102 (817) 332-2500 SEPTEMBER 22, 1997 (Date Tender Offer First Published, Sent or Given to Security Holders) CALCULATION OF FILING FEE
============================================================================================= TRANSACTION VALUATION* AMOUNT OF FILING FEE - --------------------------------------------------------------------------------------------- $56,945,028 $11,389.01 =============================================================================================
* The transaction value shown is only for the purpose of calculating the filing fee. The amount shown reflects the cost of purchasing $55,077,000 principal amount of Notes at the purchase price (100% of the principal amount of the Notes, plus accrued interest through the date of purchase) as of October 28, 1997 (the payment date of the Offer). The amount of the filing fee is calculated in accordance with Section 13(e)(3) of the Securities Exchange Act of 1934, as amended. [ ] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. Amount previously paid: Form or registration no.: Filing party: Date filed: Instruction. When submitting this statement in paper format, ten copies of this statement, including all exhibits, shall be filed with the Commission. ================================================================================ 2 INTRODUCTORY STATEMENT This Schedule 13E-4 relates to a change in control offer (the "Offer") by Box Energy Corporation, a Delaware corporation (the "Company"), to purchase for cash, on the terms and subject to the conditions set forth in the attached Change in Control Notice and Offer to Purchase, dated September 22, 1997 (the "Offer to Purchase") and the related Letter of Transmittal (the "Letter of Transmittal"), all of the outstanding 8 1/4% Convertible Subordinated Notes Due 2002 of the Company (the "Notes"). The Notes are convertible into shares of Class B (Non-Voting) Common Stock, par value $1.00 per share, at a conversion price of $11.00 per share in accordance with the Indenture under which the Notes were issued. Copies of the Offer to Purchase and the related Letters of Transmittal are filed as exhibits 99.1(a)(1) and 99.1(a)(2) hereto. ITEM 1. SECURITY AND ISSUER. (a) The issuer of the Notes is the Company. The address of the Company's principal executive office is 8201 Preston Road, Suite 600, Dallas, Texas 75225-6211. (b) The securities which are the subject of the Offer are the 8 1/4% Convertible Subordinated Notes Due 2002 issued by the Company. The Notes are convertible into shares of Class B (Non-Voting) Common Stock at a conversion price of $11.00 per share in accordance with the Indenture under which the Notes were issued. As of September 15, 1997, there was $55,077,000 aggregate principal amount of Notes outstanding. The Offer is for any and all Notes, in denominations of $1,000 or integral multiples thereof, at a purchase price of 100% of the principal amount of the Notes, plus accrued interest through the date of purchase. To the best knowledge of the Company, no Notes are being purchased from any officer, director or affiliate of the Company. (c) The information set forth in the section of the Offer to Purchase entitled "Market Price Information" is incorporated herein by reference. (d) The Company is filing this statement. The address of the Company is set forth in Item 1(a). ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. (a)-(b) The information set forth in the section of the Offer to Purchase entitled "Sources and Amount of Funds" is incorporated herein by reference. ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR AFFILIATE. The information set forth in the section of the Offer to Purchase entitled "The Offer -- Purpose and Effects of the Offer" is incorporated herein by reference. Upon purchase, Notes will cease to be outstanding and will be delivered to United States Trust Company of New York, as Trustee, for cancellation immediately after such purchase. (a) The information set forth in the section of the Offer to Purchase entitled "The Offer -- General" is incorporated herein by reference. (b) Unrelated to the Offer to Purchase, and whether or not any Notes are tendered into the Offer to Purchase, Mr. Simplot made certain statements relating to the corporate structure of the Company in a Schedule 13D, filed September 2, 1997 (the "Schedule 13D"), relating to his acquisition on August 29, 1997, of beneficial ownership of 57.2% of the Company's Class A (Voting) Common Stock. The Schedule 13D stated that although Mr. Simplot has no specific plans, he expects to explore the various possibilities that may exist for simplifying the overall corporate structure of the Company and its affiliates, including Box Brothers Holding Company, while still retaining control of the Company. The Schedule 13D further stated that although no assurance can be given that any such transactions will occur, Mr. Simplot believes that the market price of the Company's Class A (Voting) Common Stock and the Class B (Non-Voting) Common Stock will more accurately reflect the intrinsic value of the Company if the Company's securities represent the direct claim on ownership and control of the Company and its assets, and that Mr. Simplot has indicated his 3 willingness to assist in the restructuring of the Company, including the possible conversion of the Company's equity to a single class of voting stock. (c) None. (d) Unrelated to the Offer to Purchase, and whether or not any Notes are tendered into the Offer to Purchase, Mr. Simplot stated in the Schedule 13D that he will review with the Board of Directors of the Company the qualifications, background, willingness to serve, and other factors relating to each of the current members of the Board of Directors with a view to evaluating which members of the Board of Directors will continue to serve as Directors and that he may nominate himself or others to the Board in the future. The Schedule 13D also stated that Mr. Simplot has agreed with the Company not to replace current members of the Board of Directors until after a proposed settlement of prior lawsuits brought by Mr. Simplot and others against the Company has been approved or disapproved by a majority of the Board of Directors. (e) None. (f) None. (g) None. (h) Not applicable. (i) Not applicable. (j) Not applicable. ITEM 4. INTEREST IN SECURITIES OF THE ISSUER. Not applicable. ITEM 5. CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE ISSUER'S SECURITIES. The information set forth on the cover page to the Offer to Purchase and the sections of the Offer to Purchase entitled "The Offer -- General," "The Offer -- Purpose and Effects of the Offer" and "Recent Developments" is incorporated herein by reference. ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED. The information set forth in the section of the Offer to Purchase entitled "The Depositary" is incorporated herein by reference. ITEM 7. FINANCIAL INFORMATION. (a) The information set forth in the section of the Company's Offer to Purchase entitled "Selected Financial Data" is incorporated herein by reference. The following documents, which have been filed by the Company with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are incorporated herein by reference: 1. The Company's Annual Report on Form 10-K for the year ended December 31, 1996. 2. The Company's Quarterly Report on Form 10-Q for the quarter ending June 30, 1997. (b) Not applicable. ITEM 8. ADDITIONAL INFORMATION. (a) None. (b) None, except for compliance with the Exchange Act and the rules and regulations promulgated thereunder and compliance with applicable requirements of state securities or "blue sky" laws. 2 4 (c) Not applicable. (d) None. (e) Reference is made to the exhibits hereto which are incorporated in their entirety herein by reference. ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. Exhibit 99.1(a)(1) Change in Control Notice and Offer to Purchase, dated (a) September 22, 1997. Exhibit 99.1(a)(2) Letter of Transmittal. Exhibit 99.1(a)(3) Notice of Guaranteed Delivery. Exhibit 99.1(a)(4) Letter to clients. Exhibit 99.1(a)(5) Letter to brokers, dealers, commercial banks, trust companies and other nominees. Exhibit 99.2 Statement on Schedule 13D relating to Box Energy Corporation Class A (Voting) Common Stock, filed September 2, 1997, by J. R. Simplot and others (incorporated by reference). (b) Not applicable. (c) Not applicable. (d) Not applicable. (e) Not applicable. (f) Not applicable.
3 5 SIGNATURE After due 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. BOX ENERGY CORPORATION By: /s/ JAMES A. WATT ---------------------------------- James A. Watt President and Chief Operating Officer Dated: September 22, 1997 4 6 EXHIBIT INDEX
EXHIBIT DESCRIPTION ------- ----------- 99.1(a)(1) -- Change of Control Notice and Offer to Purchase, dated September 22, 1997. 99.1(a)(2) -- Letter of Transmittal. 99.1(a)(3) -- Notice of Guaranteed Delivery. 99.1(a)(4) -- Letter to clients. 99.1(a)(5) -- Letter to brokers, dealers, commercial banks, trust companies and other nominees. 99.2 -- Statement on Schedule 13D relating to Box Energy Corporation Class A (Voting) Common Stock, filed September 2, 1997, by J.R. Simplot and others (incorporated by reference).
5 EX-99.(A)(1) 2 CHANGE OF CONTROL NOTICE & OFFER TO PURCHASE 1 BOX ENERGY CORPORATION CHANGE IN CONTROL NOTICE AND OFFER TO PURCHASE FOR CASH ANY AND ALL OF THE OUTSTANDING 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THIS CHANGE IN CONTROL NOTICE AND OFFER TO PURCHASE, THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 22, 1997, UNLESS THE OFFER IS EXTENDED IN ACCORDANCE WITH THE INDENTURE (AS DEFINED HEREIN) (SUCH TIME AND DATE OR THE LATEST EXTENSION THEREOF, IF EXTENDED, THE "EXPIRATION DATE"). NOTES TENDERED IN THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE. Box Energy Corporation (the "Company") hereby offers (the "Offer") to purchase for the Purchase Price (as defined below) in cash, upon the terms and subject to the conditions set forth in this Change in Control Notice and Offer to Purchase (this "Offer to Purchase") and in the accompanying Letter of Transmittal (the "Letter of Transmittal"), any and all of the outstanding 8 1/4% Convertible Subordinated Notes due 2002 of the Company (the "Notes"). The "Purchase Price" is 100% of the principal amount of the Notes, plus accrued interest (in the amount of $33.92 per $1,000 principal amount of Notes) through October 28, 1997 (the "Payment Date"), or a later date if the Expiration Date is extended as set forth in "The Offer -- Expiration Date; Extensions; Amendments; Termination." The Company will not extend the Expiration Date unless required by law. Unless the Company fails to pay the Purchase Price, any Notes properly tendered pursuant to the Offer and accepted for payment will cease to accrue interest after the Payment Date. Any Notes not surrendered in the Offer (or surrendered and withdrawn prior to the Expiration Date) will remain obligations of the Company and will continue to accrue interest and have all of the benefits of the Indenture, including being convertible into shares of Class B (Non-Voting) Common Stock of the Company (the "Class B Common Stock") at a conversion price of $11.00 per share, subject to the terms of the Indenture. Any holder of Notes (a "Holder") desiring to tender all or any portion of such Holder's Notes must comply with the procedures for tendering Notes set forth herein in "Procedures for Tendering Notes" and in the Letter of Transmittal. Tenders of Notes may be withdrawn at any time prior to the Expiration Date. In the event of a withdrawal of Notes, the Notes so withdrawn will be promptly returned to the Holder. THE COMPANY IS MAKING THE OFFER ONLY BECAUSE IT IS REQUIRED TO DO SO PURSUANT TO ARTICLE TWELVE OF THE INDENTURE. THIS OFFER TO PURCHASE IS GOVERNED BY THE INDENTURE AND APPLICABLE LAW AND DOES NOT CONSTITUTE A REDEMPTION OF, OR AN ELECTION BY THE COMPANY TO REDEEM, THE NOTES. HOLDERS HAVE AN ELECTION WHETHER OR NOT TO ACCEPT THE OFFER. THE COMPANY MAKES NO RECOMMENDATION AS TO WHETHER OR NOT HOLDERS SHOULD EXERCISE THEIR CHANGE IN CONTROL RIGHT AND TENDER NOTES PURSUANT TO THE OFFER. (Continued on following page) September 22, 1997 2 (Continued from preceding page) The Offer is being made pursuant to the Indenture, dated as of December 1, 1992 (the "Indenture"), between the Company and United States Trust Company of New York, as Trustee (the "Trustee"), which provides that, following a change in control (as defined in the Indenture), each Holder will have the right, at such Holder's option, to require the Company to repurchase all or a portion of such Holder's Notes at the Purchase Price (a "Change in Control Right"). A Change in Control (as defined herein) occurred on August 29, 1997, as a result of the sale of control of Box Brothers Holding Company, which holds 57.2% of the Class A (Voting) Common Stock of the Company. On September 19, 1997, the closing price expressed as a percent of principal amount of the Notes, as reported on the NASDAQ SmallCap Market was 102.5, and the closing price per share of Company Class B Common Stock, as reported on the NASDAQ National Market System was $8. Tenders of Notes may be withdrawn at any time prior to the Expiration Date. In the event of a termination of the Offer, the Notes tendered pursuant to the Offer will be promptly returned to the tendering Holders. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment) and applicable law, the Company will purchase by accepting for payment, and will pay for, all Notes validly tendered (and not properly withdrawn) pursuant to the Offer on the Payment Date, and such payment will be made by the deposit of immediately available funds by the Company with United States Trust Company of New York (the "Depositary"), which will act as agent for tendering Holders for the purpose of receiving payment from the Company and transmitting such payment to tendering Holders. No person has been authorized to give any information or to make any representations directly related to this Offer other than those contained in this Offer to Purchase and, if given or made, such information or representations must not be relied upon as having been authorized. This Offer to Purchase and related documents do not constitute an offer to buy or the solicitation of an offer to sell securities in any circumstances in which such offer or solicitation is unlawful. The delivery of this Offer to Purchase shall not, under any circumstances, create any implication that the information contained herein is current as of any time subsequent to the date of such information. Any questions or requests for assistance or for additional copies of this Offer to Purchase or related documents may be directed to the Depositary at one of its telephone numbers set forth on the back cover page hereof. Any beneficial owner owning interests in Notes may contact such beneficial owner's broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Offer. ii 3 AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information concerning the Company can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the Commission's Regional Office at Seven World Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such material also can be obtained, at prescribed rates, from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The Commission maintains a site on the Internet's World Wide Web at http://www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission, including the Company. The Notes are listed and traded on the NASDAQ SmallCap Market and such reports, proxy statements and other information concerning the Company may be inspected at the offices of the NASD, 1735 K Street, N.W., Washington, D.C. 20006. This Offer to Purchase constitutes a part of an Issuer Tender Offer Statement on Schedule 13E-4 (the "Schedule 13E-4") filed with the Commission by the Company pursuant to Section 13(e) of the Exchange Act and the rules and regulations promulgated thereunder. The Schedule 13E-4 and all exhibits thereto are incorporated in this Offer to Purchase by reference. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents, which have been filed by the Company with the Commission under the Exchange Act, are incorporated herein by reference: (a) Annual Report on Form 10-K for the year ended December 31, 1996. (b) Quarterly Reports on Form 10-Q for the quarters ended March 31, 1997, and June 30, 1997. (c) Current Reports on Form 8-K dated July 30, 1997, and September 12, 1997. All subsequently filed documents by the Company prior to the Expiration Date pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act shall be deemed to be incorporated by reference herein and to be a part hereof from the date any such document is filed. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes hereof to the extent that a statement contained herein or in any other subsequently filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part hereof. The Company will provide without charge to each person to whom this Offer to Purchase is delivered a copy of the documents incorporated by reference herein, other than exhibits thereto not specifically incorporated by reference, upon written or oral request to Box Energy Corporation, 8201 Preston Road, Suite 600, Dallas, Texas 75225, Attention: Lorraine Krantz, telephone (214) 890-8000. iii 4 TABLE OF CONTENTS
PAGE ---- Available Information....................................... iii Incorporation of Certain Documents by Reference............. iii The Offer................................................... 1 General................................................... 1 Purpose and Effects of the Offer.......................... 1 Expiration Date; Extensions; Amendments; Termination...... 2 Acceptance for Payment.................................... 2 Procedures For Tendering Notes.............................. 3 Tendering Notes........................................... 3 Guaranteed Delivery Procedures............................ 5 Withdrawal Rights......................................... 6 Certain Information Concerning the Company.................. 7 Recent Developments......................................... 7 Change in Control......................................... 7 Settlement of Litigation.................................. 7 Sources and Amount of Funds................................. 7 Market Price Information.................................... 8 The Notes................................................. 8 Class B Common Stock...................................... 8 Selected Financial Data of the Company...................... 9 Certain Federal Income Tax Consequences..................... 9 The Depositary.............................................. 10 Miscellaneous............................................... 10
iv 5 THE OFFER GENERAL The Company hereby offers, upon the terms and subject to the conditions set forth in this Offer to Purchase, to purchase for cash at the Purchase Price any and all Notes that are properly tendered (and not properly withdrawn), pursuant to the terms and conditions set forth herein, prior to the Expiration Date. The Company will accept only tenders of Notes or a portion thereof which are in an amount equal to $1,000 principal amount of Notes or integral multiples thereof. Tenders of Notes may be withdrawn at any time prior to the Expiration Date. In the event of a termination of the Offer, the Notes tendered pursuant to the Offer will be returned promptly to the tendering Holders. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment) and applicable law, on the Payment Date the Company will purchase by accepting for payment, and will pay for, all Notes validly tendered (and not properly withdrawn) pursuant to the Offer. Such payment will be made by the deposit of immediately available funds by the Company with the Depositary, which will act as agent for tendering Holders for the purpose of receiving payment from the Company and transmitting such payment to tendering Holders. If less than all the principal amount of Notes held by a Holder is tendered and accepted pursuant to the Offer, the Company will issue, and the Trustee will authenticate and deliver to or on the order of the Holder thereof, at the expense of the Company, new Notes of authorized denominations, in principal amount equal to the portion of the Notes not tendered or not accepted, as the case may be, as promptly as practicable after the Payment Date. No Note tendered pursuant to this Offer may be converted into shares of Class B Common Stock after such Note has been properly tendered to the Depositary unless the tender of such Note is properly withdrawn, the Company defaults in payment of the Purchase Price or the Offer is terminated without the purchase of Notes. After the Expiration Date, the Company may purchase additional Notes in the open market, in privately negotiated transactions, through subsequent tender or exchange offers or otherwise, subject to compliance with applicable law. Any future purchases may be on the same terms or on terms that may be more or less favorable to Holders than the terms of the Offer. Any future purchases will depend on various factors at that time. PURPOSE AND EFFECTS OF THE OFFER The Offer is required to be made pursuant to the Indenture, which provides that upon the occurrence of a Change in Control (as defined below) each Holder of Notes will have the right, at such Holder's option, to require the Company to purchase all or a portion of such Holder's Notes, in denominations of $1,000 or integral multiples thereof, at a purchase price equal to 100% of the principal amount thereof plus accrued and unpaid interest through the Payment Date. A "Change in Control" is deemed to have occurred at such time as any person or group, other than Cloyce K. Box, members of his immediate family or trusts for the benefit thereof (the "Box Interests") or any entity controlled by Box Interests becomes the beneficial owner of 50% or more of the combined voting power of the Company. Prior to August 29, 1997, the Box Interests owned a controlling interest in Box Brothers Holding Company, which itself owned 57.2% of the voting stock of the Company. A "Change in Control" occurred on August 29, 1997, when Mr. J.R. Simplot, through an entity controlled by Mr. Simplot and members of his family, became the indirect beneficial owner of 57.2% of the Company's voting stock through the purchase of the controlling interest of Box Brothers Holding Company from the Box Interests. This Offer to Purchase serves as the "Change in Control Notice" required by the Indenture. The Notes purchased in the Offer will cease to be outstanding and will be delivered to the Trustee for cancellation immediately after such purchase. Any Notes which remain outstanding after consummation of the Offer will continue to be obligations of the Company and will continue to be convertible at the option of 6 the Holder thereof into shares of Class B Common Stock. The Indenture does not contain any limitations on the ability of the Company to incur additional indebtedness. Holders of Notes that are not tendered pursuant to the Offer will not have the right after the Expiration Date to exercise their Change in Control Rights relating to such Notes as a result of the sale by the Box Interests of control of the Company. Depending upon, among other things, the amount of Notes outstanding after the consummation of the Offer, the liquidity of untendered Notes may be adversely affected by the Offer. If a market for the Notes continues following the Offer, Notes may trade at a discount compared to present trading prices depending on prevailing interest rates, the market for securities with similar credit features, the performance of the Company and other factors. In addition, if substantially all of the Notes are tendered pursuant to the Offer, the Company may consider delisting the Notes from the NASDAQ SmallCap Market. Accordingly, there is no assurance that an active market in the Notes will exist following consummation of the Offer and no assurance as to the prices at which the Notes may trade. EXPIRATION DATE; EXTENSIONS; AMENDMENTS; TERMINATION The Offer will expire on the Expiration Date, which pursuant to the Indenture is the fourth business day next preceding the Payment Date, unless extended pursuant to the procedures set forth herein. The Indenture does not provide for extending the Offer unless required by law. During any extension of the Offer, all Notes previously tendered pursuant to the Offer (and not properly withdrawn) will remain subject to the Offer and may be accepted for payment by the Company, subject to the withdrawal rights of Holders. The Company also expressly reserves the right, subject to the requirements of the Indenture and applicable law, to amend the terms of the Offer in any respect. Any extension, termination or amendment of the Offer will be followed as promptly as practicable by a public announcement thereof. Without limiting the manner in which the Company may choose to make a public announcement of any extension, termination or amendment of the Offer, the Company shall have no obligation to publish, advertise or otherwise communicate any such public announcement, other than by issuing a release to the Dow Jones News Service, except in the case of an announcement of an extension of the Offer, in which case the Company shall have no obligation to publish, advertise or otherwise communicate such announcement other than by issuing a notice of such extension by press release or other public announcement, which notice shall be issued no later than 9:00 a.m., New York City time, on the next business day following the previously scheduled Expiration Date. ACCEPTANCE FOR PAYMENT Upon the terms and subject to the conditions to the Offer (including if the Offer is extended or amended, the terms of such extension or amendment) and applicable law, the Company will purchase by accepting for payment, and will pay for, all Notes properly tendered (and not properly withdrawn) pursuant to the Offer, on the Payment Date. In all cases, payment by the Depositary to tendering Holders will be made only after timely receipt by the Depositary of the documentation described under "Procedures for Tendering Notes -- Tendering Notes." For purposes of the Offer, the Company shall be deemed to have accepted for payment (and thereby to have purchased) tendered Notes, if and when the Company gives oral or written notice to the Depositary of the Company's acceptance of such Notes for payment. Subject to the terms and conditions of the Offer, payment for Notes so accepted will be made by deposit of the consideration therefor with the Depositary. The Depositary will act as agent for tendering Holders for the purpose of receiving payment from the Company and then transmitting payment to such tendering Holders. 2 7 PROCEDURES FOR TENDERING NOTES TENDERING NOTES The tender of Notes pursuant to any of the procedures set forth in this Offer to Purchase and in the Letter of Transmittal will constitute a binding agreement between the tendering Holder and the Company upon the terms and subject to the conditions of the Offer. The tender of Notes will constitute an agreement to deliver good and marketable title to all tendered Notes prior to the Expiration Date free and clear of all liens, charges, claims, encumbrances, interests and restrictions of any kind. EXCEPT AS PROVIDED IN "-- GUARANTEED DELIVERY PROCEDURES," UNLESS THE NOTES BEING TENDERED ARE DEPOSITED BY THE HOLDER WITH THE DEPOSITARY PRIOR TO THE EXPIRATION DATE (ACCOMPANIED BY A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL), THE COMPANY MAY, AT ITS OPTION, REJECT SUCH TENDER. PAYMENT FOR NOTES WILL BE MADE ONLY AGAINST DEPOSIT OF TENDERED NOTES AND DELIVERY OF ALL OTHER REQUIRED DOCUMENTS. Only record Holders of Notes are authorized to exercise a Change in Control Right and tender their Notes pursuant to the Offer. Accordingly, to properly exercise a Change in Control Right and tender Notes or cause Notes to be tendered, the following procedures must be followed: NOTES HELD THROUGH DTC. Each beneficial owner of Notes who wishes to tender Notes held through a participant (a "DTC Participant") of The Depository Trust Company ("DTC") (i.e., a custodian bank, depositary, broker, trust company or other nominee) must instruct such DTC Participant to cause its Notes to be tendered in accordance with the procedures set forth in this Offer to Purchase. Pursuant to an authorization given by DTC to the DTC Participants, each DTC Participant that holds Notes through DTC must (i) transmit its acceptance through the DTC Automated Tender Offer Program ("ATOP") (for which the transaction will be eligible), and DTC will then edit and verify the acceptance, execute a book-entry delivery to the Depositary's account at DTC and send an Agent's Message (as defined below) to the Depositary for its acceptance or (ii) comply with the guaranteed delivery procedures set forth in this Offer to Purchase. Promptly after the date of this Offer to Purchase, the Depositary will establish accounts at DTC for purposes of the Offer with respect to Notes held through DTC, and any financial institution that is a DTC Participant may make book-entry delivery of interests in Notes into the Depositary's account through ATOP. Although delivery of interests in the Notes may be effected through book-entry transfer into the Depositary's account through ATOP, an Agent's Message in connection with such book-entry transfer, and any other required documents, must, in any case, be transmitted to and received by the Depositary at its address set forth on the back cover of this Offer to Purchase, or the guaranteed delivery procedures set forth below must be complied with, in each case, prior to the Expiration Date. Delivery of documents to DTC does not constitute delivery to the Depositary. The confirmation of a book-entry transfer into the Depositary's account at DTC, as described above, is referred to herein as a "Book-Entry Confirmation." The term "Agent's Message" means a message transmitted by DTC to, and received by, the Depositary and forming a part of the Book-Entry Confirmation, which states that DTC has received an express acknowledgment from each DTC Participant tendering through ATOP that such DTC Participant has received a Letter of Transmittal and agrees to be bound by the terms of the Letter of Transmittal and that the Company may enforce such agreement against such DTC Participant. All Notes currently held through DTC have been issued in the form of a global note registered in the name of Cede & Co., DTC's nominee (the "Global Note"). At or as of the Expiration Date, DTC will deliver to the Depositary a properly completed and duly executed Letter of Transmittal with respect to the aggregate principal amount of Notes as to which it has delivered Agent's Messages, and Cede & Co. will deliver to the Depositary the Global Note. At or as of the close of business on the third business day after the Expiration Date, DTC will deliver to the Depositary a properly completed and duly executed Letter of Transmittal for the aggregate principal amount of Notes as to which it has delivered Agent's Messages relating to Notices of Guaranteed Delivery as described under "-- Guaranteed Delivery 3 8 Procedures." Thereafter, the aggregate principal amount of the Global Note will be reduced to represent the aggregate principal amount of Notes held through DTC and not tendered pursuant to the Offer, and the Global Note will be returned to Cede & Co. NOTES HELD BY RECORD HOLDERS. Each record Holder who wishes to tender Notes must complete and sign a Letter of Transmittal and mail or deliver such Letter of Transmittal and any other documents required by the Letter of Transmittal together with certificate(s) representing all tendered Notes, to the Depositary at its address set forth on the back cover page of this Offer to Purchase, or the Holder must comply with the guaranteed delivery procedures set forth in this Offer to Purchase. All signatures on a Letter of Transmittal must be guaranteed by a recognized participant in the Securities Transfer Agents Medallion Program, the NYSE Medallion Signature Program or the Stock Exchange Medallion Program; provided, however, that signatures on a Letter of Transmittal need not be guaranteed if such Notes are tendered for the account of an Eligible Institution (as defined herein). If a Letter of Transmittal or any Note is signed by a trustee, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must so indicate when signing and submit proper evidence satisfactory to the Company of the authority of such person so to act. No alternative, conditional, irregular or contingent tenders will be accepted (unless waived). By executing a Letter of Transmittal or transmitting an acceptance through ATOP, each tendering Holder waives any right to receive any notice of the acceptance for purchase of its Notes. LOST OR MISSING CERTIFICATES. If a record Holder desires to tender Notes pursuant to the Offer, but the certificates representing such Notes have been mutilated, lost, stolen or destroyed, such Holder should write to or telephone the Trustee about procedures for obtaining replacement certificates representing such Notes, arranging for indemnification or any other matter which requires handling by the Trustee. BACKUP FEDERAL INCOME TAX WITHHOLDING. Under the "backup withholding" provisions of federal income tax law, unless a tendering Holder or his or her assignee (in either case, the "Payee") satisfies the conditions described in Instruction 5 of the Letter of Transmittal or is otherwise exempt, the aggregate purchase price may be subject to backup withholding tax at a rate of 31%. To prevent backup withholding, each Payee should complete and sign the Substitute Form W-9 provided in the Letter of Transmittal. See Instruction 5 of the Letter of Transmittal. EFFECT OF LETTER OF TRANSMITTAL. Subject to, and effective upon the acceptance for, purchase of and payment for Notes tendered thereby, by executing and delivering a Letter of Transmittal a tendering Holder (i) irrevocably sells, assigns and transfers to the Company, all right, title and interest in and to all Notes tendered thereby, (ii) waives any and all rights with respect to such Notes (including without limitation any existing or past defaults and their consequences with respect to such Notes and the Indenture), (iii) releases and discharges the Company from any and all claims such Holder may have now or may have in the future arising out of, or related to, such Notes, including without limitation any claim that such Holder is entitled to receive additional principal or interest payments with respect to such Notes or to participate in any redemption or defeasance of the Notes and (iv) irrevocably constitutes and appoints the Depositary the true and lawful agent and attorney-in-fact of such Holder with respect to any such Notes, with full power of substitution and resubstitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver certificates representing such Notes, or transfer ownership of such Notes, on the account books maintained by DTC, together, in any such case, with all accompanying evidences of transfer and authenticity, to the Company, (b) present such Notes for transfer on the relevant security register and (c) receive all benefits or otherwise exercise all rights of beneficial ownership of such Notes (except that the Depositary will have no rights to, or control over, funds from the Company, except as agent for the Company, for the Purchase Price for any tendered Notes that are purchased by the Company), all in accordance with the terms of the Offer. 4 9 All questions as to the validity, form, eligibility (including time of receipt) and acceptance of tendered Notes will be resolved by the Company, whose determination will be final and binding. The Company reserves the absolute right to reject any or all tenders that are not in proper form or the acceptance of which may, in the opinion of counsel for the Company, be unlawful. The Company also reserves the absolute right to waive any condition to the Offer and any irregularities or conditions of tender as to particular Notes. The Company's interpretation of the terms and conditions of the Offer (including the instructions in the Letter of Transmittal) will be final and binding. Unless waived, any irregularities in connection with tenders must be cured within such time as the Company shall determine. The Company and the Depositary shall not be under any duty to give notification of defects in such tenders and shall not incur liabilities for failure to give such notification. Tenders of Notes will not be deemed to have been made until such irregularities have been cured or waived. Any Notes received by the Depositary that are not properly tendered and as to which the irregularities have not been cured or waived will be returned by the Depositary to the tendering Holder, unless otherwise provided in the Letter of Transmittal, as soon as practicable following the Expiration Date. LETTERS OF TRANSMITTAL AND NOTES MUST BE SENT ONLY TO THE DEPOSITARY. DO NOT SEND LETTERS OF TRANSMITTAL OR NOTES TO THE COMPANY. THE METHOD OF DELIVERY OF NOTES AND LETTERS OF TRANSMITTAL, ANY REQUIRED SIGNATURE GUARANTEES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH DTC AND ANY ACCEPTANCE THROUGH ATOP, IS AT THE ELECTION AND RISK OF THE PERSONS TENDERING AND DELIVERING ACCEPTANCES OR LETTERS OF TRANSMITTAL, AND, EXCEPT AS OTHERWISE PROVIDED IN THE LETTER OF TRANSMITTAL, DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, IT IS SUGGESTED THAT THE HOLDER USE PROPERLY INSURED, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, AND THAT THE MAILING BE MADE SUFFICIENTLY IN ADVANCE OF THE EXPIRATION DATE TO PERMIT DELIVERY TO THE DEPOSITARY PRIOR TO THE EXPIRATION DATE. GUARANTEED DELIVERY PROCEDURES DTC PARTICIPANTS. A DTC Participant who wishes to cause its Notes to be tendered, but who cannot transmit its acceptance through ATOP prior to the Expiration Date, may cause a tender to be effected if: (a) guaranteed delivery is made by or through a firm or other entity identified in Rule 17Ad-15 under the Exchange Act (an "Eligible Institution"), including (as such terms are defined therein): (i) a bank; (ii) a broker, dealer, municipal securities dealer, municipal securities broker, government securities dealer or government securities broker; (iii) a credit union; (iv) a national securities exchange, registered securities association or clearing agency; or (v) a savings institution that is a participant in a Securities Transfer Association recognized program; and (b) prior to 12:00 noon, New York City time, on the Expiration Date, the Depositary receives from such Eligible Institution a properly completed and duly executed Notice of Guaranteed Delivery (by mail, hand delivery, facsimile transmission or overnight courier) substantially in the form provided herewith; and (c) Book-Entry Confirmation of the transfer into the Depositary's account at DTC, and all other documents required by the Letter of Transmittal, are received by the Depositary within three New York Stock Exchange trading days after the date of receipt by the Depositary of such Notice of Guaranteed Delivery. RECORD HOLDERS. A record Holder who wishes to tender its Notes but (x) whose Notes are not immediately available and will not be available for tendering prior to the Expiration Date or (y) who cannot deliver its Notes, the Letter of Transmittal, or any other required documents to the Depositary prior to the Expiration Date, may effect a tender if: (a) the tender is made by or through an Eligible Institution; and (b) prior to 12:00 noon, New York City time, on the Expiration Date, the Depositary receives from such Eligible Institution a properly completed and duly executed Notice of Guaranteed Delivery (by 5 10 mail, hand delivery, facsimile transmission or overnight courier) substantially in the form provided herewith; and (c) a properly completed and executed Letter of Transmittal, as well as the certificate(s) representing all tendered Notes in proper form for transfer, and all other documents required by the Letter of Transmittal, are received by the Depositary within three New York Stock Exchange trading days after the date of receipt by the Depositary of such Notice of Guaranteed Delivery. Under no circumstances will interest be paid by the Company by reason of any delay in making payment to any person using the guaranteed delivery procedures described above. WITHDRAWAL RIGHTS Tenders of Notes (or any portion of such Notes in integral multiples of $1,000) may be withdrawn at any time prior to the Expiration Date. NOTES HELD THROUGH DTC. A DTC Participant who has transmitted its acceptance through ATOP of Notes held through DTC may, prior to the Expiration Date, withdraw the instruction given thereby by (i) withdrawing its acceptance through ATOP or (ii) delivering to the Depositary by mail, hand delivery or facsimile transmission a notice of withdrawal of such instruction. Such notice of withdrawal must contain the name and number of the DTC Participant, the principal amount of Notes to which such withdrawal relates and the signature of the DTC Participant. Withdrawal of such an instruction will be effective upon receipt of such notice of withdrawal by the Depositary. NOTES HELD BY RECORD HOLDERS. A Holder may withdraw its tender of Notes, prior to the Expiration Date, by delivering to the Depositary by mail, hand delivery or facsimile transmission a notice of withdrawal. Any such notice of withdrawal must (i) specify the name of the person who tendered the Notes to be withdrawn, (ii) contain a description of the Notes to be withdrawn and identify the certificate number or numbers shown on the particular certificates evidencing such Notes and the aggregate principal amount represented by such Notes and (iii) be signed by the Holder of such Notes in the same manner as the original signature on the Letter of Transmittal by which such Notes were tendered (including any required signature guarantees), or be signed by another person and accompanied by (x) documents of transfer in a form acceptable to the Company, in its sole discretion, and (y) a properly completed irrevocable proxy that authorizes such person to effect such revocation on behalf of such Holder. If the Notes to be withdrawn have been delivered or otherwise identified to the Depositary, a signed notice of withdrawal is effective immediately upon receipt by the Depositary even if physical release is not yet effected. Any Notes properly withdrawn will be deemed not to be validly tendered for purposes of the Offer. All signatures on a notice of withdrawal must be guaranteed by a recognized participant in the Securities Transfer Agents Medallion Program, the NYSE Medallion Signature Program or the Stock Exchange Medallion Program; provided, however, that signatures on the notice of withdrawal need not be guaranteed if the Notes being withdrawn are held for the account of an Eligible Institution. A withdrawal of an instruction or a withdrawal of a tender must be executed by a DTC Participant or a Holder, as the case may be, in the same manner as the person's name appears on its transmission through ATOP or Letter of Transmittal, as the case may be, to which such withdrawal relates. If a notice of withdrawal is signed by a trustee, partner, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must so indicate when signing and must submit with the revocation appropriate evidence of authority to execute the notice of withdrawal. A Holder or DTC Participant may withdraw a tender only if such withdrawal complies with the provisions of this Offer to Purchase. A withdrawal of an instruction previously given pursuant to the transmission of an acceptance through ATOP or a withdrawal of a tender by a Holder may be rescinded only by (i) a new transmission of acceptance through ATOP, or (ii) execution and delivery of a new Letter of Transmittal, as the case may be, in accordance with the procedures described herein. 6 11 CERTAIN INFORMATION CONCERNING THE COMPANY The Company is an independent exploration and production company primarily engaged in the exploration for, and the development of, oil and natural gas. The Company was initially organized in 1981 as OKC Limited Partnership (the "Predecessor Partnership") and converted to a corporation in 1992. The Company is a Delaware corporation with executive offices located at 8201 Preston Road, Suite 600, Dallas, Texas 75225-6211, telephone number (214) 890-8000. RECENT DEVELOPMENTS CHANGE IN CONTROL On August 29, 1997, a Change in Control of the Company occurred. Prior to this time, Box Brothers Holding Company, a Delaware corporation ("BBHC") was the record and beneficial holder of 1,840,525 shares (57.2%) of the outstanding Class A (Voting) Common Stock of the Company. On August 29, 1997, pursuant to the terms of a settlement agreement, Mr. J. R. Simplot, through an entity controlled by Mr. Simplot and members of his family, purchased, in privately negotiated transactions, all 33 shares of the outstanding Class A (Voting) Common Stock of BBHC and 38,472 of the 42,875 outstanding shares of Class B (Nonvoting) Common Stock of BBHC from Thomas Box, Don Box, Douglas Box, Gary Box and entities controlled by them. As a result of the purchase, Mr. J. R. Simplot is the beneficial owner of 57.2% of the Company's voting stock, thereby effecting a change in control. SETTLEMENT OF LITIGATION In connection with Mr. Simplot's purchase of the controlling interest of BBHC, a letter of intent with the Company was executed relating to the proposed settlement of all prior lawsuits brought by Mr. Simplot and others against the Company, members of the Box family and their affiliates. A description of the such litigation is located in Note 6 of Notes to Financial Statements in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997 (the "10-Q") under the caption "Griffin Case," and the descriptions contained therein are incorporated by reference herein. Under the terms of the proposed settlement, which are subject to court approval, Mr. Simplot will receive $1.9 million for attorneys' fees. Mr. James A. Lyle will receive $100,000 for attorneys' fees, and will be appointed to the Company's Board of Directors and be granted the right to convert his 2,500 shares of Class B Common Stock into an equal number of shares of the Company's Class A (Voting) Common Stock. In conjunction with the sale of their interests in BBHC, Thomas Box, Don Box, Douglas Box, Gary Box and entities controlled by them entered into a settlement agreement whereby each of such parties agreed to settle all pending litigation among them. A description of this litigation is located in Note 6 of Notes to Financial Statements in the 10-Q under the caption "Thomas D. Box Lawsuit" and "-- Box Control, L.L.C.," and are incorporated by reference herein. SOURCES AND AMOUNT OF FUNDS The precise amount of funds required by the Company to purchase Notes tendered pursuant to the Offer and to pay the fees and expenses related to the Offer will not be known until the Expiration Date. If all outstanding Notes were tendered and purchased, the aggregate amount of funds required to pay the Purchase Price would be $56,945,028. The Company has not arranged permanent financing to fund the purchase of the Notes. Management anticipates utilizing available working capital and current revolving bank line of credit financing plus, to the extent necessary, arranging additional bank credit sufficient to cover amounts in excess of currently available funds. There can be no assurance, however, that sufficient additional bank credit will be made available to the Company. The Company currently has a $25,000,000 revolving credit facility with Comerica Bank -- Texas that expires June 1, 1998. The present borrowing base under the facility is $10,000,000, of which $3,750,000 is currently available for future draws. Borrowings under the facility bear interest at 0.5% above Comerica Bank's floating base rate, resulting in a current effective interest rate of 9% 7 12 per annum. The loans are collateralized by the Company's interest in certain oil and gas properties known as the South Pass Blocks 86, 87 and 89. MARKET PRICE INFORMATION THE NOTES The Notes are listed and traded on the NASDAQ SmallCap Market under the symbol "BOXXG." The following table sets forth the high and low last sales prices expressed as a percent of principal amount of the Notes, as reported by the NASDAQ SmallCap Market, for the periods indicated.
HIGH LOW ----- ----- Year ended December 31, 1995 First Quarter............................................. 103.0% 88.5% Second Quarter............................................ 98.0 91.0 Third Quarter............................................. 107.0 91.5 Fourth Quarter............................................ 104.0 95.3 Year ended December 31, 1996 First Quarter............................................. 109.0% 96.0% Second Quarter............................................ 110.0 102.6 Third Quarter............................................. 105.0 100.0 Fourth Quarter............................................ 103.0 98.0 Year ended December 31, 1997 First Quarter............................................. 102.0% 94.0% Second Quarter............................................ 99.5 92.0 Third Quarter (through September 19, 1997)................ 103.0 93.0
On September 19, 1997, the last reported sales price of the Notes was 102.5%. CLASS B COMMON STOCK The Company has two classes of stock: Class A (Voting) Common Stock and Class B (Non-Voting) Common Stock. The Notes are convertible only into shares of Class B Common Stock, which are traded on the NASDAQ National Market System under the trading symbol BOXXB, and on the Pacific Exchange under the trading symbol BXCB.P. The following table sets forth the high and low last sales prices per share for the Class B Common Stock as reported by NASDAQ for the periods indicated.
HIGH LOW ---- --- Year ended December 31, 1995 First Quarter............................................. $11 $75/8 Second Quarter............................................ 95/8 81/4 Third Quarter............................................. 111/4 77/8 Fourth Quarter............................................ 97/8 81/8 Year ended December 31, 1996 First Quarter............................................. $113/8 $73/4 Second Quarter............................................ 111/8 83/4 Third Quarter............................................. 93/4 8 Fourth Quarter............................................ 103/8 8 Year ended December 31, 1997 First Quarter............................................. $ 95/16 $63/4 Second Quarter............................................ 83/4 61/4 Third Quarter (through September 19, 1997)................ 83/4 61/4
On September 19, 1997, the last reported sales prices of Class B Common Stock was $8. 8 13 SELECTED FINANCIAL DATA The following table presents selected historical financial data for the Company for the periods indicated. The financial data for each of the two years in the period ended December 31, 1996, have been derived from the audited consolidated financial statements of the Company for such periods. The financial data for the six months ended June 30, 1997 and 1996 are unaudited, but in the opinion of the Company reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of such data. The data for the six months ended June 30, 1997, are not necessarily indicative of results of operations for the entire year. The data should be read in conjunction with the consolidated financial statements, related notes and other financial information of the Company incorporated by reference in this Offer to Purchase. See "Incorporation of Certain Documents by Reference."
AT OR FOR AT OR FOR SIX MONTHS ENDED YEAR ENDED JUNE 30, DECEMBER 31, -------------------- ---------------------------- 1997 1996 1996 1995 -------- -------- ------------ ------------ (IN THOUSANDS, EXCEPT PER SHARE AND RATIO DATA) INCOME STATEMENT DATA: Total Revenue............................... $ 34,194 $ 36,934 $ 70,210 $ 59,493 Net income (loss)........................... $ 1,345 $ (1,056) $ (7,662) $ 5,392 Income (loss) per share..................... $ 0.06 $ (0.05) $ (0.37) $ .26 Ratio of Earnings to Fixed Charges.......... 1.84 0.38* * 2.55 BALANCE SHEET DATA: Total assets................................ $134,835 $141,955 $136,599 $145,491 Long-term debt.............................. $ 55,077 $ 55,077 $ 55,077 $ 55,077 Shareholders' equity........................ $ 72,635 $ 80,787 $ 74,356 $ 82,047 Book Value per share........................ $ 3.57 $ 3.88 $ 3.57 $ 3.97
- --------------- * Fixed charges (as defined in Regulation S-K under the Exchange Act) exceeded earnings (as defined in Regulation S-K) by $1,513 for the six months ended June 30, 1996, and by $9,432 for the year ended December 31, 1996. CERTAIN FEDERAL INCOME TAX CONSEQUENCES The following discussion is for general information only and is based on the federal income tax law now in effect, which is subject to change, possibly retroactively. This summary does not discuss all aspects of federal income taxation which may be relevant to any particular Holder in light of such Holder's individual investment circumstances or to certain types of Holders subject to special tax rules (e.g., financial institutions, broker-dealers, insurance companies, tax-exempt organizations, and foreign taxpayers), nor does it address specific state, local or foreign tax consequences. This summary assumes that Holders have held their Notes as "capital assets" under the Internal Revenue Code of 1986, as amended. EACH HOLDER IS URGED TO CONSULT SUCH HOLDER'S TAX ADVISOR REGARDING THE SPECIFIC FEDERAL, STATE, LOCAL, AND FOREIGN INCOME AND OTHER TAX CONSEQUENCES OF THE OFFER. The receipt of cash by a Holder in exchange for Notes will be a taxable transaction for federal income tax purposes and may also be a taxable transaction under applicable state, local or foreign tax laws. Such Holder will recognize gain or loss in an amount equal to the difference between (i) the amount of cash received (other than that representing accrued interest) and (ii) such Holder's adjusted tax basis in the Notes. Subject to the market discount rules discussed below, such gain or loss will be capital gain or loss. If the Holder has held such Notes for more than 12 months but less than 18 months, any gain will be mid-term gain with a maximum federal income tax rate of 28%. If the Holder has held such Notes for more than 18 months, the gain will be long-term gain with a maximum federal income tax rate of 20%. Any capital loss will be short-term loss if the Notes have been held for 12 months or less and long-term loss if the Notes have been held for more than 12 months. 9 14 The payment of accrued interest on a Note generally will be treated as ordinary income. An exception to the capital gain treatment described above applies to a Holder who holds a Note with a "market discount." Market discount is the amount by which the Holder's basis in the Note immediately after its acquisition is exceeded by the stated redemption price of the Note at maturity. A Note, however, will be considered to have no market discount if such excess is less than 1/4 of 1% of the stated redemption price of the Note at maturity multiplied by the number of complete years from the Holder's acquisition date of the Note to its maturity date. The gain realized by the Holder of a market discount Note on its purchase by the Company will be treated as ordinary income to the extent that a market discount has accrued (on a straight line basis or, at the election of the Holder, on a constant interest basis) from the Holder's acquisition date to the date of sale, unless the Holder has elected to include market discount in income currently as it accrues. Gain in excess of such accrued market discount will be subject to the capital gains rules described above. THE DEPOSITARY The Depositary for the Offer is United States Trust Company of New York. All deliveries, correspondence and questions sent or presented to the Depositary relating to the Offer should be directed to one of the addresses or telephone numbers set forth on the back cover of this Offer to Purchase. Requests for information or additional copies of the Offer to Purchaser and the related Letter of Transmittal should be directed to the Depositary. The Company will pay the Depositary reasonable and customary compensation for its services in connection with the Offer, plus reimbursement for reasonable out-of-pocket expenses. Brokers, dealers, commercial banks and trust companies will be reimbursed by the Company for customary mailing and handling expenses incurred by them in forwarding material to their customers. MISCELLANEOUS The Company is not aware of any jurisdiction where the making of the Offer is not in compliance with the laws of such jurisdiction. If the Company becomes aware of any jurisdiction where the making of the Offer would not be in compliance with such laws, the Company will make a good faith effort to comply with any such laws or seek to have such laws declared inapplicable to the Offer. If, after such good faith effort, the Company cannot comply with any such applicable laws, the Offer will not be made to (nor will tenders be accepted from or on behalf of) the Holders residing in such jurisdiction. 10 15 The Letter of Transmittal, certificates representing tendered Notes and any other required documents should be sent or delivered by each Holder or such Holder's broker, dealer, commercial bank, trust company or other nominee to the Depositary as follows: The Depositary for the Offer is: UNITED STATES TRUST COMPANY OF NEW YORK BY MAIL: BY HAND DELIVERY: BY COURIER: United States Trust Company United States Trust Company United States Trust Company of New York of New York of New York P. O. Box 841 Cooper Station 111 Broadway -- Lower Level 770 Broadway -- 13th Floor New York, New York 10276 New York, New York 10006-1906 New York, New York 10003-9598
CONFIRM BY TELEPHONE: (800) 225-2398 (212) 420-6504 (fax) 11 EX-99.(A)(2) 3 LETTER OF TRANSMITTAL 1 LETTER OF TRANSMITTAL TO TENDER 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION PURSUANT TO THE CHANGE IN CONTROL NOTICE AND OFFER TO PURCHASE DATED SEPTEMBER 22, 1997 SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE OFFER TO PURCHASE, THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 22, 1997, UNLESS THE OFFER IS EXTENDED IN ACCORDANCE WITH THE INDENTURE (SUCH TIME AND DATE OR THE LATEST EXTENSION THEREOF, IF EXTENDED, THE "EXPIRATION DATE"). NOTES TENDERED IN THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE. The Depositary for the Offer is: UNITED STATES TRUST COMPANY OF NEW YORK BY MAIL: BY HAND DELIVERY: BY COURIER: United States Trust Company United States Trust Company United States Trust Company of New York of New York of New York P. O. Box 841 Cooper Station 111 Broadway -- Lower Level 770 Broadway -- 13th Floor New York, New York 10276 New York, New York 10006-1906 New York, New York 10003-9598
CONFIRM BY TELEPHONE: (800) 225-2398 (212) 420-6504 (fax) Delivery of this Letter of Transmittal to an address, or transmission of instructions via facsimile, other than as set forth above will not constitute valid delivery. THE INSTRUCTIONS CONTAINED HEREIN AND IN THE OFFER TO PURCHASE (AS DEFINED BELOW) SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. AS DESCRIBED IN THE OFFER TO PURCHASE, THE COMPANY IS MAKING THE OFFER (AS DEFINED BELOW) ONLY BECAUSE IT IS REQUIRED TO DO SO UNDER ARTICLE TWELVE OF THE INDENTURE UNDER WHICH THE NOTES WERE ISSUED. THE OFFER DOES NOT CONSTITUTE A REDEMPTION OF, OR AN ELECTION BY THE COMPANY TO REDEEM, THE NOTES. HOLDERS HAVE AN ELECTION WHETHER OR NOT TO ACCEPT THE OFFER. List below the Notes to which this Letter of Transmittal relates. If the space provided below is inadequate, list the certificate numbers and principal amounts on a separately executed schedule and affix the schedule to this Letter of Transmittal. Tenders of Notes will be accepted only in principal amounts equal to $1,000 or integral multiples thereof. - ---------------------------------------------------------------------------------------------------------------------- DESCRIPTION OF NOTES - ---------------------------------------------------------------------------------------------------------------------- AGGREGATE NAME(S) AND ADDRESS(ES) OF HOLDER(S) CERTIFICATE PRINCIPAL AMOUNT PRINCIPAL AMOUNT (PLEASE FILL IN, IF BLANK) NUMBER* REPRESENTED** TENDERED** - ---------------------------------------------------------------------------------------------------------------------- ====================================================== ====================================================== - ---------------------------------------------------------------------------------------------------------------------- TOTAL PRINCIPAL AMOUNT OF NOTES - ----------------------------------------------------------------------------------------------------------------------
* Need not be completed by Holders tendering by book-entry transfer (see below). ** Unless otherwise indicated in the column labeled "Principal Amount Tendered" and subject to the terms and conditions of the Offer to Purchase, a Holder will be deemed to have tendered the entire aggregate principal amount represented by the Notes indicated in the column labeled "Aggregate Principal Amount Represented." See Instruction 2. [ ] CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY DELIVERED TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Registered Holder(s): ------------------------------------------------------------------------------- Window Ticket No. (if any): ---------------------------------------------------------------------------- Date of Execution of Notice of Guaranteed Delivery: -------------------------------------------------------------- Name of Eligible Institution that Guaranteed Delivery: ------------------------------------------------------------ - -------------------------------------------------------------------------------- 2 By execution hereof, the undersigned acknowledges receipt of the Change in Control Notice and Offer to Purchase, dated September 22, 1997 (as the same may be amended from time to time, the "Offer to Purchase"), of Box Energy Corporation (the "Company") and this Letter of Transmittal and instructions hereto (the "Letter of Transmittal"), which together constitute the Company's offer to purchase (the "Offer") any and all of the outstanding 8 1/4% Convertible Subordinated Notes due 2002 of the Company (the "Notes"), upon the terms and subject to the conditions set forth in the Offer to Purchase. HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE PAYMENT FOR THE NOTES TO BE PURCHASED PURSUANT TO THE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR NOTES TO THE DEPOSITARY PRIOR TO THE EXPIRATION DATE. This Letter of Transmittal is to be used by holders of Notes ("Holders") if certificates representing the Notes are to be physically delivered to the Depositary herewith by Holders. This Letter of Transmittal is also being supplied for informational purposes only to persons who hold Notes in book-entry form through the facilities of The Depository Trust Company ("DTC"). Tender of Notes held through DTC must be made pursuant to the procedures described under "Procedures for Tendering Notes -- Tendering Notes -- Notes Held Through DTC" in the Offer to Purchase. In order to properly complete this Letter of Transmittal, a Holder must (i) complete the box entitled "Description of Notes;" (ii) if appropriate, check and complete the boxes relating to guaranteed delivery, Special Issuance or Payment Instructions and Special Delivery Instructions; (iii) sign the Letter of Transmittal; and (iv) complete Substitute Form W-9. Each Holder should carefully read the detailed Instructions contained herein prior to completing this Letter of Transmittal. The undersigned has completed, executed and delivered this Letter of Transmittal to indicate the action the undersigned desires to take with respect to the Offer. If Holders desire to tender Notes pursuant to the Offer and (i) certificates representing such Holder's Notes are not lost but are not immediately available or time will not permit this Letter of Transmittal, certificates representing such Notes or other required documents to reach the Depositary prior to the Expiration Date, or (ii) the procedures for book-entry transfer cannot be completed prior to the Expiration Date, such Holders may effect a tender of such Notes in accordance with the guaranteed delivery procedures described under "Procedure for Tendering Notes -- Guaranteed Delivery Procedures" in the Offer to Purchase. See Instruction 1. All capitalized terms used herein and not defined herein shall have the meaning ascribed to them in the Offer to Purchase. Your bank or broker can assist you in completing this form. The instructions included with this Letter of Transmittal must be followed. Questions and requests for assistance or for additional copies of the Offer to Purchase, this Letter of Transmittal and the Notice of Guaranteed Delivery may be directed to the Depositary. See Instruction 9. The Company is not aware of any jurisdiction where the making of the Offer would not be in compliance with applicable laws. If the Company becomes aware of any jurisdiction where the making of the Offer would not be in compliance with such laws, the Company will make a good faith effort to comply with any such laws or seek to have such laws declared inapplicable to the Offer. If after such good faith effort, the Company cannot comply with any such applicable laws, the Offer will not be made to, nor will tenders be accepted from or on behalf of, Holders residing in such jurisdiction. HOLDERS WHO WISH TO ACCEPT THE OFFER AND TENDER THEIR NOTES MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY. NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: Upon the terms and subject to the conditions of the Offer, the undersigned hereby tenders to the Company the principal amount of Notes indicated above. Subject to and effective upon the acceptance for purchase of and payment for Notes tendered thereby, by executing and delivering a Letter of Transmittal a tendering Holder (i) irrevocably sells, assigns and transfers to the Company, all right, title and interest in and to all Notes tendered thereby and (ii) waives any and all rights with respect to such Notes (including without limitation any existing or past defaults and their consequences with respect to such Note and the Indenture under which the Notes were issued), (iii) releases and discharges the Company from any and all claims such Holder may have now, or may have in the future arising out of, or related to, such Notes including without limitation any claims that such Holder is entitled to receive additional principal or interest payments with respect to such Notes or to participate in any redemption or defeasance of the Notes and (iv) irrevocably constitutes and appoints the Depositary the true and lawful agent and attorney-in-fact of such Holder with respect to any such tendered Notes, with full power of substitution and resubstitution (such power of attorney being deemed to be an irrevocable power coupled with an interest) to (a) deliver certificates representing such Notes, or transfer ownership of such Notes, on the account books maintained by DTC, together, in any such case, with all accompanying evidences of transfer and authenticity, to the Company, (b) present such Notes for transfer on the relevant security register and (c) receive all benefits or otherwise exercise all rights of beneficial ownership of such Notes (except that the Depositary will have no rights to, or control over, funds from the Company, except as agent for the Company, for the purchase price for any tendered Notes that are purchased by the Company), all in accordance with the terms of the Offer. The undersigned understands that tenders of Notes may be withdrawn by written notice of withdrawal received by the Depositary at any time prior to the Expiration Date. See Instruction 1. 3 The undersigned hereby represents and warrants that the undersigned (i) owns the Notes tendered and is entitled to tender such Notes and (ii) has full power and authority to tender, sell, assign and transfer the Notes tendered hereby and that when such Notes are accepted for purchase and payment by the Company, the Company will acquire good title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claim or right. The undersigned will, upon request, execute and deliver any additional documents deemed by the Depositary or the Company to be necessary or desirable to complete the sale, assignment and transfer of the Notes tendered hereby. For the purposes of the Offer, the undersigned understands that the Company will be deemed to have accepted for purchase validly tendered Notes (or defectively tendered Notes with respect to which the Company has waived such defect) only if, as and when the Company gives oral or written notice thereof to the Depositary. Payment for Notes purchased pursuant to the Offer will be made by deposit of the purchase price for such Notes with the Depositary, which will act as agent for tendering Holders for the purpose of receiving payments from the Company and transmitting such payments to such Holders. All authority conferred or agreed to be conferred by this Letter of Transmittal shall survive the death or incapacity of the undersigned, and every obligation of the undersigned under this Letter of Transmittal shall be binding upon the undersigned's heirs, personal representatives, executors, administrators, successors, assigns, trustees in bankruptcy and other legal representatives. The undersigned understands that valid tender of Notes pursuant to any one of the procedures described under "Procedures for Tendering Notes" in the Offer to Purchase and in the instructions hereto will constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Offer, including the undersigned's waiver of any existing defaults and their consequences with respect to the Notes and the Indenture (including, without limitation, a default in the payment of interest). The undersigned understands that the delivery and surrender of Notes is not effective, and the risk of loss of the Notes does not pass to the Depositary, until receipt by the Depositary of this Letter of Transmittal, or a facsimile hereof, properly completed and duly executed, together with all accompanying evidences of authority and any other required documents in form satisfactory to the Company. All questions as to the validity, form, eligibility (including time of receipt) and acceptance for payment of any tender of Notes pursuant to the procedures described in the Offer to Purchase and the form and validity (including time of receipt of notices of withdrawal) of all documents will be determined by the Company, in its sole direction, which determination shall be final and binding on all parties. Unless otherwise indicated herein under "Special Issuance or Payment Instructions," the undersigned hereby requests that any Notes representing principal amounts not tendered be issued in the name(s) of the undersigned, and checks constituting payments for Notes purchased in connection with the Offer be issued to the order of the undersigned. Similarly, unless otherwise indicated herein under "Special Delivery Instructions," the undersigned hereby requests that any Notes representing principal amounts not tendered and checks constituting payments for Notes to be purchased in connection with the Offer be delivered to the undersigned at the address(es) shown herein. In the event that the "Special Issuance or Payment Instructions" box or the "Special Delivery Instructions" box, or both, are completed, the undersigned hereby requests that any Notes representing principal amounts not tendered be issued in the name(s) of, certificates for such Notes be delivered to, and checks constituting payments for Notes purchased in connection with the Offer be issued in the name(s) of, and be delivered to, the person(s) at the address(es) so indicated, as applicable. The undersigned recognizes that the Company has no obligation pursuant to the "Special Issuance or Payment Instructions" box to transfer any Notes from the name of the registered Holder(s) thereof if the Company does not accept for purchase any of the principal amount of such Notes so tendered. 4 SPECIAL ISSUANCE OR PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 2 THROUGH 6) To be completed ONLY if certificates for Notes represent a greater amount of Notes than the Holder is tendering or the check for the purchase price for Notes to be purchased are to be issued to the order of someone other than the person or persons whose signature(s) appear(s) within this Letter of Transmittal or issued to an address different from that shown in the box entitled "Description of Notes" within this Letter of Transmittal. Issue: [ ] Notes [ ] Checks (Complete as applicable) Name: - ------------------------------------------------ (Please Print) Address: - ---------------------------------------------- (Please Print) ------------------------------------------------------- (Zip Code) ------------------------------------------------------- Taxpayer Identification or Social Security Number (See Substitute Form W-9 herein) SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 2 THROUGH 6) To be completed ONLY if certificates for Notes represent a greater amount of Notes than the Holder is tendering or the check for the purchase price for Notes to be purchased is to be sent to an address different from that shown in the box entitled "Description of Notes" within this Letter of Transmittal. Deliver: [ ] Notes [ ] Checks (Complete as applicable) Name: - ------------------------------------------------ (Please Print) Address: - ---------------------------------------------- (Please Print) ------------------------------------------------------- (Zip Code) ------------------------------------------------------- Taxpayer Identification or Social Security Number (See Substitute Form W-9 herein) 5 PLEASE SIGN BELOW PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN (TO BE COMPLETED BY ALL TENDERING HOLDERS REGARDLESS OF WHETHER NOTES ARE BEING PHYSICALLY DELIVERED HEREWITH) This Letter of Transmittal must be signed by the registered Holder(s) of Notes exactly as his (their) name(s) appear(s) on certificate(s) for Notes or by person(s) authorized to become registered Holder(s) by endorsements and documents transmitted with this Letter of Transmittal. If the signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer or other person acting in a fiduciary or representative capacity, such person must set forth his or her full title below under "Capacity" and submit evidence satisfactory to the Company of such person's authority to so act. See Instruction 3. If the signature appearing below is not that of the registered Holder(s) of the Notes, then the registered Holder(s) must sign a valid power of attorney. X - -------------------------------------------------------------------------------- X - -------------------------------------------------------------------------------- (Signature(s) of Holder(s) or Authorized Signatory) Date: - --------------------------------------------- , 1997 Name(s): - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Please Print) Capacity: - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Address: - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Include Zip Code) Area Code and Telephone Number: - -------------------------------------------------------------------------------- SIGNATURE GUARANTEE (IF REQUIRED -- SEE INSTRUCTION 3) Certain signatures must be Guaranteed by an Eligible Institution. - -------------------------------------------------------------------------------- (Name of Eligible Institution Guaranteeing Signatures) - -------------------------------------------------------------------------------- (Address (including zip code) and Telephone Number (including area code) of Eligible Institution) - -------------------------------------------------------------------------------- (Title) - -------------------------------------------------------------------------------- (Authorized Signature) - -------------------------------------------------------------------------------- (Printed Name) - -------------------------------------------------------------------------------- (Title) Date: - --------------------------------------------- , 1997 6 INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. Procedures for Tendering Notes; Guaranteed Delivery Procedures; Withdrawal of Tenders. To tender Notes in the Offer, certificates representing such Notes, together with a properly completed and duly executed copy (or facsimile) of this Letter of Transmittal, and any other documents required by this Letter of Transmittal must be received by the Depositary at one of its addresses set forth herein prior to the Expiration Date. The method of delivery of this Letter of Transmittal, certificates for Notes and all other required documents to the Depositary is at the election and risk of Holders. If such delivery is to be made by mail, it is suggested that Holders use properly insured registered mail, return receipt requested, and that the mailing be made sufficiently in advance of the Expiration Date to permit delivery to the Depositary prior to such date. Except as otherwise provided below, the delivery will be deemed made when actually received or confirmed by the Depositary. THIS LETTER OF TRANSMITTAL AND NOTES SHOULD BE SENT ONLY TO THE DEPOSITARY, AND NOT TO THE COMPANY OR THE TRUSTEE. This Letter of Transmittal is also being supplied for informational purposes only to persons who hold notes in book-entry form through the facilities of DTC. Tender of Notes held through DTC must be made pursuant to the procedures described under "Procedures for Tendering Notes -- Tendering Notes -- Notes Held Through DTC" in the Offer to Purchase. Except as provided herein for the book-entry or guaranteed delivery procedures, unless the Notes being tendered are deposited with the Depositary on or prior to the Expiration Date (accompanied by the appropriate, properly completed and duly executed Letter of Transmittal and any required signature guarantees and other documents required by this Letter of Transmittal), the Company may, in its sole discretion, reject such tender. Payment for Notes will be made only against deposit of tendered Notes. By executing this Letter of Transmittal (or a facsimile thereof), a tendering Holder waives any right to receive any notice of the acceptance for payment of tendered Notes. For a full description of the procedures for tendering Notes, see "Procedures for Tendering Notes -- Tendering Notes" in the Offer to Purchase. If a Holder desires to tender Notes pursuant to the Offer and (i) certificates representing such Holder's Notes are not lost but are not immediately available or time will not permit this Letter of Transmittal, certificates representing Notes or other required documents to reach the Depositary on or prior to the Expiration Date or (ii) the procedures for book-entry transfer cannot be completed on or prior to the Expiration Date, such Holder may effect a tender of such Notes in accordance with the guaranteed delivery procedures described under "Procedures for Tendering Notes -- Guaranteed Delivery Procedures" in the Offer to Purchase. Tenders of Notes may be withdrawn at any time prior to the Expiration Date pursuant to the procedures described under "Procedures For Tendering Notes -- Withdrawal Rights" in the Offer to Purchase. 2. Partial Tenders. Tenders of Notes pursuant to the Offer will be accepted only in principal amounts equal to $1,000 or integral multiples thereof. If less than the entire principal amount of any Notes evidenced by a submitted certificate is tendered, the tendering Holder must fill in the principal amount tendered in the last column of the box entitled "Description of Notes" herein. The entire principal amount represented by the certificates for all Notes delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. If the entire principal amount of all Notes is not tendered, certificates for the principal amount of Notes not tendered will be sent to the Holder unless otherwise provided in the appropriate box on this Letter of Transmittal (see Instruction 4), promptly after the Notes are accepted for purchase. 3. Signatures on this Letter of Transmittal; Bond Powers and Endorsement; Guarantee of Signatures. If this Letter of Transmittal is signed by the registered Holder(s) of the Notes tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificate(s) without alteration, enlargement or any change whatsoever. IF THIS LETTER OF TRANSMITTAL IS EXECUTED BY A HOLDER WHO IS NOT THE REGISTERED HOLDER, THEN THE REGISTERED HOLDER MUST SIGN A VALID POWER OF ATTORNEY, WITH THE SIGNATURE OF SUCH REGISTERED HOLDER GUARANTEED BY AN ELIGIBLE INSTITUTION. If any of the Notes tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any tendered Notes are registered in different names on several certificates, it will be necessary to complete, sign and submit as many copies of this Letter of Transmittal and any necessary accompanying documents as there are different names in which certificates are held. If this Letter of Transmittal is signed by the Holder, and the certificates for any principal amount of Notes not tendered for purchase are to be issued (or if any principal amount of Notes that is not tendered for purchase is to be reissued or returned) to the Holder, and checks constituting payments for Notes to be purchased in connection with the Offer are to be issued to the order of the Holder, then the Holder need not endorse any certificates for tendered Notes nor provide a separate bond power. In any other case (including if this Letter of Transmittal is not signed by the Holder), the Holder must either properly endorse the certificates for Notes tendered or transmit a separate properly completed bond power with this Letter of Transmittal (in either case, executed exactly as the name(s) of the registered Holder(s) appear(s) on such Notes), with the signature on the endorsement or bond power guaranteed by an Eligible Institution, unless such certificates or bond powers are executed by an Eligible Institution. 7 If this Letter of Transmittal or any certificates representing Notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and submit proper evidence satisfactory to the Company of their authority so to act with this Letter of Transmittal. Endorsements on certificates for Notes and signatures on bond powers provided in accordance with this Instruction 3 by registered Holders not executing this Letter of Transmittal must be guaranteed by an Eligible Institution. No signature guarantee is required if: (i) this Letter of Transmittal is signed by the registered Holder(s) of the Notes tendered herewith and the payments for the Notes to be purchased are to be made, or any Notes for principal amounts not tendered for purchase are to be issued, directly to such registered Holder(s) and neither the "Special Issuance or Payment Instructions" box nor the "Special Delivery Instructions" box of this Letter of Transmittal has been completed; or (ii) such Notes are tendered for the account of an Eligible Institution. In all other cases, all signatures on Letters of Transmittal accompanying Notes must be guaranteed by an Eligible Institution. 4. Special Issuance or Payment and Special Delivery Instructions. Tendering Holders should indicate in the applicable box or boxes the name and address to which Notes for principal amounts not tendered or not accepted for purchase or checks constituting payments for Notes to be purchased in connection with the Offer are to be issued or sent, if different from the name and address of the Holder signing this Letter of Transmittal. In the case of issuance in a different name, the taxpayer identification or social security number of the person named must also be indicated. If no instructions are given, Notes not tendered or not accepted for purchase will be returned to the Holder of the Notes tendered. 5. Taxpayer Identification Number and Substitute Form W-9. Each tendering Holder is required to provide the Depositary with the Holder's correct taxpayer identification number ("TIN"), generally the Holder's social security or federal employer identification number, on Substitute Form W-9, which is provided under "Important Tax Information" below, or, alternatively, to establish another basis for exemption from backup withholding. A Holder must cross out item (2) in the Certification box on Substitute Form W-9 if such Holder is subject to backup withholding. Failure to provide the information on the form may subject the tendering Holder to 31% federal income tax backup withholding on the payments made to the Holder or other payee with respect to Notes purchased pursuant to the Offer. The box in Part 3 of the form should be checked if the tendering Holder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked and the Depositary is not provided with a TIN within 60 days, thereafter the Depositary will withhold 31% from all such payments with respect to the Notes to be purchased until a TIN is provided to the Depositary. 6. Transfer Taxes. The Company will pay all transfer taxes, if any, payable on the purchase and transfer of Notes purchased pursuant to the Offer, except in the case of deliveries of certificates for Notes for principal amounts not tendered for payment that are to be registered or issued in the name of any person other than the Holder of Notes tendered hereby, in which case the amount of any transfer taxes (whether imposed on the registered Holder or such other person) payable on account of the transfer to such person will be deducted from the purchase price unless satisfactory evidence of the payment of such taxes or exemption therefrom is submitted. Except as provided in this Instruction 6, it will not be necessary for transfer stamps to be affixed to the certificates listed in this Letter of Transmittal. 7. Irregularities. All questions as to the validity, form, eligibility (including the time of receipt) and acceptance for payment of any tenders of Notes pursuant to the procedures described in the Offer to Purchase and the form and validity (including the time of receipt of notices of withdrawal) of all documents will be determined by the Company, in its sole discretion, which determination shall be final and binding on all parties. The Company reserves the absolute right to reject any or all tenders determined by it not to be in proper form or the acceptance of or payment for which may be unlawful. The Company also reserves the absolute right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular Notes. The Company's interpretations of the terms and conditions of the Offer (including without limitation the instructions in this Letter of Transmittal) shall be final and binding. No alternative, conditional or contingent tenders will be accepted. Unless waived, any irregularities in connection with tenders must be cured within such time as the Company shall determine. None of the Company, the Depositary or any other person will be under any duty to give notification of any defects or irregularities in such tenders or will incur any liability to Holders for failure to give such notification. Tenders of such Notes shall not be deemed to have been made until such irregularities have been cured or waived. Any Notes received by the Depositary that are not properly tendered and as to which the irregularities have not been cured or waived will be returned by the Depositary to the tendering Holders, unless such Holders have otherwise provided herein, as promptly as practical following the Expiration Date. 8. Mutilated, Lost, Stolen or Destroyed Certificates for Notes. Any Holder whose certificates for Notes have been mutilated, lost, stolen or destroyed should contact the Depositary at the address indicated above for further instructions. 9. Requests for Assistance or Additional Copies. Questions relating to the procedure for tendering Notes and requests for assistance or additional copies of the Offer to Purchase and this Letter of Transmittal may be directed to, and additional information about the Offer may be obtained from the Depositary, whose address and telephone number appears herein. 8 IMPORTANT TAX INFORMATION Under federal income tax laws, a Holder whose tendered Notes are accepted for payment is required by law to provide the Depositary (as payer) with such Holder's correct TIN on Substitute Form W-9 included herein or otherwise establish a basis for exemption from backup withholding. If such Holder is an individual, the TIN is his social security number. If the Depositary is not provided with the correct TIN, a $50 penalty may be imposed by the Internal Revenue Service, and payments made with respect to Notes purchased pursuant to the Offer may be subject to backup withholding. Failure to comply truthfully with the backup withholding requirements also may result in the imposition of severe criminal and/or civil fines and penalties. Certain Holders (including, among others, all corporations and certain foreign persons) are not subject to these backup withholding and reporting requirements. Exempt Holders should furnish their TIN, write "Exempt" on the face of the Substitute Form W-9, and sign, date and return the Substitute Form W-9 to the Depositary. A foreign person, including entities, may qualify as an exempt recipient by submitting to the Depositary a properly completed Internal Revenue Service Form W-8, signed under penalties of perjury, attesting to that Holder's foreign status. A Form W-8 can be obtained from the Depositary. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional instructions. If backup withholding applies, the Depositary is required to withhold 31% of any payments made to the Holder or other payee. Backup withholding is not an additional federal income tax. Rather, the federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service. PURPOSE OF SUBSTITUTE FORM W-9 To prevent backup withholding on payments made with respect to Notes purchased pursuant to the Offer, the Holder is required to provide the Depositary with either: (i) the Holder's correct TIN by completing the form included herein, certifying that the TIN provided on Substitute Form W-9 is correct (or that such Holder is awaiting a TIN) and that (A) the Holder has not been notified by the Internal Revenue Service that the Holder is subject to backup withholding as a result of failure to report all interest or dividends or (B) the Internal Revenue Service has notified the Holder that the Holder is no longer subject to backup withholding; or (ii) an adequate basis for exemption. 9 NUMBER TO GIVE THE DEPOSITARY The Holder is required to give the Depositary the TIN (e.g., social security number or employer identification number) of the registered Holder of the Notes. If the Notes are held in more than one name or are held not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which number to report. PAYER'S NAME: UNITED STATES TRUST COMPANY OF NEW YORK - -------------------------------------------------------------------------------- SUBSTITUTE FORM W-9 PART 1 -- PLEASE PROVIDE YOUR TIN IN DEPARTMENT OF THE TREASURY THE BOX AT RIGHT AND CERTIFY BY ------------------------- INTERNAL REVENUE SERVICE SIGNING AND DATING BELOW Social Security Number or Employer identification number ------------------------------------------------------------------------------------- PART 2 -- Certification -- Under penalties of perjury, I certify that: (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me) and (2) I am not subject to back-up withholding either because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to back-up withholding as a result of failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to back-up withholding. ------------------------------------------------------------------------------------- PAYER'S REQUEST FOR Certified instructions -- You must cross out item PART 3 -- TAXPAYER (2) above if you have been notified by the IRS that IDENTIFICATION you are subject to back-up withholding because of Check if NUMBER (TIN) underreporting interest or dividends on your tax Awaiting TIN [ ] return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS stating that you are no longer subject to back-up withholding, do not cross out item (2). SIGNATURE ----------------------- DATE----------- - ------------------------------------------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF SUBSTITUTE FORM W-9 CERTIFICATE OF TAXPAYER AWAITING IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (a) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration or (b) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number within 60 days, 31% of all reportable payments made to me thereafter will be withheld until I provide a number. - ------------------------------------------------------ - ------------------------------------ , 1997 Signature Date 10 GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER. -- Social Security numbers have nine digits separated by two hyphens: i.e. 000-00-0000. Employer identification numbers have nine digits separated by only one hyphen: i.e. 00-0000000. The table below will help determine what name and number to give the payer. - --------------------------------------------------------------- ---------------------------------------------------------------
GIVE THE SOCIAL SECURITY FOR THIS TYPE OF ACCOUNT: NUMBER OF -- - -------------------------------------------------------------- GIVE THE EMPLOYER IDENTIFICATION FOR THIS TYPE OF ACCOUNT: NUMBER OF -- - -------------------------------------------------------------- 1. An individual's account The individual 2. Two or more individuals (joint The actual owner of the account) account or, if combined funds, any one of the individuals(1) 3. Husband and wife (joint The actual owner of the account) account or, if joint funds, either person(1) 4. Custodian account of minor The minor(2) (Uniform Gift to Minors Act) 5. Adult and minor (joint account) The adult or, if the minor is the only contributor, the minor(1) 6. Account in the name of guardian The ward, minor, or or committee for a designated incompetent person(3) ward, minor, or incompetent person 7. a. The usual revocable savings The actual owner(1) trust account (grantor is also trustee) b. So-called trust account that The actual owner(1) is not a legal or valid trust under State law 8. Sole proprietorship The owner(4)
9. Sole proprietorship account The Owner(4) 10. A valid trust, estate, or Legal entity (Do not pension trust furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)(5) 11. Corporate account The Corporation 12. Partnership account held in the The partnership name of the business 13. Association, club, religious, The organization charitable, educational or other tax-exempt organization 14. A broker or registered nominee The broker or nominee 15. Account with the Department of The public entity Agriculture in the name of a public entity (such as a State or local government, school district or prison) that receives agricultural program payments - --------------------------------------------------------------- --------------------------------------------------------------- (1) List first and circle the name of the person whose number you furnish. If only one person on a joint account has an SSN, that person's number must be furnished. (2) Circle the minor's name and furnish the minor's social security number. (3) Circle the ward's, minor's or incompetent person's name and furnish such person's social security number. (4) Show the name of the owner. You may also enter your business name. (5) List first and circle the name of the legal trust, estate, or pension trust. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. 11 GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 PAGE 2 OBTAINING A NUMBER If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5, Application for a Social Security Number Card, or Form SS-4, Application for Employer Identification Number, at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. PAYEES EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on ALL payments include the following: - - A corporation. - - A financial institution. - - An organization exempt from tax under section 501(a), an individual retirement plan, or a custodial account under section 403(b)(7), if the account satisfies the requirements of section 401(f)(2). - - The United States or any agency or instrumentality thereof. - - A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. - - A foreign government, a political subdivision of a foreign government, or any agency, or instrumentality thereof. - - An international organization or any agency, or instrumentality thereof. - - A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S. - - A real estate investment trust. - - A common trust fund operated by a bank under section 584(a). - - An exempt charitable remainder trust, or a non-exempt trust described in section 4947(a)(1). - - An entity registered at all times during the tax year under the Investment Company Act of 1940 - - A foreign central bank of issue. - - A futures commission merchant registered with the Commodity Futures Trading Commission. - - A middleman known in the investment community as a nominee or who is listed in the most recent publication of the American Society of Corporate Secretaries, Inc. Nominee List. Payments of dividends and patronage dividends not generally subject to backup withholding include the following: - - Payments to nonresident aliens subject to withholding under section 1441. - - Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner. - - Payments of patronage dividends where the amount received in not paid in money. - - Payments made by certain foreign organizations. - - Section 404(k) payments made by an ESOP. Payments of interest not generally subject to backup withholding include the following: - - Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. - - Payments of tax-exempt interest (including exempt interest dividends under section 852). - - Payments described in section 6049(b)(5) to nonresident aliens. - - Payments on tax-free covenant bonds under section 1451. - - Payments made by certain foreign organizations. - - Mortgage interest paid to you. Exempt payees described above should file Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE FORM. Certain payments other than interest, dividends, and patronage dividends that are not subject to information reporting are also not subject to backup withholding. For details, see the regulations under section 6041, 6041A(a), 6045, and 6050A. PRIVACY ACT NOTICE. -- Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to the IRS. The IRS uses the numbers for identification purposes and to help verify the accuracy of tax returns. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 31% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. PENALTIES PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500. CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE EX-99.(A)(3) 4 NOTICE OF GUARANTEED DELIVERY 1 NOTICE OF GUARANTEED DELIVERY FOR TENDER OF CERTIFICATES FOR 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION Capitalized terms used but not defined herein have the meanings given them in the Change in Control Notice and Offer to Purchase, dated September 22, 1997 (the "Offer to Purchase"). This Notice of Guaranteed Delivery may be used to cause a tender of 8 1/4% Convertible Subordinated Notes due 2002 of the Company (the "Notes") by (i) a record holder of Notes if certificates for the Notes are not immediately available or time will not permit all required documents to reach the Depositary on or prior to the Expiration Date or (ii) by a DTC Participant if the procedures for book-entry transfer described in the Offer to Purchase cannot be completed on a timely basis. The Depositary for the Offer is: UNITED STATES TRUST COMPANY OF NEW YORK BY MAIL: BY HAND DELIVERY: BY COURIER: United States Trust Company United States Trust Company United States Trust Company of New York of New York of New York P. O. Box 841 Cooper Station 111 Broadway -- Lower Level 770 Broadway -- 13th Floor New York, New York 10276 New York, New York 10006-1906 New York, New York 10003-9598
CONFIRM BY TELEPHONE: (800) 225-2398 (212) 420-6504 (fax) DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY 2 Ladies and Gentlemen: By execution hereof, the undersigned acknowledges receipt of the Offer to Purchase and the Letter of Transmittal. On the terms and subject to the conditions of the Offer to Purchase and the Letter of Transmittal, the undersigned hereby represents that it is the holder of the Notes (or the holder of interests in the Global Note) being tendered (or caused to be tendered) hereby and is entitled to tender (or cause to be tendered) such Notes as contemplated by the Offer and, pursuant to the guaranteed delivery procedures described in the Offer to Purchase and Letter of Transmittal, hereby tenders (or causes a tender) to the Company the aggregate principal amount of Notes indicated below. Except as stated in the Offer to Purchase, all authority herein conferred or agreed to be conferred shall survive the death or incapacity of the undersigned, and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. A record Holder must execute this Notice of Guaranteed Delivery exactly as its name appears on its Notes, and a DTC Participant must execute this Notice of Guaranteed Delivery exactly as its name is registered with DTC. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must set forth his or her name, address and capacity as indicated below and submit evidence to the Company of such person's authority so to act. Signed: - -------------------------------------------------------------------------------- Name(s): - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) Company: - -------------------------------------------------------------------------------- Capacity: - -------------------------------------------------------------------------------- Address: - -------------------------------------------------------------------------------- Dated: - --------------------------------------------- , 1997 Aggregate Principal Amount of Notes Tendered: - ------------------------------------------------------- Certificate Nos. for Notes (if applicable): - -------------------------------------------------------------- If being executed by a DTC Participant: DTC Participant's No. - -------------------------------------------------------------------------------- Account No. - -------------------------------------------------------------------------------- Transaction Code No. - -------------------------------------------------------------------------------- 3 THE GUARANTEE BELOW MUST BE COMPLETED GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or a commercial bank or trust company having an office or correspondent in the United States or another "Eligible Guarantor Institution" as defined in Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended, hereby guarantees that, within three New York Stock Exchange trading days from the date of receipt by the Depositary of this Notice of Guaranteed Delivery, a properly completed and validly executed Letter of Transmittal (or a facsimile thereof), together with Notes tendered hereby in proper form for transfer, (or confirmation of the book-entry transfer of such Notes into the Depositary's account at The Depositary Trust Company, pursuant to the procedures for book-entry transfer set forth under "Procedure for Tendering Notes" in the Offer to Purchase) and all other required documents will be delivered by the undersigned to the Depositary. - -------------------------------------------------------------------------------- NAME OF FIRM - -------------------------------------------------------------------------------- ADDRESS - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- AREA CODE AND TELEPHONE NO. - -------------------------------------------------------------------------------- AUTHORIZED SIGNATURE NAME: - -------------------------------------------------------------------------------- (PLEASE TYPE OR PRINT) - -------------------------------------------------------------------------------- TITLE - -------------------------------------------------------------------------------- DATE The institution which completes this form must deliver to the Depositary the Guarantee, the Letter of Transmittal (or facsimile thereof) and certificates for Notes within the time periods specified herein. Failure to do so could result in a financial loss to such institution. DO NOT SEND CERTIFICATES FOR NOTES WITH THIS FORM. CERTIFICATES SHOULD BE SENT WITH THE LETTER OF TRANSMITTAL. EX-99.(A)(4) 5 LETTER TO CLIENTS 1 BOX ENERGY CORPORATION CHANGE IN CONTROL NOTICE AND OFFER TO PURCHASE FOR CASH ANY AND ALL OF THE OUTSTANDING 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE OFFER TO PURCHASE, THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 22, 1997, UNLESS THE OFFER IS EXTENDED IN ACCORDANCE WITH THE INDENTURE (SUCH TIME AND DATE OR THE LATEST EXTENSION THEREOF, IF EXTENDED, THE "EXPIRATION DATE"). NOTES TENDERED IN THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE. September 22, 1997 To our clients: Enclosed for your consideration is a Change in Control Notice and Offer to Purchase, dated September 22, 1997 (as the same may be amended from time to time, the "Offer to Purchase"), and a form of Letter of Transmittal and instructions thereto (the "Letter of Transmittal"), relating to the offer (the "Offer") by Box Energy Corporation (the "Company") to purchase for cash any and all of its outstanding 8 1/4% Convertible Subordinated Notes due 2002 (the "Notes") at 100% of the principal amount thereof, plus accrued interest thereon through the date of payment. The materials are being forwarded to you as the beneficial owner of Notes carried by us for your account or benefit but not registered in your name. A tender of any Notes may only be made by us as the registered Holder and pursuant to your instructions. Accordingly, we request instructions as to whether you wish us to tender any or all such Notes held by us for your account or benefit pursuant to the terms and conditions set forth in the Offer to Purchase and the Letter of Transmittal. We urge you to read carefully the Offer to Purchase and Letter of Transmittal before instructing us to tender your Notes. The Company has informed us that the Company is making the Offer only because it is required to do so pursuant to Article Twelve of the Indenture under which the Notes were issued. If you elect to tender Notes, your instructions to us should be forwarded as promptly as possible in order to permit us to tender Notes on your behalf in accordance with the provisions of the Offer. Notes tendered pursuant to the Offer may be validly withdrawn, subject to the procedures described in the Offer to Purchase, at any time prior to the Expiration Date. Your attention is directed to the following: 1. The Offer does not constitute a redemption of, or an election by the Company to redeem, the Notes. Holders have an election whether or not to accept the Offer. 2. The Offer is for any and all outstanding Notes. 3. The Offer and withdrawal rights will expire on the Expiration Date. 4. Any transfer taxes incident to the transfer of Notes from the tendering Holder to the Company will be paid by the Company, except as provided in the Offer to Purchase and the instructions to the Letter of Transmittal. 2 If you wish to have us tender any or all of your Notes held by us for your account or benefit, please so instruct us by completing, executing and returning to us the instruction form that appears below. If you authorize the tender of your Notes, all such Notes will be tendered unless otherwise specified below. THE ACCOMPANYING LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR INFORMATIONAL PURPOSES ONLY AND MAY NOT BE USED BY YOU TO TENDER NOTES HELD BY US AND REGISTERED IN OUR NAME FOR YOUR ACCOUNT OR BENEFIT. INSTRUCTIONS The undersigned acknowledge(s) receipt of your letter and the enclosed material referred to therein relating to the Offer. This will instruct you to tender the principal amount of Notes indicated below held by you for the account or benefit of the undersigned pursuant to the terms of and conditions set forth in the Offer to Purchase and the Letter of Transmittal. [ ] Please tender ALL my Notes held by you for my account or benefit. [ ] Please tender LESS than all my Notes. I wish to tender $ principal amount of Notes (Tenders must be in increments of $1000). [ ] Please do not tender any Notes held by you for my account or benefit. Date: - ------------------------------ --------------------------------------- --------------------------------------- Signature(s) --------------------------------------- --------------------------------------- Please print name(s) here UNLESS A SPECIFIC INSTRUCTION IS GIVEN BY MARKING ONE OF THE BOXES, YOUR SIGNATURE(S) HEREON SHALL NOT CONSTITUTE AN INSTRUCTION TO US TO TENDER ANY OF YOUR NOTES. 2 EX-99.(A)(5) 6 LETTER TO BROKE, DEALERS 1 BOX ENERGY CORPORATION CHANGE IN CONTROL NOTICE AND OFFER TO PURCHASE FOR CASH ANY AND ALL OF THE OUTSTANDING 8 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2002 OF BOX ENERGY CORPORATION SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THE OFFER TO PURCHASE, THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 22, 1997, UNLESS THE OFFER IS EXTENDED IN ACCORDANCE WITH THE INDENTURE (SUCH TIME AND DATE OR THE LATEST EXTENSION THEREOF, IF EXTENDED, THE "EXPIRATION DATE"). NOTES TENDERED IN THE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE. September 22, 1997 To Brokers, Dealers, Commercial Banks, Trust Companies And Other Nominees: Enclosed for your consideration is a Change in Control Notice and Offer to Purchase, dated September 22, 1997 (as the same may be amended from time to time, the "Offer to Purchase"), and form of Letter of Transmittal and instructions thereto (the "Letter of Transmittal") relating to the offer (the "Offer") by Box Energy Corporation (the "Company") to purchase for cash all of the outstanding 8 1/4% Convertible Subordinated Notes due 2002 of the Company (the "Notes") at 100% of the principal amount thereof, plus accrued interest thereon through the date of payment. We are asking you to contact your clients for whom you hold Notes registered in your name (or in the name of your nominee) and who, to your knowledge, hold Notes registered in their own names. You will be reimbursed by the Company for customary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your clients. The Company will pay all transfer taxes, if any, applicable to the tender of Notes, except as otherwise provided in the Offer to Purchase and the Letter of Transmittal. Enclosed is a copy of each of the following documents for forwarding to your clients: 1. The Offer to Purchase. 2. A Letter of Transmittal, including Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9, for your use in connection with the tender of Notes by record holders and for the information of your clients. 3. A form of letter addressed "To Our Clients" that may be sent to your clients for whose accounts you hold Notes registered in your name or the name of your nominee, with space provided for obtaining the clients' instructions with regard to the Offer. 4. A Notice of Guaranteed Delivery to be used to accept the Offer if certificates for Notes are not lost but not immediately available, or if the procedure for book-entry transfer cannot be completed on or prior to the Expiration Date. Your prompt action is requested. Notes tendered pursuant to the Offer may be validly withdrawn, subject to the procedures described in the Offer to Purchase, at any time prior to the Expiration Date. 2 Please refer to "Procedures for Tendering Notes" in the Offer to Purchase for a description of the procedures which must be followed to tender Notes in the Offer. Additional copies of the enclosed materials may be obtained from the Depositary at (800) 225-2398. Very truly yours, BOX ENERGY CORPORATION NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY PERSON AS AN AGENT OF THE COMPANY, THE TRUSTEE, OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENTS ON BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE OFFER TO PURCHASE OR THE LETTER OF TRANSMITTAL. -----END PRIVACY-ENHANCED MESSAGE-----