ABSTRACT
The merger with Phoenix Resources Company gave exas International, Inc. (TEI) a second valuable asset: James Kishpaugh, Phoenix Resources Company’s president. Phoenix Resources Company was the reorganized successor to the King Resources Company, named after James King. In March 1978, the Security and Exchange Commission (SEC) filed suit against TEI, charging that it violated the Williams Act by allegedly failing to make required filings disclosing all material facts, and misstating certain material facts in connection with the offering for Phoenix Resources. Phoenix Resources’ board of directors believed this suit to be without merit. Several other suits were filed concerning the Phoenix reorganization: subordinated debenture holders alleged the plan was unfair to certain creditors, and King Resources Company common stockholders challenged the insolvency argument that “crammed down” their loss of ownership. In September 1980, following continued delays from the Canadian government, TEI proposed a share-for-share merger of the two companies.
