SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
SEPTEMBER 2, 2003
KANSAS CITY SOUTHERN
(Exact name of company as specified in its charter)
DELAWARE 1-4717 44-0663509
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(State or other jurisdiction (Commission file number) (IRS Employer
of incorporation) Identification Number)
427 WEST 12TH STREET, KANSAS CITY, MISSOURI 64105
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(Address of principal executive offices) (Zip Code)
COMPANY'S TELEPHONE NUMBER, INCLUDING AREA CODE:
(816) 983 - 1303
NOT APPLICABLE
(Former name or former address if changed since last report)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
EXHIBIT NO. DOCUMENT
(99) Additional Exhibits
99.1 Press Release issued by Kansas City
Southern dated September 2, 2003
entitled, "Kansas City Southern
Files for Preliminary Injunction to
Preserve Its Rights Pending Dispute
Resolution" is attached hereto as
Exhibit 99.1
ITEM 9. REGULATION FD DISCLOSURE
Kansas City Southern ("KCS" or "Company") is furnishing under Item 9 of this
Current Report on Form 8-K the information included as Exhibit 99.1 to this
report. Exhibit 99.1 is the KCS news release, dated September 2, 2003,
indicating that the Company has filed in the Delaware Court of Chancery a motion
for a preliminary injunction to preserve the parties' positions while KCS seeks
to resolve its dispute over Grupo TMM, S.A.'s (TMM) attempt to terminate the
Acquisition Agreement. As previously announced, under the Acquisition Agreement
TMM agreed to sell its shares of Grupo Transportacion Ferroviaria Mexicana, S.A.
De C.V. (GTFM), the corporate parent of the Mexican railway company TFM, S.A. de
C.V. (TFM). KCS has asked for an expedited hearing on its motion for a
preliminary injunction. See the Press Release attached as Exhibit 99.1 for
further information.
The information included in this Current Report on Form 8-K, including Exhibit
99.1, is furnished pursuant to Item 9 and shall not be deemed to be "filed" for
the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise
subject to the liabilities of that Section.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly caused this Report to be signed on its behalf by the undersigned
hereunto duly authorized.
Kansas City Southern
Date: September 3, 2003 By: /S/ LOUIS G. VAN HORN
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Louis G. Van Horn
Vice President and Comptroller
(Principal Accounting Officer)
EXHIBIT 99.1
KANSAS CITY SOUTHERN PRESS RELEASE
Cathedral Square - 427 West 12th Street - P.O. Box 219335
Kansas City, Missouri 64121-9335 NYSE SYMBOL: KSU
DATE: SEPTEMBER 2, 2003
MEDIA CONTACTS:
Mexico Gabriel Guerra Phone: 011-5255-5273-5359
gguerra@gcya.net
U.S. Warren K. Erdman Phone: 816/983-1454
warren.k.erdman@kcsr.com
INVESTORS CONTACT: William H. Galligan Phone: 816/983-1551
william.h.galligan@kcsr.com
KANSAS CITY SOUTHERN FILES FOR PRELIMINARY INJUNCTION
TO PRESERVE ITS RIGHTS PENDING DISPUTE RESOLUTION
Kansas City Southern (KCS) (NYSE:KSU) today filed in the Delaware Court
of Chancery a motion for a preliminary injunction to preserve the parties'
positions while KCS seeks to resolve its dispute over Grupo TMM, S.A.'s (TMM)
attempt to terminate the Acquisition Agreement. As previously announced, under
the Acquisition Agreement TMM agreed to sell its shares of Grupo Transportacion
Ferroviaria Mexicana, S.A. de C.V. (GTFM), the corporate parent of the Mexican
railway company TFM, S.A. de C.V. (TFM). KCS has asked for an expedited hearing
on its motion for a preliminary injunction.
On Friday, August 29, 2003, KCS delivered to TMM a formal Notice of
Dispute pursuant to the Acquisition Agreement, initiating procedures that will
lead to arbitration in New York if the parties' executives are unable to settle
the matter through negotiations.
Also on Friday, KCS filed a complaint in the Delaware Chancery Court
alleging that TMM had breached the Acquisition Agreement and seeking a final
order requiring TMM not to sell GTFM or take other actions outside of the
ordinary course of business, so as to preserve the assets and business of the
Mexican railroad while the parties follow the dispute resolution procedures
provided for in the Acquisition Agreement.
On August 23, 2003, TMM sent a notice to KCS claiming to terminate the
Acquisition Agreement, because the TMM shareholders had failed to approve the
Acquisition Agreement at an August 18, 2003 meeting. KCS's Notice of Dispute and
Complaint points out that the Acquisition Agreement does not provide that a
negative shareholder vote is a basis for termination, and that the Agreement
remains in effect until December 31, 2004, during which time the shareholders
may vote differently.
More important, KCS contends that TMM breached its commitment under the
Acquisition Agreement to use commercially reasonable efforts to see that all
obligations to closing the transaction are fulfilled, and specifically to use
commercially reasonable efforts to obtain the approval of its shareholders and
its bondholders.
The Agreement was negotiated and signed by TMM Chairman Jose Serrano,
who is also the controlling shareholder of TMM. Based upon TMM's filings with
the Securities and Exchange Commission, KCS believes that Jose Serrano controls
over 80% of the voting shares. KCS believes that TMM's and Jose Serrrano's
actions concerning the TMM shareholders vote violate the Acquisition Agreement.
If the parties are unable to resolve their disputes through the informal
process established by the Acquisition Agreement, KCS will seek an arbitration
award compelling TMM to honor its agreement to sell its controlling shares of
GTFM to KCS. The motion for preliminary injunction is intended to prevent TMM
from taking any action to diminish the value of GTFM or to interfere with the
process of obtaining and maintaining governmental approvals of the acquisition,
while the parties carry out the dispute resolution process.
KCS believes that in the days following its purported termination of the
Acquisition Agreement, TMM has shown it is willing to take actions to try to
stop the governmental approval process and to commit TFM to extraordinary
contracts to the railway's detriment.
In addition to the Acquisition Agreement, which remains valid through
December 31, 2004, KCS has, under the GTFM bylaws, a right of first refusal
regarding the sale of TMM's interest in GTFM. As KCS has noted previously, it
will enforce its rights and will pursue all appropriate legal or administrative
actions against any person or entities involved in interfering with KCS and its
agreements with TMM.
KCS also reaffirms its commitment to continue working in good faith with
the appropriate Mexican authorities and other relevant parties. KCS remains
committed to the creation of NAFTA Rail and is convinced that NAFTA Rail will be
a strong competitor in the rail sector by providing a seamless, efficient and
competitive rail service to shippers in North America.
In addition, KCS announced today that consistent with the schedule set
out by the Surface Transportation Board (STB) to review KCS's plans to acquire
control of The Texas Mexican Railway Company (Tex Mex), KCS filed its comments
replying to the opposition comments, which were filed on August 4. In its reply,
KCS requested the Board to proceed with its review of the Tex Mex transaction.
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