The Kansas University Endowment Association will receive $200,000 in a settlement resolving a stock dispute with LSB Industries of Oklahoma City, according to court documents.

The suit was filed Feb. 8 in federal court in Kansas City, Kan., claiming that the endowment was forced to tender its public shares for less than full value, losing money in the process.

The suit claims that in 2006, LSB began a private exchange of its preferred stock at a ratio of 8.3 shares of its common stock for each share of preferred. The endowment owned 1,000 shares of preferred stock and offered to participate. However, LSB allegedly refused to convert the endowment’s shares.

In 2007, LSB again proposed to exchange shares of its common stock, this time for 7.4 shares of common for each share of preferred, according to the court filing. KU alumnus and part-time professor Kent McCarthy, a regular contributor, had donated 11,200 shares of LSB preferred stock to the endowment association in this time frame.

The endowment claimed that when it attempted to tender all 12,200 of its preferred shares, LSB refused to accept the 11,200 shares donated by McCarthy.

According to the filling, LSB allegedly said that the 11,200 shares not converted during the tender offer were rejected because of an agreement among LSB, McCarthy and his affiliates, and certain other parties, referred to in LSB’s public filings as the “Jayhawk Agreement.”

The endowment association claimed to have no involvement with the agreement and sought the $75,000 it says it lost because of the denial.

Although a court document filed Monday did not name a specific figure, a quarterly Securities and Exchange Commission filing from LSB Industries listed the $200,000 figure as the tentative settlement.

“During June 2008, we entered into an agreement in principal with KU to settle this matter for payment of $200,000 upon the parties entering into a definitive settlement agreement which are currently being prepared,” stated the filing.

Dale Seuferling, president of the endowment association, said the terms of the settlement forbade him from commenting.