<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 16)*
KEY PRODUCTION COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $.25 par value
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(Title of Class of Securities)
493138 10 1
- --------------------------------------------------------------------------------
(CUSIP Number)
Z.S. Kobiashvili
Apache Corporation
Vice President and General Counsel
2000 Post Oak Boulevard
Suite 100
Houston, Texas 77056-4400
(713) 296-6000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 23, 1995
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
(Continued on following page(s))
Schedule 13D. Page 1 of 5 Pages
<PAGE> 2
CUSIP No. 493138 10 1 13D Page 2 of 5 Pages
===============================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Apache Corporation, ID# 41-0747868
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
Not Applicable
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) OR 2(E) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
---------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 380,015
---------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 380,015
---------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER
WITH -0-
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
380,015
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
/ /
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.3%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
===============================================================================
<PAGE> 3
SCHEDULE 13D
Item 1. Security and Issuer.
This Amendment No. 16 to Schedule 13D relates to the common
stock (the "Common Stock"), par value $.25 per share, of Key Production
Company, Inc. ("Key"), a Delaware corporation.
Item 2. Identity and Background.
No changes except for the addition of the following:
The current directors and executive officers of Apache
Corporation ("Apache") are identified on the attached Schedule I.
Item 4. Purpose of Transaction.
No changes except for the addition of the following:
On October 23, 1995, Francis H. Merelli ("Merelli"), Key and
Apache entered into a Letter Agreement providing for the sale by Apache to Key
of 331,000 shares of Common Stock at a price of $5.00 per share.
Pursuant to a Stock Purchase Agreement, dated September 1, 1992,
between Apache and Merelli, concerning Merelli's purchase of certain shares of
Common Stock, Apache has agreed to provide Merelli with the opportunity to
purchase, or to designate another party to purchase, certain shares of Common
Stock proposed to be sold by Apache. Through the Letter Agreement referenced
above, Merelli has waived his right to purchase the 331,000 shares of Common
Stock, and has elected to designate Key as the purchaser of such 331,000 shares
of Common Stock.
The foregoing information is intended merely as a summary of the
material portions of, and is qualified in its entirety by reference to, the
full text of the Letter Agreement and the Stock Purchase Agreement which are
listed under Item 7 as Exhibit 7(a) and Exhibit 7(b), respectively, and are
incorporated herein by reference.
Item 5. Interest in the Securities of the Issuer.
No changes except for the addition of the following:
(a) Taking into account the transaction reported under
Item 4, Apache is the direct beneficial owner of
380,015 shares of Common Stock, or 4.3 percent of the
total shares of Common Stock outstanding as of
September 30, 1995.
Page 3 of 5 Pages
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(b) Apache has shared voting power, to the extent set
forth in the Standstill Agreement referred to in Item
6 below, and sole dispositive power over the shares
reported in paragraph (a) above.
(c) The information set forth under Item 4 relating to
Apache's sale of 331,000 shares of Common Stock to
Key is incorporated herein by reference.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
No changes except for the addition of the following:
The information set forth under Item 4 relating to Apache's sale
of 331,000 shares of Common Stock to Key, is incorporated herein by reference.
Item 7. Material to Be Filed as Exhibits.
(a) Letter Agreement between Francis H. Merelli, Key
Production Company, Inc. and Apache Corporation, dated October 23, 1995.
(b) Stock Purchase Agreement between Apache Corporation
and Francis H. Merelli, dated September 1, 1992 (incorporated by reference to
Exhibit 7(b) to Schedule 13D, Amendment No. 11, filed by Apache on September
16, 1992).
Page 4 of 5 Pages
<PAGE> 5
Signature
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement is
true, complete and correct.
Dated: October 26, 1995 APACHE CORPORATION
/s/ Z. S. Kobiashvili
-----------------------------------
Z. S. Kobiashvili
Vice President and General Counsel
Page 5 of 5 Pages
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SCHEDULE I
(to Item 2)
EXECUTIVE OFFICERS AND DIRECTORS OF APACHE CORPORATION
The name, residence or business address, present principal occupation
or employment, and citizenship of each director and executive officer of Apache
Corporation are set forth below.
<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
Frederick M. Bohen Founders Hall, Box 500 United States
Director 1230 York Avenue
New York, New York 10021
Virgil B. Day 805 Third Avenue, 22nd Floor United States
Director New York, New York 10022
*G. Steven Farris Suite 100 United States
Director, President and 2000 Post Oak Boulevard
Chief Operating Officer Houston, Texas 77056
Randolph M. Ferlic 4242 Farnam, Suite 270 United States
Director Omaha, Nebraska 68131
</TABLE>
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<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
Eugene C. Fiedorek Suite 160 United States
Director 4600 Greenville Ave.
Dallas, Texas 75206
W. Brooks Fields Suite 100 United States
Director 2000 Post Oak Boulevard
Houston, Texas 77056
Robert V. Gisselbeck Suite E, 3936 Tamiami Tr. N. United States
Director Naples, Florida 33940
Stanley K. Hathaway Suite 402 United States
Director 2424 Pioneer Avenue
Cheyenne, Wyoming 82001
John A. Kocur Suite 100 United States
Director 2000 Post Oak Boulevard
Houston, Texas 77056
</TABLE>
I-2
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<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
*Raymond Plank Suite 100 United States
Director, Chairman of the Board and Chief 2000 Post Oak Boulevard
Executive Officer Houston, Texas 77056
Joseph A. Rice Suite 100 United States
Director 2000 Post Oak Boulevard
Houston, Texas 77056
*James R. Bauman Suite 100 United States
Senior Vice President - 2000 Post Oak Boulevard
Business Development Houston, Texas 77056
*H. Craig Clark Suite 100 United States
Vice President - 2000 Post Oak Boulevard
Domestic Production Houston, Texas 77056
*Lisa A. Floyd Suite 100 United States
Vice President - 2000 Post Oak Boulevard
Technical Services Houston, Texas 77056
</TABLE>
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<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
*Mark A. Jackson Suite 100 United States
Vice President - Finance 2000 Post Oak Boulevard
Houston, Texas 77056
*Jon A. Jeppesen Suite 100 United States
Vice President - Domestic Exploration 2000 Post Oak Boulevard
and Development Houston, Texas 77056
*Z. S. Kobiashvili Suite 100 United States
Vice President and General Counsel 2000 Post Oak Boulevard
Houston, Texas 77056
*Anthony R. Lentini, Jr. Suite 100 United States
Vice President - Public and 2000 Post Oak Boulevard
International Affairs Houston, Texas 77056
*Clyde E. McKenzie Suite 100 United States
Vice President and Treasurer 2000 Post Oak Boulevard
Houston, Texas 77056
</TABLE>
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<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
*Thomas J. Mulkey Suite 100 United States
Vice President - Marketing 2000 Post Oak Boulevard
Houston, Texas 77056
*Roger B. Plank Suite 100 United States
Vice President - Corporate Planning 2000 Post Oak Boulevard
Houston, Texas 77056
*Floyd R. Price Suite 100 United States
Vice President - International 2000 Post Oak Boulevard
Exploration and Production Houston, Texas 77056
*Roger B. Rice Suite 100 United States
Vice President - Human Resources 2000 Post Oak Boulevard
and Administration Houston, Texas 77056
*R. Kent Samuel Suite 100 United States
Controller and 2000 Post Oak Boulevard
Chief Accounting Officer Houston, Texas 77056
</TABLE>
I-5
<PAGE> 11
<TABLE>
<CAPTION>
NAME AND POSITION RESIDENCE OR BUSINESS
WITH RESPECT TO APACHE ADDRESS CITIZENSHIP
- ---------------------- --------------------- ------------
<S> <C> <C>
*Cheri L. Peper Suite 100 United States
Corporate Secretary 2000 Post Oak Boulevard
Houston, Texas 77056
</TABLE>
Mr. Bohen is the executive vice president and chief operating officer
of The Rockefeller University at the address set forth above.
Mr. Day is a senior partner in the law firm of Vedder, Price, Kaufman,
Kammholz & Day at the address set forth above.
Mr. Ferlic is retired.
Mr. Fiedorek is the president and managing director of EnCap
Investments L.C., an energy investment banking firm, at the address set forth
above.
Mr. Fields is retired.
Mr. Gisselbeck is the president of Gisselbeck & Associates, a real
estate development company, at the address set forth above.
Mr. Hathaway is a senior partner in the law firm of Hathaway, Speight,
Kunz & Trautwein at the address set forth above.
Mr. Kocur is an attorney in private practice at the address set forth
above.
Mr. Joseph Rice is retired.
*The principal occupation of the named persons is the position indicated in the
table.
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<PAGE> 12
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
- -------
<S> <C>
7(a) Letter Agreement between Francis H. Merelli, Key Production Company, Inc.
and Apache Corporation, dated October 23, 1995.
7(b) Stock Purchase Agreement between Apache Corporation and Francis H. Merelli,
dated September 1, 1992 (incorporated by reference to Exhibit 7(b) to
Schedule 13D, Amendment No. 11, filed by Apache on September 16, 1992).
</TABLE>
<PAGE> 1
EXHIBIT 7(a)
[Apache Corporation Letterhead]
October 23, 1995
Key Production Company, Inc.
Suite 2050 One Norwest Center
1700 Lincoln Street
Denver, Colorado 80203-4520
Mr. Francis H. Merelli Mr. Thomas A. Richardson
Key Production Company, Inc. Holme Roberts & Owen
Suite 2050 One Norwest Center 1700 Lincoln, Suite 4100
1700 Lincoln Street Denver, Colorado 80203
Denver, Colorado 80203-4520
RE: Purchase by Key Production Company, Inc. ("Key"), of 331,000
shares of Key common stock from Apache Corporation ("Apache")
Ladies and Gentlemen:
This letter is to confirm our understandings with Francis H. Merelli
("Merelli") and Key concerning the sale of 331,000 shares of Key common stock
by Apache to Key. Apache recently informed Merelli of its desire to sell up to
331,000 shares of Key common stock in open market transactions. Pursuant to
Section 7 of the Stock Purchase Agreement dated September 1, 1992, between
Apache and Merelli (the "1992 Agreement") concerning the purchase by Merelli of
70,000 shares of Key common stock from Apache, Apache has agreed to provide
Merelli with the opportunity to purchase, or to designate another party to
purchase, certain shares of Key common stock proposed to be sold by Apache.
This letter shall serve to confirm that notice and opportunity to purchase were
provided in accordance with the 1992 Agreement with respect to 331,000 shares
of Key common stock (the "Shares") to be sold by Apache, that Merelli and
Apache have agreed that the purchase price of the shares shall be $5.00 per
share, that Merelli has elected to designate Key as the purchaser of the
Shares, and that Key, Merelli and Apache have agreed that Key will purchase and
Apache will sell the Shares under the following terms and conditions:
1. Payment; Delivery of Shares. In consideration of the transfer
and conveyance of the Shares to Key, Key will deliver to Apache at Closing (as
hereinafter defined), against delivery of the Share certificates, an aggregate
consideration of $1,655,000 in cash (the "Purchase Price") which shall be paid
by wire transfer to the account identified on Schedule "A" hereto for the
<PAGE> 2
Mr. F. H. Merelli
Key Production Company, Inc.
October 23, 1995
Page 2
benefit of Apache. At Closing, Apache shall deliver certificates for the
Shares, accompanied by stock powers duly endorsed for transfer of the Shares to
Key, against payment of the Purchase Price.
2. Purchase for Own Account. Key represents and warrants that the
Shares are being purchased for its own account, that the Shares are not being
purchased with a view to sale, distribution or other disposition.
3. Apache's Representations and Warranties. Apache represents and
warrants to Key as follows:
(a) Corporate Organization. Apache is a corporation duly
organized and validly existing, in good standing, under
the laws of the State of Delaware. Apache has the
corporate power and authority to own its property and to
carry on its business as now conducted and to enter into
and to carry out the terms of this agreement.
(b) Authorization. The execution and delivery of this
agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all
necessary corporate action on behalf Apache and Apache is
not subject to any charter, by-law, lien or encumbrance of
any kind, agreement, instrument, order or decree of any
court or governmental body which would prevent
consummation of the actions contemplated by this
agreement.
(c) Stock. Apache is the sole owner of the Shares free and
clear of all liens, encumbrances, restrictions, voting
trusts or other adverse claims or rights, except rights of
Merelli under the 1992 Agreement, and except as otherwise
noted on the face of the stock certificates.
4. Key's Representations and Warranties. Key represents and
warrants to Apache as follows:
(a) Corporate Organization. Key is a corporation duly
organized and validly existing, in good standing, under
the laws of the State of Delaware. Key has the corporate
power and authority to own its property and to carry on
its business as now conducted and to enter into and to
carry out the terms of this agreement.
(b) Authorization. The execution and delivery of this
agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all
necessary corporate action on behalf Key and Key is not
<PAGE> 3
Mr. F. H. Merelli
Key Production Company, Inc.
October 23, 1995
Page 3
subject to any charter, by-law, lien or encumbrance of
any kind, agreement, instrument, order or decree of any
court or governmental body which would prevent
consummation of the actions contemplated by this
agreement.
5. Closing. The closing of the purchase and sale contemplated
hereby shall occur at 10:00 a.m. local time on October 24, 1995 (the "Closing")
at Key's offices in Denver, Colorado, or at such other time and place as the
parties may agree in writing. All representations and warranties of each party
hereto shall be deemed to be restated in their entirety on and as of the date
of Closing.
6. General Provisions. The transactions and agreements contemplated
by this letter will be subject to the following provisions:
(a) Amendment. The agreements contained herein may be amended
only by written instrument executed by each of Key,
Merelli and Apache.
(b) Brokers. Each party hereto indemnifies the other against
any liability or expense for brokerage fees, finder's
fees, agent's commissions or other similar forms of
compensation incurred by the indemnifying party in
connection with the agreements contained herein or any
transaction contemplated hereby.
(c) Expenses. Each party shall be solely responsible for
expenses incurred in connection with the agreements
contained herein and any transaction contemplated hereby
and shall not be entitled to reimbursement by the other
party.
(d) Successors. This agreement shall be binding upon and
shall inure to the benefit of the parties hereto and the
respective successors and assigns of Key, Merelli and
Apache.
(e) Notices. All notices which are required or may be given
pursuant to this letter shall be given in writing and
delivered personally or by registered or certified mail,
postage prepaid to the addresses of the parties first set
forth above. All notices shall be deemed to have been
given as of the date of receipt.
(f) Entire Agreement. This letter constitutes the entire
agreement between the parties hereto and supersede all
prior agreements, negotiations and understandings.
(g) Governing Law. The agreements contained herein shall be
interpreted in accordance with the laws of the state of
Texas.
<PAGE> 4
Mr. F. H. Merelli
Key Production Company, Inc.
October 23, 1995
Page 4
(h) Announcements. The parties shall consult with each other
with regard to all press releases and other announcements
issued after the date of this letter and prior to the date
of Closing concerning the agreements contained herein or
the transactions contemplated hereby and, except as may be
required by applicable laws or the applicable rules and
regulations of any governmental agency or stock exchange,
none of Apache, Key or Merelli shall issue any such press
release or other publicity without the prior written
consent of the other parties, which consent shall not be
unreasonably withheld.
If the foregoing accurately sets forth our agreement with respect to the
matters described above, please sign where indicated below and return a copy of
this letter for our files.
APACHE CORPORATION
/s/ Z. S. Kobiashvili
---------------------------------
By: Z. S. Kobiashvili
Its: Vice President and
General Counsel
/s/ Mark A. Jackson
---------------------------------
By: Mark A. Jackson
Its: Vice President, Finance
ACCEPTED and AGREED:
/s/ Francis H. Merelli
- ---------------------------------
Francis H. Merelli,
a citizen and resident of Colorado
<PAGE> 5
Mr. F. H. Merelli
Key Production Company, Inc.
October 23, 1995
Page 5
KEY PRODUCTION COMPANY, INC
/s/ Monroe W. Robertson
- ----------------------------------
By: Monroe W. Robertson
Its: Senior Vice President
<PAGE> 6
SCHEDULE "A"
APACHE CORPORATION
WIRING INSTRUCTIONS
FIRST BANK OF MINNEAPOLIS
ABA #091-000-022
APACHE CORPORATION MASTER
ACCOUNT #1-502-5008-9953
