<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 8, 1999
REGISTRATION NO. 333-75633
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
AMENDMENT No. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
APACHE CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE NO. 41-0747868
(State of incorporation) (I.R.S. Employer
Identification Number)
ONE POST OAK CENTRAL Z. S. KOBIASHVILI
2000 POST OAK BOULEVARD, SUITE 100 2000 POST OAK BOULEVARD, SUITE 100
HOUSTON, TEXAS 77056-4400 HOUSTON, TEXAS 77056-4400
(713) 296-6000 (713) 296-6000
(Address, including zip code, and (Name, address, including zip code, and
telephone number, including area code, of telephone number, including area code,
registrant's executive offices) of agent for service)
</TABLE>
---------------------
Copies to:
<TABLE>
<S> <C>
JOHN B. CLUTTERBUCK CRAIG E. CHAPMAN
MAYOR, DAY, CALDWELL & KEETON, L.L.P. BROWN & WOOD LLP
700 LOUISIANA, SUITE 1900 ONE WORLD TRADE CENTER
HOUSTON, TEXAS 77002-2778 NEW YORK, NEW YORK 10048-0557
</TABLE>
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, check the following
box and list the Securities Act of 1933 registration statement number of the
earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, check the following box and list the
Securities Act of 1933 registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED(1) REGISTERED(2) UNIT(3)(4) PRICE(4)(5) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock and Related Rights, Preferred
Stock, Depositary Shares and Debt
Securities.................................... -- -- $1,000,000,000 $278,000(6)
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) This registration statement also covers debt securities, preferred stock,
and common stock and related rights which may be issued in exchange for, or
upon conversion of, as the case may be, the securities registered hereunder.
In addition, any other securities registered hereunder may be sold
separately or as units with other securities registered hereunder.
(2) In no event will the aggregate initial offering price of common stock and
related rights, preferred stock, depositary shares and debt securities
issued under this registration statement exceed $1,000,000,000, or the
equivalent thereof in one or more foreign currencies or composite
currencies.
(3) Not specified as to each class of securities to be registered pursuant to
General Instruction II.D of Form S-3 under the Securities Act of 1933.
(4) The proposed maximum offering price per unit will be determined from time to
time by Apache in connection with, and at the time of, the issuance by
Apache of the securities registered hereunder.
(5) Estimated solely for the purposes of computing the registration fee pursuant
to Rule 457(o) of the Securities Act of 1933.
(6) Previously paid.
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
The information in this preliminary prospectus is not complete and may be
changed. These securities may not be sold until the registration statement filed
with the Securities and Exchange Commission is effective. This preliminary
prospectus is not an offer to sell nor does it seek an offer to buy these
securities in any jurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED APRIL 8, 1999.
$1,000,000,000
APACHE CORPORATION
COMMON STOCK
PREFERRED STOCK
DEPOSITARY SHARES
DEBT SECURITIES
---------------------
We may from time to time issue up to a total of $1,000,000,000 of our
common stock and related rights, preferred stock, depositary shares and/or debt
securities. The accompanying prospectus supplement will specify the terms of the
securities.
---------------------
Apache may sell these securities to or through underwriters, and also to
other purchasers or through agents. The accompanying prospectus supplement will
specify the names of these underwriters or agents.
---------------------
Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
---------------------
This prospectus may not be used to sell securities unless it is accompanied
by a prospectus supplement.
---------------------
Prospectus dated , 1999.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
About This Prospectus....................................... 1
Where You Can Find More Information......................... 1
Apache Corporation.......................................... 2
Ratios of Earnings to Fixed Charges and Ratios of Earnings
to Combined Fixed Charges and Preferred Stock Dividends... 2
Use of Proceeds............................................. 3
The Securities We May Offer................................. 3
Description of Capital Stock................................ 4
Description of Depositary Shares............................ 10
Description of Debt Securities.............................. 13
Book-Entry Securities....................................... 25
Plan of Distribution........................................ 27
Legal Matters............................................... 28
Experts..................................................... 28
</TABLE>
i
<PAGE> 4
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission utilizing a "shelf" registration process.
Under this shelf process, we may sell any combination of the securities
described in this prospectus in one or more offerings up to a total dollar
amount of $1,000,000,000. This prospectus provides you with a general
description of the securities we may offer. Each time we offer to sell
securities, we will provide a prospectus supplement that will contain specific
information about the terms of that offering. The prospectus supplement may also
add, update or change information contained in this prospectus. This prospectus,
together with applicable prospectus supplements, will include or refer you to
all material information relating to each offering.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. Our Securities and
Exchange Commission filings are available to the public over the Internet at the
Securities and Exchange Commission's web site at http://www.sec.gov. You may
also read and copy any document we file at the Securities and Exchange
Commission's public reference rooms located at:
- 450 Fifth Street, N.W.
Washington, D.C. 20549;
- 7 World Trade Center
New York, New York 10048; and
- Citicorp Center
500 West Madison Street
Chicago, Illinois 60661.
Please call the Securities and Exchange Commission at 1-800-SEC-0330 for
further information on the public reference rooms and their copy charges.
Our common stock has been listed and traded on the New York Stock Exchange
since 1969 and the Chicago Stock Exchange since 1960. Accordingly, you may
inspect the information we file with the Securities and Exchange Commission at
the New York Stock Exchange, 20 Broad Street, New York, New York 10005, and at
the Chicago Stock Exchange, One Financial Place, 440 S. LaSalle Street, Chicago,
Illinois 60605-1070.
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is an important part of this prospectus,
and information that we file later with the Securities and Exchange Commission
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings made with the
Securities and Exchange Commission under Sections 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934 until we sell all of the securities:
- Our Annual Report on Form 10-K for the fiscal year ended December 31,
1998.
- Current Report on Form 8-K dated March 2, 1999 (as amended by Amendment
No. 1 on Form 8-K/A filed on March 5, 1999).
1
<PAGE> 5
Each of these documents is available from the Securities and Exchange
Commission's web site and public reference rooms described above. You may also
request a copy of these filings, excluding exhibits, at no cost by writing or
telephoning Cheri L. Peper, Corporate Secretary, at our principal executive
office, which is:
Apache Corporation
2000 Post Oak Boulevard, Suite 100
Houston, Texas 77056-4400
(713) 296-6000
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone to provide you with different information.
We are not making an offer of the securities covered by this prospectus in
any state where the offer is not permitted. You should not assume that the
information in this prospectus or any prospectus supplement or in any other
document incorporated by reference in this prospectus is accurate as of any date
other than the date on the front of those documents.
APACHE CORPORATION
Apache Corporation is a Delaware corporation formed in 1954. We are an
independent energy company that explores for, develops and produces natural gas,
crude oil and natural gas liquids. In North America, our exploration and
production interests are focused on the Gulf of Mexico, the Anadarko Basin, the
Permian Basin, the Gulf Coast and the Western Sedimentary Basin of Canada.
Outside of North America, we have exploration and production interests offshore
Western Australia, in Egypt and offshore the Ivory Coast, and exploration
interests in Poland and offshore The People's Republic of China.
We hold interests in many of our U.S., Canadian and international
properties through operating subsidiaries, such as Apache Canada Ltd., DEK
Energy Company, which was formerly known as DEKALB Energy Company, Apache Energy
Limited, which was formerly known as Hadson Energy Limited, Apache
International, Inc., and Apache Overseas, Inc. The properties referred to in
this prospectus, in any prospectus supplement or in any other document
incorporated by reference in this prospectus may be held by our subsidiaries. We
treat all operations as one line of business.
RATIOS OF EARNINGS TO FIXED CHARGES AND
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
Our ratios of earnings to fixed charges and our ratios of earnings to
combined fixed charges and preferred stock dividends were the same for each of
the periods indicated in the table below. This is because there were no shares
of preferred stock outstanding prior to 1998, and because our 1998 earnings were
inadequate to cover fixed charges and dividends as described below.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
- --------------------------------
1998 1997 1996 1995 1994
- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
-- 2.93 2.72 1.15 2.34
</TABLE>
Our ratios of earnings to fixed charges and our ratios of earnings to
combined fixed charges and preferred stock dividends were computed based on:
- "earnings," which consist of consolidated income or losses from
continuing operations plus income taxes and fixed charges, except
capitalized interest, or, in the case of our ratios of earnings to
combined fixed charges and preferred stock dividends, those earnings plus
preferred stock dividends; and
- "fixed charges," which consist of consolidated interest on indebtedness,
including capitalized interest, amortization of debt discount and
expense, and the estimated portion of rental expense
2
<PAGE> 6
attributable to interest, or, in the case of our ratios of earnings to
combined fixed charges and preferred stock dividends, those fixed charges
plus preferred stock dividends.
Due to the $243.2 million non-cash write-down of the carrying value of our
U.S. proved oil and gas properties, for the year ended December 31, 1998, our
1998 earnings were inadequate to cover fixed charges by $236.8 million and
inadequate to cover combined fixed charges and preferred stock dividends by
$239.7 million.
On May 17, 1995, Apache acquired DEKALB Energy Company, which is now known
as DEK Energy Company, through a merger which resulted in DEKALB becoming a
wholly-owned subsidiary of Apache. The merger was accounted for as a "pooling of
interests." As a result, our financial information for all preceding periods was
restated.
USE OF PROCEEDS
Unless otherwise indicated in an accompanying prospectus supplement, we
expect to use the net proceeds from the sale of the securities for general
corporate purposes, which may include, among other things:
- the repayment of outstanding indebtedness;
- working capital;
- capital expenditures; and
- acquisitions.
The precise amount and timing of the application of such proceeds will
depend upon our funding requirements and the availability and cost of other
funds.
THE SECURITIES WE MAY OFFER
The descriptions of the securities contained in this prospectus, together
with the applicable prospectus supplements, summarize all the material terms and
provisions of the various types of securities that we may offer. The particular
terms of the securities offered by any prospectus supplement will be described
in that prospectus supplement. If indicated in the applicable prospectus
supplement, the terms of the securities may differ from the terms summarized
below. The prospectus supplement will also contain information, where
applicable, about material U.S. federal income tax considerations relating to
the securities, and the securities exchange, if any, on which the securities
will be listed.
We may sell from time to time, in one or more offerings:
- common stock and related rights;
- preferred stock;
- depositary shares; and/or
- debt securities.
In this prospectus, we will refer to the common stock and related rights,
preferred stock, depositary shares and debt securities collectively as
"securities." The total dollar amount of all securities that we may issue under
this prospectus will not exceed $1,000,000,000.
If we issue debt securities at a discount from their original stated
principal amount, then, for purposes of calculating the total dollar amount of
all securities issued under this prospectus, we will treat the initial offering
price of the debt securities as the total original principal amount of the debt
securities.
This prospectus may not be used to sell securities unless it is accompanied
by a prospectus supplement.
3
<PAGE> 7
DESCRIPTION OF CAPITAL STOCK
The following description of our common stock and preferred stock, together
with the additional information included in any applicable prospectus
supplements, summarizes the material terms and provisions of these types of
securities. For the complete terms of our common stock and preferred stock,
please refer to our charter, bylaws and stockholder rights plan that are
incorporated by reference into the registration statement that includes this
prospectus or may be incorporated by reference in this prospectus. The terms of
these securities may also be affected by the General Corporation Law of the
State of Delaware.
Under our charter, our authorized capital stock consists of 215,000,000
shares of common stock, $1.25 par value per share, and 5,000,000 shares of
preferred stock, no par value. We will describe the specific terms of any common
stock or preferred stock we may offer in a prospectus supplement. If indicated
in a prospectus supplement, the terms of any common stock or preferred stock
offered under that prospectus supplement may differ from the terms described
below.
COMMON STOCK
As of March 31, 1999, Apache had approximately 97,820,667 shares of common
stock issued and outstanding. Each outstanding share of common stock currently
has attached to it one preferred share purchase right issued under our
stockholder rights plan, which is summarized below. All outstanding shares of
common stock are duly authorized, validly issued, fully paid and nonassessable.
Voting
For all matters submitted to a vote of stockholders, each holder of common
stock is entitled to one vote for each share registered in his or her name on
the books of Apache. Our common stock does not have cumulative voting rights. As
a result, subject to the voting rights of Series B preferred stockholders and
any future holders of preferred stock, persons who hold more than 50% of the
outstanding common stock entitled to elect members of the board of directors can
elect all of the directors who are up for election in a particular year.
Dividends
If our board of directors declares a dividend, holders of common stock will
receive payments from the funds of Apache that are legally available to pay
dividends. However, this dividend right is subject to any preferential dividend
rights we have granted to Series B preferred stockholders or may grant to future
holders of preferred stock.
Liquidation
If Apache is dissolved, the holders of common stock will be entitled to
share ratably in all the assets that remain after we pay our liabilities and any
amounts we may owe to the persons who hold preferred stock.
Other Rights and Restrictions
Holders of common stock do not have preemptive rights, and they have no
right to convert their common stock into any other securities. Our common stock
is not subject to redemption by Apache. Our charter and bylaws do not restrict
the ability of a holder of common stock to transfer his or her shares of common
stock.
When we issue shares of common stock, the shares will be fully paid and
nonassessable. Delaware law provides that, if we make a distribution to our
stockholders other than a distribution of our capital stock, when we are
insolvent, or that renders us insolvent, then our stockholders would be required
to pay back to us the amount of the distribution we made to them, or the portion
of the distribution that causes us to become insolvent.
4
<PAGE> 8
Listing
Our common stock is listed on the New York Stock Exchange and the Chicago
Stock Exchange.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Norwest Bank
Minnesota, National Association.
PREFERRED STOCK
General
We have 5,000,000 shares of no par preferred stock authorized, of which
25,000 shares have been designated as Series A Junior Participating Preferred
Stock and 100,000 shares have been designated as 5.68% Series B Cumulative
Preferred Stock. The remaining shares of preferred stock are undesignated.
Our charter authorizes our board of directors to issue preferred stock in
one or more series and to determine the voting rights and dividend rights,
dividend rates, liquidation preferences, conversion rights, redemption rights,
including sinking fund provisions and redemption prices, and other terms and
rights of each series of preferred stock.
Series A
The shares of Series A preferred stock are authorized for issuance pursuant
to rights that trade with outstanding Apache common stock and are reserved for
issuance upon the exercise of the rights discussed below under the caption
"-- Stockholder Rights Plan."
Series B
As of March 31, 1999, Apache had issued and outstanding 100,000 shares of
Series B preferred stock in the form of one million depositary shares, each
representing one-tenth ( 1/10) of a share of Series B preferred stock. The
Series B preferred stock has no stated maturity, is not subject to a sinking
fund and is not convertible into Apache common stock or any other securities.
Apache has the option to redeem the Series B preferred stock at $1,000 per share
on or after August 25, 2008. Holders of the shares are entitled to receive
cumulative cash dividends at an annual rate of $5.68 per depositary share when,
and if, declared by Apache's board of directors.
The Series B preferred stock ranks prior and superior to our common stock
and Series A preferred stock as to payment of dividends and distribution of
assets upon our dissolution, liquidation or winding up.
If dividends are not paid on the Series B preferred stock, payments on our
common stock are prohibited and payments on any other capital stock are
restricted.
Shares of Series B preferred stock generally do not have voting rights.
However, if we fail to pay the equivalent of six quarterly dividends payable on
the Series B preferred stock or another class or series of preferred stock that
ranks equally with the Series B preferred stock, then we will increase the size
of our board of directors by two members. The holders of the Series B preferred
stock and any other class or series of preferred stock ranking equally with the
Series B preferred stock, voting as a single class, will then have the right to
vote for the two additional directors. This voting right would continue until we
paid all past dividends on all that preferred stock.
Without the vote of at least 80% of the outstanding shares of Series B
preferred stock, we may not alter or repeal any provision in our charter so as
to adversely affect the rights of the Series B preferred stock.
5
<PAGE> 9
Undesignated Preferred Stock
This summary of the undesignated preferred stock discusses terms and
conditions that we expect will apply to all series of the preferred stock
offered under this prospectus. The applicable prospectus supplement will
describe the particular terms of each particular series of preferred stock
offered. If indicated in the prospectus supplement, the terms of any series may
differ from the terms described below.
The following description, together with the applicable prospectus
supplements, summarizes all the material terms and provisions of any preferred
stock being offered by this prospectus. It does not restate the terms and
provisions in their entirety. We urge you to read our charter and the applicable
certificate of designation because they, and not this description, define the
rights of any holders of preferred stock. We have filed our charter as an
exhibit to the registration statement which includes this prospectus. We will
incorporate by reference as an exhibit to the registration statement the form of
any certificate of designation before the issuance of any series of preferred
stock.
We expect the prospectus supplement to include some or all of the following
terms:
- the designation of the series of preferred stock;
- the number of shares of preferred stock offered, the liquidation
preference per share and the offering price of the preferred stock;
- the dividend rate or rates of the shares, the dates at which dividends,
if declared, will be payable, and whether or not the dividends are to be
cumulative and, if cumulative, the date or dates from which dividends
shall be cumulative;
- the amounts payable on shares of the preferred stock in the event of our
voluntary or involuntary liquidation, dissolution or winding up;
- the redemption rights and price or prices, if any, for the shares of
preferred stock;
- any terms, and the amount, of any sinking fund or analogous fund
providing for the purchase or redemption of the shares of preferred
stock;
- any restrictions on our ability to make payments on any of our capital
stock if dividend or other payments are not made on the preferred stock;
- any voting rights granted to the holders of the shares of preferred stock
in addition to those required by Delaware law or our certificate of
incorporation;
- whether the shares of preferred stock will be convertible into shares of
our common stock or any other class of our capital stock, and, if
convertible, the conversion price or prices, and any adjustment or other
terms and conditions upon which the conversion shall be made;
- any other rights, preferences, restrictions, limitations or conditions
relative to the shares of preferred stock permitted by Delaware law or
our certificate of incorporation;
- any listing of the preferred stock on any securities exchange; and
- the federal income tax considerations applicable to the preferred stock.
Subject to our charter and to any limitations imposed by any
then-outstanding preferred stock, we may issue additional series of preferred
stock, at any time or from time to time, with such powers, preferences, rights
and qualifications, limitations or restrictions, as the board of directors
determines, and without further action of the stockholders, including holders of
our then outstanding preferred stock, if any.
STOCKHOLDER RIGHTS PLAN
In 1995, our board of directors adopted a stockholder rights plan to
replace the former plan adopted in 1986. Under our stockholder rights plan, each
of our common stockholders received a dividend of one "preferred stock purchase
right" for each outstanding share of common stock that the stockholder owned. We
refer to these preferred stock purchase rights as the "rights." Unless the
rights have been previously redeemed, all shares of Apache common stock issued
after the 1996 dividend are issued with rights. The
6
<PAGE> 10
rights trade automatically with our shares of common stock and become
exercisable only under certain circumstances described below.
The purpose of the rights is to encourage potential acquirors to negotiate
with our board of directors before attempting a takeover bid and to provide our
board of directors with leverage in negotiating on behalf of our stockholders
the terms of any proposed takeover. The rights may have certain anti-takeover
effects. They should not, however, interfere with any merger or other business
combination approved by our board of directors.
The following description is a summary of all the material terms of our
stockholder rights plan. It does not restate these terms in their entirety. We
urge you to read our stockholder rights plan because it, and not this
description, defines the terms and provisions of our plan. Our stockholder
rights plan is an exhibit to our registration statement on Form 8-A, as amended,
which we filed with the Securities and Exchange Commission on January 24, 1996
and which is incorporated by reference as an exhibit to the registration
statement that includes this prospectus. You may obtain a copy at no charge by
writing to us at the address listed under the caption "Where You Can Find More
Information."
Exercise of Rights
Until a right is exercised, the holder of a right will not have any rights
as a stockholder. When the rights become exercisable, holders of the rights will
be able to purchase from us 1/10,000th of a share of our Series A preferred
stock, at a purchase price of $100, subject to adjustment, per 1/10,000th of a
share.
In general, the rights will become exercisable upon the earlier of:
- ten calendar days after a public announcement that a person or group has
acquired beneficial ownership of 20% or more of the outstanding shares of
our common stock; or
- ten business days after the beginning of a tender offer or exchange offer
that would result in a person or group beneficially owning 30% or more of
our common stock.
Flip in Event
If a person or group becomes the beneficial owner of 20% or more of our
common stock, then each right will then entitle its holder to receive, upon
exercise, a number of shares of our common stock which is equal to the exercise
price of the right divided by one-half of the market price of our common stock
on the date of the occurrence of this event. We refer to this occurrence as a
"flip in event." A flip in event does not occur if there is an offer for all of
our outstanding shares of common stock that our board of directors determines is
fair to our stockholders and in Apache's best interests.
Flip Over Event
If at any time after a person or group becomes the beneficial owner of 20%
or more of our common stock, Apache is acquired in a merger or other transaction
in which Apache does not survive or in which our common stock is changed or
exchanged or 50% or more of Apache's assets or earning power is sold or
transferred, then each holder of a right will be entitled to receive, upon
exercise, a number of shares of common stock of the acquiring company in the
transaction equal to the exercise price of the right divided by one-half of the
market price of the acquiring company's common stock on the date of the
occurrence of this event. This exercise right will not occur if the merger or
other transaction follows an offer for all of our outstanding shares of common
stock that our board of directors determines is fair to our stockholders and in
Apache's best interests.
Exchange of Rights
At any time after a flip in event, our board of directors may exchange the
rights by providing to the holder one share of our common stock or 1/10,000th of
a share of our Series A preferred stock for each of the holder's rights.
7
<PAGE> 11
Redemption of Rights
At any time before a flip in event, we may redeem the rights at a price of
$.01 per right. The rights will expire on the close of business on January 31,
2006, subject to earlier expiration or termination as described in our
stockholder rights plan.
Unless and until the rights become exercisable, they will be transferred
with and only with the shares of Apache common stock.
ANTI-TAKEOVER EFFECT OF PROVISIONS OF APACHE'S CHARTER AND BYLAWS AND DELAWARE
LAW
Apache's charter and bylaws include provisions designed to prevent the use
of certain tactics in connection with a potential takeover of Apache. Please
refer to our charter and bylaws that are incorporated by reference into the
registration statement that includes this prospectus. You may obtain copies at
no charge by writing to us at the address listed under the caption "Where You
Can Find More Information."
Provisions of Delaware law have a similar anti-takeover effect.
Apache's Bylaws
Apache's board of directors is divided into three classes, with directors
serving staggered three-year terms.
Apache's Charter
Article Twelve generally stipulates that the affirmative vote of 80% of our
voting shares is required to adopt any agreement for the merger or consolidation
with or into any other corporation which is the beneficial owner of more than 5%
of our voting shares. Article Twelve further provides that such 80% approval is
necessary to authorize any sale or lease of assets between Apache and any
beneficial holder of 5% or more of our voting shares.
Article Fourteen contains a "fair price" provision which requires that any
tender offer made by a beneficial owner of more than 5% of our outstanding
voting stock in connection with any:
- plan of merger;
- consolidation or reorganization;
- any sale or lease of substantially all of our assets; or
- any issuance of our equity securities to the 5% stockholder
must provide at least as favorable terms to each holder of common stock other
than the stockholder making the tender offer.
Article Fifteen contains an "anti-greenmail" mechanism which prohibits
Apache from acquiring any voting stock from the beneficial owner of more than 5%
of the outstanding voting stock, except for acquisitions pursuant to a tender
offer to all holders of voting stock on the same price, terms and conditions,
acquisitions in compliance with Rule 10b-18 of the Securities Exchange Act of
1934 and acquisitions at a price not exceeding the market value per share.
Article Sixteen prohibits the stockholders from acting by written consent
in lieu of a meeting.
8
<PAGE> 12
Business Combinations with Interested Stockholders Under Delaware Law
Section 203 of the Delaware General Corporation Law prevents a publicly
held corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless:
- before the date on which the person became an interested stockholder, the
board of directors of the corporation approved either the business
combination or the transaction in which the person became an interested
stockholder;
- the interested stockholder owned at least 85% of the outstanding voting
stock of the corporation at the beginning of the transaction in which it
became an interested stockholder, excluding stock held by directors who
are also officers of the corporation and by employee stock plans that do
not provide participants with the rights to determine confidentially
whether shares held subject to the plan will be tendered in a tender or
exchange offer; or
- after the date on which the interested stockholder became an interested
stockholder, the business combination is approved by the board of
directors and the holders of two-thirds of the outstanding voting stock
of the corporation voting at a meeting, excluding the voting stock owned
by the interested stockholder.
As defined in Section 203, an "interested stockholder" is generally a
person owning 15% or more of the outstanding voting stock of the corporation. As
defined in Section 203, a "business combination" includes mergers,
consolidations, stock and assets sales and other transactions with the
interested stockholder.
The provisions of Section 203 may have the effect of delaying, deferring or
preventing a change of control of Apache.
9
<PAGE> 13
DESCRIPTION OF DEPOSITARY SHARES
The following description, together with the applicable prospectus
supplements, summarizes all the material terms and provisions of the depositary
shares that we may offer under this prospectus and the related deposit
agreements and depositary receipts. Specific deposit agreements and depositary
receipts will contain additional important terms and provisions and will be
incorporated by reference into the registration statement which includes this
prospectus before we issue any depositary shares.
This summary of depositary agreements, depositary shares and depositary
receipts relates to terms and conditions applicable to these types of securities
generally. The particular terms of any series of depositary shares will be
summarized in the applicable prospectus supplement. If indicated in the
applicable prospectus supplement, the terms of any series may differ from the
terms summarized below.
GENERAL
We may elect to offer fractional shares of preferred stock rather than full
shares of preferred stock. If so, we will issue "depositary receipts" for these
"depositary shares." Each depositary share will represent a fraction of a share
of a particular series of preferred stock. Each holder of a depositary share
will be entitled, in proportion to the fraction of preferred stock represented
by that depositary share, to the rights and preferences of the preferred stock,
including dividend, voting, redemption, conversion and liquidation rights, if
any. We will enter into a deposit agreement with a depositary, which will be
named in the related prospectus supplement.
In order to issue depositary shares, we will issue preferred stock and
immediately deposit these shares with the depositary. The depositary will then
issue and deliver depositary receipts to the persons who purchase depositary
shares. Each whole depositary share issued by the depositary may represent a
fraction of a share of preferred stock held by the depositary. The depositary
will issue depositary receipts in a form that reflects whole depositary shares,
and each depositary receipt may evidence any number of whole depositary shares.
Pending the preparation of definitive engraved depositary receipts, a
depositary may, upon our written order, issue temporary depositary receipts,
which will temporarily entitle the holders to all the rights pertaining to the
definitive depositary receipts. We will bear the costs and expenses of promptly
preparing definitive depositary receipts and of exchanging the temporary
depositary receipts for such definitive depositary receipts.
DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute all cash and non-cash distributions it
receives with respect to the underlying preferred stock to the record holders of
depositary shares in proportion to the number of depositary shares they hold. In
the case of non-cash distributions, the depositary may determine that the
distribution cannot be made proportionately or that it may not be feasible to
make the distribution. If so, the depositary will, with our approval, adopt a
method it deems equitable and practicable to effect the distribution, including
the sale, public or private, of the securities or other non-cash property it
receives in the distribution at a place and on terms it deems proper. The
amounts distributed by the depositary will be reduced by any amount required to
be withheld by Apache or the depositary on account of taxes.
REDEMPTION OF DEPOSITARY SHARES
If we redeem the series of preferred stock that underlies the depositary
shares, the depositary will redeem the depositary shares from the proceeds it
receives from the redemption of the preferred stock it holds. The depositary
will redeem the number of depositary shares that represent the amount of
underlying preferred stock that we have redeemed. The redemption price for
depositary shares will be in proportion to the redemption price per share that
we paid for the underlying preferred stock. If we redeem less than all of the
depositary shares, the depositary will select which depositary shares to redeem
by lot, or some substantially equivalent method.
10
<PAGE> 14
After a redemption date is fixed, the depositary shares to be redeemed no
longer will be considered outstanding. The rights of the holders of the
depositary shares will cease, except for the rights to receive money or other
property upon redemption. In order to redeem their depositary shares, holders
will surrender their depositary receipts to the depositary.
VOTING THE PREFERRED STOCK
We will notify the depositary about any meeting at which the holders of
preferred stock are entitled to vote, and the depositary will mail the
information to the record holders of depositary shares related to that preferred
stock. Each record holder of depositary shares on the record date will be
entitled to instruct the depositary on how to vote the shares of preferred stock
represented by that holder's depositary shares. The depositary will vote the
preferred stock represented by the depositary shares in accordance with these
instructions, provided the depositary receives these instructions sufficiently
in advance of the meeting. If the depositary does not receive instructions from
the holders of the depositary shares, the depositary will abstain from voting
the preferred stock that underlies those depositary shares.
WITHDRAWAL OF PREFERRED STOCK
When a holder surrenders depositary receipts at the corporate trust office
of the depositary, and pays any necessary taxes, charges or other fees, the
holder will be entitled to receive the number of whole shares of the related
series of preferred stock, and any money or other property, if any, represented
by the holder's depositary shares. Once a holder exchanges depositary shares for
whole shares of preferred stock, that holder cannot "re-deposit" these shares of
preferred stock with the depositary, or exchange them for depositary shares. If
a holder delivers depositary receipts that represent a number of depositary
shares that exceeds the number of whole shares of related preferred stock the
holder seeks to withdraw, the depositary will issue a new depositary receipt to
the holder that evidences the excess number of depositary shares.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
Apache and the depositary can agree, at any time, to amend the form of
depositary receipt and any provisions of the deposit agreement. However, if an
amendment has a material adverse effect on the rights of the holders of related
depositary shares, the holders of at least a majority of the depositary shares
then outstanding must first approve the amendment. Every holder of a depositary
receipt at the time an amendment becomes effective will be bound by the amended
deposit agreement. However, subject to any conditions in the deposit agreement
or applicable law, no amendment can impair the right of any holder of a
depositary share to receive shares of the related preferred stock, or any money
or other property represented by the depositary shares, when they surrender
their depositary receipts.
We can terminate the deposit agreement at any time, as long as the
depositary mails notice of termination to the record holders of depositary
shares then-outstanding at least 30 days prior to the date fixed for
termination.
CHARGES OF DEPOSITARY
We will pay all transfer and other taxes and the government charges that
relate solely to the depositary arrangements. We will also pay the charges of
each depositary, including charges in connection with the initial deposit of the
related series of preferred stock, the initial issuance of the depositary
shares, and all withdrawals of shares of the related series of preferred stock.
However, holders of depositary shares will be required to pay transfer and other
taxes and government charges, as provided in the deposit agreement.
RESIGNATION AND REMOVAL OF DEPOSITARY
The depositary may resign at any time by delivering written notice of its
decision to us. We may remove the depositary at any time. Any resignation or
removal will take effect when we appoint a successor depositary. We must appoint
the successor depositary within 60 days after delivery of the notice
11
<PAGE> 15
of resignation or removal. The successor depositary must be a bank or trust
company that has its principal office in the United States and has a combined
capital and surplus of at least $50,000,000.
MISCELLANEOUS
We will be required to furnish certain information to the holders of the
preferred stock underlying any depositary shares. The depositary, as the holder
of the underlying preferred stock, will forward any report or information it
receives from us to the holders of depositary shares.
Neither the depositary nor Apache will be liable if its ability to perform
its obligations under the deposit agreement is prevented or delayed by law or
any circumstance beyond its control. Both Apache and the depositary will be
obligated to use their best judgment and to act in good faith in performing its
duties under the deposit agreement. Each of Apache and the depositary will be
liable only for gross negligence and willful misconduct in performing their
duties under the deposit agreement. They will not be obligated to appear in,
prosecute or defend any legal proceeding with respect to any depositary
receipts, depositary shares or preferred stock unless they receive what they, in
their sole discretion, determine to be a satisfactory indemnity from one or more
holders of the depositary shares. Apache and the depositary will evaluate any
proposed indemnity in order to determine whether the financial protection
afforded by the indemnity is sufficient to reduce each party's risk to a
satisfactory and customary level. Apache and the depositary may rely on the
advice of legal counsel or accountants of their choice. They may also rely on
information provided by persons they believe, in good faith, to be competent,
and on documents they believe, in good faith, to be genuine.
The applicable prospectus supplement will identify the depositary's
corporate trust office. Unless the prospectus supplement indicates otherwise,
the depositary will act as transfer agent and registrar for depositary receipts,
and if we redeem shares of preferred stock, the depositary will act as
redemption agent for the corresponding depositary receipts.
TITLE
Apache, each depositary and any agent of Apache or the applicable
depositary may treat the registered owner of any depositary share as the
absolute owner of the depositary shares for all purposes, including making
payment, regardless of whether any payment in respect of the depositary share is
overdue and regardless of any notice to the contrary. See "Book-Entry
Securities" below.
12
<PAGE> 16
DESCRIPTION OF DEBT SECURITIES
The following description, together with the applicable prospectus
supplements, summarizes all the material terms and provisions of the debt
securities that we may offer under this prospectus and the related trust
indenture. The indenture under which debt securities will be issued contains
additional important terms and provisions and is or will be filed as an exhibit
to the registration statement that includes this prospectus.
This summary of the indenture and the debt securities relates to terms and
conditions applicable to the debt securities generally. The particular terms of
any series of debt securities will be summarized in the applicable prospectus
supplement. If indicated in the prospectus supplement, the terms of any series
may differ from the terms summarized below.
Unless otherwise specified in the applicable prospectus supplement, we will
issue the debt securities under an indenture entered into between us and The
Chase Manhattan Bank, as trustee. We may only offer up to $1,000,000,000 of debt
securities under this prospectus. However, the indenture does not limit the
amount of debt securities we may issue under the indenture and provides that
additional debt securities of any series may be issued up to the aggregate
principal amount that we authorize from time to time. Debt securities may also
be issued pursuant to the indenture in transactions exempt from the registration
requirements of the Securities Act of 1933. Those debt securities will not be
considered in determining the aggregate amount of securities issued under this
prospectus.
Unless otherwise indicated in the applicable prospectus supplement, we will
issue the debt securities in denominations of $1,000 or integral multiples of
$1,000.
Unless otherwise indicated in the applicable prospectus supplement, the
payment of principal of, and any premium and interest on, the debt securities
will rank pari passu with all of our other unsecured unsubordinated
indebtedness. Principal and any premium and any interest will be payable, and
the debt securities will be transferable, at the corporate trust office of the
appropriate trustee, unless we specify otherwise in the accompanying prospectus
supplement. At our option, however, payment of interest may be made by check
mailed to the registered holders of the debt securities at their registered
addresses.
We will describe special U.S. federal income tax and other considerations
relating to debt securities denominated in foreign currencies or units of two or
more foreign currencies in the applicable prospectus supplement.
Unless we specify otherwise in the applicable prospectus supplement, the
covenants contained in the indenture and the debt securities will not provide
special protection to holders of debt securities if we enter into a highly
leveraged transaction, recapitalization or restructuring.
GENERAL
The prospectus supplement relating to the particular series of debt
securities being offered will specify the amounts, prices and terms of those
debt securities. These terms may include:
- the designation, aggregate principal amount and authorized denominations
of the debt securities;
- the date or dates on which the debt securities will mature;
- the percentage of the principal amount at which the debt securities will
be issued;
- the date on which the principal of the debt securities will be payable;
- whether the debt securities will be issued as registered securities,
bearer securities or a combination of the two;
- whether the debt securities will be issued in the form of one or more
global securities and whether such global securities will be issued in a
temporary global form or permanent global form;
13
<PAGE> 17
- the currency or currencies or units of two or more currencies in which
debt securities are denominated, for which they may be purchased, and in
which principal and any premium and interest is payable;
- if the currency or currencies or currency unit or units for which debt
securities may be purchased or in which principal and any premium
interest may be paid is at our election or at the election of a
purchaser, the manner in which an election may be made and its terms;
- the annual rate or rates, which may be fixed or variable, or the method
of determining the rate or rates at which the debt securities will bear
interest;
- the date or dates from which any interest will accrue and the date or
dates on which such interest will be payable;
- a description of any provisions providing for redemption, exchange or
conversion of the debt securities at our option or a holder's option and
the terms and provisions of such redemption, exchange or conversion;
- information with respect to book-entry procedures relating to global debt
securities;
- any redemption or sinking fund terms;
- whether and under what circumstances we will pay "additional amounts," as
defined in the indenture, on the debt securities to any holder who is a
"United States alien," as defined in the indenture, in respect of any
tax, assessment or governmental charge and, if so, whether and on what
terms we will have the option to redeem the debt securities rather than
pay any additional amounts. The term "interest," as used in this
prospectus, includes any additional amounts;
- any events of default or covenants of Apache with respect to the debt
securities of a certain series that are different from those described in
this prospectus;
- if either or both of Section 402(2) of the indenture relating to
defeasance or Section 402(3) of the indenture relating to covenant
defeasance is not applicable to the debt securities, or if any covenants
in addition to those specified in Section 402(3) of the indenture shall
be subject to covenant defeasance;
- any deletions from, or modifications or additions to, the provisions of
the indenture relating to satisfaction and discharge in respect of the
debt securities;
- any index or other method used to determine the amount of payments of
principal of, and any premium and interest on, the debt securities; and
- any other specific terms of the debt securities.
We are not obligated to issue all debt securities of any one series at the
same time. The debt securities of any one series may not bear interest at the
same rate or mature on the same date.
If any of the debt securities are sold for foreign currencies or foreign
currency units or if the principal of, or any premium or interest on, any series
of debt securities is payable in foreign currencies or foreign currency units,
we will describe the restrictions, elections, tax consequences, specific terms
and other information with respect to those debt securities and such foreign
currencies or foreign currency units in the applicable prospectus supplement.
Other than as described below under "The Indenture Limits Our Ability to
Incur Liens," "The Indenture Limits Our Ability to Engage in Sale/Leaseback
Transactions" and "We Are Obligated to Purchase Debt Securities on a Change in
Control," the indenture does not limit our ability to incur indebtedness or
afford holders of debt securities protection in the event of a decline in our
credit quality or if we are involved in a takeover, recapitalization or highly
leveraged or similar transaction. The prospectus supplement relating to the
particular series of debt securities, to the extent not otherwise described in
this prospectus, will include any information with respect to any deletions
from, modifications of or additions to
14
<PAGE> 18
the events of default described below and contained in the indenture, including
any addition of a covenant or other provision providing event risk or similar
protection.
INTEREST RATES AND DISCOUNTS
The debt securities will earn interest at a fixed or floating rate or rates
for the period or periods of time specified in the applicable prospectus
supplement. Unless otherwise specified in the applicable prospectus supplement,
the debt securities will bear interest on the basis of a 360-day year consisting
of twelve 30-day months.
We may sell debt securities at a substantial discount below their stated
principal amount, bearing no interest or interest at a rate that at the time of
issuance is below market rates. Federal income tax consequences and special
considerations that apply to any series will be described in the applicable
prospectus supplement.
EXCHANGE, REGISTRATION AND TRANSFER
Registered securities of any series that are not global securities will be
exchangeable for other registered securities of the same series and of like
aggregate principal amount and tenor in different authorized denominations. In
addition, if debt securities of any series are issuable as both registered
securities and bearer securities, the holder may choose, upon written request,
and subject to the terms of the indenture, to exchange bearer securities and the
appropriate related coupons of that series into registered securities of the
same series of any authorized denominations and of like aggregate principal
amount and tenor. Bearer securities with attached coupons surrendered in
exchange for registered securities between a regular record date or a special
record date and the relevant date for interest payment shall be surrendered
without the coupon relating to the interest payment date. Interest will not be
payable with respect to the registered security issued in exchange for that
bearer security. That interest will be payable only to the holder of the coupon
when due in accordance with the terms of the indenture. Bearer securities will
not be issued in exchange for registered securities.
You may present registered securities for registration of transfer,
together with a duly executed form of transfer, at the office of the security
registrar or at the office of any transfer agent designated by us for that
purpose with respect to any series of debt securities and referred to in the
applicable prospectus supplement. This may be done without service charge but
upon payment of any taxes and other governmental charges as described in the
indenture. The security registrar or the transfer agent will effect the transfer
or exchange upon being satisfied with the documents of title and identity of the
person making the request. We have appointed the trustee as security registrar
for the indenture. If a prospectus supplement refers to any transfer agents
initially designated by us with respect to any series of debt securities in
addition to the security registrar, we may at any time rescind the designation
of any of those transfer agents or approve a change in the location through
which any of those transfer agents acts. However, if debt securities of a series
are issuable solely as registered securities, we will be required to maintain a
transfer agent in each place of payment for that series, and if debt securities
of a series are issuable as bearer securities, we will be required to maintain a
transfer agent in a place of payment for that series located in Europe in
addition to the security registrar. We may at any time designate additional
transfer agents with respect to any series of debt securities.
In the event of any redemption, we will not be required to:
- issue, register the transfer of or exchange debt securities of any series
during a period beginning at the opening of business 15 days before any
selection of debt securities of that series to be redeemed and ending at
the close of business on the day of mailing of the relevant notice of
redemption; or
- register the transfer of or exchange any registered security, or portion
thereof, called for redemption, except the unredeemed portion of any
registered security being redeemed in part.
15
<PAGE> 19
PAYMENT AND PAYING AGENTS
Unless we specify otherwise in the applicable prospectus supplement,
payment of principal of, and any premium and interest on, bearer securities will
be payable in accordance with any applicable laws and regulations, at the
offices of those paying agents outside the United States that we may designate
at various times. We will make interest payments on bearer securities and the
attached coupons on any interest payment date only against surrender of the
coupon relating to that interest payment date. No payment with respect to any
bearer security will be made at any of our offices or agencies in the United
States by check mailed to any U.S. address or by transfer to an account
maintained with a bank located in the United States. However, if, but only if,
payment in U.S. dollars of the full amount of principal of, and any premium and
interest on, bearer securities denominated and payable in U.S. dollars at all
offices or agencies outside the United States is illegal or effectively
precluded by exchange controls or other similar restrictions, then those
payments will be made at the office of our paying agent in the Borough of
Manhattan, The City of New York.
Unless we specify otherwise in the applicable prospectus supplement,
payment of principal of, and any premium and interest on, registered securities
will be made at the office of the paying agent or paying agents that we
designate at various times. However, at our option, we may make interest
payments by check mailed to the address, as it appears in the security register,
of the person entitled to the payments. Unless we specify otherwise in the
applicable prospectus supplement, we will make payment of any installment of
interest on registered securities to the person in whose name that registered
security is registered at the close of business on the regular record date for
such interest.
Unless we specify otherwise in the applicable prospectus supplement, the
Corporate Trust Office of the trustee in the Borough of Manhattan, The City of
New York, will be designated:
- as our sole paying agent for payments with respect to debt securities
that are issuable solely as registered securities; and
- as our paying agent in the Borough of Manhattan, The City of New York,
for payments with respect to debt securities, subject to the limitation
described above in the case of bearer securities, that are issuable
solely as bearer securities or as both registered securities and bearer
securities.
We will name any paying agents outside the United States and any other
paying agents in the United States initially designated by us for the debt
securities in the applicable prospectus supplement. We may at any time designate
additional paying agents or rescind the designation of any paying agent or
approve a change in the office through which any paying agent acts. However, if
debt securities of a series are issuable solely as registered securities, we
will be required to maintain a paying agent in each place of payment for that
series. If debt securities of a series are issuable as bearer securities, we
will be required to maintain:
- a paying agent in the Borough of Manhattan, The City of New York, for
payments with respect to any registered securities of the series and for
payments with respect to bearer securities of the series in the
circumstance described above, but not otherwise; and
- a paying agent in a place of payment located outside the United States
where debt securities of that series and any attached coupons may be
presented and surrendered for payment.
However, if the debt securities of that series are listed on the London
Stock Exchange, the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and if the stock exchange requires it, we will
maintain a paying agent in London or Luxembourg or any other required city
located outside the United States for those debt securities.
16
<PAGE> 20
All moneys we pay to a paying agent for the payment of principal of, and
any premium or interest on, any debt security or coupon that remains unclaimed
at the end of two years after becoming due and payable will be repaid to us.
After that time, the holder of the debt security or coupon will look only to us
for payments out of those repaid amounts.
GLOBAL SECURITIES
The debt securities of a series may be issued in whole or in part in the
form of one or more global certificates that we will deposit with a depositary
identified in the applicable prospectus supplement. Global securities may be
issued in either registered or bearer form and in either temporary or permanent
form. Unless and until it is exchanged in whole or in part for the individual
debt securities it represents, a global security may not be transferred except
as a whole:
- by the applicable depositary to a nominee of the depositary;
- by any nominee to the depositary itself or another nominee; or
- by the depositary or any nominee to a successor depositary or any nominee
of the successor.
We will describe the specific terms of the depositary arrangement with
respect to a series of debt securities in the applicable prospectus supplement.
We anticipate that the following provisions will generally apply to depositary
arrangements.
When we issue a global security in registered form, the depositary for the
global security or its nominee will credit, on its book-entry registration and
transfer system, the respective principal amounts of the individual debt
securities represented by that global security to the accounts of participants
that have accounts with the depositary. Those accounts will be designated by the
dealers, underwriters or agents with respect to the underlying debt securities
or by us if those debt securities are offered and sold directly by us. Ownership
of beneficial interests in a global security will be limited to participants or
persons that may hold interests through participants. For interests of
participants, ownership of beneficial interests in the global security will be
shown on records maintained by the applicable depositary or its nominee. For
interests of persons other than participants, that ownership information will be
shown on the records of participants. Transfer of that ownership will be
effected only through those records. The laws of some states require that
certain purchasers of securities take physical delivery of securities in
definitive form. These limits and laws may impair our ability to transfer
beneficial interests in a global security.
As long as the depositary for a global security, or its nominee, is the
registered owner of that global security, the depositary or nominee will be
considered the sole owner or holder of the debt securities represented by the
global security for all purposes under the applicable indenture. Except as
provided below, owners of beneficial interests in a global security:
- will not be entitled to have any of the underlying debt securities
registered in their names;
- will not receive or be entitled to receive physical delivery of any of
the underlying debt securities in definitive form; and
- will not be considered the owners or holders under the indenture relating
to those debt securities.
Payments of principal of, and any premium and interest on, individual debt
securities represented by a global security registered in the name of a
depositary or its nominee will be made to the depositary or its nominee as the
registered owner of the global security representing such debt securities.
Neither we, the trustee, any paying agent nor the registrar for the debt
securities will be responsible for any aspect of the records relating to or
payments made by the depositary or any participants on account of beneficial
interests of the global security.
We expect that the depositary or its nominee, upon receipt of any payment
of principal, premium or interest relating to a permanent global security
representing any series of debt securities, immediately will credit
participants' accounts with the payments. Those payments will be credited in
amounts proportional
17
<PAGE> 21
to the respective beneficial interests of the participants in the principal
amount of the global security as shown on the records of the depositary or its
nominee. We also expect that payments by participants to owners of beneficial
interests in the global security held through those participants will be
governed by standing instructions and customary practices. This is now the case
with securities held for the accounts of customers in bearer form or registered
in "street name." Those payments will be the sole responsibility of those
participants.
If the depositary for a series of debt securities is at any time unwilling,
unable or ineligible to continue as depositary and we do not appoint a successor
depositary within 90 days, we will issue individual debt securities of that
series in exchange for the global security or securities representing that
series. In addition, we may at any time in our sole discretion determine not to
have any debt securities of a series represented by one or more global
securities. In that event, we will issue individual debt securities of that
series in exchange for the global security or securities. Further, if we
specify, an owner of a beneficial interest in a global security may, on terms
acceptable to us, the trustee and the applicable depositary, receive individual
debt securities of that series in exchange for those beneficial interests. The
foregoing is subject to any limitations described in the applicable prospectus
supplement. In that instance, the owner of the beneficial interest will be
entitled to physical delivery of individual debt securities equal in principal
amount to the beneficial interest and to have the debt securities registered in
its name. Those individual debt securities will be issued in denominations,
unless we specify otherwise, of $1,000 or integral multiples of $1,000.
For a description of the depository arrangements for global securities held
by The Depository Trust Company, see "Book-Entry Securities."
THE INDENTURE LIMITS OUR ABILITY TO INCUR LIENS
Nothing in the indenture or the debt securities will in any way limit the
amount of indebtedness or securities which we or our subsidiaries, as defined in
the indenture, may incur or issue. The indenture provides that neither us nor
any of our subsidiaries may issue, assume or guarantee any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed secured
by a mortgage, lien, pledge, security interest or other encumbrance -- defined
in the indenture as "liens" -- upon any of its property unless we provide that
any and all debt securities then outstanding shall be secured by a lien equally
and ratably with any and all other obligations by the lien. The restrictions on
liens will not, however, apply to:
- liens existing on the date of the indenture or provided for under the
terms of agreements existing on the date thereof;
- liens securing all or part of the cost of exploring, producing,
gathering, processing, marketing, drilling or developing any of our or
our subsidiaries' properties, or securing indebtedness incurred to
provide funds therefor or indebtedness incurred to finance all or part of
the cost of acquiring, constructing, altering, improving or repairing any
such property or assets, or securing indebtedness incurred to provide
funds therefor;
- liens securing only indebtedness owed by us or one of our subsidiaries to
us or to one or more of our subsidiaries;
- liens on the property of any corporation or other entity existing at the
time it becomes our subsidiary;
- liens on any property to secure indebtedness incurred in connection with
the construction, installation or financing of pollution control or
abatement facilities or other forms of industrial revenue bond financing
or indebtedness issued or guaranteed by the United States, any state or
any department, agency or instrumentality of either or indebtedness
issued to or guaranteed for the benefit of a foreign government, any
state or any department, agency or instrumentality of either or an
international finance agency or any division or department thereof,
including the World Bank, the International Finance Corp. and the
Multilateral Investment Guarantee Agency;
18
<PAGE> 22
- any extension, renewal or replacement or successive extensions, renewals
or replacements of any lien referred to in the foregoing clauses that
existed on the date of the indenture;
- certain other liens incurred in the ordinary course of business; or
- liens which secure "Limited Recourse Indebtedness," as defined in the
indenture.
In addition, the following types of transactions, among others, shall not
be deemed to create indebtedness secured by liens:
- the sale or other transfer of crude oil, natural gas or other petroleum
hydrocarbons in place for a period of time until, or in an amount such
that, the transferee will receive as a result of the transfer a specified
amount of money or of such crude oil, natural gas or other petroleum
hydrocarbons;
- the sale or other transfer of any other interest in property of the
character commonly referred to as a production payment, overriding
royalty, forward sale or similar interest; and
- liens required by any contract or statute in order to permit us or one of
our subsidiaries to perform any contract or subcontract made by it with
or at the request of the U.S. government or any foreign government or
international finance agency, any state or any department thereof, or any
agency or instrumentality of either, or to secure partial, progress,
advance or other payments to us or one of our subsidiaries by any of
these entities pursuant to the provisions of any contract or statute.
THE INDENTURE LIMITS OUR ABILITY TO ENGAGE IN SALE/LEASEBACK TRANSACTIONS
Unless we specify otherwise in the applicable prospectus supplement,
neither we nor any of our subsidiaries will enter into any arrangement with any
person, other than us or one of our subsidiaries, to lease any property to us or
a subsidiary of ours for more than three years. For the restriction to apply, we
or one of our subsidiaries must sell or plan to sell the property to the person
leasing it to us or our subsidiary or to another person to which funds have been
or are to be advanced on the security of the leased property. The limitation
does not apply where:
- either we or our subsidiary would be entitled to create debt secured by a
lien on the property to be leased in a principal amount equal to or
exceeding the value of that sale/leaseback transaction;
- since the date of the indenture and within a period commencing six months
prior to the consummation of that arrangement and ending six months after
the consummation of the arrangement, we have or our subsidiary has
expended or will expend for any property -- including amounts expended
for the acquisition, exploration, drilling or development thereof, and
for additions, alterations, improvements and repairs to the
property -- an amount equal to all or a portion of the net proceeds of
that arrangement and we designate such amount as a credit against that
arrangement, with any that amount not being so designated to be applied
as set forth in the next item; or
- during or immediately after the expiration of the 12 months after the
effective date of that transaction, we apply to the voluntary defeasance
or retirement of the debt securities and or other senior indebtedness, as
defined in the indenture, an amount equal to the greater of the net
proceeds of the sale or transfer of the property leased in that
transaction or the fair value of such property at the time of entering
into such transaction, in either case adjusted to reflect the remaining
term of the lease and any amount we utilize as set forth in the prior
item. The amount will be reduced by the principal amount of senior
indebtedness we voluntarily retire within that 12-month period.
19
<PAGE> 23
THE INDENTURE INCLUDES EVENTS OF DEFAULT
Unless otherwise specified in the applicable prospectus supplement, any one
of the following events will constitute an "event of default" under the
indenture with respect to the debt securities of any series:
- if we fail to pay any interest on any debt security of that series when
due, and the failure continues for 30 days;
- if we fail to pay principal of or any premium on the debt securities of
that series when due and payable, either at maturity or otherwise;
- if we fail to perform, or we breach any of our other covenants or
warranties in the indenture or the debt securities -- other than a
covenant or warranty included in the indenture solely for the benefit of
a series of securities other than the debt securities -- and that breach
of failure continues for 60 days after written notice as provided in the
indenture;
- if any of our indebtedness, as defined in the indenture, in excess of an
aggregate of $25,000,000 in principal amount is accelerated under any
event of default as defined in any mortgage, indenture or instrument and
the acceleration has not been rescinded or annulled within 30 days after
written notice as provided in the indenture specifying such event of
default and requiring us to cause that acceleration to be rescinded or
annulled;
- if we fail to pay, bond or otherwise discharge within 60 days of entry, a
judgment, court order or uninsured monetary damage award against us in
excess of an aggregate of $25,000,000 which is not stayed on appeal or
otherwise being appropriately contested in good faith;
- certain events of bankruptcy, insolvency or reorganization involving us;
and
- any other event of default provided with respect to the debt securities
of that series.
If an event of default with respect to the debt securities of any series,
other than an event of default described in the second to last and third to last
items above, occurs and is continuing, either the trustee or the holders of at
least 25% in aggregate principal amount of the outstanding debt securities of
that series may declare the principal amount of the debt securities to be due
and payable immediately. At any time after a declaration of acceleration has
been made, but before a judgment or decree for payment of money has been
obtained by the trustee, and subject to applicable law and certain other
provisions of the indenture, the holders of a majority in aggregate principal
amount of the debt securities of that series may, under certain circumstances,
rescind and annul such acceleration. If an event of default described in the
second to last and third to last items above occurs, the principal amount and
accrued interest -- or a lesser amount as provided for in the debt securities of
that series -- will become immediately due and payable without any declaration
or other act by the trustee or any holder.
Within 90 days after the occurrence of any event of default under the
indenture with respect to the debt securities of any series, the trustee must
transmit notice of the event of default to the holders of the debt securities of
that series unless the event of default has been cured or waived. However,
except in the case of a payment default, the trustee may withhold the notice if
and so long as the board of directors, the executive committee or a trust
committee of directors or responsible officers of the trustee has in good faith
determined that the withholding of the notice is in the interest of the holders
of debt securities of that series.
If an event of default occurs and is continuing with respect to the debt
securities of any series, the trustee may in its discretion proceed to protect
and enforce its rights and the rights of the holders of debt securities of that
series by all appropriate judicial proceedings.
Subject to the duty of the trustee during any default to act with the
required standard of care, the trustee is under no obligation to exercise any of
its rights or powers under the indenture at the request or direction of any of
the holders of debt securities, unless the holders offer the trustee reasonable
indemnity. Subject to indemnifying of the trustee, and subject to applicable law
and certain other provisions of the
20
<PAGE> 24
indenture, the holders of a majority in aggregate principal amount of the
outstanding debt securities of a series may direct the time, method and place of
conducting any proceeding for any remedy available to the trustee, or exercising
any trust or power conferred on the trustee, with respect to the debt securities
of that series.
WE ARE OBLIGATED TO PURCHASE DEBT SECURITIES ON A CHANGE IN CONTROL
If a change in control, as defined in the indenture, occurs, within 15 days
we must mail a written notice regarding the change in control to the trustee and
to every holder of the debt securities of each series. The notice must also be
published at least once in an authorized newspaper, as defined in the indenture,
and must state:
- the event causing the change in control and the date thereof;
- the date by which notice of the change in control is required by the
indenture to be given;
- the date, 35 business days after the occurrence of the change in control,
by which we must purchase debt securities we are obligated to purchase
pursuant to the selling holder's exercise of rights on change in control;
- the price we must pay for the debt securities we are obligated to
purchase;
- the name and address of the trustee;
- the procedure for surrendering debt securities to the trustee or other
designated office or agent for payment;
- a statement of our obligation to make prompt payment on proper surrender
of the debt securities;
- the procedure for holders' exercise of rights of sale of the debt
securities; and
- the procedures by which a holder may withdraw such a notice after it is
given.
After we give this notice we will obligated, at the election of each
holder, to purchase such debt securities. Under the indenture, a change in
control is deemed to have occurred when:
- any event requiring the filing of any report under or in response to
Schedule 13D or 14D-1 pursuant to the Securities Exchange Act of 1934
disclosing beneficial ownership of either 50% or more of the our common
stock then outstanding or 50% or more of the voting power of the our
voting stock then outstanding;
- the completion of any sale, transfer, lease, or conveyance of our
properties and assets substantially as an entirety to any person or
persons that is not our subsidiary, as those terms are defined in the
indenture; or
- the completion of a consolidation or merger of us with or into any other
person or entity in a transaction in which either we are not the sole
surviving corporation or our common stock existing prior to the
transaction is converted into cash, securities or other property and
those exchanging our common stock do not, as a result of the transaction,
receive either 75% or more of the survivor's common stock or 75% or more
of the voting power of the survivor's voting stock.
We will not purchase any debt securities if there has occurred and is
continuing an event of default under the indenture, other than default in
payment of the purchase price payable for the debt securities upon change in
control. In connection with any purchase of debt securities after a change in
control, we will comply with all federal and state securities laws, including,
specifically, Rule 13E-4, if applicable, of the Securities Exchange Act, and any
related Schedule 13E-4 required to be submitted under that rule.
21
<PAGE> 25
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
We may discharge certain obligations to holders of any series of debt
securities that have not already been delivered to the trustee for cancellation
and that:
- have become due and payable;
- will become due and payable within one year; or
- are scheduled for redemption within one year.
To discharge the obligations with respect to a series of debt securities, we
must deposit with the trustee, in trust, an amount of funds in U.S. dollars or
in the foreign currency in which those debt securities are payable sufficient to
pay the entire amount of principal of, and any premium or interest on, those
debt securities to the date of the deposit if those debt securities have become
due and payable or to the maturity of the debt securities, as the case may be.
The indenture provides that, unless the provisions of section 402 of the
indenture are made inapplicable to the debt securities, we may elect either
- to defease and be discharged from any and all obligations with respect to
those debt securities, which we refer to as "legal defeasance"; or
- to be released from its obligations with respect to such debt securities
under the covenants described in "The Indenture Limits Our Ability to
Incur Liens" and "The Indenture Limits Our Ability to Engage in
Sale/Leaseback Transactions" above or, if provided pursuant to section
301 of the indenture, its obligations with respect to any other covenant,
which we refer to as "covenant defeasance."
In the case of legal defeasance we will still retain some obligations in
respect of the debt securities, including or obligations:
- to pay additional amounts, if any, upon the occurrence of certain events
of taxation, assessment or governmental charge with respect to payments
on the debt securities;
- to register the transfer or exchange of the debt securities;
- to replace temporary or mutilated, destroyed, lost or stolen debt
securities; and
- to maintain an office or agency with respect to the debt securities and
to hold moneys for payment in trust.
After a covenant defeasance, any omission to comply with the obligations or
covenants that have been defeased shall not constitute a default or an event of
default with respect to the debt securities.
To elect either legal defeasance or covenant defeasance we must deposit
with the trustee, in trust, an amount, in U.S. dollars or in the foreign
currency in which the relevant debt securities are payable at stated maturity,
or in government obligations, as defined below, or both, applicable to such debt
securities which through the scheduled payment of principal and interest in
accordance with their terms will provide money in an amount sufficient to pay
the principal of and any premium and interest on those debt securities on their
scheduled due dates.
In addition, we can only elect legal defeasance or covenant defeasance if,
among other things:
- the applicable defeasance does not result in a breach or violation of, or
constitute a default under, the indenture or any other material agreement
or instrument to which we are a party or by which we are is bound;
- no default or event of default with respect to the debt securities to be
defeased shall have occurred and be continuing on the date of the
establishment of such a trust; and
22
<PAGE> 26
- we have delivered to the trustee an opinion of counsel to the effect that
the holders of such debt securities will not recognize income, gain or
loss for U.S. federal income tax purposes as a result of such defeasance
and will be subject to U.S. federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such
defeasance had not occurred, and such opinion of counsel, in the case of
legal defeasance, must refer to and be based upon a letter ruling of the
Internal Revenue Service received by us, a Revenue Ruling published by
the Internal Revenue Service or a change in applicable U.S. federal
income tax law occurring after the date of the indenture.
The indenture deems a foreign currency to be any currency, currency unit or
composite currency, including, without limitation, the ECU, issued by the
government of one or more countries other than the United States or by any
recognized confederation or association of governments.
The indenture defines government obligations as securities which are not
callable or redeemable at the option of the issuer or issuers thereof and are:
- direct obligations of the United States or the government or the
governments in the confederation which issued the foreign currency in
which the debt securities of a particular series are payable, for the
payment of which its full faith and credit is pledged; or
- obligations of a person or entity controlled or supervised by and acting
as an agency or instrumentality of the United States or the government or
governments which issued the foreign currency in which the debt
securities of a particular series are payable, the timely payment of
which is unconditionally guaranteed as a full faith and credit obligation
by the United States or that other government or governments.
Government obligations also include a depository receipt issued by a bank or
trust company as custodian with respect to any government obligation described
above or a specific payment of interest on or principal of or any other amount
with respect to any government obligation held by that custodian for the account
of the holder of such depository receipt, as long as, except as required by law,
that custodian is not authorized to make any deduction from the amount payable
to the holder of the depository receipt from any amount received by the
custodian with respect to the government obligation or the specific payment of
interest on or principal of or any other amount with respect to the government
obligation evidenced by the depository receipt.
Unless we disclose otherwise in the applicable prospectus supplement, if
after we have deposited funds and/or government obligations to effect legal
defeasance or covenant defeasance with respect to debt securities of any series,
either:
- the holder of a debt security of that series is entitled to, and does,
elect to receive payment in a currency other than that in which such
deposit has been made in respect of that debt security; or
- a conversion event, as defined below, occurs in respect of the foreign
currency in which the deposit has been made,
the indebtedness represented by that debt security shall be deemed to have been,
and will be, fully discharged and satisfied through the payment of the principal
of, and any premium and interest on, that debt security as that debt security
becomes due out of the proceeds yielded by converting the amount or other
properties so deposited in respect of that debt security into the currency in
which that debt security becomes payable as a result of the election or
conversion event based on:
- in the case of payments made pursuant to the first of the two items in
the list above, the applicable market exchange rate for the currency in
effect on the second business day prior to the date of the payment; or
- with respect to a conversion event, the applicable market exchange rate
for such foreign currency in effect, as nearly as feasible, at the time
of the conversion event.
23
<PAGE> 27
The indenture defines a "conversion event" as the cessation of use of:
- a foreign currency other than the ECU both by the government of the
country or the confederation which issued such foreign currency and for
the settlement of transactions by a central bank or other public
institutions of or within the international banking community;
- the ECU both within the European Monetary System and for the settlement
of transactions by public institutions of or within the European
Community; or
- any currency unit or composite currency other than the ECU for the
purposes for which it was established. Unless otherwise provided in the
applicable prospectus supplement, all payments of principal of, and any
premium and interest on, any debt security that are payable in a foreign
currency that ceases to be used by the government or confederation of
issuance shall be made in U.S. dollars.
If we effect a covenant defeasance with respect to any debt securities and
the debt securities are declared due and payable because of the occurrence of
any event of default other than an event of default with respect to which there
has been covenant defeasance, the amount in the foreign currency in which the
debt securities are payable, and government obligations on deposit with the
trustee, will be sufficient to pay amounts due on the debt securities at the
time of the stated maturity but may not be sufficient to pay amounts due on the
debt securities at the time of the acceleration resulting from the event of
default. However, we would remain liable for payment of the amounts due at the
time of acceleration.
The applicable prospectus supplement may further describe the provisions,
if any, permitting defeasance or covenant defeasance, including any
modifications to the provisions described above, with respect to the debt
securities of or within a particular series.
Under the indenture, we are required to furnish to the trustee annually a
statement as to our performance of certain of our obligations under the
indenture and as to any default in such performance. We are also required to
deliver to the trustee, within five days after occurrence thereof, written
notice of any event which after notice or lapse of time or both would constitute
an event of default.
MODIFICATION AND WAIVER
We and the trustee may modify the indenture or waive certain provisions of
the indenture with the consent of the holders of not less than a majority in
aggregate principal amount of the debt securities of each series affected by the
modification or waiver. However, provisions of the indenture may not be waived
or modified without the consent of the holder of each debt security affected
thereby if the modification or waiver would:
- change the stated maturity of the principal of, or premium, if any, on,
or any installment of principal, if any, of or interest on, or any
additional amounts with respect to, any debt security;
- reduce the principal amount of, or premium or interest on, or any
additional amounts with respect to, any debt security;
- change the coin or currency in which any debt security or any premium or
any interest on such debt security or any additional amounts with respect
to the debt security is payable;
- impair the right to institute suit for the enforcement of any payment on
or after the stated maturity of any debt securities or, in the case of
redemption, exchange or conversion, on or after the redemption, exchange
or conversion date or, in the case of repayment at the option of any
holder, on or after the date for repayment or in the case of a change in
control, after the change in control purchase date;
- reduce the percentage and principal amount of the outstanding debt
securities, the consent of whose holders is required in order to take
certain actions;
24
<PAGE> 28
- change any of our obligations to maintain an office or agency in the
places and for the purposes required by the indenture; or
- modify any of the above provisions.
The holders of at least a majority in aggregate principal amount of debt
securities of any series may, on behalf of the holders of all debt securities of
that series, waive our compliance certain restrictive provisions of the
indenture. The holders of not less than a majority in aggregate principal amount
of debt securities of any series may, on behalf of all holders of debt
securities of that series, waive any past default and its consequences under the
indenture with respect to the debt securities of that series, except:
- a payment default with respect to debt securities of that series; or
- a default of a covenant or provision of the indenture that cannot be
modified or amended without the consent of the holder of each debt
security of any series.
CONSOLIDATION, MERGER AND SALE OF ASSETS
We may, without the consent of the holders of the debt securities,
consolidate or merge with or into, or convey, transfer or lease its properties
and assets substantially as an entirety to, any person that is a corporation,
limited liability company, partnership or trust organized and validly existing
under the laws of any domestic jurisdiction. We may also permit any of those
persons to consolidate with or merge into us or convey, transfer or lease its
properties and assets substantially as an entirety to us, as long as any
successor person assumes our obligations on the debt securities and that after
giving effect to the transaction no event of default under the indenture, and no
event which, after notice or lapse of time or both, would become an event of
default, will have occurred and be continuing, and as long as some other
conditions are met.
BOOK-ENTRY SECURITIES
Unless otherwise specified in the applicable prospectus supplement, we will
issue securities, other than common stock, in the form of one or more book-entry
certificates registered in the name of a depositary or a nominee of a
depositary. Unless otherwise specified in the applicable prospectus supplement,
the depositary will be The Depository Trust Company. We have been informed by
DTC that its nominee will be Cede & Co. Accordingly, Cede is expected to be the
initial registered holder of all securities that are issued in book-entry form.
No person that acquires a beneficial interest in securities issued in
book-entry form will be entitled to receive a certificate representing those
securities, except as set forth in this prospectus or in the applicable
prospectus supplement. Unless and until definitive securities are issued under
the limited circumstances described below, all references to actions by
beneficial owners of securities issued in book-entry form will refer to actions
taken by DTC upon instructions from its participants, and all references to
payments and notices to beneficial owners will refer to payments and notices to
DTC or Cede, as the registered holder of such securities.
DTC has informed us that it is:
- a limited purpose trust company organized under New York banking laws;
- a "banking organization" within the meaning of the New York banking laws;
- a member of the Federal Reserve System;
- a "clearing corporation" within the meaning of the New York Uniform
Commercial Code; and
- a "clearing agency" registered under the Securities Exchange Act.
25
<PAGE> 29
DTC has also informed us that it was created to:
- hold securities for "participants"; and
- facilitate the clearance and settlement of securities transactions among
participants through electronic book-entry, thereby eliminating the need
for the physical movement of securities certificates.
Participants have accounts with DTC and include securities brokers and
dealers, banks, trust companies and clearing corporations. Indirect access to
the DTC system also is available to indirect participants such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a participant, either directly or indirectly.
Persons that are not participants or indirect participants but desire to
buy, sell or otherwise transfer ownership of or interests in securities may do
so only through participants and indirect participants. Under the book-entry
system, beneficial owners may experience some delay in receiving payments, as
payments will be forwarded by our agent to Cede, as nominee for DTC. DTC will
forward these payments to its participants, which thereafter will forward them
to indirect participants or beneficial owners. Beneficial owners will not be
recognized by the applicable registrar, transfer agent, trustee or depositary as
registered holders of the securities entitled to the benefits of the
certificate, the indenture or any deposit agreement. Beneficial owners that are
not participants will be permitted to exercise their rights as an owner only
indirectly through participants and, if applicable, indirect participants.
Under the current rules and regulations affecting DTC, DTC will be required
to make book-entry transfers of securities among participants and to receive and
transmit payments to participants. Participants and indirect participants with
which beneficial owners of securities have accounts are also required by these
rules to make book-entry transfers and receive and transmit such payments on
behalf of their respective account holders.
Because DTC can act only on behalf of participants, who in turn act only on
behalf of other participants or indirect participants, and on behalf of certain
banks, trust companies and other persons approved by it, the ability of a
beneficial owner of securities issued in book-entry form to pledge those
securities to persons or entities that do not participate in the DTC system may
be limited due to the unavailability of physical certificates for the
securities.
DTC has advised us that it will take any action permitted to be taken by a
registered holder of any securities under the certificate, the indenture or any
deposit agreement only at the direction of one or more participants to whose
accounts with DTC the securities are credited.
DTC has further advised us that its management is aware that some computer
applications, systems, and the like for processing data that are dependent upon
calendar dates, including dates before, on, and after January 1, 2000, may
encounter "Year 2000 problems." DTC has informed its participants and other
members of the financial community that it has developed and is implementing a
program so that its computer systems, as they relate to the timely payment of
distributions to securityholders, book-entry deliveries, and settlement of
trades within DTC, continue to function appropriately. This program includes a
technical assessment and a remediation plan, each of which is complete.
Additionally, DTC's plan includes a testing phase, which is expected to be
completed within appropriate time frames.
However, DTC's ability to perform properly its services is also dependent
upon other parties, including issuers and their agents, as well as DTC's direct
and indirect participants and third party vendors from whom DTC licenses
software and hardware, and third party vendors on whom DTC relies for
information or the provision of services, including telecommunication and
electrical utility service providers, among others. DTC has informed its
participants and other members of the financial community that it is contacting
and will continue to contact third party vendors from whom it acquires services
to impress upon them the importance of such services being Year 2000 compliant
and determine the extent of their efforts for Year 2000 remediation -- and, as
appropriate, testing -- of their services. In addition, DTC is in the process of
developing contingency plans that it considers appropriate.
26
<PAGE> 30
According to DTC, the information with respect to DTC has been provided to
its participants and other members of the financial community for informational
purposes only and is not intended to serve as a representation, warranty, or
contract modification of any kind.
Unless otherwise specified in the applicable prospectus supplement, a
book-entry security will be exchangeable for definitive securities registered in
the names of persons other than DTC or its nominee only if:
- DTC notifies us that it is unwilling or unable to continue as depositary
for the book-entry security or DTC ceases to be a clearing agency
registered under the Securities Exchange Act at a time when DTC is
required to be so registered; or
- we execute and deliver to the applicable registrar, transfer agent,
trustee and/or depositary an order complying with the requirements of the
certificate, the indenture or any deposit agreement that the book-entry
security will be so exchangeable.
Any book-entry security that is exchangeable in accordance with the preceding
sentence will be exchangeable for securities registered in such names as DTC
directs.
If one of the events described in the immediately preceding paragraph
occurs, DTC is generally required to notify all participants of the availability
through DTC of definitive securities. Upon surrender by DTC of the book-entry
security representing the securities and delivery of instructions for re-
registration, the registrar, transfer agent, trustee or depositary, as the case
may be, will reissue the securities as definitive securities. After reissuance
of the securities, such persons will recognize the beneficial owners of such
definitive securities as registered holders of securities.
Except as described above:
- a book-entry security may not be transferred except as a whole book-entry
security by or among DTC, a nominee of DTC and/or a successor depositary
appointed by us; and
- DTC may not sell, assign or otherwise transfer any beneficial interest in
a book-entry security unless the beneficial interest is in an amount
equal to an authorized denomination for the securities evidenced by the
book-entry security.
None of Apache, the trustees, any registrar and transfer agent or any
depositary, or any agent of any of them, will have any responsibility or
liability for any aspect of DTC's or any participant's records relating to, or
for payments made on account of, beneficial interests in a book-entry security.
PLAN OF DISTRIBUTION
We may sell the securities through agents, underwriters or dealers, or
directly to one or more purchasers.
We may designate agents who agree to use their reasonable efforts to
solicit purchases for the period of their appointment or to sell securities on a
continuing basis.
If we use underwriters for a sale of securities, the underwriters will
acquire the securities for their own account. The underwriters may resell the
securities in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The obligations of the underwriters to purchase the securities will be subject
to the conditions set forth in the applicable underwriting agreement. The
underwriters will be obligated to purchase all the securities of the series
offered if any of the securities of that series are purchased. Any initial
public offering price and any discounts or concessions allowed or re-allowed or
paid to dealers may be changed from time to time.
We may also sell securities directly to one or more purchasers without
using underwriters or agents.
27
<PAGE> 31
Underwriters, dealers and agents that participate in the distribution of
the securities may be underwriters as defined in the Securities Act and any
discounts or commissions they receive from us and any profit on their resale of
the securities may be treated as underwriting discounts and commissions under
the Securities Act. The applicable prospectus supplement will identify any
underwriters, dealers or agents and will describe their compensation. We may
have agreements with the underwriters, dealers and agents to indemnify them
against certain civil liabilities, including liabilities under the Securities
Act. Underwriters, dealers and agents may engage in transactions with or perform
services for us or our subsidiaries in the ordinary course of their businesses.
TRADING MARKETS AND LISTING OF SECURITIES
Unless otherwise specified in the applicable prospectus supplement, each
class or series of securities will be a new issue with no established trading
market, other than the common stock, which is listed on the New York Stock
Exchange and the Chicago Stock Exchange. We may elect to list any other class or
series of securities on any exchange, but we are not obligated to do so. It is
possible that one or more underwriters may make a market in a class or series of
securities, but the underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. We cannot give any
assurance as to the liquidity of the trading market for any of the securities.
STABILIZATION ACTIVITIES
Any underwriter may engage in over-allotment, stabilizing transactions,
short-covering transactions and penalty bids in accordance with Regulation M
under the Securities Exchange Act. Over-allotment involves sales in excess of
the offering size, which create a short position. Stabilizing transactions
permit bids to purchase the underlying security so long as the stabilizing bids
do not exceed a specified maximum. Short-covering transactions involve purchases
of the securities in the open market after the distribution is completed to
cover short positions. Penalty bids permit the underwriters to reclaim a selling
concession from a dealer when the securities originally sold by the dealer are
purchased in a covering transaction to cover short positions. Those activities
may cause the price of the securities to be higher than it would otherwise be.
If commenced, the underwriters may discontinue any of the activities at any
time.
LEGAL MATTERS
The legality of the securities will be passed upon for Apache by its Vice
President and General Counsel, Z. S. Kobiashvili. As of the date of this
prospectus, Mr. Kobiashvili owns 1,990 shares of Apache common stock through
Apache's 401(k) savings plan, holds employee stock options to purchase 45,700
shares of Apache common stock, of which options to purchase 21,200 shares are
currently exercisable, and holds a conditional grant under Apache's 1996 share
Price Appreciation Plan relating to 18,900 shares of Apache common stock, none
of which is vested. In addition, other customary legal matters relating to the
offering of the securities, including matters relating to our due incorporation,
legal existence and authorized capitalization, will be passed upon for Apache by
Mr. Kobiashvili or Mayor, Day, Caldwell & Keeton, L.L.P., Houston, Texas.
EXPERTS
The audited consolidated financial statements of Apache that are
incorporated by reference into this prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
report.
The information incorporated by reference into this prospectus regarding
the total proved reserves of Apache was prepared by Apache and reviewed by Ryder
Scott Company Petroleum Engineers, as stated in their letter reports, and is
incorporated by reference in reliance upon the authority of said firm as experts
in such matters. The information incorporated by reference into this prospectus
regarding the total
28
<PAGE> 32
estimated proved reserves acquired from Texaco Exploration and Production Inc.
was prepared by Apache and reviewed by Ryder Scott, as stated in their letter
reports, and is incorporated by reference in reliance upon the authority of that
firm as experts in these matters. The information incorporated by reference into
this prospectus regarding the total proved reserves of DEKALB was prepared by
DEKALB and for the four years ended December 31, 1994 was reviewed by Ryder
Scott, as stated in their letter reports with respect thereto, and is
incorporated by reference in reliance upon the authority of that firm as experts
in these matters.
A portion of the information incorporated by reference in this prospectus
regarding the total proved reserves of Aquila Energy Resources Corporation
acquired by Apache was prepared by Netherland, Sewell & Associates, Inc. as of
December 31, 1994, as stated in their letter report, and is incorporated by
reference in reliance upon the authority of that firm as experts in those
matters. Netherland, Sewell did not review any of the reserves of Aquila
acquired during 1995.
29
<PAGE> 33
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Estimated expenses, other than underwriting discounts and commissions, in
connection with the issuance and distribution of the securities are as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission filing fee............... $278,000
Rating agency fees.......................................... 50,000
Legal fees and expenses..................................... 200,000
Accounting fees and expenses................................ 75,000
Trustee's fees and expenses................................. 12,000
Printing and engraving...................................... 100,000
Miscellaneous............................................... 30,000
--------
Total............................................. $745,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Apache's restated certificate of incorporation provides that Apache shall,
to the full extent permitted under the Delaware General Corporation Law,
indemnify its officers, directors, employees and agents.
Section 145 of the Delaware General Corporation Law, inter alia, authorizes
a corporation to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, other than an action by or in the right of the corporation, because
such person is or was a director, officer, employee or agent of the corporation
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or other enterprise, against expenses,
including attorneys' fees, judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reason to believe his conduct was
unlawful. Similar indemnity is authorized for such persons against expenses,
including attorneys' fees, actually and reasonably incurred in defense or
settlement of any such pending, completed or threatened action or suit by or in
the right of the corporation if such person acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and provided further that, unless a court of competent jurisdiction
otherwise provides, such person shall not have been adjudged liable to the
corporation. Any such indemnification may be made only as authorized in each
specific case upon a determination by the stockholders or disinterested
directors that indemnification is proper because the indemnitee has met the
applicable standard of conduct.
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would otherwise have the power to indemnify him. Apache maintains policies
insuring its and its subsidiaries' officers and directors against certain
liabilities for actions taken in such capacities, including liabilities under
the Securities Act of 1933.
Article VII of Apache's bylaws provides, in substance, that directors,
officers, employees and agents of Apache shall be indemnified to the extent
permitted by Section 145 of the Delaware General Corporation Law. Additionally,
Article Seventeen of Apache's restated certificate of incorporation eliminates
in certain
II-1
<PAGE> 34
circumstances the monetary liability of directors of Apache for a breach of
their fiduciary duty as directors. These provisions do not eliminate the
liability of a director
- for a breach of the director's duty of loyalty to Apache or its
stockholders;
- for acts or omissions by the director not in good faith;
- for acts or omissions by a director involving intentional misconduct or a
knowing violation of the law;
- under Section 174 of the Delaware General Corporation Law, which relates
to the declaration of dividends and purchase or redemption of shares in
violation of the Delaware General Corporation Law; and
- for transactions from which the director derived an improper personal
benefit.
Reference is made to the form of underwriting agreements to be incorporated
by reference in this registration statement for a description of the
indemnification arrangements Apache agrees to in connection with offerings of
the securities registered by this registration statement.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
1.1 -- Each form of underwriting agreement will be filed as an
exhibit to a current report of Apache and incorporated in
this registration statement by reference.
3.1 -- Restated Certificate of Incorporation of Apache dated
December 1, 1993, as filed with the Secretary of State of
Delaware on December 16, 1993 (incorporated by reference
to Exhibit 3.1 to Apache's Annual Report on Form 10-K for
year ended December 31, 1993, SEC File No. 1-4300).
3.2 -- Certificate of Ownership and Merger Merging Apache Energy
Resources Corporation into Apache, effective December 31,
1995, as filed with the Secretary of State of Delaware on
December 21, 1995 (incorporated by reference to Exhibit
3.2 to Apache's Annual Report on Form 10-K for year ended
December 31, 1995. SEC File No. 1-4300).
3.3 -- Certificate of Designations, Preferences and Rights of
Series A Junior Participating Preferred Stock of Apache,
effective January 31, 1996, as filed with the Secretary
of State of Delaware on January 22, 1996 (incorporated by
reference to Exhibit 3.3 to Apache's Annual Report on
Form 10-K for year ended December 31, 1995, SEC File No.
1-4300).
3.4 -- Certificate of Ownership and Merger merging Apache PHN
Company, Inc. into Registrant, effective July 1, 1998, as
filed with the Secretary of State of Delaware on July 1,
1998 (incorporated by reference to Exhibit 3.4 to
Apache's Annual Report on Form 10-K for the year ended
December 31, 1998, SEC File No. 1-4300).
3.5 -- Agreement and Plan of Merger merging MWJR Petroleum
Corporation into Registrant, effective September 1, 1998,
as filed with the Secretary of State of Delaware on
August 19, 1998 (incorporated by reference to Exhibit 3.5
to Apache's Annual Report on Form 10-K for the year ended
December 31, 1998, SEC File No. 1-4300).
</TABLE>
II-2
<PAGE> 35
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
3.6 -- Certificate of Ownership and Merger merging MW Petroleum
Corporation into Registrant, effective September 1, 1998,
as filed with the Secretary of State of Delaware on
August 19, 1998 (incorporated by reference to Exhibit 3.6
to Apache's Annual Report on Form 10-K for the year ended
December 31, 1998, SEC File No. 1-4300).
3.7 -- Certificate of Designations, Preferences and Rights of
5.68% Cumulative Preferred Stock, Series B, of
Registrant, as filed with the Secretary of State of
Delaware on August 21, 1998 (incorporated by reference to
Exhibit 3.7 to Apache's Annual Report on Form 10-K for
the year ended December 31, 1998, SEC File No. 1-4300).
3.8 -- Certificate of Correction to Certificate of Designations,
Preferences and Rights of 5.68% Cumulative Preferred
Stock, Series B, of Registrant, as filed with the
Secretary of State of Delaware on August 24, 1998
(incorporated by reference to Exhibit 3.8 to Apache's
Annual Report on Form 10-K for the year ended December
31, 1998, SEC File No. 1-4300).
3.9 -- Bylaws of Apache, as amended September 17, 1998
(incorporated by reference to Exhibit 3.2 to Apache's
Quarterly Report of Form 10-Q, for the quarter Ended
September 30, 1998, SEC File No. 1-4300).
4.1 -- Form of Indenture between Apache and The Chase Manhattan
Bank, as Trustee and successor to Chemical Bank,
governing the Debt Securities (incorporated by reference
to Exhibit 4.1 to Apache's Registration Statement on Form
S-3, Registration No. 33-63923, filed November 2, 1995).
4.2 -- Form of First Supplemental Indenture between Apache and
The Chase Manhattan Bank, as Trustee (incorporated by
reference to Exhibit 4.1 to Apache's Current Report on
Form 8-K, dated October 31, 1996, SEC File No. 1-4300).
4.3 --Form of Deposit Agreement with Form of Depositary Receipt
(incorporated by reference to Exhibit 4.1 to Apache's
Current Report on Form 8-K/A, dated August 19, 1998, SEC
File No. 1-4300).
*5.1 -- Opinion of general counsel regarding legality of
securities being registered.
12.1 -- Statement of computation of ratio of earnings to combined
fixed charges and preferred stock dividends (incorporated
by reference to Exhibit 99.1 to Apache's Current Report
on Form 8-K, dated March 2, 1999, SEC File No. 1-4300).
**23.1 -- Consent of Arthur Andersen LLP, Houston, Texas.
*23.2 -- Consent of Ryder Scott Company Petroleum Engineers.
*23.3 -- Consent of Netherland, Sewell & Associates, Inc.
*23.4 -- Consent of general counsel (included in Exhibit 5.1).
*23.5 -- Consent of Mayor, Day, Caldwell & Keeton, L.L.P.
*24.1 -- Power of Attorney (included in Part II as a part of the
signature pages of the Registration Statement).
*25.1 -- Statement of Eligibility and Qualification under Trust
Indenture Act of 1939 of The Chase Manhattan Bank,
Trustee, on Form T-1.
99.1 -- Form of Apache's common stock certificate (incorporated
by reference to Exhibit 4.1 to the Apache's Annual Report
on Form 10-K for year ended December 31, 1995, SEC File
No. 1-4300).
</TABLE>
II-3
<PAGE> 36
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
99.2 -- Rights Agreement dated January 31, 1996, between Apache
and Norwest Bank Minnesota, N.A., rights agent, relating
to the declaration of a rights dividend to Apache's
common shareholders of record on January 31, 1996
(incorporated by reference to Exhibit (a) to Apache's
Registration Statement on Form 8-A, dated January 24,
1996, SEC File No. 1-4300).
99.3 -- Form of Apache's Right Certificate (incorporated by
reference to Exhibit (b) to Apache's Registration
Statement on Form 8-A, dated January 24, 1996, SEC File
No. 1-4300).
</TABLE>
- ---------------
* Previously filed.
** Filed herewith.
ITEM 17. UNDERTAKINGS
1. The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement.
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculations of
Registration Fee" table in the effective Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
Provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934, that are incorporated by reference in the Registration
Statement;
(b) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof; and
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
2. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-4
<PAGE> 37
3. Insofar as indemnification for liabilities arising under the Securities
Act of 1933, may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted against the Registrant by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
4. The undersigned Registrant hereby undertakes that:
(a) For the purpose of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act, as amended, shall be
deemed to be part of this Registration Statement as of the time it was
declared effective; and
(b) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
5. The undersigned Registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Act.
II-5
<PAGE> 38
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Houston, State of Texas on April 8,
1999.
APACHE CORPORATION
By: /s/ RAYMOND PLANK*
----------------------------------
Raymond Plank,
Chairman and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons, in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ RAYMOND PLANK* Chairman and Chief Executive Officer (Principal
- --------------------------------------------------- Executive Officer)
Raymond Plank
/s/ ROGER B. PLANK* Vice President and Chief Financial Officer
- --------------------------------------------------- (Principal Financial Officer)
Roger B. Plank
/s/ THOMAS L. MITCHELL* Vice President and Controller (Principal
- --------------------------------------------------- Accounting Officer)
Thomas L. Mitchell
/s/ FREDERICK M. BOHEN* Director
- ---------------------------------------------------
Frederick M. Bohen
/s/ G. STEVEN FARRIS* Director
- ---------------------------------------------------
G. Steven Farris
/s/ RANDOLPH M. FERLIC* Director
- ---------------------------------------------------
Randolph M. Ferlic
/s/ EUGENE C. FIEDOREK* Director
- ---------------------------------------------------
Eugene C. Fiedorek
Director
- ---------------------------------------------------
A.D. Frazier, Jr.
/s/ STANLEY K. HATHAWAY* Director
- ---------------------------------------------------
Stanley K. Hathaway
/s/ JOHN A. KOCUR* Director
- ---------------------------------------------------
John A. Kocur
/s/ GEORGE D. LAWRENCE JR.* Director
- ---------------------------------------------------
George D. Lawrence Jr.
</TABLE>
<PAGE> 39
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ MARY RALPH LOWE* Director
- ---------------------------------------------------
Mary Ralph Lowe
/s/ F.H. MERELLI* Director
- ---------------------------------------------------
F.H. Merelli
/s/ JOSEPH A. RICE* Director
- ---------------------------------------------------
Joseph A. Rice
*By: /s/ ZURAB S. KOBIASHVILI
------------------------------------------------
Zurab S. Kobiashvili
Attorney in Fact
Dated: April 8, 1999
</TABLE>
<PAGE> 40
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
23.1 -- Consent of Arthur Andersen LLP, Houston, Texas.
</TABLE>
<PAGE> 1
EXHIBIT 23.1
CONSENT OF ARTHUR ANDERSEN LLP
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 5, 1999 on
the audited consolidated financial statements of Apache Corporation and
subsidiaries included in the Apache Corporation Annual Report on Form 10-K for
the year ended December 31, 1998, and to all references to our Firm included
in this registration statement.
/s/ ARTHUR ANDERSEN LLP
----------------------------
ARTHUR ANDERSEN LLP
Houston, Texas
April 7, 1999
