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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No. 4)
ENRON OIL & GAS COMPANY
(Name of Issuer)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
293562 10 4
(CUSIP Number)
Rex R. Rogers
Vice President and Associate General Counsel
Enron Corp.
1400 Smith Street
Houston, Texas 77002
(713) 853-3069
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 16, 1999
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Section 240.13d-1(e), Section 240.13d-1(f) or
Section 240.13d-1(g), check the following box: [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities and Exchange Act
of 1934 ("Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes).
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SCHEDULE 13D/A
CUSIP NO. 293562 10 4 Page 2 of 7 Pages
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1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Enron Corp.
I.R.S. No. 47-0255140
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
N/A
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
BK, WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d)or 2(e)
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Oregon
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NUMBER OF 7. SOLE VOTING POWER**
SHARES 11,500,000
------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 0
------------------------------------
EACH 9. SOLE DISPOSITIVE POWER**
REPORTING 11,500,000
------------------------------------
PERSON 10. SHARED DISPOSITIVE POWER
WITH 0
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,500,000 shares of common stock
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
N/A
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.7%
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14. TYPE OF REPORTING PERSON
CO
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** Subject to contractual restrictions on Enron's right to vote or dispose
of the shares reported, which restrictions are described in this
Amendment No. 4 to Schedule 13D.
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AMENDMENT NO. 4 TO
STATEMENT ON SCHEDULE 13D
Reference is made to the Statement on Schedule 13D (the "Statement")
filed by Enron Corp. ("Enron") with respect to its beneficial ownership of the
common stock, par value $.01 per share ("Common Stock"), of Enron Oil & Gas
Company (the "Issuer"). The following items of the Statement are amended in the
manner set forth below. Capitalized terms used but not defined herein shall have
the respective meanings set forth in the Statement.
ITEM 4. PURPOSE OF TRANSACTION.
Until the consummation of the IPO, Enron owned 99.4% of the Common
Stock of the Issuer. Pursuant to the IPO, the Issuer sold 23,000,000 shares
(after giving effect to the Issuer's June 1994 2-for-1 stock split effected as a
stock dividend). Subsequent to the completion of the IPO and prior to August 16,
1999, the Issuer remained a majority-owned subsidiary of Enron, and its assets,
liabilities and results of operations were included in the consolidated
financial statements of Enron and its consolidated subsidiaries.
On August 16, 1999, Enron consummated the transactions contemplated by
a Share Exchange Agreement, dated July 19, 1999, by and between Enron and the
Issuer (as amended by letter agreements between Enron and the Issuer dated as of
July 30, 1999 and August 10, 1999 filed as Exhibits E and F hereto, the
"Exchange Agreement"), which is filed as Exhibit D hereto. The following summary
of the Exchange Agreement is qualified by reference to the Exchange Agreement.
Under the Exchange Agreement, Enron exchanged 62,270,000 shares of the
Common Stock for the stock of EOGI-India, Inc., which was a wholly owned
subsidiary of the Issuer and which owned all of the Issuer's China and India
operations at the time of closing (the "Exchange"). In connection with the
Exchange, the Issuer contributed approximately $600 million in cash to one of
the Issuer's India subsidiaries that was transferred to Enron. These funds will
be used in connection with international operations.
Prior to the Exchange, the Board of Directors of the Issuer consisted
of eleven directors. Of these directors, five served as executive officers of
Enron:
Name Position with Enron
---- -------------------
Kenneth L. Lay Director, Chairman of the Board and
Chief Executive Officer
Jeffrey K. Skilling Director, President and Chief
Operating Officer
Ken L. Harrison Director, Vice Chairman
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James V. Derrick Executive Vice President and
General Counsel
Richard A. Causey Executive Vice President and Chief
Accounting, Information and
Administrative Officer
In addition, John H. Duncan, who served as a non-employee director of
Enron and as Chairman of the Executive Committee of Enron's Board of Directors,
also served as a director of the Issuer. In connection with the Exchange, all of
these individuals resigned as directors of the Issuer.
After the Exchange, on August 16, 1999, Enron sold 8,500,000 shares of
Common Stock to the public in a registered public offering (the "Public
Offering"). In addition, the Issuer issued and sold 27,000,000 shares of Common
Stock in the Public Offering. After the Public Offering, Enron owned
approximately 9.7% of the outstanding shares of Common Stock.
Additionally, on August 17, 1999, Enron sold 10,000,000 of its 7%
Exchangeable Notes due July 31, 2002 (the "Exchangeable Notes") to the public in
a registered public offering. In addition to the 10,000,000 Exchangeable Notes
sold by Enron on August 17, 1999, the underwriters of the public offering of the
Exchangeable Notes have an option, expiring on September 9, 1999, to purchase an
additional 1,500,000 Exchangeable Notes from Enron. At the maturity of the
Exchangeable Notes, Enron will exchange Common Stock that is owned by Enron for
the Exchangeable Notes. The number of shares of Common Stock that Enron will
exchange for each Exchangeable Note will not be more than one share and not less
than .8475 of a share, depending on the market price of the Common Stock at the
maturity of the Exchangeable Notes. As a result, at the maturity of the
Exchangeable Notes, Enron will exchange up to 10,000,000 (11,500,000 if the
underwriters' option is exercised in full) but not less than 8,475,000
(9,746,250 if the underwriters' option is exercised in full) shares of Common
Stock for the Exchangeable Notes.
Under the Exchange Agreement, each party has made certain
representations and warranties, with each party agreeing to indemnify the other
party for breaches of such party's representations and warranties.
Under the Exchange Agreement, Enron has agreed, except as provided
below, commencing on July 19, 1999 and ending on February 16, 2000 (the "Lock-Up
Expiration Date"), not to, directly or indirectly, sell, transfer, pledge or
otherwise dispose of (including without limitation by issuing any debt or equity
securities exercisable or exchangeable for, or convertible into) any of Enron's
shares of Common Stock to any person other than a wholly owned subsidiary of
Enron. However, Enron was permitted by the Exchange Agreement to sell the shares
of Common Stock in the Public Offering and the Exchangeable Notes described
above. In the event that, pursuant to the terms of the Exchange Agreement, Enron
is entitled to sell, any of its shares of Common Stock not sold in the Public
Offering or not exchanged for Exchangeable Notes, Enron is required to sell such
shares (a) in a public offering registered under the Securities Act, (b)
pursuant to Rule 144 promulgated under the Securities Act, (c) to a wholly owned
subsidiary of Enron, which would then be bound by
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these restrictions, (d) pursuant to any merger approved by the Issuer's Board of
Directors or (e) any tender offer or exchange offer recommended by the Issuer's
Board of Directors.
In addition, under the Exchange Agreement, Enron has agreed that,
commencing on July 19, 1999 and ending on the later of (a) August 16, 2001 and
(b) the earliest date that Enron ceases to beneficially own more than 5% of the
issued and outstanding shares of Common Stock (the "Standstill Expiration
Date"), unless specifically requested in advance by the Issuer's Board of
Directors, neither Enron nor any of its subsidiaries will directly or indirectly
(1) acquire, offer to acquire or agree to acquire, or cause or recommend that
any other person acquire, directly or indirectly, by purchase, gift, through the
acquisition or control of another person or otherwise, any voting securities of
the Issuer, (2) make or in any way participate in, directly or indirectly, any
solicitation of proxies to vote or become a participant in any election contest
or seek to advise or influence any person with respect to the voting of any
voting securities of the Issuer, (3) propose or nominate any nominee for
director of the Issuer, (4) submit any stockholder proposal to be voted upon by
the stockholders of the Issuer, (5) deposit any voting securities in a voting
trust or subject any such voting securities to any arrangement or agreement with
respect to the voting of such securities, (6) propose any business combination
involving the Issuer or make or propose a tender or exchange offer or any other
offer for any of the Issuer's voting securities, or arrange, or participate in
the arrangement of, financing thereof, (7) disclose an intent, purpose, plan or
proposal with respect to the Issuer or its voting securities inconsistent with
the provisions of the Exchange Agreement, (8) after the closing of the Exchange,
otherwise act, alone or in concert with or on behalf of others, to seek directly
or indirectly to control the officers or Board of Directors of the Issuer or (9)
encourage or assist any other person in connection with any of the foregoing. In
addition, Enron has agreed that, during the period from August 16, 1999 until
the Standstill Expiration Date, at any meeting of the stockholders of the Issuer
with respect to which Enron owns shares of Common Stock entitled to vote, Enron
will attend such meeting in person or by proxy and will vote all of its shares
of Common Stock in the manner, if any, recommended by the Issuer's Board of
Directors.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) According to the Issuer's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1999, the Issuer had 153,914,790 outstanding shares of
Common Stock as of July 26, 1999. Giving effect to the Exchange and the issuance
and sale of shares of Common Stock by the Issuer in the Public Offering, the
Issuer had 118,644,790 outstanding shares of Common Stock as of July 26, 1999.
As of the date hereof, Enron beneficially owns 11,500,000 shares of Common
Stock, or 9.7% of such number of outstanding shares.
(b) Enron has sole voting and dispositive power with respect to
the shares of Common Stock indicated to be beneficially owned by it in
paragraph (a).
To Enron's knowledge, except as set forth on Schedule II, each of the
officers and directors set forth on Schedule II has sole voting and dispositive
power with respect to the shares of Common Stock set forth next to such
individual's name on Schedule II.
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(c) Except as described in Item 4 above, which description is
incorporated by reference herein, neither Enron nor, to its knowledge, any of
the persons named in Schedule I hereto, has effected any transactions in the
Common Stock since the filing of Amendment No. 3 to Schedule 13D.
(d) Not applicable.
(e) Not applicable.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
A. Stock Restriction and Registration Agreement dated as of August
23, 1989 by and between Enron and the Issuer (incorporated by
reference to Exhibit 10.2 to the Registration Statement on Form
S-1 of the Issuer, Registration Statement No. 33-30678, filed
August 24, 1989).
B. Amendment to Stock Restriction and Registration Agreement dated
December 9, 1997 by and between Enron and the Issuer (incorporated
by reference to Exhibit 10.7 to Annual Report on Form 10-K of the
Issuer for the year ended December 31, 1997).
C. Equity Participation and Business Opportunity Agreement, dated
December 9, 1997, between Enron and the Issuer (incorporated by
reference to Exhibit 10 to the Registration Statement on Form S-3
of the Issuer, Registration Statement No. 333-44785, filed January
23, 1998).
*D. Share Exchange Agreement dated as of July 19, 1999, by and between
Enron and the Issuer.
E. Letter Agreement dated as of July 30, 1999, by and between Enron
and the Issuer.
F. Letter Agreement dated as of August 10, 1999, by and between Enron
and the Issuer.
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* Previously filed
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After the reasonable inquiry and to the best knowledge and belief of
the undersigned, the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: August 18, 1999 ENRON CORP.
By: /s/ TIMOTHY J. DETMERING
-------------------------------------------
Timothy J. Detmering
Vice President, Corporate Development
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EXHIBIT INDEX
A. Stock Restriction and Registration Agreement dated as of August
23, 1989 by and between Enron and the Issuer (incorporated by
reference to Exhibit 10.2 to the Registration Statement on Form
S-1 of the Issuer, Registration Statement No. 33-30678, filed
August 24, 1989).
B. Amendment to Stock Restriction and Registration Agreement dated
December 9, 1997 by and between Enron and the Issuer (incorporated
by reference to Exhibit 10.7 to Annual Report on Form 10-K of the
Issuer for the year ended December 31, 1997).
C. Equity Participation and Business Opportunity Agreement, dated
December 9, 1997, between Enron and the Issuer (incorporated by
reference to Exhibit 10 to the Registration Statement on Form S-3
of the Issuer, Registration Statement No. 333-44785, filed January
23, 1998).
*D. Share Exchange Agreement dated as of July 19, 1999, by and between
Enron and the Issuer.
E. Letter Agreement dated as of July 30, 1999, by and between Enron
and the Issuer.
F. Letter Agreement dated as of August 10, 1999, by and between Enron
and the Issuer.
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* Previously filed
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EXHIBIT E
July 30, 1999
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Dear Sirs:
Reference is made to the Share Exchange Agreement, dated July 19, 1999,
between Enron Corp. and Enron Oil & Gas Company (the "Share Exchange
Agreement"). Capitalized terms used, but not defined in this letter agreement,
have the respective meanings given them in the Share Exchange Agreement.
EOG understands that the Convertible Securities that Enron is proposing
to issue pursuant to Section 6.2(b) of the Share Exchange Agreement in the
Public Offering will be mandatorily convertible into up to 10,000,000 Retained
Shares, or, if the underwriters exercise their over-allotment option, up to
11,500,000 Retained Shares. Furthermore, EOG and Enron anticipate that the
underwriters' over-allotment option relating to the sale by EOG of shares of EOG
Common Stock in the Public Offering is to be satisfied by the sale by Enron of
Retained Shares. If both of the over-allotment options referred to above are
fully exercised by the respective underwriters, a total of 15,550,000 Retained
Shares will be involved (either directly or underlying Convertible Securities)
in the Public Offering, which is more than the 10,000,000 Retained Shares
contemplated by Section 6.2(b) of the Share Exchange Agreement and which would
involve the direct sale of Retained Shares (as opposed to the sale of only
Convertible Securities contemplated by Section 6.2(b)). In this connection, EOG
hereby consents to the sale of shares of EOG Common Stock pursuant to the
aforementioned underwriters over-allotment options in the manner described above
and waives the provisions of the first sentence of Section 6.2(b) of the Share
Exchange Agreement solely to the extent necessary to permit such sales, provided
that the Public Offering meets the provisions of Section 6.2 of the Share
Exchange Agreement other than such first sentence of Section 6.2(b). This letter
agreement shall constitute an amendment to the Share Exchange Agreement if and
to the extent necessary under the terms of the Share Exchange Agreement.
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If the foregoing correctly reflects our understanding, please execute
this letter agreement in the space provided below.
Very truly yours,
ENRON OIL & GAS COMPANY
By: /s/ Walter C. Wilson
--------------------------------
Walter C. Wilson
Senior Vice President and
Chief Financial Officer
Agreed and accepted:
ENRON CORP.
By: /s/ Timothy J. Detmering
--------------------------------
Timothy J. Detmering
Vice President Corporate
Development
<PAGE> 1
EXHIBIT F
August 10, 1999
Enron Corp.
1400 Smith Street
Houston, Texas 77002
Dear Sirs:
Reference is made to the Share Exchange Agreement, dated July 19, 1999,
between Enron Corp. and Enron Oil & Gas Company (as amended by that certain
letter agreement (the "Letter Agreement") dated July 30, 1999, between Enron
Corp. and Enron Oil & Gas Company, the "Share Exchange Agreement"). Capitalized
terms used, but not defined in this letter agreement, have the respective
meanings given them in the Share Exchange Agreement.
Pursuant to the Share Exchange Agreement, and subject to the terms and
conditions set forth in the Letter Agreement, EOG consented to the sale by Enron
of (i) Convertible Securities that Enron is proposing to issue pursuant to
Section 6.2(b) of the Share Exchange Agreement in the Public Offering that will
be mandatorily convertible into up to 10,000,000 Retained Shares, or, if the
underwriters exercise their over-allotment option, up to 11,500,000 Retained
Shares and (ii) up to 4,050,000 Retained Shares upon exercise of the
underwriters' over-allotment option relating to the sale by EOG of shares of EOG
Common Stock in the Public Offering.
In addition to the foregoing, EOG and Enron now understand from the
underwriters in the Public Offering that there is sufficient demand from
potential investors that up to an additional 4,000,000 Retained Shares may be
sold directly by Enron in the Public Offering (or up to an additional 4,450,000
Retained Shares if the underwriters' overallotment option is fully exercised).
Accordingly, if both of the over-allotment options referred to above
are fully exercised by the respective underwriters, a total of 20,000,000
Retained Shares will be sold to the public (either directly or underlying
Convertible Securities) in the Public Offering, which is more than the
15,550,000 Retained Shares to which EOG has previously consented pursuant to the
Letter Agreement (subject to the terms and conditions of the Letter Agreement).
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Enron Corp.
August 10, 1999
Page 2
In this connection, EOG hereby consents to the sale by Enron of
4,000,000 shares of EOG Common Stock directly in connection with the Public
Offering, the sale by Enron of Convertible Securities that will be mandatorily
convertible into up to 10,000,000 shares of Retained Shares and the sale by
Enron of up to 6,000,000 additional shares pursuant to the aforementioned
underwriters' over-allotment options in the Public Offering in the manner
described above and waives the provisions of the first sentence of Section
6.2(b) of the Share Exchange Agreement solely to the extent necessary to permit
such sales, provided that the Public Offering meets the provisions of Section
6.2 of the Share Exchange Agreement other than such first sentence of Section
6.2(b) to the extent waived hereunder and in the Letter Agreement. This letter
agreement shall constitute an amendment to the Share Exchange Agreement if and
to the extent necessary under the terms of the Share Exchange Agreement.
If the foregoing correctly reflects our understanding, please execute
this letter agreement in the space provided below.
Very truly yours,
ENRON OIL & GAS COMPANY
By: /s/ Walter C. Wilson
--------------------------------
Walter C. Wilson
Senior Vice President and
Chief Financial Officer
Agreed and accepted:
ENRON CORP.
By: /s/ Timothy J. Detmering
--------------------------------
Name: Timothy J. Detmering
---------------------------
Title: Vice President, Corporate
Development
--------------------------
