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As filed with the Securities and Exchange Commission on January 24, 2000
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________________
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
______________________________________
WESTERN GAS RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Delaware 84-1127613
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
12200 North Pecos Street
Denver, Colorado 80234-3439
(303) 452-5603
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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Non-Employee Directors' Stock Option Plan
(Full title of plan)
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John C. Walter, Esq.
General Counsel
Western Gas Resources, Inc.
12200 North Pecos Street
Denver, Colorado 80234-3439
(303) 452-5603
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED REGISTERED (1) OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION FEE
SHARE (2) PRICE
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Common Stock, par
value $.10 per share 15,000 shares $ 12.1875 $ 182,812.50 $ 48.26
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</TABLE>
(1) This Registration Statement, pursuant to Rule 416, covers any
additional shares of $.10 per value common stock (the "Common Stock") which
becomes issuable under the Non-Employee Directors" Stock Option Plan
("Plan") set forth herein by reason of any stock dividend, stock split,
recapitalization or any other similar transaction without receipt of
consideration which results in an increase in the number of shares of
Common Stock outstanding.
(2) The proposed maximum offering price per share was estimated solely
for the purpose of calculating the registration fee in accordance
with Rule 457(h) and is based on the average of the high and low
prices for the Common Stock on The New York Stock Exchange on
January 19, 2000 of $12.1875 per share.
<PAGE>
EXPLANATORY NOTE
Western Gas Resources, Inc. ("Western") has prepared this Registration
Statement in accordance with the requirements of Form S-8 under the Securities
Act of 1933, as amended (the "1933 Act"), to register shares of its common
stock, $0.10 par value per share. Under cover of this Form S-8 is a Reoffer
Prospectus that Western prepared in accordance with Part I of Form S-3 under the
1933 Act. The Reoffer Prospectus may be utilized for reofferings and resales of
up to 15,000 shares of common stock acquired by prospective selling stockholders
under the Western Gas Resources, Inc. Non-Employee Directors' Stock Option Plan
(the "Plan"). It does not contain all the information set forth in the
Registration Statement, certain items of which are contained in schedules and
exhibits to the Registration Statement as permitted by the rules and regulations
of the Securities and Exchange Commission (the "Commission"). Statements
contained in this Reoffer Prospectus as to the contents of any agreement,
instrument or other document referred to are not necessarily complete. With
respect to each such agreement, instrument or other document filed as an exhibit
to the Registration Statement, reference is made to the exhibit for a more
complete description of the matter involved, and each such statement shall be
deemed qualified in its entirety by such reference.
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PART I
WESTERN GAS RESOURCES, INC.
FORM S-8 CROSS REFERENCE SHEET SHOWING LOCATION OF INFORMATION
REQUIRED BY PART I OF FORM S-3
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Form S-3 Item Number Location/Heading in Prospectus
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<S> <C>
1. Forepart of Registration Statement and Outside Cover page
Front Cover page of Prospectus
2. Inside Front and Outside Back Cover Page of Table of Contents
Prospectus
3. Summary Information, Risk Factors and Ratio of The Company; Risk Factors
Earnings to Fixed Charges
4. Use of Proceeds Use of Proceeds
5. Determination of Offering Price Not applicable
6. Dilution Not applicable
7. Selling Security Holders Selling Securityholders
8. Plan of Distribution Plan of Distribution
9. Description of Securities to be Registered Not applicable
10. Interests of Named Experts and Counsel Legal Matters
11. Material Changes Not Applicable
12. Incorporation of Certain Information Documents Incorporated by Reference
13. Disclosure of Commission Position on Indemnification
Indemnification for Securities Act Liabilities
</TABLE>
<PAGE>
15,000 Shares of
Common Stock
Western Gas Resources, Inc.
Non-Employee Directors' Stock Option Plan
This Reoffer Prospectus relates to 15,000 shares of the Common Stock, par
value $0.10 (the "Common Stock"), of Western, which may be offered from time to
time by certain key employees named herein and certain employees who are not
named herein (the "Selling Securityholders"). It is anticipated that the Selling
Securityholders will offer shares for sale at prevailing prices on the New York
Stock Exchange on the date of sale. The Company will receive no part of the
proceeds of sale made hereunder. All expenses of registration incurred in
connection with this offering are being borne by the Company, but all selling
and other expenses incurred by each of the Selling Securityholders will be borne
by each such Selling Securityholder.
The Common Stock is traded on the New York Stock Exchange under the symbol
"WGR". The Selling Securityholders and any broker executing selling orders on
behalf of the Selling Securityholders may be deemed to be "underwriters" within
the meaning of the 1933 Act, in which event commissions received by such broker
may be deemed to be underwriting commissions under the 1933 Act.
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED
ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT.
SEE "RISK FACTORS" BEGINNING ON PAGE 3.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION 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.
No person is authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by Western or
any Selling Securityholder. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, nor shall there be any sale of these
securities by any person in any jurisdiction in which it is unlawful for such
person to make such offer, solicitation or sale. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstances create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.
The date of this Prospectus is January 24, 2000.
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<TABLE>
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THE COMPANY........................................................ 1
RISK FACTORS....................................................... 1
USE OF PROCEEDS.................................................... 3
SELLING SECURITYHOLDERS............................................ 3
PLAN OF DISTRIBUTION............................................... 4
LEGAL MATTERS...................................................... 4
DOCUMENTS INCORPORATED BY REFERENCE................................ 5
INDEMNIFICATION.................................................... 5
EXPERTS............................................................ 5
</TABLE>
<PAGE>
THE COMPANY
Western Gas Resources, Inc. is an independent gas gatherer and processor
and an energy marketer providing a full range of services to its customers from
the wellhead to the delivery point. We design, construct, own and operate
natural gas gathering, processing, treating and storage facilities in major gas-
producing basins in the Rocky Mountain, Mid-Continent, Gulf Coast and
Southwestern regions of the United States. We connect producers' wells to our
gathering systems for delivery to our processing or treating plants, process the
natural gas to extract natural gas liquids ("NGLs") and treat the natural gas in
order to meet pipeline specifications. We are a nationwide marketer of natural
gas, NGLs and wholesale electric power, providing a full range of services
including risk management, storage, transportation, scheduling and peaking
services to a variety of customers. We were incorporated in Delaware in 1989.
Our principal offices are located at 12200 North Pecos Street, Denver, Colorado
80234-3439, and our telephone number is (303) 452-5603.
RISK FACTORS
Prospective investors should carefully review the following factors
together with the other information contained in this Prospectus and any
accompanying Prospectus Supplement prior to making an investment decision.
Risks Related to Our Business
Our future finanical condition and results of operations are affected by
volatile product prices and hedging transactions.
Our future financial condition and results of operations will depend
significantly upon the prices received for our natural gas and NGLs. Prices for
natural gas and NGLs are subject to fluctuations in response to changes in
supply, market uncertainty and a variety of additional factors that are beyond
our control. These factors include the level of domestic production, the
availability of imported oil and gas, actions taken by foreign oil and gas
producing nations, the availability of transportation systems with adequate
capacity, the availability of competitive fuels, fluctuating and seasonal demand
for oil, gas and NGLs, conservation and the extent of governmental regulation of
production and the overall economic environment. A substantial or extended
decline in gas and/or NGL prices would have a material adverse effect on our
financial position, results of operations and access to capital.
Our risk management policy is to enter into futures, swaps and option
contracts primarily to reduce risk and lock-in profit margins on our marketing
and storage activities. Over-the-counter derivatives, with creditworthy
counterparties, also permit us to offer our gas customers alternate pricing and
delivery mechanisms meeting their specific needs. To ensure a known price for
future equity production and a fixed margin between gas injected into storage
and gas withdrawn from storage, we typically will sell a futures contract and
related basis swap and thereafter, either (i) make physical delivery of our
product to comply with such futures contract and settle our basis swap or (ii)
buy matching futures and basis position contracts to unwind our position and
sell our production to a customer in the cash market. We also may contract to
sell future production to a customer at a fixed price and then purchase futures
contracts to lock-in a margin. These same techniques also may be utilized to
manage price risk for product purchased from marketing customers. Such contracts
may expose us to the risk of financial loss in certain circumstances, including
instances where production is less than expected, our customers fail to purchase
or deliver the contracted quantities of natural gas or NGLs or credit risk with
derivatives counterparties. Furthermore, to the extent that we engage in hedging
activities, we may be prevented from realizing the benefits of price increases
above the levels of such hedges.
The uncertainties of gas supply may affect our ability to replace
dedicated reserves.
We must continually connect new wells to our gathering systems in order
to maintain or increase throughput levels to offset natural declines in
dedicated volumes. Historically, while certain individual plants have
experienced declines in dedicated reserves, we have been successful in
connecting additional reserves to more than offset the natural declines and
reserves dedicated to existing facilities. There is no assurance that we will
continue to be successful in replacing the dedicated reserves processed at our
facilities.
Our estimates of oil and gas reserves are subject to numerous
uncertainties.
Our reserve estimates are subject to numerous uncertainties inherent in
the estimation of quantities of proved reserves and in the projection of future
rates of production and the timing of development expenditures. The accuracy
<PAGE>
of such estimates is a function of the quality of available data and of
engineering and geological interpretation and judgement. Reserve estimates are
imprecise and should be expected to change as additional information becomes
available. Results of subsequent drilling, testing and production may cause
either upward or downward revisions of previous estimates. In addition, the
estimates of future net revenues from our proved reserves and the present value
thereof are based upon certain assumptions about production levels, prices and
costs, which may not be correct. Further, the volumes considered to be
commercially recoverable fluctuate with changes in prices and operating costs.
The meaningfulness of such estimates is highly dependent upon the accuracy of
the assumptions upon which they were based. Actual results may differ materially
from the results estimated. Our estimates of reserves dedicated to our gathering
and processing facilities are calculated by our reservoir engineering staff and
are based on publicly available data. These estimates may be less reliable than
the reserve estimates made for our own producing properties since the data
available for estimates of our own producing properties also includes our
proprietary data.
Our ability to pay fixed charges and common stock dividends depends on
many factors.
Our financial and operational performance depends in part on prevailing
economic conditions and on various financial, business and other factors beyond
our control. We cannot assure you that our cash flows and capital resources will
be sufficient to pay our fixed charges, including interest expense and common
stock dividends.
Opportunities for expansion and availability of related financing are
uncertain.
In order for us to expand our business through either the purchase or
construction of new gathering and processing facilities, we will be required to
identify expansion opportunities and to finance such activities, using cash
flow, equity or debt financing or a combination thereof. No assurance can be
given that appropriate opportunities for expansion at levels of profitability
which satisfy our target rates can be obtained or that financing on terms
acceptable to us can be obtained. Natural gas and NGL price volatility make it
difficult to estimate the value of acquisitions and to budget and forecast the
return on our projects. In addition, unusually volatile prices often disrupt the
market for gas and NGL properties, as buyers and sellers have more difficulty
agreeing on the purchase price of properties.
The natural gas gathering, processing, treating and marketing businesses
are highly competitive and there can be no assurance that we can compete
successfully with other companies in the industry.
We compete with other companies in the gathering, processing, treating
and marketing business both for supplies of natural gas and for customers for
our natural gas and NGLs. Competition for natural gas supplies is primarily
based on efficiency, reliability, availability of transportation and ability to
obtain a satisfactory price for the producers' natural gas. Competition for
sales customers is primarily based upon reliability and price of deliverable
natural gas and NGLs. Our competitors for obtaining additional gas supplies, for
gathering and processing gas and for marketing gas and NGLs include national and
local gas gatherers, brokers, marketers and distributors of various size,
financial resources and experience. For marketing customers that have the
capability of using alternative fuels, such as oil and coal, we also compete
based primarily on price against companies capable of providing such alternative
fuels. We have experienced narrowing margins related to third- party sales due
to the increasing availability of pricing information in the natural gas
industry. Counterparties in our gas marketing transactions may require
additional security such as letters of credit that are not required of certain
of our competitors. If the additional security is required, our marketing
margins and volumes may be adversely impacted.
The construction and operation of our gathering lines, plants and other
facilities are subject to environmental laws and regulations that could affect
our financial position or results of operations.
The construction and operation of our gathering lines, plants and other
facilities used for the gathering, transporting, processing, treating or storing
of natural gas and NGLs are subject to federal, state and local environmental
laws and regulations, including those that can impose obligations to clean-up
hazardous substances at our facilities or at facilities to which the we send
wastes for disposal. In most instances, the applicable regulatory requirements
relate to water and air pollution control or waste management. We believe that
we are in substantial compliance with applicable material environmental laws and
regulations. Environmental regulation can increase the cost of planning,
designing, constructing and operating our facilities or well sites.
Under the Clean Air Act, as amended, individual states are required to
adopt regulations to implement the operating permit program. We do not believe
that compliance with the Clean Air Act will require any material capital
expenditures, although it will cause increased permitting costs in future years
and will increase certain operating costs, such as emissions fees, on an
on-going basis. We do not believe that such cost increases will have a material
<PAGE>
effect on our financial position or results of operations.
We believe that it is reasonably likely that the trend in environmental
legislation and regulation will continue to be towards stricter standards. We
are unaware of future environmental standards that are reasonably likely to be
adopted that will have a material effect on our financial position or results of
operations, but cannot rule out that possibility.
Our business is subject to numerous other operational risks.
Numerous risks affect drilling activities, including the risk of drilling
non-productive wells or dry holes. The cost of drilling, completing and
operating wells and of installing production facilities and pipelines is often
uncertain. Also, our drilling operations could diminish or cease because of any
of the following:
. title problems;
. weather conditions;
. noncompliance with or changes in governmental requirements or
regulations;
. shortage or delays in the delivery or availability of equipment; and
. failure to obtain permits from regulatory agencies, such as those
issued by the Bureau of Land Management, for our operations in a timely
manner.
Regulations may have a significant impact upon our overall operations.
Many aspects of our gathering, processing, marketing and transportation
of natural gas and NGLs are subject to federal, state and local laws and
regulations which can have a significant impact upon our overall operations. As
a processor and marketer of natural gas and NGLs, we depend on the
transportation and storage services offered by various interstate and intrastate
pipeline companies for the delivery and sale of our own gas supplies as well as
those we process and/or market for others. Both the performance of
transportation and storage services by interstate pipelines and the rates
charged for such services are subject to the jurisdiction of the Federal Energy
Regulatory Commission or state regulatory agencies. An inability to obtain
transportation and/or storage services at competitive rates can hinder our
processing and marketing operations and/or affect our sales margins.
Insurance and operational risks may result in curtailment or suspension
of operations.
We are subject to various hazards which are inherent in the industry in
which we operate such as explosions, product spills, leaks and fires, each of
which could cause personal injury and loss of life, severe damage to and
destruction of property and equipment, and pollution or other environmental
damage, and may result in curtailment or suspension of operations at the
affected facility. We maintain physical damage, comprehensive general liability,
workers' compensation and business interruption insurance. Such insurance is
subject to deductibles that we consider reasonable. We are not fully insured
against all risks in our business, however, we believe that the coverage we
maintain is adequate and consistent with other companies in the industry.
Consistent with insurance coverage typically available to the natural gas
industry, our insurance policies do not provide coverage for losses or
liabilities relating to pollution, except for sudden and accidental occurrences.
USE OF PROCEEDS
We will not receive any of the proceeds from the offering hereunder. All
expenses of registration incurred in connection with this offering are being
borne by us, but all selling and other expenses incurred by the individual
Selling Securityholders will be borne by such Selling Securityholders.
SELLING SECURITYHOLDERS
This Prospectus covers possible sales by our officers, directors and
affiliates of shares they acquire through exercise of stock options granted
under the Plan. The names of such individuals who may be selling stockholders
from time to time are listed below, along with the number of shares of common
stock currently owned by them and the number of shares offered for sale.
Non-affiliates which are not named in this Prospectus holding the lesser of
<PAGE>
1,000 shares or one percent of the shares issuable under the Plan may use this
Prospectus to sell up to the lesser of 1000 shares or one percent of the shares
issuable under the Plan. The number of shares offered for sale may be updated in
supplements to this prospectus, which will be filed with the Securities and
Exchange Commission in accordance with Rule 424(b) under the Securities Act of
1933, as amended. The address of each individual is in our care at 12200 North
Pecos Street, Denver, Colorado 80234-3439.
Number of
Name of Selling Shareholdings Shares Offered
Stockholder Number(1) Percent(1) For Sale
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(1) Includes all stock options exercisable within 60 days from the date
hereof, including stock options issued under the Plan.
PLAN OF DISTRIBUTION
The shares of Common Stock covered by this Reoffer Prospectus are being
registered by us for the account of the Selling Securityholders.
The Selling Securityholder(s) may sell the shares in one or more
transactions (which may involve one or more block transactions) on the New York
Stock Exchange in sales occurring in the public market off such system, in
privately negotiated transactions or in a combination of such transactions. Each
such sale may be made either at market prices prevailing at the time of such
sale or at negotiated prices. The Selling Securityholder(s) may sell some or all
of the shares in transactions involving broker-dealers, who may act as agent or
acquire the shares as principal. Any broker-dealer participating in such
transactions as agent may receive commissions from the Selling Securityholder(s)
(and, if they act as agent for the purchaser of such shares, from such
purchaser). The Registered Stockholder(s) will pay usual and customary brokerage
fees. Broker-dealers may agree with the Registered Stockholder(s) to sell a
specified number of shares at a stipulated price per share and, to the extent
such a broker-dealer is unable to do so acting as agent for the Selling
Securityholder(s), to purchase as principals any unsold shares at the price
required to fulfill the respective broker-dealer's commitment to the Selling
Securityholder(s). Broker-dealers who acquire shares as principals may
thereafter resell such shares from time to time in transactions (which may
involve cross and block transactions and which may involve sales to and through
other broker-dealers, including transactions of the nature described above) in
the over-the-counter market, negotiated transactions or otherwise, at market
prices prevailing at the time of sale or at negotiated prices, and in connection
with such resales may pay to or receive from the purchasers of such shares
commissions.
To our knowledge, there is currently no agreement with any broker or
dealer respecting the sale of the shares offered hereby. Upon the sale of any
such shares, the Selling Securityholder(s) or anyone effecting sales on behalf
of the Selling Securityholder(s) may be deemed an underwriter, as that term is
defined under the 1933 Act. We will pay all expenses of preparing and
reproducing this Reoffer Prospectus, but will not receive the proceeds from
sales by the Selling Securityholders. Sales will be made at prices prevailing at
the time of such sales.
We are bearing all costs relating to the registration of the shares.
Any commissions or other fees payable to broker-dealers in connection with any
sale of the shares will be borne by the Registered Stockholder(s) or other party
selling such shares. In order to comply with certain states' securities laws, if
applicable, the shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In certain states the shares may not
be sold unless the shares have been registered or qualified for sale in such
state, or unless an exemption form registration or qualification is available
and is obtained.
LEGAL MATTERS
John C. Walter, who is giving an opinion regarding the legality of the
securities registered hereby, is Executive Vice President-General Counsel and
Secretary of Western. In addition, Mr. Walter will be eligible to be granted
options to purchase the securities registered hereby. As of January 24, 2000,
Mr. Walter owned 29,625 shares of Common Stock and options to purchase 68,000
shares of Common Stock.
<PAGE>
INDEPENDENT ACCOUNTS
The financial statements incorporated in this Prospectus by reference to
the Annual Report on Form 10-K of the Company for the year ended December 31,
1998, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents are incorporated by reference in the registration
statement:
(a) The latest annual report of Western on Form 10-K filed pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange
Act").
(b) All other reports filed by Western pursuant to Sections 13(a) or
15(d) of the Exchange Act since the end of the fiscal year covered by the annual
report referred to in (a) above.
(c) The description of Western's Common Stock which is contained in
Western's registration statement filed under section 12 of the Exchange Act,
including any amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by Western pursuant to Section 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment hereto which indicates that all securities offered hereby have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents.
We will provide without charge to each person to whom a copy of this
Prospectus has been delivered, upon the written or oral request of such person,
a copy of any or all of the documents referred to above which have been or may
be incorporated by reference herein (other than exhibits to such documents
unless such exhibits are specifically incorporated by reference in such
documents). Requests for such copies should be directed to John C. Walter,
Executive Vice President, Western Gas Resources, Inc., 12200 North Pecos Street,
Denver, Colorado 80234-3439 (telephone (303) 452-5603).
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Exchange Act, and in accordance therewith files reports, proxy and information
statements and other information with the Commission. Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of
the Commission: Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, IL 60661 and 7 World Trade Center, 13th Floor, New York, NY 10048 and
through the Commission's Internet site at www.sec.gov. Copies of such material
can also be obtained from the Public Reference Section of the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. In addition, such material can be inspected at the offices of the New
York Stock Exchange, 20 Broad Street, New York, New York 10005.
INDEMNIFICATION
Our Bylaws incorporate substantially the provisions of the General
Corporation Law of the State of Delaware providing for indemnification of our
directors, officers, employees, and agents against expense, judgments, fines,
settlements and other amounts actually and reasonably incurred in connection
with any proceeding arising by reason of the fact that such person is or was an
officer, director, employee, agent or controlling stockholder of Western. In
addition, we are authorized to enter into indemnification agreements with its
directors and officers providing mandatory indemnification to them to the
maximum extent permissible under Delaware law.
As permitted under Delaware law, our Certificate of Incorporation
provides for the elimination of the personal liability of a director to the
corporation and its stockholders for monetary damages arising from a breach of
the directors' fiduciary duty of care. The provision is limited to monetary
damages, applies only to a director's actions while acting within his capacity
as a director, and does not entitle Western to limit director liability for any
judgment resulting from (a) any breach of the director's duty of loyalty to
Western or its stockholders; (b) acts or omissions
<PAGE>
not in good faith or which involve intentional misconduct or a knowing violation
of the law; (c) paying an illegal dividend or approving an illegal stock
repurchase; or (d) any transaction from which the director derived an improper
benefit. In addition, Section 145 of the General Corporation Law of the State of
Delaware provides generally that a person sued as a director, officer, employee
or agent of a corporation may be indemnified by the corporation for reasonable
expenses, including counsel fees, if in the case of other than derivative suits,
he has 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 in the case of a
criminal proceeding, had no reasonable cause to believe that his conduct was
unlawful). In the case of a derivative suit, an officer, employee or agent of
the corporation who is not protected by the Certificate of Incorporation, may be
indemnified by the corporation for reasonable expenses, including attorneys'
fees, if he has acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the corporation, except that no
indemnification shall be made in the case of a derivative suit in respect of any
claim as to which an officer, employee or agent has been adjudged to be liable
to the corporation unless the Delaware Court of Chancery or the court in which
such action or suit was brought shall determine that such person is fairly and
reasonably entitled to indemnity for proper expenses. Indemnification is
mandatory in the case of a director, officer, employee, agent or controlling
stockholder who is successful on the merits in defense of a suit against him.
Insofar as indemnification for liabilities arising under the 1933 Act may
be permitted to directors, officers and controlling persons of Western pursuant
to the foregoing provisions, or otherwise, Western 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 Western of expenses incurred or paid by a director, officer
or controlling person of Western in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, Western 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.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
The following documents are incorporated by reference in the
registration statement:
(a) The latest annual report of Western Gas Resources, Inc. (the
"Registrant") on Form 10-K filed pursuant to sections 13(a) or 15(d) of the
Securities Exchange Act of 1934 (the "Exchange Act").
(b) All other reports filed by the Registrant pursuant to sections 13(a)
or 15(d) of the Exchange Act since the end of the fiscal year covered by the
annual report referred to in (a) above.
(c) The description of the Registrant's Common Stock which is contained
in the Registrant's registration statement filed under section 12 of the
Exchange Act, including any amendment or report filed for the purpose of
updating such description.
All documents subsequently filed by the Registrant pursuant to Section
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment hereto which indicates that all securities offered
hereby have been sold or which deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference herein and to be a part hereof
from the date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interest of Named Experts and Counsel.
John C. Walter, who is giving an opinion regarding the legality of the
securities registered hereby, is Executive Vice President-General Counsel and
Secretary of the Registrant. As of January 24, 2000 Mr. Walter owned 29,625
<PAGE>
shares of Common Stock and options to purchase 68,000 shares of Common Stock,
none of which were granted under this Plan.
Item 6. Indemnification of Directors and Officers.
The Registrant's Bylaws incorporate substantially the provisions of the
General Corporation Law of the State of Delaware providing for indemnification
of directors, officers, employees, and agents of the Registrant against expense,
judgments, fines, settlements and other amounts actually and reasonably incurred
in connection with any proceeding arising by reason of the fact that such person
is or was an officer, director, employee, agent or controlling stockholder of
the Registrant. In addition, the Registrant is authorized to enter into
indemnification agreements with its directors and officers providing mandatory
indemnification to them to the maximum extent permissible under Delaware law.
As permitted under Delaware law, the Registrant's Certificate of
Incorporation provides for the elimination of the personal liability of a
director to the corporation and its stockholders for monetary damages arising
from a breach of the directors's fiduciary duty of care. The provision is
limited to monetary damages, applies only to a director's actions while acting
within his capacity as a director, and does not entitle the Registrant to limit
director liability for any judgment resulting from (a) any breach of the
director's duty of loyalty to the Registrant or its stockholders; (b) acts or
omission not in good faith or which involve intentional misconduct or a knowing
violation of the law; (c) paying an illegal dividend or approving an illegal
stock repurchase; or (d) any transaction from which the director derived an
improper benefit. In addition, Section 145 of the General Corporation Law of the
State of Delaware provides generally that a person sued as a director, officer,
employee or agent of the corporation may be indemnified by the corporation for
reasonable expenses, including counsel fees, if in the case of other than
derivative suits, he has 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
in the case of criminal proceeding, had no reasonable cause to believe that his
conduct was unlawful). In the case of a derivative suit, an officer, employee or
agent of the corporation who is not protected by the Certificate of
Incorporation, may be indemnified by the corporation for reasonable expenses,
including attorneys' fees, if he has acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interest of the
corporation, except that no indemnification shall be made in the case of a
derivative suit in respect of any claim as to which an officer, employee or
agent has been adjudged to liable to the corporation unless the Delaware Court
of Chancery of the court in which such action or suit was brought shall
determine that such person is fairly and reasonably entitled to indemnity for
proper expenses. Indemnification is mandatory in the case of a director,
officer, employee, agent or controlling stockholder who is successful on the
merits in defense of a suit against him.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibits Description
-------- -----------
4.1 The Certificate of Incorporation of Western Gas Resources, Inc.
(filed as exhibit 3.1 to Western Gas Resources, Inc.'s
Registration Statement on Form S-1, Registration No. 33-31604,
and incorporated herein by reference).
4.2 Certificate of Amendment to the Certificate of Incorporation of
Western Gas Resources, Inc (Filed as exhibit 3.2 to Western Gas
Resources, Inc.'s Registration Statement on Form S-1,
Registration No. 33-31604, ns incorporated herein by reference).
4.3 Certificate of Designation of 7.25% Cumulative Senior Perpetual
Convertible Preferred Stock of the Company (filed as exhibit 3.5
to Western Gas Resources, Inc.'s Registration Statement on
Form S-1, Registration No. 33-43077, and incorporated herein by
reference).
4.4 Certificate of Designation of $2.28 Cumulative Preferred Stock of
the Company (filed as exhibit 3.6 to Western Gas Resources, Inc's
Registration Statement of Form S-1, Registration No. 33-53786,
and incorporated herein by reference).
4.5 Certificate of Designation of the $2.625 Cumulative Convertible
Preferred Stock of the Company (filed
<PAGE>
under cover of Form 8-K dated February 24, 1994 and incorporated
herein by reference).
4.6 The Amended and Restated Bylaws of the Registrant, adopted on
February 12, 1999, and in effect on the date hereof (filed with
the SEC as an Exhibit to the Registrant's 10-K for the year ended
December 31, 1998 and incorporated by reference.
4.7 Non-Employee Directors'Stock Option Plan
5.1 Opinion of John C. Walter, General Counsel of the Registrant, as
to the legality of the securities offered hereby.
23.1 Consent of John C. Walter, General Counsel of the Registrant
(included in Exhibit 5.1)
23.2 Consent of PriceWaterhouseCoopers, LLP, Independent Accountants
24.1 Power of Attorney (included in signature page)
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to the 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;
(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 paragraph (a)(1)(i) and (a) (1) (ii) shall 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 section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
the registration statement.
(2) 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.
(3) 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.
(b) 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 section 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 herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) 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 in Item 6, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemification 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 of
proceeding) is asseted by such director, officer or controlling person in
connection with the securities being
<PAGE>
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 witl be governed by the final adjudication of
such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Regisrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registtation
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Denver, State of Colorado, on January 24, 2000.
WESTERN GAS RESOURCES, INC.
By: /s/ Lanny F. Outlaw
______________________________________________
Lanny F. Outlaw, Chief Executive Officer
<PAGE>
KNOWN ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below, constitutes and appoints and hereby authorizes Lanny F. Outlaw,
John C. Walter, William J. Krysiak, severally, such person's true and lawful
attorneys-in-fact, with full power of substitution and resubstitution, for such
person's name, place and stead, in any and all capacities, in connection with
the Registrant's registration statement, in the name and on behalf of the
Registrant or on behalf of the undersigned as a director or officer of the
Registrant, on Form S-8 under the Securities Act of 1933, as amended, including,
without limiting the generality of the foregoing, to sign the registration
statement and any and all amendments (including post-effective amendments) to
the registration statement, and any subsequent registration statement filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact full power and authority to do and perform each and every act
and thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as such person might or could do in person, thereby
ratifying and confirming all that said attorneys-in-fact or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
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 date indicated.
<TABLE>
Signature Title Date
<S> <C> <C>
/s/ Lanny F. Outlaw
_____________________________ Chief Executive Officer, President and
Lanny F. Outlaw Director January 24, 2000
/s/ Brion G. Wise
_____________________________ Chairman of the Board and Director January 24, 2000
Brion G. Wise
/s/ Walter L. Stonehocker
_____________________________ Vice Chairman of the Board and
Walter L. Stonehocker Director January 24, 2000
/s/ Bill M. Sanderson
_____________________________ Director January 24, 2000
Bill M. Sanderson
/s/ Richard B. Robinson
_____________________________ Director January 24, 2000
Richard B. Robinson
/s/ Dean Phillips
_____________________________ Director January 24, 2000
Dean Phillips
/s/ Ward Sauvage
_____________________________ Director January 24, 2000
Ward Sauvage
/s/ James Senty
_____________________________ Director January 24, 2000
James Senty
/s/ Joseph E. Reid
_____________________________ Director January 24, 2000
Joseph E. Reid
</TABLE>
By: /s/ William J. Krysiak
_________________________________________________
William J. Krysiak
Attorney-in-fact pursuant to a power of attorney
<PAGE>
March 12, 1999
EXHIBIT 4.7
THIS DOCUMENT CONSTITUTES PART OF A
PROSPECTUS COVERING SECURITIES THAT HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
SUMMARY PLAN DESCRIPTION
(a) General Plan Information
------------------------
1. The name of the plan is the Western Gas Resources, Inc. Non-Employee
Directors' Stock Option Plan (the "Plan"), as amended. The name of the
registrant of the Plan is Western Gas Resources, Inc., a Delaware corporation
(the "Corporation").
2. The purpose of the Plan is to enable certain of the Corporation's
non-employee directors to participate in the growth and profitability of the
Corporation by providing a method whereby non-employee directors may be
encouraged to invest in Common Stock of the Corporation on reasonable terms to
increase incentives to contribute to the Corporation's future success and
prosperity and to allow them to acquire a proprietary interest in the
Corporation. Further, the availability and offering of stock options under the
Plan supports and encourages non-employee directors to remain as directors of
the Corporation.
The Plan terminates on the earlier of: (i) March 12, 2009; (ii) the date on
which all options granted under the Plan have expired; or (iii) the date on
which all options granted under the Plan have been exercised in full. In
addition, the Plan and Options granted thereunder will terminate upon the
dissolution and liquidation of the Corporation, unless otherwise provided for in
such transaction.
The Board of Directors of the Corporation, as administrators of the Plan,
has the right to cancel at any time any non-vested unexercised Options awarded
under the Plan if an Optionee engages in conduct which the Board determines to
be detrimental to the best interests of the Corporation. In addition, the Board
of Directors may, at any time and from time to time, amend, suspend or terminate
the Plan and may amend the form of the Option Agreement; provided, however, that
------------------
any such amendment, suspension, termination or modification shall not: (i)
without the consent of an Optionee, affect the Optionee's rights under an Option
previously granted to him; (ii) change the maximum number of shares for which
Options may be granted; (iii) change the Option prices; (iv) change the period
during which Options may be granted or exercised; (v) change the provisions
relating to the class of person eligible to receive Options granted under the
Plan; or (vi) change the provisions relating to adjustments to be made upon
changes in the capitalization of the Corporation.
3. The Plan is not subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
4. The Plan is administered by the Board of Directors of the Corporation,
who are divided into three separate classes. Each class serves a three-year
term, with one class being elected each year by the shareholders of the
Corporation. Members of the Corporation's Board of Directors are elected,
<PAGE>
and may be removed, in any manner consistent with the Corporation's Articles of
Incorporation, as amended, its by-laws, as amended, and the Delaware General
Corporation Laws.
The Board of Directors has the right to, among other things, fix the price,
terms and conditions for the grant or exercise of any option. The purchase price
of the stock under each Option is determined by the Board, but in no event shall
it be less than one hundred percent of the fair market value of the stock at the
time such Option is granted. "Fair market value" means: (i) when the stock is
listed on any stock exchange, the average between the high and low quoted sales
price for the immediately preceding one-month period prior to the determination
of the fair market value; (ii) when the stock is not so listed, the average
between the daily bid and ask price on any over-the-counter market over the
immediately preceding one month period prior to the determination of the fair
market value; or (iii) when the stock is not so listed or traded, the fair
market value shall be determined by the Board in good faith. The stock is, as of
the date hereof, traded on the New York Stock Exchange.
(b) Securities to be Offered
------------------------
1. The title of the securities being offered is the Corporation's Common
Stock, par value $0.10 per share. Pursuant to the Plan, options to purchase a
total of 15,000 shares of Common Stock may be issued. If any option granted
under the Plan shall terminate or expire, in whole or in part, the shares so
released may be the subject of additional options granted under the Plan. The
Corporation is obligated to reserve and keep available such number of shares of
stock necessary to satisfy the requirements of all outstanding options and
grants under the Plan.
2. The Common Stock is registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended.
(c) Non-Employee Directors Who May Participate
------------------------------------------
Non-employee directors of the Corporation shall be eligible for selection to
participate in the Plan by the Board from time to time. Directors of the
Corporation who are employees or officers of the Corporation are not eligible to
participate in the Plan. In addition, Brion Wise, Bill Sanderson, Walter
Stonehocker, Dean Phillips and Ward Sauvage are not eligible at any time to
participate in or receive any options granted pursuant to the Plan. No Director
who is eligible to participate in the Plan, or in any other similar plan of the
Corporation, shall have the right to participate in the discussion of or to vote
or decide upon any matter relating to the Plan.
(d) Purchase and Payment for Securities
-----------------------------------
1. and 2. The period during which you may exercise your Option, the manner in
which you may exercise it, along with the price and other terms of exercise are
discussed in the attachment entitled "INFORMATION REGARDING THE NON-EMPLOYEE
DIRECTORS' STOCK OPTION". The Corporation is not required to issue Common Stock
pursuant to an attempted exercise of an Option if the issuance of such shares
would constitute or result in a violation by you or the Corporation of any law,
statute or regulation or any governmental authority. There is currently filed
with the Securities and Exchange Commission a registration statement on Form S-8
that registers the shares of Common
<PAGE>
Stock issuable upon exercise of the Options. In the absence of such registration
statement, the Corporation could require you to provide the Corporation with a
written statement that you are acquiring the shares for investment purposes and
not with a view to distribution. The shares of Common Stock reserved for
issuance pursuant to the Plan have been listed with the New York Stock Exchange.
No adjustment shall be made to the number of shares to be issued pursuant to
the Plan or any Option granted thereunder as a result of dividends (ordinary or
extraordinary, whether in cash, securities, or other properties) or
distributions or other rights for which the record date is prior to the date
certificates representing shares of Common Stock purchased pursuant to an
Option, except as discussed in section "Adjustments for Corporate
Reorganizations" in the attachment entitled INFORMATION REGARDING THE OPTIONS
GRANTED PURSUANT TO THE NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN".
3. and 4. The Directors to whom Options are granted do not make any
contributions to the Plan, but upon exercise of an Option, such Director must
pay to the Corporation the exercise price set forth in such Director's Stock
Option Agreement with the Corporation.
5. Directors who have been granted options will receive no statements
regarding the amount and status of their accounts. However, each participating
Director will receive a copy of the Corporation's annual report and quarterly
reports and may contact Investor Relations at (303) 452-5603 regarding any
questions about the Plan or their ability to exercise their Option.
6. The Common Stock to be purchased upon the exercise of an Option shall be
purchased from the Corporation's treasury and such exercise shall not involve
any fees, commission or charges, other than payment of the exercise price.
(e) Resale Restrictions
-------------------
Trading of the Common Stock of the Corporation received upon exercise is
restricted by "Blackout Periods", as announced by the Corporation and other
restrictions discussed in the Corporation's Insider Trading Memorandum, along
with federal and state laws governing trading on the basis of insider
information and trading by directors of a corporation. The shares of Common
Stock issuable upon exercise of an Option have been registered with the
Securities and Exchange Commission pursuant to a registration statement on Form
S-8.
(f) Tax Effects
-----------
The tax consequences to you of exercising an Option are discussed in the
attachment entitled "INFORMATION REGARDING THE NON-EMPLOYEE DIRECTORS' STOCK
OPTION PLAN" under the heading "Tax Consequences".
The Corporation is permitted a federal income tax deduction equal to the
amount of ordinary income you are required to recognize as a result of the
exercise of an Option.
<PAGE>
(g) Investment of Funds
-------------------
Not Applicable.
(h) Withdrawal from Plan; Assignment of Interest
--------------------------------------------
See the section "Rights If No Longer a Director; Change in Control" in the
attachment entitled "INFORMATION REGARDING THE NON-EMPLOYEE DIRECTORS' STOCK
OPTION PLAN". You may not transfer any option rights under the Plan, other than
by will or the laws of descent and distribution. No such option rights may be
assigned, pledged or hypothecated in any way and shall not be subject to
execution, attachment or similar process.
(i) Forfeitures and Penalties
-------------------------
If you cease to be a Director prior to the time any portion of your Option
vests (other than because of death, disability or after a "Change in Control",
other than for cause), you forfeit all your rights relating to such portion that
has not yet vested. For a discussion of the effect of a "Change in Control", see
the section "Rights If No Longer a Director; Change in Control" in the
attachment entitled "INFORMATION REGARDING THE NON-EMPLOYEE DIRECTORS' STOCK
OPTION PLAN". In addition, the Board of Directors may cancel and terminate any
non-vested Option if the Board of Directors determines that you have acted in a
manner detrimental to the interests of the Corporation.
(j) Charges and Deductions and Liens Thereof
----------------------------------------
Other than the exercise price, you will not be subject to any charges and your
property shall not be subject to any liens as a result of your participation in
the Plan.
AVAILABILITY OF ADDITIONAL
INFORMATION AND INCORPORATION BY REFERENCE
You have the right to receive without charge, upon written or oral request,
the documents that have been incorporated by reference into the Corporation's
Registration Statement on Form S-8 relating to the Non-Employee Directors' Stock
Option Plan, dated January 24, 2000, as 333- filed with the Securities and
Exchange Commission (registration number 333- ). This request should be
directed to Investor Relations at (303) 452-5603. These documents have been
incorporated by reference into this Prospectus. Upon written or oral request
from you directed to Investor Relations at (303) 452-5603, the Corporation shall
supply you with an additional copy of its annual report for its latest fiscal
year without charge.
<PAGE>
March 12, 1999
THIS DOCUMENT CONSISTUTES PART OF A
PROSPECTUS COVERING SECURITIES THAT HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
INFORMATION REGARDING OPTIONS GRANTED
PURSUANT TO NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
This document contains certain information regarding Options granted
pursuant to Western Gas Resources, Inc.'s Non-Employee Directors' Stock Option
Plan (the "Plan") to purchase shares of common stock, par value $.10 per share
(the "Common Stock") of Western Gas Resources, Inc., a Delaware corporation (the
"Corporation").
WHEN YOUR OPTION MAY BE EXERCISED
You earn the right to exercise your option according to the following vesting
schedule:
(i) Commencing on the later of March 12, 2000, or one year from the date of
grant of your Option, you shall have the right toe exercise thirty-three and
one-third percent (33-1/3%) of your Option, i.e., one-third of the shares of
Common Stock covered by your option;
(ii) Commencing on the later of March 12, 2001, or two years from the date of
grant of your Option, you shall have the right to exercise an additional
thirty-three and one-third percent (33-1/3%) of your Option;
(iii) Commencing on the later of March 12, 2002, or three years from the date
of grant of your Option, you shall have the right to exercise an additional
thirty-three and one-third percent (33-1/3%) of your Option.
Your right to purchase Common Stock pursuant to your Option shall be
cumulative, so that on the third anniversary of the date the options were
granted, you shall have the right to exercise one hundred percent of the Option;
provided, however, your Option will terminate ten years after it has been
- -----------------
granted and you will no longer be able to exercise any portion of your option
after that date.
CANCELLATION FOR DETRIMENTAL ACTS
The Board of Directors may, at any time, cancel the non-vested portion of
your Option if the Board determines that you have engaged in conduct detrimental
to the best interests of the Corporation.
<PAGE>
RIGHTS IF NO LONGER A DIRECTOR; CHANGE IN CONTROL
If you cease to be a Director of the Corporation for any reason other than:
(i) death or disability (as hereinafter defined); or (ii) dishonesty or
commission of a crime; you may exercise the Option at any time within three
months after termination, to the extent that your Option was exercisable as of
the date of termination; provided, however, if there is a "Change in Control" of
the Corporation, then all of the Options granted to you under the Plan become
one hundred percent (100%) exercisable and you may exercise those Options at any
time within three months after termination. All unexercised Options or portions
thereof, shall terminate upon expiration of such three month period, or
immediately if you cease to be a Director because of dishonesty or the
commission of a crime.
A "Change in Control" occurs on the date any person or persons acting as a
group acquires ownership of stock in the Corporation, that gives such person or
group more than forty-five percent of the total fair market value or total
voting power of the Common Stock of the Corporation. For these purposes, the
acquisition of stock of the Corporation by Brion Wise, Walter Stonehocker, Bill
Sanderson, Dean Phillips, Ward Sauvage, and or any corporation, partnership or
other entity in which any of the foregoing people and or members of their
immediate family own, individually or in the aggregate, more than forty percent
of the outstanding ownership interest, shall not be counted as a Change in
Control.
If you die while you are a Director of the Corporation or cease to be a
Director as a result of a disability, all of the Options granted to you shall
become one hundred percent (100%) exercisable, without regard to the vesting
schedule. In such event, your Option may be exercised by you, or, in the event
of your death, by the person or persons to whom your rights under the Option
pass by will or by the applicable laws of descent and distribution; provided,
however, that no such Option may be exercised after 180 days from the later of
the date of death, or the date you decease to be a director as a result of
disability, whichever is applicable. You will be found to be "disabled" if you
are unable to engage in any active gainful activity by reason of any medically
determined physical or mental impairment which can be expected to result in
death, or which has lasted, or can be expected to last, for a continuous period
of not less than twelve months.
DATE ALL UNEXERCISED OPTIONS TERMINATE
Subject to the provisions described above relating to your right to
exercise a vested Option after you cease to be a Director or die or become
disabled, you may exercise your Option as to all, or any whole part, of the
total shares which have vested. However, pursuant to the Plan, no Option may be
exercised later than ten years after granted, no Option may be granted after
March 12, 2009, and the Plan terminates on March 12, 2009.
<PAGE>
RIGHTS UPON A CORPORATE REORGANIZATION
If there is any capital reorganization, or consolidation or merger of the
Corporation with another corporation or corporations, or any sale of all or
substantially all of the Corporation's profits and assets to any other
corporation or corporations, the Corporation is obligated, pursuant to the Plan,
to take such action as shall be necessary to enable you to receive, in lieu of
shares of Common Stock, upon any subsequent exercise of your Option, such
securities or other assets as were issued or payable upon such reorganization,
consolidation, merger or sale, in respect of, or in exchange for shares of
Common Stock.
PROCEDURE TO FOLLOW SHOULD YOU DECIDE TO EXERCISE YOUR OPTION
In order to exercise your Option, you must give written notice to the
Corporation in a form satisfactory to the Board of Directors. Please notify
Investor Relations by calling (303) 452-5603 that you have sent written notice.
In order to avoid delays, please use the form attached, which should be mailed,
along with payment, to the following address:
Western Gas Resources, Inc.
Attn: Investor Relations
12200 N. Pecos St.
Denver, CO 80234-3439
Please note that if your notice does not include payment in full for the
number of shares you elect to purchase, the notice will be returned to you.
Payment may be made by certified check, money order or wire transfer. Upon
receipt of your notice and payment, we will further notify our Transfer Agent to
issue a stock certificate to you representing the number of shares for which you
exercised your option. Allow thirty (30) days for receipt of your certificate.
If you have any questions about your stock certificate, contact EquiServe, L.P.
at (800) 736-3001.
TAX CONSEQUENCES
The following is a brief summary of the principal United States federal
income tax consequences under current federal income tax laws relating tot he
Options. This summary is not intended to be exhaustive and does not describe,
among other things, state, local or foreign income and other tax consequences.
It is suggested that you consult your tax and/or financial advisor before
deciding to exercise any Option.
The grant of an Option pursuant to the Plan is not a taxable event for
federal income tax purposes. Pursuant to Section 83 ("Section 83") of the
Internal Revenue Code of 1986, as amended, you will not recognize income upon
the exercise of your
<PAGE>
option because as a Director of the Corporation, you are subject to Section
16(b) of the Securities Exchange Act of 1934, as amended, relating to short-
swing profits. Section 83 provides that you will be deemed to have received
ordinary income six months after you exercise your Option; provided, however,
that pursuant to Section 83(b), you may elect to be taxed upon the date of
exercise. Please indicate on your Notice to Exercise whether you elect to be
taxed upon exercise of your Option pursuant to Section 83.
AVAILABILITY OF ADDITIONAL
INFORMATION AND INCORPORATION BY REFERENCE
You have the fight to receive without charge, upon written or oral request,
the documents that have been incorporated by reference into the Corporation's
Registration Statement on Form S-8 relating to the Non-Employee Directors' Stock
Option Plan, dated January 24, 1999, as filed with the Securities and Exchange
Commission (registration number 333- ). This request should be director to
Investor Relations at (303) 452-5603. These documents have been incorporated by
reference into this Prospectus. Upon written or oral request from you directed
to Investor Relations at (303) 452-5603, the Corporation shall supply you with
an additional copy of its annual report for its latest fiscal year without
charge.
<PAGE>
WESTERN GAS RESOURCES, INC.
NON-EMPLOYEE DIRECTORS' STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of March 12, 1999, by and between Western Gas
Resources, Inc. (hereinafter called the "Corporation"), a Delaware corporation,
and __________, a director of the Corporation (hereinafter called the
"Optionee").
RECITALS:
A. The Optionee is eligible as a director of the Corporations to participate
in the Western Gas Resources, Inc. Non-Employee Director's Stock Option Plan
(the "Plan").
B. The Board of Directors of the Corporation considers it desirable and in the
Corporation's best interests that the Optionee be given an opportunity to
purchase shares of its Common Stock in furtherance of the Plan to provide
incentive for the Optionee to remain as a director of the Company and to promote
the success of the Corporation.
NOW THEREFORE, in consideration of the premises, it is agreed as follows:
1. Grant of Option. The Corporation hereby grants as of March 12, 1999
---------------
(the "Grant Date") to the Optionee the right, privilege and option to purchase
5,000 shares of the Common Stock par value $0.10 (the "Common Stock") of the
Corporation, at a purchase price of Five Dollars and 12/100ths ($5.12) per share
in the manner and subject to the conditions hereafter provided. Said purchase
price is not less than the Fair Market Value (as that term is defined in the
Plan) of the shares of Common Stock of the Corporation at the time this option
was granted.
2. Period of Exercise of Option. This Option may be exercised in whole or
----------------------------
in part, or in installments, from time to time, with respect to the shares
covered hereby, in the amounts and at the times specified below. The Option or
any portion thereof, once it becomes exercisable as specified below, shall
remain exercisable until it shall expire in accordance with the provisions of
this Agreement.
(a) Notwithstanding anything herein to the contrary, no Option or portion
thereof granted under this Agreement may be exercised after the earlier of (i)
five (5) years after the date the Optionee has the right to exercise such Option
or portion thereof, in accordance with paragraph 2(b) below; or (ii) ten (10)
years after the Option is granted.
(b) Except as expressly provided in Section 2(e), below, an Optionee shall
become entitled to exercise that portion of the Option and to purchase the
percentage of the Common stock subject to the Option in accordance with the
following schedule:
(1) Commencing one (1) year from the Grant Date, the Optionee shall have
the right to exercise thirty-three and one-third percent (33-1.3%) of the Option
and to purchase an additional thirty-three and one-third percent (33-1/3%)
subject to the Option.
<PAGE>
(2) Commencing two (2) years from the Grant Date, the Optionee shall have
the right to exercise thirty-three and one-third percent (33-1.3%) of the Option
and to purchase an additional thirty-three and one-third percent (33-1/3%)
subject to the Option.
(3) Commencing three (3) years from the Grant Date, the Optionee shall have
the right to exercise thirty-three and one-third percent (33-1.3%) of the Option
and to purchase an additional thirty-three and one-third percent (33-1/3%)
subject to the Option.
The Optionee's right to purchase Shares subject to the Option shall be
cumulative, so that three (3) years from the Grant Date, the Optionee shall be
entitled to exercise one hundred percent (100%) of the Option and to purchase
all of the Common Stock subject to the Option, subject to all of the provisions
of this Agreements.
(c) Except as provided in Sections 2(d) and 2(e), an Optionee may exercise
an Option only if, at the time such Option is exercised, such Optionee is a
director of, and has continuously since the grant of the Option, been a director
of the Corporation or any subsidiary, parent, or predecessor of the Corporation.
(d) If an Optionee ceases to be a director for any reason other than (i)
his or her death or disability; or (ii) his or her discharge for dishonesty or
commission of a crime, the Optionee may, within three (3) months thereafter, and
subject to provisions of Sections 2(a), (b) and (c), exercise the Option to the
extent that the Option was exercisable as of the date of the Optionee ceased to
be a director. All unexercised Options, or portions thereof, shall terminate, be
forfeited, and shall lapse upon expiration of said three (3) month period, or
immediately if the Optionee ceases to be a director of the Corporation for any
of the reasons set forth in (ii), above.
(e) If an Optionee dies or becomes disabled while he is a director of the
Corporation or ceases to be a director as a result of disability, all of the
Options granted to such employee shall become one hundred percent (100%)
exercisable, without regard to the provisions of Section 2(b), above. In such
event, the Options may be exercised by the disabled director, or the person or
persons to whom his or her rights under the Option shall pass by will, or by the
applicable laws of descent and distribution; provided, however, that no such
-----------------
Option may be exercised after 180 days from such directors' s date of death, or
the date Optionee ceases to be a director as a result of disability, whichever
is applicable. Upon expiration of said period, all unexercised Options, or
portions thereof, shall terminate, be forfeited, and shall lapse.
(f) Notwithstanding the provision of Section (b), above, in the event (1)
there is a "Change of Control" of the Corporation; and (2) the Optionee is
removed as a director of the Corporation without cause, then all of the options
granted to such Optionee under this Agreement shall become one hundred percent
(100%) exercisable, subject to the other provisions of this Section 2. For these
purposes, a Change of Control of the Corporation will occur on the date any
person, or more than one person acting as a group, acquires ownership of stock
in the Corporation, and together with stock held by such person or persons
possesses more that forty-five percent (45%) of the total; fair market value or
total voting power of the Common Stock of the Corporation. For these purposes,
the acquisition of stock of the Corporation by Brian G.
<PAGE>
Wise, Walter L. Stonehocker, Bill M. Sanderson, Dean Phillips, Ward Sauvage,
and/or any corporation, partnership, or other entity in which any of the
foregoing people and/or members of their immediate family own, individually or
in the aggregate, more than forty (40%) percent of the outstanding ownership
interests, shall not be counted as a Change of Control.
3. Method of Exercise.
------------------
(a) To exercise an Option, the Optionee, or his or her successors, shall
give written notice to the Treasurer of the Corporation, at the
Corporation's principal office, accompanied by full payment of the Common
Stock being purchased. If the Option is exercised by the successor of the
Optionee, following his or her death, proof shall be submitted,
satisfactory to the Board, of the right of the successor to exercise the
Option. The Corporation shall not be required to transfer or deliver any
certificate or certificates for shares purchased upon any such exercise of
said option: (a) until after compliance with all then applicable
requirements of law; and (b) prior to admission of such shares to listing
on any stock exchange on which the stock may then be listed. In no event
shall the Corporation be required to issue fractional shares to the
Optionee.
4. Limitation Upon Exercise. The option is not transferable by the
------------------------
Optionee otherwise than by will or the laws of descent and distribution and is
exercisable, during the lifetime of Optionee, only by the Optionee.
5. Limitation Upon Transfer. Except as otherwise provided hereto, the
------------------------
option and all rights granted hereunder shall not be transferred by the
Optionee, and may not be assigned, pledged, or hypothecated in any way and shall
not be subject to execution, attachment or similar process. Upon any attempt to
transfer the option, or to assign, pledge, hypothecate or otherwise dispose of
such Option or of any rights granted hereunder, contrary to the provisions
hereof, or upon the levy of any attachment or similar process upon such option
or such rights, such option and such rights shall immediately become null and
void.
6. Stock Adjustment. In the event of any change in Common Stock of the
----------------
Corporation, by reason of a stock split, stock dividend, recapitalization,
exchange of shares, or other transaction, the number of shares remaining subject
to the option and the option price per share shall be appropriately adjusted by
the Board of Directors.
7. Corporate Reorganization. If there shall be any capital reorganization
------------------------
or consolidation or merger of the Corporation with another corporation or
corporations, or any sale of all or substantially all of the Corporation's
properties and assets to any other corporation, the Corporation shall take such
action as may be necessary to enable the Optionee to receive upon any subsequent
exercise of such option, in whole or in part, in lieu of shares of Common Stock,
securities or other assets as were issuable or payable upon such reorganization,
consolidation, merger or sale in respect of, or in exchange for such shares of
Common Stock.
8. Rights of Stockholders. Neither the Optionee, his or her legal
----------------------
representative, nor other persons entitled to exercise the option shall be or
have any rights of a stockholder in the
<PAGE>
Company in respect of the shares issuable upon exercise of the option granted
hereunder, unless and until certificates representing such shares shall have
been delivered pursuant to the terms hereof.
9. Rights of Director. Nothing contained in this Agreement shall confer
------------------
upon Optionee any right to continue to remain as a director of the Corporation.
10. Stock Reserved. The Company shall at all times during the term of
---------------
this Agreement reserve and keep available such number of shares of its Common
Stock as will be sufficient to satisfy the terms of this Agreement.
11. Binding Effect. This Agreement shall be binding upon and inure to the
---------------
benefit of any successor or successors of the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
WESTERN GAS RESOURCES, INC.
By:___________________________
______________________________
Optionee
<PAGE>
EXHIBIT 5.1
Western Gas Resources, Inc.
12200 N. Pecos Street
Denver, CO 80234
January 24, 2000
Western Gas Resources, Inc.
12200 North Pecos Street
Denver, Colorado 80234
Gentlemen:
I am the general counsel for Western Gas Resources, Inc., a Delaware
corporation (the "Corporation") and am delivering this opinion in connection
with the preparation of a registration statement on Form S-8 of the Corporation
(the "Registration Statement") relating to the registration by the Corporation
of an aggregate of 15,000 shares of the Corporation's common stock, par value
$.10 per share (the "Common Stock"), to be issued pursuant to options granted
under the Corporation's Non-Employee Director's Stock Option Plan (the "Plan").
This opinion is being delivered in accordance with the requirements of Item
601 (b) (5) of Regulation S-K under the Securities Act of 1933, as amended (the
"Securities Act"). Capitalized terms used herein but not otherwise defined
herein have the meaning ascribed to them in the Registration Statement.
In connection with this opinion, I have examined the originals or copies
certified or otherwise authenticated to my satisfaction of such corporate
records of the Corporation, of certificates of public officials and of officers
of the Corporation, and of other agreements, instruments or documents as I have
deemed necessary as a basis for the opinions contained herein. I have also
reviewed the Registration Statement.
In my examination, I have assumed the legal capacity of natural persons,
the genuineness of all signatures, the authenticity of all documents submitted
to me as originals, the conformity to original documents of all documents
submitted to me as a certified or photostatic copies and the authenticity of the
originals of such copies. In making my examination of documents executed by
parties other than the Corporation, I have assumed that such parties had the
power, corporate or other, to enter into and perform all obligations thereunder
and have also assumed the due authorization by all requisite action, corporate
or other, and execution and delivery by such parties of such documents and that
such documents constitute valid and binding obligations of such parties. As to
any facts material to this opinion that I did not independently establish or
verify, I have relied upon certificates, statements and representations of
officers, trustees and other representatives of the Corporation and others.
I am a member of the Bar of the State of Colorado and do not express any
opinion as to the laws of any other state or jurisdiction. Insofar as opinions
herein expressed relate to matters governed by Delaware law, I have relied
solely upon a reading of applicable statutes and records of the Corporation and
certificates of public officials.
<PAGE>
Based upon and subject to the foregoing and the limitations,
qualifications, exceptions and assumptions set forth herein, I advise you that,
in my opinion:
1. The Corporation has been duly incorporated and is validly existing and
in good standing under the laws of the State of Delaware.
2. The shares of Common Stock initially issuable pursuant to the Plan have
been duly authorized by the Corporation and, when issued and sold by the
Corporation in accordance with the provisions of the Plan, will have been
validly issued and will be fully paid and non-assessable.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission (the "Commission") as an exhibit to the Registration
Statement and the reference to me under the heading "Interests of Named Experts
and Counsel" in the Registration Statement. In giving such consent, I do not
thereby admit that I am in the category of persons whose consent is required
under Section 7 of the Securities Act or the rules and regulations of the
Commission promulgated thereunder. As of January 24, 2000, I owned 29,625 shares
of Common Stock and options to purchase 68,000 shares of Common Stock, none of
which were granted under this Plan.
Respectfully submitted,
/s/ John C. Walter
John C. Walter, Esquire
General Counsel
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated March 22, 1999 relating to the
financial statements, which appears in Western Gas Resources, Inc. Annual Report
on Form 10-K for the year ended December 31, 1998.
PriceWaterhouseCoopers
Denver, Colorado
January 24, 2000
