PROSPECTUS
1,083,251 Shares
SNYDER OIL CORPORATION
Common Stock
All the 1,083,251 shares of Common Stock, par value $0.01 per share
("Common Stock"), of Snyder Oil Corporation, a Delaware corporation (the
"Company"), are offered by the selling stockholders (the "Selling
Stockholders"). See "Selling Stockholders." The Company will not receive any
of the proceeds from the sale of Common Stock by the Selling Stockholders.
It is expected that sales made pursuant to this Prospectus will be
effected from time to time in transactions on the New York Stock Exchange, or
other exchanges to which shares of the Company's Common Stock may be admitted
for trading privileges or in the over-the-counter market or through
underwriters or agents or otherwise at market prices obtainable at the time
of sale or otherwise in privately negotiated transactions at prices determined
by negotiation. See "Plan of Distribution." On January 5, 1996, the last
reported sale price for the Company's Common Stock on the New York Stock
Exchange was $11 3/8 per share.
Any broker-dealers who participate in a sale of shares of the Common
Stock may be deemed to be "underwriters" as defined in the Securities Act of
1933, as amended (the "Securities Act"), and any commissions received by them,
and proceeds of any such sale as principals, may be deemed to be underwriting
discounts and commissions under the Act.
All expenses incurred in connection with the registration of the shares
of Common Stock being offered hereby will be borne by the Company.
See "Risk Factors" at Page 3 for certain considerations relevant to an
investment in the Common Stock offered hereby.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
The date of this Prospectus is January 5, 1996.
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AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (together with all amendments, the
"Registration Statement") on Form S-3 under the Securities Act with respect
to the Common Stock offered hereby. This Prospectus, filed as a part of that
Registration Statement, does not contain all the information set forth in the
Registration Statement, certain portions of which have been omitted as
permitted by the rules and regulations of the Commission. In addition, certain
documents filed by the Company with the Commission have been incorporated by
reference. See "Incorporation of Certain Information by Reference." For
further information regarding the Company and the Common Stock offered hereby,
reference is made to the Registration Statement, including the exhibits and
schedules thereto and the documents incorporated therein by reference. The
Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information can be
inspected and copied at the Public Reference Section of the Commission, 450
Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549; and at the
regional offices of the Commission at Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511, and at 7 World Trade
Center, New York, New York 10048. Copies of such materials can also be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. Reports, proxy
statements and other information concerning the Company can also be inspected
and copied at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005. The Common Stock of the Company is listed on the New
York Stock Exchange.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents heretofore filed by the Company with the
Commission pursuant to the Exchange Act are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended December
31, 1994;
(b) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1995, June 30, 1995 and September 30, 1995;
(c) The Company's Current Report on Form 8-K dated October 13, 1995; and
(d) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A dated April 4, 1990.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act, after the date of this Prospectus and prior to
the termination of the offering of the securities offered by this Prospectus,
shall be deemed to be incorporated by reference in this Prospectus and be a
part hereof from the date of filing of such documents. Any statements
contained in a document incorporated or deemed to be incorporated by reference
in this Prospectus shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained in this
Prospectus, or in any other subsequently filed document that also is or is
deemed to be incorporated by reference, modifies or replaces such statement.
Any such statement so modified or superseded shall not be deemed, except as
so modified, to constitute a part of this Prospectus.
The Company undertakes to provide without charge to each person to whom
a copy of this Prospectus has been delivered, upon written or oral request of
any such person, a copy of any or all of the documents incorporated by
reference herein, other than exhibits to such documents, unless such exhibits
are specifically incorporated by reference into the information that this
Prospectus incorporates. Written and oral requests for such copies should be
addressed to Snyder Oil Corporation, 1625 Broadway, Suite 2200, Denver,
Colorado 80202, Attention: Investor Relations, telephone (303) 592-8638, or
to the Company's principal executive offices, 777 Main Street, Fort Worth,
Texas, 76102, telephone (817) 338-4043.
RISK FACTORS
Volatility of Oil and Natural Gas Prices
Historically, the markets for oil and natural gas have been volatile and
are likely to continue to be volatile in the future. Prices for oil and
natural gas are subject to wide fluctuation in response to relatively minor
changes in the supply of and demand for oil and natural gas, market
uncertainty and a variety of additional factors that will be beyond the
control of the Company. These factors include the level of consumer product
demand, weather conditions, domestic and foreign governmental regulations, the
price and availability of alternative fuels, political conditions in the
Middle East, the foreign supply of oil and natural gas, the price of foreign
imports and overall economic conditions. It is impossible to predict future
oil and natural gas price movements with any certainty. Declines in oil and
natural gas prices have and may continue to adversely affect the Company's
financial condition, liquidity and results of operations. Lower oil and
natural gas prices also may reduce the amount of the Company's oil and natural
gas that can be produced economically.
Economic Risks of Oil and Natural Gas Operations
The Company's oil and natural gas operations will be subject to the
economic risks typically associated with development, production and
exploration activities, including the necessity of significant expenditures
to locate and acquire producing properties and to drill wells. In conducting
development and exploration activities, the Company may drill unsuccessful
wells and experience losses. In the event that oil or natural gas is
discovered, there is no assurance that such oil or natural gas can be
economically produced or satisfactorily marketed. The presence of
unanticipated pressure or irregularities in formations, miscalculations or
accidents may cause the Company's development, production or exploration
activities to be unsuccessful, resulting in a total loss of the Company's
investment in such activities. Consequently, the Company's actual future
production may be substantially affected by factors beyond the Company's
control.
Replacement of Reserves
In general, the volume of production from oil and natural gas properties
declines as reserves are depleted. Except to the extent the Company acquires
properties containing proved reserves or conducts successful development and
exploration activities, or both, the proved reserves of the Company will
decline as reserves are produced. The Company's future oil and natural gas
production is, therefore, highly dependent upon its level of success in
finding or acquiring additional reserves at attractive rates of return. The
business of exploring for, developing or acquiring reserves is capital
intensive. To the extent cash flow from operations is reduced and external
sources of capital become limited, the Company's ability to make the necessary
capital investment to maintain or expand its asset base of oil and natural gas
reserves would be impaired. Since January 1, 1995, the Company has sold a
number of properties in non-core areas and its Wattenberg area gas facilities,
and has reduced its senior debt from $216 million at year end 1994 to
approximately $162 million at September 30, 1995. The Company believes this
reduction, together with the modest level of capital expenditures expected in
the current price environment, should afford the Company the financial
flexibility to fund its capital expenditures and pursue acquisition
opportunities. However, continued decreases in product prices may
nevertheless impair the Company's ability to fund its capital projects. In
addition, there can be no assurance that the Company's future development,
acquisition and exploration activities will result in additional proved
reserves or that the Company will be able to drill productive wells at
acceptable costs.
Operating Risks of Oil and Natural Gas Operations
The oil and natural gas business involves certain operating hazards such
as well blowouts, cratering, explosions, uncontrollable flows of oil, natural
gas or well fluids, fires, formations with abnormal pressures, pollution,
releases of toxic gas and other environmental hazards and risks, any of which
could result in substantial losses to the Company. In addition, the Company
may be liable for environmental damages cause by previous owners of property
purchased by the Company. As a result, substantial liabilities to third
parties or governmental entities may be incurred, the payment of which could
reduce or eliminate the funds available for development, acquisitions or
exploration, or result in the loss of the Company's properties. In accordance
with customary industry practices, the Company maintains insurance against
some, but not all, of such risks and losses. The occurrence of such an event
not fully covered by insurance could have a material adverse effect on the
financial condition and results of operations of the Company.
Uncertainty of Reserve Estimates
There are numerous uncertainties inherent in estimating oil and natural
gas reserves and their estimated values, including many factors beyond the
control of the producer. The reserve data incorporated by reference in this
Prospectus represents only estimates. Reserve engineering is a subjective
process of estimating underground accumulations of oil and natural gas that
cannot be measured in an exact manner. The accuracy of any reserve estimate
is a function of the quality of available data and of engineering and
geological interpretation and judgment. As a result, estimates of different
engineers, including those used by the Company, may vary.
Competition
The oil and gas industry is highly competitive. The Company will compete
for the acquisition of oil and natural gas properties with numerous entities,
including major oil companies, other independent oil and gas concerns and
individual producers and operators. Many of these competitors have financial
and other resources substantially greater than those of the Company.
Government Regulation
The Company's business will be regulated by certain local, state and
federal laws and regulations relating to the exploration for and the
development, production, marketing, pricing, transportation and storage of,
oil and natural gas. The Company's business will also be subject to extensive
and changing environmental and safety laws and regulation governing the
discharge of materials into the environment or otherwise relating to
environmental protection. There can be no assurance that present or future
regulation will not adversely affect the operations of the Company.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Common Stock offered hereby. See "Selling Stockholders."
SELLING STOCKHOLDERS
This Prospectus covers the registration of an aggregate of up to
1,083,251 shares of Common Stock of the Company to be sold by the persons set
forth below (the "Selling Stockholders").
The table below sets forth the number and percentage of outstanding
shares of Common Stock of the Company beneficially owned by each of the
Selling Stockholders (including the shares of Common Stock registered hereby)
and the number of shares of the Company's Common Stock registered hereby for
the account of the Selling Stockholders. Assuming the sale of all the shares
of Common Stock registered hereby, none of the Selling Stockholders will own
any shares of the Common Stock after the completion of this offering.
Beneficial Ownership Shares
Prior to Offering Registered
and Being
Selling Stockholder Shares Percent Offered
Baralonco Exploration, Inc. 1,003,136 3.19% 1,003,136
NIPSCO Fuel Company, Inc. 80,115 .25% 80,115
PLAN OF DISTRIBUTION
Any distribution hereunder of the Common Stock by the Selling Stockholders
may be effected from time to time in one or more of the following
transactions: (a) to underwriters who will acquire the Common Stock for their
own account and resell them in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale (any public offering price and any discount or concessions
allowed or reallowed or paid to dealers may be changed from time to time), (b)
through brokers, acting as principal or agent, in transactions (which may
involve block transactions) on the New York Stock Exchange or other exchanges
on which shares of the Company's Common Stock may be admitted for trading
privileges, in special offerings, exchange distributions pursuant to the rules
of the applicable exchanges or in the over-the-counter market, or otherwise,
at market prices obtainable at the time of sale, at prices related to such
prevailing market prices, at negotiated prices or at fixed prices or (c)
directly or through brokers or agents in private sales at negotiated prices,
or by any other legally available means.
Any such underwriters, brokers, dealers or agents, upon effecting the sale
of the Common Stock, may be deemed "underwriters" as that term is defined by
the Securities Act.
Underwriters participating in any offering made pursuant to this Prospectus
(as amended or supplemented from time to time) may receive underwriting
discounts and commissions, and discounts or concessions may be allowed or
reallowed or paid to dealers, and brokers or agents participating in such
transactions may receive brokerage or agent's commissions or fees.
At the same time a particular offering of Common Stock is made hereunder,
to the extent required by law, a Prospectus Supplement will be distributed
which will set forth the amount of Common Stock being offered and the terms
of the offering, including the purchase price or public offering price, the
name or names of any underwriters, dealers or agents, the purchase price paid
by any underwriter for Common Stock purchased from the Selling Stockholders,
any discounts, commissions and other items constituting compensation from the
Selling Stockholders and any discounts, commissions or concessions allowed or
reallowed or paid to dealers.
In order to comply with the securities laws of certain states, if
applicable, the Common Stock will be sold hereunder in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
states the Common Stock may not be sold hereunder unless it has been
registered or qualified for sale in such state or an exemption from
registration or qualification is available and complied with.
Pursuant to Indemnification and Contribution Agreements, each dated as of
September 15, 1995, between the Company and each Selling Stockholder (the
"Indemnification and Contribution Agreements") and pursuant to the Purchase
and Sale Agreement dated December 19, 1995 between the Company and Baralonco
Exploration, Inc. (the "Purchase and Sale Agreement"), the Company has agreed
to indemnify the Selling Stockholders against certain liabilities, including
liabilities arising under the Securities Act, and the Selling Stockholders
have agreed to indemnify the Company, its directors, each of its officers who
has signed the Registration Statement of which this Prospectus is a part, and
each person who controls the Company, against certain liabilities, including
liabilities arising under the Securities Act. In addition, pursuant to a
Stock Purchase Agreement dated as of June 30, 1994 between the Company, DelMar
Petroleum, Inc. and certain stockholders of DelMar Petroleum, Inc., and the
Purchase and Sale Agreement, the Selling Stockholders have agreed not to sell
any Common Stock hereunder during certain "black out" periods not to exceed
135 days following notice from the Company (i) of its intent to proceed with
a financing and that it has been advised by a recognized investment banking
firm that the sale of Common Stock by the Selling Stockholders under this
Registration Statement would adversely affect the Company's financing; or (ii)
that such sale would require disclosure of material information that the
Company has a bona fide business purpose for preserving as confidential as a
result of a pending merger, consolidation, acquisition, disposition or other
material development involving the Company.
LEGAL MATTERS
The validity of the shares of Common Stock offered by this Prospectus and
certain other legal matters will be passed upon for the Company by Peter E.
Lorenzen, Esq., Vice President-General Counsel of the Company. Mr. Lorenzen
owns 10,000 shares of Common Stock and holds options to purchase 77,300 shares
of Common Stock.
EXPERTS
The audited financial statements and schedules incorporated in this
Prospectus by reference have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and
are incorporated herein by reference in reliance upon the authority of said
firm as experts in accounting and auditing in giving said reports.
The information incorporated in this Prospectus by reference regarding
proved reserves and related future net revenues and the present value thereof
is derived, as and to the extent described therein, from reserve reports and
reserve report audits prepared by Netherland, Sewell & Associates, Inc.,
independent oil and gas consultants, and, to such extent, are incorporated by
reference in reliance upon the authority of such firm as experts with respect
to the matters contained in such reports and audits.
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SNYDER OIL CORPORATION
1,083,251 SHARES
COMMON STOCK
PROSPECTUS
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus, or incorporated herein by reference, and if given or made, such
information or representations must not be relied upon as having been
authorized by the Company or the Selling Stockholders. This Prospectus does
not constitute an offer to sell or the solicitation of an offer to buy any
securities other than the Common Stock to which it relates or an offer to sell
or solicitation of an offer to buy any of the securities offered hereby to any
person to whom it is unlawful to make such offer or solicitation to such
jurisdiction.
