PROSPECTUS
399,202 SHARES
SNYDER OIL CORPORATION
COMMON STOCK
All the 399,202 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 August 16, 1996, the last reported sale price for the
Company's Common Stock on the New York Stock Exchange was $9.625 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 August 19, 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,
1995;
(b) The Company's Quarterly Reports on Form 10-Q for the quarters ended March
31, 1996 and June 30, 1996;
(c) The Company's Current Reports on Form 8-K dated January 29, 1996 and May
17, 1996, as amended by Form 8K/A dated May 17, 1996; 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.
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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 AND AVAILABILITY OF CAPITAL
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 reduced its senior
debt from $216 million at year end 1994 to approximately $156 million at March
31, 1996. In May, 1996 the Company consolidated its Wattenberg oil and gas
operations with Gerrity Oil & Gas Corporation ("Gerrity") to form Patina Oil &
Gas Corporation ("Patina"), a publicly traded 70%- owned subsidiary of the
Company. As part of this transaction, Patina assumed $75 million of the
Company's senior debt. However, because Patina is consolidated in the Company's
consolidated financial statements, the Company's reported consolidated senior
debt increased to approximately $175.3 at June 30, 1996. As of that date,
consolidated senior debt included approximately $59 million of parent company
debt and approximately $116.3 of Patina's debt. Patina's debt is non-recourse to
the Company. Although the Patina transaction will result in increased
consolidated net cash provided by operations, cash generated by Patina will be
retained by it and will not be available to fund the Company's other operations.
The Company believes the recent reduction in its senior debt, together
with the modest level of capital expenditures expected in the current price
environment, affords the Company the financial flexibility to fund its capital
expenditures and to pursue acquisition opportunities. However, continued
decreases in product prices could impair the Company's ability to fund future
capital projects. In addition, there can be no assurance that the Company's
future development, acquisition and exploration activities will result in the
addition of the anticipated proved reserves or that the Company will be able to
drill productive wells on an economically attractive basis.
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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 399,202
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.
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<TABLE>
<CAPTION>
BENEFICIAL
OWNERSHIP SHARES
PRIOR TO REGISTERED
OFFERING AND BEING
SELLING STOCKHOLDER SHARES OFFERED
<S> <C> <C>
The John Hancock Mutual Life Insurance
Company 343,121 343,121
Randi Metz Odom 11,216 11,216
Andrew J. Metz 11,216 11,216
Don A. Metz 11,216 11,216
Douglas A. Metz 11,216 11,216
Derek A. Metz 11,217 11,217
Randi Metz Odom, Andrew J. Metz, Don A. Metz, Douglas A. Metz and Derek A. Metz are children of Clyde T.
Metz. Until his retirement on July 1, 1996, Mr. Metz was President and a director of DelMar Petroleum, Inc.
("DelMar"), a subsidiary of the Company, a position he held since prior to the acquisition of a majority of the shares
of common stock of DelMar by the Company in September 1994.
</TABLE>
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 Registration Rights Agreements, each dated as of June 17, 1996,
between the Company and The John Hancock Mutual Life Insurance Company and Clyde
T. Metz, Trustee (assignor of Randi Metz Odom, Andrew J. Metz, Don A. Metz,
Douglas A. Metz and Derek A. Metz), the Company has agreed to indemnify the
Selling
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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, the Selling Stockholders have agreed in the
Registration Rights Agreements 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 89,700 shares of
Common Stock.
EXPERTS
The audited financial statements and schedules of the Company incorporated
in this Prospectus by reference have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report 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 audited financial statements of Gerrity at December 31, 1994 and 1995
and for the two years then ended incorporated in this Prospectus by reference
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report 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 Gerrity consolidated financial statements for the year ended December
31, 1993 incorporated in this Prospectus by reference have been audited by
Coopers & Lybrand, independent accountants, as stated in their report,
incorporated herein by reference. The consolidated financial statements audited
by Coopers & Lybrand have been incorporated herein by reference in reliance upon
the reports of Coopers & Lybrand, independent accountants, upon the authority of
such firm as experts in accounting and auditing.
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., and
Ryder Scott Petroleum engineers, independent oil and gas consultants, and, to
such extent, are incorporated by reference in reliance upon the authority of
such firms as experts with respect to the matters contained in such reports and
audits.
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SNYDER OIL CORPORATION
399,202 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.
