SNYDER OIL CORPORATION PROFIT
SHARING AND SAVINGS PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
MAY 24, 1999 AND DECEMBER 31, 1998
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
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ANNUAL REPORT
PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD JANUARY 1, 1999 THROUGH MAY 24, 1999
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SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
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SANTA FE SNYDER CORPORATION
840 GESSNER, SUITE 1400
HOUSTON, TEXAS 77024
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, persons who
administer the Plan have duly caused this annual report to be signed by the
undersigned thereunto duly authorized.
SNYDER OIL CORPORATION
PROFIT SHARING AND SAVINGS PLAN
By: _________________________________
Mark A. Older
Member - Employee Benefits
Committee
Date: __________________________________
<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
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PAGE
(a) Financial Statements:
Reports of Independent Accountants 1 - 2
Statement of Net Assets Available for Plan Benefits at
May 24, 1999 and December 31, 1998 3
Statement of Changes in Net Assets Available for Plan
Benefits for the period January 1, 1999 through
May 24, 1999 and the year ended December 31, 1998 4
Notes to Financial Statements 5 - 10
(b) Supplemental Schedule*:
Assets Held for Investment Purposes at May 24, 1999 11
(c) Exhibits:
23.A Consent of PricewaterhouseCoopers LLP 12
23.B Consent of Arthur Andersen LLP 13
* All other schedules required by Section 2520.103-10 of the Department of
Labor Rules and Regulations for Reporting and Disclosure under ERISA have
been omitted because they are not applicable or the required information is
shown in the financial statements or the notes thereto.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Employee Benefits Committee of
Santa Fe Snyder Corporation
In our opinion, the accompanying statement of net assets available for plan
benefits and the related statement of changes in net assets available for plan
benefits present fairly, in all material respects, the net assets available for
plan benefits of the Snyder Oil Corporation Profit Sharing and Savings Plan (the
Plan) at May 24, 1999, and the changes in net assets available for plan benefits
for the period January 1, 1999 through May 24, 1999 in conformity with
accounting principles generally accepted in the United States. These financial
statements are the responsibility of the Plan's management; our responsibility
is to express an opinion on these financial statements based on our audit. We
conducted our audit of these statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for the opinion expressed
above.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Assets Held
for Investment Purposes at May 24, 1999 is presented for the purpose of
additional analysis and is not a required part of the basic financial statements
but is supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
PricewaterhouseCoopers LLP
Houston, Texas
July 10, 2000
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Advisory Committee of the
Snyder Oil Corporation Profit Sharing and Savings Plan
We have audited the accompanying statement of net assets available for plan
benefits of the Snyder Oil Corporation Profit Sharing and Savings Plan (the
Plan) as of December 31, 1998, and the related statement of changes in net
assets available for plan benefits for the year then ended. These financial
statements, and the schedules referred to below, are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements and schedules based on our audits.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan as
of December 31, 1998, and the changes in net assets available for the year then
ended in conformity with accounting principles generally accepted in the United
States.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes (Schedule I) and reportable transactions (Schedule II)
are presented for purposes of additional analysis and are not a required part of
the basic financial statements but are supplementary information required by the
Department of Labor Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974. The Fund information in the
statements of net assets available for plan benefits and the statement of
changes in net assets available for plan benefits is presented for purposes of
additional analysis rather than to present the net assets available for plan
benefits and changes in net assets available for plan benefits of each fund. The
supplemental schedules and Fund information have been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, are fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
Arthur Andersen
Fort Worth, Texas
June 21, 1999
<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
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MAY 24, DECEMBER 31,
1999 1998
Investments, at fair value:
Mutual funds ................................ $16,693,099 $17,305,454
Snyder Oil Corporation common stock ......... 1,228,149
Santa Fe Snyder Corporation common stock .... 1,497,404
Loans to participants ....................... 122,982 152,903
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Total investments ........................ 18,313,485 18,686,506
Liabilities:
Due to other plan ........................... 18,313,485
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Net assets available for plan benefits ......... $ -- $18,686,506
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The accompanying notes are an integral part of these financial statements.
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
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<TABLE>
<CAPTION>
PERIOD JANUARY 1,
1999 THROUGH YEAR ENDED
MAY 24, DECEMBER 31,
1999 1998
<S> <C> <C>
Additions to net assets attributed to:-
Investment income:
Interest and dividends ........................ $ 97,804 $ 926,202
Net appreciation (depreciation) of investments:
Mutual funds ................................. 1,008,752 529,956
Snyder Oil Corporation common stock .......... 322,243 (361,100)
Santa Fe Snyder Corporation common stock ..... 28,789
Contributions:
Employer ...................................... 394,531 941,642
Employee ...................................... 764,287 1,743,222
Other receipts ................................ 35,258
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Total additions .............................. 2,616,406 3,815,180
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Deductions from net assets attributed to:
Net benefits paid to participants ............... 2,989,427 1,813,415
Transfers to other plan ......................... 18,313,485 4,265,049
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Total deductions ............................. 21,302,912 6,078,464
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Changes in net assets .............................. (18,686,506) (2,263,284)
Net assets available for plan benefits:
Beginning of period ............................. 18,686,506 20,949,790
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End of period ................................... $ -- $ 18,686,506
------------ ------------
</TABLE>
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
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1. DESCRIPTION OF THE PLAN
The following description of the Snyder Oil Corporation Profit Sharing and
Savings Plan (the Plan) is provided for general information purposes only.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions, as the document is controlling at
all times.
GENERAL
The Plan is a defined contribution plan for employees of Snyder Oil
Corporation (SOCO or the Company) and is subject to the provisions of the
Employee Retirement Security Act of 1974 (ERISA). In 1996, the Plan was
amended and restated to allow for more than one employer and to comply
with the Small Business Job Protection Act of 1996.
Effective May 5, 1999, SOCO merged with Santa Fe Energy Resources, Inc.
(Santa Fe) (the Merger) and adopted the name Santa Fe Snyder Corporation
(SFS). In conjunction with the Merger, the Board of Directors approved the
immediate vesting of Plan benefits for all persons employed on the Merger
date. On May 24, 1999, the transfer of the Plan assets was completed to
the trustee of the surviving Santa Fe Snyder Savings Investment Plan (SFS
Plan). Prior to the Merger, both plan agreements were reviewed by
independent counsel to ensure that benefits were not reduced for the plan
participants.
Patina Oil and Gas Corporation (Patina), a 74 percent-owned SOCO affiliate
and the successor entity to Gerrity Oil and Gas Corporation (Gerrity),
adopted the Plan for the benefit of its eligible employees and, effective
August 16, 1996, the Gerrity 401(k) Plan assets were merged into the Plan.
In October 1997, SOCO sold its interest in Patina. As such, in January
1998, plan assets of $4.3 million attributable to Patina employees were
transferred out of the Plan to a separate plan to be administered by
Patina.
ADMINISTRATION OF THE PLAN
The Plan is administered by the Plan's advisory committee comprising
three employees approved by the SOCO Board of Directors.
Prior to completing the final transfer of the Plan's net assets, each
share of SOCO stock held in the Plan was exchanged immediately after the
merger for 2.05 shares of SFS stock. Upon the Plans merging, Putnam
Investments became the investment manager, recordkeeper and trustee for
all plan assets. Additionally, all mutual and collective trust funds were
mapped to similar Putnam funds and loan balances were transferred for all
active participants.
Prior to January 1998, Barclays Global Investors served as the trustee of
the Plan. Effective January 1998, SOCO designated Merrill Lynch Trust
Company as the trustee of the Plan upon their acquisition of Barclays
Global Investors.
ELIGIBILITY
Substantially all salaried, full-time employees of the Company are
eligible to participate in the Plan. Employees become eligible to
participate in the Plan on the first entry date after the employee attains
age 18 and completes four months of service. The entry dates for the
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SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
--------------------------------------------------------------------------------
Plan were January 1 and June 1. On May 19, 1998, the entry requirements of
the Plan were amended to allow eligible employees to participate on the
first January 1, April 1, July 1 or October 1 after completing three
months of service.
CONTRIBUTIONS
Subject to certain maximum limitations imposed by the Internal Revenue
Code, a participant can elect to contribute to the Plan up to 15% of his
or her annual pre-tax compensation. In 1998, the Plan was amended whereby
a participant can change the applicable percentage or completely suspend
his or her annual contributions effective at the beginning of any calendar
year quarter in accordance with the Plan. The Plan also allows employees
to "rollover" contributions from another qualified plan to the Plan.
Employer contributions to the Plan are entirely discretionary and
determined on an annual basis independently by the SOCO Board of
Directors. Employer contributions are allocated to participants
independently based upon annual compensation, in a manner defined by the
plan agreement. Contributions are allocated in accordance with permitted
disparity provisions of Internal Revenue Code Section 401(1) not to exceed
the sum of 5.7% of the participant's eligible salary not exceeding the
Federal Insurance Contributions Act (FICA) taxable wage base, as defined,
and 11.4% of eligible salary in excess of the FICA taxable wage base, as
defined. Eligible salary excludes overtime and bonuses. Effective with the
Merger on May 5, 1999, the SOCO Compensation Committee approved an interim
company contribution to the SOCO plan whereby all active plan participants
received a contribution equal to a minimum of 7% of eligible participants'
earnings through April 30, 1999.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's
contributions and an allocation of (a) the Company's contribution, (b)
earnings from the plan funds in which the participant has invested and (c)
forfeitures of the unvested portion of terminated participants' accounts.
Allocations are based on participant earnings or account balances, as
defined.
VESTING
Participants are 100% vested at all times with respect to their
contribution and rollover accounts. Vesting in employer contribution
accounts is based on years of service. A participant is 40% vested after
two years, 80% vested after three years and 100% vested after four or more
years of service. In addition, participants also become fully vested in
their employer contribution accounts upon reaching their normal retirement
date as defined by the Plan, or upon death or total disability of the
participant. Effective with the Merger, all company contributions made on,
or prior to, May 5, 1999, and any related earnings, became 100% vested.
INVESTMENTS
The Plan allows participants several investment options in which to invest
their individual and employer contribution accounts which can be changed
at any time throughout the year. Investment income is allocated to
participants based upon the ratio of their participant account balance to
the total participants' accounts in a manner defined by the plan
agreement.
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SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
--------------------------------------------------------------------------------
Upon enrollment in the Plan, a participant may direct employee
contributions in any of the following investment options:
FUND 1 - the "RET PRESERVATION TRUST FUND" invests primarily in U.S.
government obligations, investment contracts and other high-quality
securities. Has low volatility and low earnings potential.
FUND 2 - the "CORPORATE BOND FUND" invests in domestic and foreign fixed
income securities generally rated at or below BBB by Standard & Poor's
Rating Group.
FUND 3 - the "CAPITAL CLASS D FUND" invests in a changing mix of stocks,
bonds and cash equivalents. Aims for a high level of total return over the
long term, consistent with reasonable risk.
FUND 4 - the "GLOBAL ALLOCATION FUND" invests in a varying mix of U.S. and
foreign equity, debt and money market securities in order to benefit from
shifts in the relative performance of different capital markets.
FUND 5 - the "S&P 500 STOCK INDEX FUND" invests in the companies included
in the Standard & Poor's 500 Index. Aims to match the returns of that
index before fees and expenses.
FUND 6 - the "ALLIANCE QUASAR FUND" invests in the stocks of small and
medium-sized companies that the fund manager believes have potential for
above-average, long-term capital appreciation. Has strong earnings
potential accompanied by strong volatility potential.
FUND 7 - the "DAVID NY VENTURE FUND" invests in large capital stocks
identified as being value-priced with the potential for long-term growth.
FUND 8 - the "GROWTH CLD FUND" invests in large capital securities that
have been identified as having the potential of being undervalued at the
market purchase price.
FUND 9 - the "SFS STOCK FUND" invests in Santa Fe Snyder Corporation
common stock.
FUND 10 - the "AIM INTERNATIONAL EQUITY FUND" invests in stocks of large
companies in foreign countries, including France, the United Kingdom,
Germany and Japan. The fund return tracks the European Australia Far East
(EAFE) Index and may fluctuate significantly in response to changes in
currency rates, as well as the factors that affect stock funds generally.
LOANS
Participants may borrow from their fund accounts a minimum of $1,000 and a
maximum equal to the lesser of $50,000 or 50% of their vested account
balance. Loan transactions are treated as a transfer to (from) the
investment funds to the Participant Loan Fund. Loan terms range from one
to five years or up to ten years for the purchase of a primary
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
--------------------------------------------------------------------------------
residence. The loans are secured by the balance in the participant's
account and bear interest at a rate commensurate with local prevailing
rates determined by the plan administrator. Principal and interest are
paid through monthly payroll deductions.
After the May 5, 1999 Merger, loan balances were transferred for all
active participants to Putnam Fiduciary Trust Company.
WITHDRAWALS, TRANSFERS AND FORFEITURES
Distribution of the participant's entire account becomes due upon
retirement, at or after age 55 or upon death or total disability. Such
account balances may be distributed either in a lump-sum distribution or
in instalments, as described in the plan agreement. Participants are
entitled to receive the balance of their individual contribution account
plus their vested interest in their employer contribution account upon
termination of employment. Participants may make hardship withdrawals from
their individual contribution account, subject to certain restrictions.
The nonvested amounts in a participant's employer contribution account are
forfeited to the Plan upon termination. Such forfeitures are allocated to
the remaining participants based upon annual compensation in a manner
defined by the plan agreement. These forfeitures do not reduce the
employer contribution. Forfeitures of $634 and $44,661 were allocated to
remaining participants for the period January 1, 1999 through May 24, 1999
and the year ended December 31, 1998, respectively.
AMENDMENT AND TERMINATION
Although it has expressed no intention to do so, the employer may suspend
or discontinue contributions under the Plan and have reserved the right to
terminate the Plan subject to the provisions of ERISA. In the event of
full or partial termination of the Plan, participants will become fully
vested in their individual and employer contribution accounts and will be
entitled to distributions of their entire accounts according to the plan
document and ERISA.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
METHOD OF ACCOUNTING
Financial statements of the Plan are prepared on the accrual basis of
accounting and include all adjustments necessary to present fairly the
financial statements of the Plan in accordance with generally accepted
accounting principles.
VALUATION OF INVESTMENTS
The Plan's investments are held by and administered by the trustee and are
recorded at fair market value as determined by published quotations.
Investments are accounted for on the GAAP preferred trade date. Loans are
valued at cost which approximates fair market value.
CONTRIBUTIONS
Employee contributions are recorded in the periods in which the Company
makes payroll deductions from the plan participants' earnings. Employer
contributions are recorded on an annual basis as determined by the Board
of Directors.
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
--------------------------------------------------------------------------------
INCOME RECOGNITION
Investment income from dividends and interest is recorded on the accrual
basis, with dividends accrued on the ex-dividend date. The Plan presents,
in the statement of changes in net assets available for benefits, the net
appreciation (depreciation) in the fair value of its instruments which
consists of the realized gains or losses and the unrealized appreciation
(depreciation) on those investments.
EXPENSES
The employer has paid for the majority of the expenses related to the
administration of the Plan, but is not obligated to do so. The employer
will not require reimbursement for these expenses. Any such expenses not
paid by the employer shall be paid from the plan assets. The Plan had no
administrative expenses in 1999 and $15,638 in 1998.
BENEFITS
Benefit claims are accrued when they have been processed and approved for
payment by the Plan. Claims processed and approved, but unpaid as of the
Plan's fiscal year end, are not shown as liabilities on the statement of
net assets available for plan benefits but are reflected as liabilities on
the Plan's Form 5500.
USE OF ESTIMATES
The preparation of the Plan's financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities and the periods in which certain items
of revenue and expense are included. Actual results may differ from such
estimates.
NEW ACCOUNTING STANDARDS
Effective May 24, 1999, the Plan elected early adoption of Statement of
Position 99-3, "Accounting for and Reporting of Certain Defined
Contribution Plan Investments and Other Disclosure Matters" (the SOP). The
SOP modifies disclosures related to participant-directed investments,
significant investment holdings of the Plan and benefit-responsive
investment contracts. The Plan's financial statement disclosures, where
applicable, have been conformed to the SOP.
3. FEDERAL INCOME TAX STATUS OF THE PLAN
FEDERAL INCOME TAXES
The Internal Revenue Service issued a favorable letter of determination
with respect to the tax status of the Plan dated October 28, 1997.
Management believes the Plan's design and operations are in compliance
with the applicable requirements of the Internal Revenue Code (Code).
Therefore, the related trust is exempt from federal income tax under Code
Section 501(a).
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 24, 1999 AND DECEMBER 31, 1998
--------------------------------------------------------------------------------
4. INVESTMENTS
The following table represents the fair values of investments as of May
24, 1999 and December 31, 1998. Investments that represent 5% or more of
the Plan's net assets are separately identified:
MAY 24, DECEMBER 31,
1999 1998
Investments at fair value as determined by
quoted market price:
Ret Preservation Trust Fund ........... $ 1,881,314 $ 1,658,172
Corporate Bond Fund ................... 1,289,024 1,475,046
Capital Class D Fund .................. 2,769,680 3,340,443
S&P 500 Stock Index Fund .............. 5,496,989 5,561,434
Alliance Quasar Fund .................. 2,240,467 3,026,859
Davis NY Venture Fund ................. 1,255,345 920,796
SFS Stock Fund ........................ 1,497,404 1,228,149
Other collective trust funds .......... 1,760,280 1,322,704
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Total investments at fair value .... $18,190,503 $18,533,603
----------- -----------
5. SUBSEQUENT EVENTS
On May 5, 1999, the Plan was merged into the Santa Fe Snyder Savings
Investment Plan (the SFS Plan). Under the new consolidated plan, the
Plan's funds were mapped to similar funds in the SFS Plan: thus, none of
the Plan's funds survived the Merger.
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<PAGE>
SNYDER OIL CORPORATION PROFIT SHARING AND SAVINGS PLAN
ASSETS HELD FOR INVESTMENT PURPOSES
MAY 24, 1999
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<TABLE>
<CAPTION>
(B) (C) (E)
IDENTITY OF DESCRIPTION CURRENT
(A) ISSUE, BORROWER OF INVESTMENT VALUE
<S> <C>
* Merrill Lynch Trust Company S&P 500 Stock Index Fund, $15.30 net asset value $ 5,496,989
* Merrill Lynch Trust Company Capital Class D Fund, $34.36 net asset value 2,769,680
* Merrill Lynch Trust Company Alliance Quasar Fund, $25.00 net assets value 2,240,467
* Merrill Lynch Trust Company Ret Preservation Trust Fund, $1.00 net asset value 1,881,314
* Merrill Lynch Trust Company Corporate Bond Fund, $6.96 net asset value 1,289,024
* Santa Fe Snyder Corporation SFS Stock Fund, $.01 par value 1,497,404
* Merrill Lynch Trust Company Davis NY Venture Fund, $25.01 net asset value 1,255,345
* Merrill Lynch Trust Company Global Allocation Fund, $12.60 net asset value 493,819
* Merrill Lynch Trust Company AIM International Equity Fund, $18.61 net asset value 500,099
* Merrill Lynch Trust Company Growth CLD Fund, $21.46 net asset value 766,362
* Participant loans Loans to participants, interest rates ranging from
8.5% to 11.5% 122,982
--------------
$ 18,313,485
--------------
</TABLE>
* Indicates party-in-interest.
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