<PAGE>
As filed with the Securities and Exchange Commission on July 2, 1999
Registration No. 333-79747
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CROSS TIMBERS OIL COMPANY
(Exact name of registrant as specified in its charter)
Delaware 75-2347769
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
810 Houston Street, Suite 2000
Fort Worth, Texas 76102
(817) 870-2800
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Frank G. McDonald
810 Houston Street, Suite 2000
Fort Worth, Texas 76102
(817) 870-2800
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
F. Richard Bernasek, Esq.
Kelly, Hart & Hallman, P.C.
201 Main Street, Suite 2500
Fort Worth, Texas 76102
(817) 332-2500
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective. [_]
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================
Proposed Proposed
Title of Each Class Amount Maximum Maximum
of Securities to be to be Offering Price Aggregate Amount of
Registered Registered Per Share(1) Offering Price(1) Registration Fee(2)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value 4,000,000 $10.8125 $43,250,000 $12,023.50
$.01 per share
=================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(c), the offering price is computed on the average of
the high and low prices of the Registrant's common stock, as reported on the
New York Stock Exchange on May 26, 1999.
(2) Previously paid.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
PROSPECTUS
CROSS TIMBERS OIL COMPANY
4,000,000 Shares
Common Stock
This prospectus relates to 4,000,000 shares of common stock of Cross
Timbers Oil Company that may be sold from time to time by the selling
stockholders named in this prospectus.
Cross Timbers Oil Company will not receive any of the proceeds from
the sales by the selling stockholders.
The common stock is traded on the New York Stock Exchange under the
symbol "XTO." On July 1, 1999 the last reported sale price of the common
stock on the NYSE was $ 14.5 per share.
Investing in the common stock involves certain risks. You should
carefully consider the 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 determined that
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this prospectus is July 2, 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Risk Factors.................................................................. 3
We Must Replace Reserves We Produce........................................ 3
Prices of Oil and Natural Gas Fluctuate Widely Based on Market Conditions.. 3
We Have Incurred Substantial Indebtedness.................................. 3
We Have Substantial Capital Requirements................................... 3
We Are in a Highly Competitive Business.................................... 4
There Are Risks in Acquiring Producing Properties.......................... 4
There Are Many Risks in Drilling Oil and Gas Wells......................... 4
We Cannot Insure Against All Operating Hazards............................. 4
Our Reserves Are Uncertain................................................. 5
We Depend Upon Certain Key Persons......................................... 5
We Face Many Government Regulations........................................ 5
Forward-Looking Statements.................................................... 5
Where You Can Find More Information........................................... 6
Cross Timbers Oil Company..................................................... 7
Use of Proceeds............................................................... 7
Recent Developments........................................................... 7
Selling Stockholders.......................................................... 8
Sale of Shares................................................................ 9
Validity of Common Stock...................................................... 9
Experts....................................................................... 9
</TABLE>
CROSS TIMBERS OIL COMPANY
810 Houston Street, Suite 2000
Fort Worth, Texas 76102
(817) 870-2800
2
<PAGE>
RISK FACTORS
You should carefully consider the following risk factors:
We Must Replace the Reserves We Produce
Our success depends upon finding, acquiring and developing oil and gas
reserves that are economically recoverable. Unless we are able to successfully
explore for, develop or acquire proved reserves, our proved reserves will
decline through depletion. To increase reserves and production, we must:
. continue our development drilling and recompletion programs;
. pursue our exploration drilling program; and
. undertake other replacement activities, including property acquisitions.
We cannot assure, however, the success of our exploration, development and
acquisition activities.
Prices of Oil and Natural Gas Fluctuate Widely Based on Market Conditions, and
Any Decline Will Adversely Affect Our Financial Condition.
Our results of operations depend upon the prices received for our oil and gas.
We sell most of our oil and gas at current market prices rather than through
fixed-price contracts. The prices we receive depend upon factors beyond our
control, which include:
. weather conditions;
. the supply and price of foreign oil and gas;
. the level of consumer product demand;
. worldwide economic conditions;
. political conditions in the Middle East;
. the price and availability of alternative fuels;
. the proximity to and capacity of transportation facilities; and
. worldwide energy conservation measures.
Moreover, government regulations, such as regulation of natural gas
transportation and price controls, can affect product prices in the long-term.
Any decline in oil and gas prices adversely affects our financial condition.
If the oil and gas industry experiences significant price declines, we may,
among other things, be unable to meet our financial obligations or make planned
capital expenditures.
We Have Incurred Substantial Debt
We have substantial debt and may incur more. This poses risks to holders of
our securities. If we are unsuccessful in increasing production from existing
reserves or developing new reserves, we may lack the funds to pay principal and
interest on our debt obligations, and the value of any outstanding preferred or
common stock may decline. Our debt also affects our ability to finance future
operations and capital needs and may preclude pursuit of other business
opportunities.
We Have Substantial Capital Requirements
We make, and will continue to make, substantial capital expenditures for the
acquisition, development, production, exploration and abandonment of our oil and
gas reserves. We intend to finance our capital expenditures primarily through
cash flow from operations and bank borrowings. Lower oil and gas prices,
however, reduce cash flow and the amount of credit available under our bank
revolving credit facility. Costs of exploration and development decreased from
$88.6 million in 1997 to $77.4 million in 1998. We initially budgeted $60
million for exploration and development expenditures in 1999. With recent higher
oil prices, we anticipate 1999 expenditures to be between $70 million and $90
million, depending upon the price of oil and gas.
We believe that, after debt service, we will have sufficient cash from
operating activities to finance our exploration and development expenses through
1999. If revenues decrease, however, and we are unable to obtain
3
<PAGE>
additional debt or equity financing, we may lack the capital necessary to
replace our reserves or to maintain production at current levels.
We Are in a Highly Competitive Business
The oil and gas industry is highly competitive. We compete with major oil
companies, independent oil and gas businesses, and individual producers and
operators, many of which have greater financial and other resources than us. In
addition, the industry as a whole competes with other industries which supply
energy and fuel to industrial, commercial and other consumers.
There Are Risks in Acquiring Producing Properties
We constantly evaluate acquisition opportunities and frequently engage in
bidding and negotiation for acquisitions. If successful in this process, we may
alter or increase our capitalization through the issuance of additional debt or
equity securities, the sale of production payments or other measures. Our
current bank revolving credit agreement and the indentures governing outstanding
debt securities, however, contain covenants that limit our ability to incur
additional debt. Any change in capitalization affects our risk profile.
A change in capitalization, however, is not the only way acquisitions affect
our risk profile. Acquisitions may alter the nature of our business. This
would occur when the character of acquired properties is substantially different
from our existing properties in terms of operating or geologic characteristics.
There Are Many Risks in Drilling Oil and Gas Wells
Our drilling activities subject us to many risks, including the risk that we
will not find commercially productive reservoirs. Drilling for oil and gas can
be unprofitable, not only from dry wells, but from productive wells that do not
produce sufficient revenues to return a profit. Also, title problems, weather
conditions, governmental requirements and shortages or delays in the delivery of
equipment and services can delay our drilling operations or result in their
cancellation. The cost of drilling, completing and operating wells is often
uncertain, and we cannot assure that new wells will be productive or that we
will recover all or any portion of our investment.
We Cannot Insure Against All Operating Hazards
Our operations are subject to inherent hazards and risks such as:
. fires;
. natural disasters;
. explosions;
. formations with abnormal pressures;
. blowouts;
. collapses of wellbore, casing or other tubulars;
. pipeline ruptures; and
. spills.
Any of these events could cause a loss of hydrocarbons, environmental
pollution, personal injury claims, damage to our properties, or damage to the
properties of others. As protection against operating hazards, we maintain
insurance coverage against some, but not all, potential losses. Our coverages
include:
. operator's extra expense;
. physical damage to certain assets;
. employer's liability;
. comprehensive general liability;
. automobile; and
. workers' compensation.
We do not believe that insurance coverage for all environmental damages that
could occur is available at a reasonable cost. We believe that our insurance is
adequate and customary for companies of similar size and
4
<PAGE>
operation, but losses could occur for uninsured risks or in amounts exceeding
existing coverage. The occurrence of an event that is not fully covered by
insurance could affect our financial condition and results of operations.
Our Reserves Are Uncertain
Estimating our proved reserves involves many uncertainties, including factors
beyond our control. Petroleum engineers consider many factors and make
assumptions in estimating our oil and gas reserves and future net cash flows.
These factors include:
. historical production from the area compared with production from other
producing areas;
. the assumed effect of governmental regulation; and
. assumptions concerning future oil and gas prices, future production and
development costs, severance and excise taxes, and capital expenditures.
Lower oil and gas prices generally cause lower estimates of proved reserves.
Estimates of reserves and expected future cash flows prepared by different
engineers, or by the same engineers at different times, may differ
substantially. Ultimately, actual production, revenues and expenditures
relating to our reserves will vary from any estimates, and these variations may
be material.
We Depend Upon Certain Key Persons
Our success depends upon our Chairman of the Board of Directors and Chief
Executive Officer, Bob R. Simpson, our Vice Chairman of the Board and President,
Steffen E. Palko, and a limited number of other senior management personnel.
Loss of the services of any of these individuals may affect our operations.
We Face Many Government Regulations
Extensive federal, state and local regulation of the oil and gas industry
significantly affects our operations. In particular, our oil and gas
exploration, development and production, and our storage and transportation of
liquid hydrocarbons, are subject to stringent environmental regulations. These
regulations have increased the costs of planning, designing, drilling,
installing, operating and abandoning oil and gas wells and other related
facilities. These regulations may become more demanding in the future.
We may need to expend significant resources, both financial and managerial, to
comply with environmental regulations and permitting requirements. Although we
believe that our operations generally comply with applicable laws and
regulations, we may incur substantial additional costs and liabilities in our
oil and gas operations as a result of stricter environmental laws, regulations
and enforcement policies.
FORWARD-LOOKING STATEMENTS
Some statements made by Cross Timbers in this prospectus and incorporated by
reference from documents filed with the SEC are "forward-looking statements."
These prospective statements include projections related to:
. production and cash flows;
. number and location of planned wells;
. completion of property acquisitions;
. completion of repurchases of Cross Timbers common stock;
. sources of funds necessary to conduct operations and complete acquisitions;
. acquisition and development budgets;
. anticipated dividend payments;
. anticipated oil and gas price changes; and
. establishing and selling interests in royalty trusts.
In determining these projections, we make numerous assumptions, including
assumptions with respect to:
. the quality of our properties;
. our oil and gas production and development expenditures;
. our potential for growth;
5
<PAGE>
. the demand for oil and gas;
. our sources of liquidity and bank credit availability;
. the impact of production imbalances on liquidity;
. the likelihood of regulatory approval of our operations;
. the impact of regulatory compliance;
. the impact of losing an oil or gas purchaser;
. the impact of new rules promulgated by the Federal Energy Regulatory
Commission; and
. the impact of new legislation in Oklahoma related to infill drilling.
Risks, uncertainties and other factors may cause our actual results to differ
materially from anticipated results expressed or implied by these prospective
statements. The most significant of these risks, uncertainties and other
factors are discussed under "Risk Factors" in this prospectus and in sections of
documents we incorporate by reference, including "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Business and
Properties." You are urged to carefully consider these factors.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You can read and copy
any document filed by us at the public reference facilities maintained by the
SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. You may request copies
of these documents, upon payment of a duplicating fee, by writing the SEC at the
address in the previous sentence. Please call the SEC at 1-800-SEC-0330 for
further information on the operation of its public reference room. Our SEC
filings are also available on the SEC's Website at "http://www.sec.gov."
The SEC allows us to "incorporate by reference" information from other
documents that we file with it, which means that we can disclose important
information by referring you to those documents. The information incorporated
by reference is an important part of this prospectus, and information that we
file later with the SEC will automatically update and supersede this
information. We incorporate by reference the following documents:
. Cross Timbers' Annual Report on Form 10-K for the fiscal year ended
December 31, 1998;
. Cross Timbers' Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999;
. Cross Timbers' current Reports on Form 8-K filed on April 23, 1999
(dated April 8, 1999) and on May 27, 1999 (dated May 17, 1999) and on Form 8-
K/A filed on February 16, 1999 (Amendment No. 2 to Form 8-K dated April 24,
1998) and on May 24, 1999 (Amendment No. 1 to Form 8-K dated April 8, 1999);
. the description of our common stock contained in Cross Timbers' Form 8-A
dated April 8, 1993, as amended by Amendment No. 1 dated June 15, 1995;
. the description of preferred stock purchase rights contained in Cross
Timbers' Form 8-A dated September 8, 1998; and
. all other documents filed by us pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this prospectus and prior to
termination of this offering of common stock.
You may request a copy of any of these documents, except exhibits to the
documents (unless the exhibits are specifically incorporated by reference), at
no cost, by writing or telephoning us at the following address:
Cross Timbers Oil Company
Attention: Investor Relations
810 Houston Street, Suite 2000
Fort Worth, Texas 76102
(817) 870-2800
6
<PAGE>
You should rely only on the information contained in this document or that we
have referred you to. We have not authorized anyone else to provide you with
different information.
CROSS TIMBERS OIL COMPANY
Cross Timbers is a leading United States independent energy company. We
acquire, develop, and explore oil and natural gas properties, and produce,
process, market and transport oil and natural gas. We have consistently
increased our proved reserves, production and cash flow since we started our
operations in 1986. Our growth has come primarily through acquisition of
reserves, followed by aggressive development activities and the purchase of
additional interests in or near our existing reserves. Our oil and gas fields
generally tend to have long remaining reserve lives and predictable production
profiles based on well-established production histories. Our properties are
concentrated in:
. the Permian Basin of West Texas and New Mexico;
. the Hugoton area of Kansas and Oklahoma;
. the Anadarko Basin of Oklahoma;
. the Green River Basin of Wyoming;
. the San Juan Basin of northwestern New Mexico;
. the East Texas Basin of Texas and Louisiana;
. the Middle Ground Shoal Field in Alaska's Cook Inlet; and
. the Arkoma Basin of Arkansas and Oklahoma.
Cross Timbers is a Delaware corporation. Our principal executive offices are
located at 810 Houston Street, Suite 2000, Fort Worth, Texas 76102 and our
telephone number is (817) 870-2800.
USE OF PROCEEDS
Cross Timbers will not receive any of the proceeds from the sale of the common
stock offered by the selling stockholders.
RECENT DEVELOPMENTS
Recently we formed the Hugoton Royalty Trust. We transferred to it 80% net
profits interests in our properties located in the Hugoton area of Kansas and
Oklahoma, the Anadarko Basin of Oklahoma and the Green River Basin of Wyoming.
We retained the underlying working interests in the properties, including the
remaining 20% net profits interests. The 80% nets profits interests represent
approximately 30% of our reserves as of December 31, 1998. In April 1999, we
sold trust units to the public representing approximately 43% of our trust units
of the Hugoton Royalty Trust. We used the net proceeds of proceeds of $149
million from the sale to reduce bank debt. We may form two additional trusts,
one with interests in the San Juan Basin and one with interests in the Permian
Basin.
In May 1999, we sold non-operated producing properties in the San Juan Basin
of New Mexico to Vastar Resources, Inc. for $29.5 million. We used the proceeds
from the sale to reduce bank debt. Our total long-term debt is currently $744
million.
On July 1, we acquired with an affiliate of Lehman Brothers Holdings, Inc., the
common stock of Spring Holding Company, a private oil and gas company located in
Tulsa, Oklahoma, for $39.3 million in cash and 4 million shares of Cross
Timbers' common stock, totaling $85 million. Cross Timbers and Lehman Brothers
each indirectly own through a holding company 50% of all outstanding common
stock of Spring and have equal board representation and control of Spring. We
issued 4 million shares of our common stock at an agreed value of $11.425 per
share for our interest in 50% of Spring, and we received $3.2 million in cash.
Lehman Brothers contributed $42.5 million in cash. At a later date, Cross
Timbers will have the right to purchase, and Lehman Brothers will have the right
to sell to Cross Timbers, Lehman Brothers' 50% equity interest.
Spring Holding Company owns about 1,400 producing wells on 340,000 net acres
located primarily in the Arkoma Basin of Arkansas and Oklahoma. Spring
estimates proved reserves at December 31, 1998 to be 264 billion cubic feet of
natural gas equivalent, of which 99% is natural gas. First quarter daily
production from this
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acquisition averaged 66 million cubic feet of natural gas equivalent. As of
July 1, 1999, Spring's debt was $148 million.
SELLING STOCKHOLDERS
The selling stockholders who are offering common stock in this prospectus are
Natural Gas Partners III, L.P., Natural Gas Partners IV, L.P., Natural Gas
Partners V, L.P., Theresa Killgore, Charles R. Stephenson, Charles E. Still,
Margaret E. Gwartney, Larry Williams, David A. Horton, Jack Wilson, Albert Hood,
Jimmy Joe Bobbitt, Steven R. Hash, Don E. Kentner, Mike Rollins, Teresa White,
Timothy A. Jurek, Steven J. Howry, D. Scott Brewer, Michael Phenicie, and Joe
Dudley. In connection with Cross Timbers' agreement to purchase Spring Holding
Company stock, the selling stockholders entered into agreements to purchase, in
private placement transactions, a total of 4,000,000 shares of common stock.
Cross Timbers agreed to file this registration statement for the resale of those
shares of common stock and to keep it effective until two years after the
purchase of that common stock, unless all the shares are sold before that date.
Cross Timbers also agreed to bear all out-of-pocket expenses of this offering,
other than underwriting discounts and selling commissions. Cross Timbers has
agreed to indemnify the selling stockholders against certain liabilities under
the Securities Act of 1933. The selling stockholders may sell none, some or all
of the common stock offered by them as listed below. None of the selling
stockholders has had any position, office or other material relationship within
the past three years with Cross Timbers or any of its affiliates.
The following table shows the number of shares of common stock that each
selling stockholder owns prior to this offering and the number of shares offered
in this prospectus. Assuming the sale of all the shares offered in this
prospectus, none of the selling stockholders will own any shares of common stock
after the offering.
<TABLE>
<CAPTION>
Number of Shares Number of Shares
Selling Stockholder Owned Prior to Offering Offered
- ------------------- ----------------------- ----------------
<S> <C> <C>
Natural Gas Partners III, L.P. 235,039 235,039
Natural Gas Partners IV, L.P. 1,606,107 1,606,107
Natural Gas Partners V, L.P. 1,566,928 1,566,928
Theresa Killgore 323,437 323,437
Charles R. Stephenson 67,878 67,878
Charles E. Still 26,409 26,409
Margaret E. Gwartney 7,657 7,657
Larry Williams 34,445 34,445
David A. Horton 8,298 8,298
Jack Wilson 13,317 13,317
Albert Hood 3,058 3,058
Jimmy Joe Bobbitt 3,696 3,696
Steven R. Hash 4,786 4,786
Don E. Kentner 3,190 3,190
Mike Rollins 4,786 4,786
Teresa White 1,595 1,595
Timothy A. Jurek 47,713 47,713
(as Trustee of the Timothy A. Jurek Trust)
Steven J. Howry 23,386 23,386
D. Scott Brewer 12,311 12,311
Michael Phenicie 2,982 2,982
Joe Dudley 2,982 2,982
----------------------
4,000,000
</TABLE>
8
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SALE OF SHARES
The selling stockholders advised Cross Timbers that the distribution of the
shares of common stock offered in this prospectus by the selling stockholders
may be effected from time to time in one or more transactions (which may involve
block transactions) on the New York Stock Exchange or other securities exchange
or in transactions otherwise than on those exchanges or in any combination of
transactions. Sales may be effected at market prices prevailing at the time of
sale, at prices related to market prices or at negotiated prices. The selling
stockholders may sell shares to or through broker-dealers in transactions
involving one or more of the following: (1) a block trade in which the broker-
dealer attempts to sell the shares as agent but, to facilitate the transaction,
may position and resell a portion of the block as principal, (2) an underwritten
public offering, (3) purchases by a broker-dealer as principal and resale by the
broker-dealer for its own account or (4) ordinary brokerage transactions in
which the broker-dealer solicits purchases. Broker-dealers participating in the
distribution of shares may be deemed to be underwriters under the Securities Act
of 1933, and any discounts or commissions received by the broker-dealers and any
profit on the resale of the shares may be deemed to be underwriting discounts or
commissions under the Securities Act of 1933.
Any of the shares covered by this prospectus which qualify for sale pursuant
to Rule 144 under the Securities Act of 1933 may be sold under that Rule rather
than pursuant to this prospectus.
Upon notification by a selling stockholder of any material arrangement to sell
shares through a secondary distribution, or a purchase by a broker-dealer, Cross
Timbers will file a supplement to this prospectus, if required, to disclose
among other things the names of the broker-dealers, the number of shares
involved, the price at which the shares will be sold and the commissions paid or
the discounts or concessions allowed to the broker-dealers.
We cannot assure you that the selling stockholders will sell any or all of the
common stock offered by them hereunder.
VALIDITY OF COMMON STOCK
Counsel for Cross Timbers, Kelly, Hart & Hallman, P.C., Fort Worth, Texas,
will give a legal opinion as to the validity of our shares of common stock.
Members of Kelly, Hart & Hallman, P.C. currently own 26,580 shares of our common
stock.
EXPERTS
The information incorporated by reference in this prospectus from our Annual
Report on Form 10-K for the year ended December 31, 1998 regarding the estimated
quantities of proved reserves of our oil and gas properties, the future net cash
flows from those reserves and the present values of those cash flows is derived
from reserve reports prepared or reviewed by Miller and Lents. The information
is incorporated by reference in this prospectus in reliance upon the authority
of said firm as experts in matters contained in the reports.
Our consolidated financial statements incorporated by reference in this
prospectus have been audited by Arthur Andersen LLP independent auditors, as
stated in their report relating to the financial statements. We are
incorporating our financial statements by reference in this prospectus in
reliance upon the authority of said firm as experts in accounting and auditing.
9
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Set forth below is an estimate of the approximate amount of the fees and
expenses expected to be incurred by Cross Timbers Oil Company (the "Company") in
connection with offerings described in this Registration Statement.
<TABLE>
<CAPTION>
<S> <C>
Registration Fee................................... $12,024
-------
Legal Fees and Expenses............................ 15,000
-------
Accounting Fees and Expenses....................... 8,000
-------
Printing and Duplicating Expenses.................. 1,000
-------
Miscellaneous...................................... 19,976
-------
Total.............................................. $56,000
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is incorporated in Delaware. Under Section 145 of the Delaware
General Corporation Law (the "DGCL"), a Delaware corporation has the power,
under specified circumstances, to indemnify its directors, officers, employees
and agents in connection with actions, suits or proceedings brought against them
by a third party or in the right of the corporation, by reason of the fact that
they were or are such directors, officers, employees or agents, against expenses
and liabilities incurred in any such action, suit or proceeding so long as they
acted in good faith and in a manner that they reasonably believed to be in, or
not opposed to, the best interests of such corporation, and with respect to any
criminal action, that they had no reasonable cause to believe their conduct was
unlawful. With respect to suits by or in the right of such corporation, however,
indemnification is generally limited to attorneys' fees and other expenses and
is not available if such person is adjudged to be liable to such corporation
unless the court determines that indemnification is appropriate. A Delaware
corporation also has the power to purchase and maintain insurance for such
persons. Article Nine of the Restated Certificate of Incorporation of the
Company permits indemnification of directors and officers to the fullest extent
permitted by Section 145 of the DGCL. Reference is made to the Restated
Certificate of Incorporation of the Company.
Additionally, the Company has acquired directors and officers insurance in the
amount of $10,000,000, which includes coverage for liability under the federal
securities laws.
Section 102(b)(7) of the DGCL provides that a certificate of incorporation may
contain a provision eliminating or limiting the personal liability of a director
to the corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director provided that such provisions may not eliminate or
limit the liability of a director (i) for any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 (relating to liability for unauthorized
acquisitions or redemptions of, or dividends on, capital stock) of the DGCL or
(iv) for any transaction from which the director derived an improper personal
benefit. Article Ten of the Company's Restated Certificate of Incorporation
contains such a provision.
The above discussion of the Company's Restated Certificate of Incorporation
and Sections 102(b)(7) and 145 of the DGCL is not intended to be exhaustive and
is qualified in its entirety by such Restated Certificate of Incorporation and
statutes.
II - 1
<PAGE>
ITEM 16. EXHIBITS
Exhibit
Number Description
- ------ -----------
5.1* Opinion of Kelly, Hart & Hallman, P.C. re legality.
15.1* Awareness Letter of Arthur Andersen LLP.
23.1 Consent of Arthur Andersen LLP.
23.2* Consent of Miller and Lents, Ltd.
23.3* Consent of Kelly, Hart & Hallman, P.C. (set forth in their opinion
filed as Exhibit 5.1).
24.1* Powers of attorney (set forth on the signature page).
- ----------
*Previously filed.
ITEM 17. UNDERTAKINGS
The Company hereby undertakes that, for the purposes of determining any
liability under the Securities Act of 1933, each filing of the Company'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 this Registration Statement shall be deemed to be a
new Registration Statement relating to the securities offered herein, and the
offering of such securities at the time shall be deemed to be the initial bona
fide offering thereof.
The Company hereby undertakes:
(a) To file, during any period in which offers or sales are being made, a
post-effective amendment to this 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; notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective Registration
Statement; and
(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 paragraphs (a)(i) and (a)(ii) do 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
Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, that are incorporated by reference in the
Registration Statement;
(b) 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;
(c) 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; and
II - 2
<PAGE>
(d) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Company'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 therein, and offering
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person of the
Company 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, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II - 3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Amendment to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Fort Worth, State of Texas, on July 2,
1999.
CROSS TIMBERS OIL COMPANY
By /s/ J. Richard Seeds
-------------------------------------
J. Richard Seeds
Executive Vice President
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
/s/ Bob R. Simpson* Director, Chairman of the Board July 2, 1999
- -----------------------
Bob R. Simpson and Chief Executive Officer
(Principal Executive Officer)
/s/ Steffen E. Palko* Director, Vice Chairman of July 2, 1999
- -----------------------
Steffen E. Palko the Board and President
/s/ J. Richard Seeds Director and Executive Vice June 2, 1999
- -----------------------
J. Richard Seeds President
/s/ J. Luther King, Jr.* Director July 2, 1999
- -----------------------
J. Luther King, Jr.
/s/ Jack P. Randall* Director July 2, 1999
- -----------------------
Jack P. Randall
/s/ Scott G. Sherman* Director July 2, 1999
- -----------------------
Scott G. Sherman
/s/ Louis G. Baldwin Senior Vice President and July 2, 1999
- -----------------------
Louis G. Baldwin Chief Financial Officer
(Principal Financial
Officer)
/s/ Bennie G. Kniffen Senior Vice President and July 2, 1999
- -----------------------
Bennie G. Kniffen Controller (Principal
Accounting Officer)
By /s/ J. Richard Seeds
---------------------
J. Richard Seeds
Attorney-in-Fact
II - 4
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
23.1 Consent of Arthur Andersen LLP.
<PAGE>
EXHIBIT 23.1
INDEPENDENT PUBLIC ACCOUNTANTS' CONSENT
As independent public accountants, we hereby consent to the incorporation
by reference in this Amendment No. 1 to Registration Statement, No. 333-79747,
on Form S-3 of Cross Timbers Oil Company (the "Company"), of our report dated
March 12, 1999 included in the Company's Form 10-K for the year ended December
31, 1998, and our report dated February 15, 1999, included in the Company's Form
8-K/A Amendment No. 2 dated April 24, 1998 and to all references to our firm
included in this Registration Statement. It should be noted that we have not
audited any financial statements of the Company subsequent to December 31, 1998,
or performed any audit procedures subsequent to the date of our report.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Fort Worth, Texas
July 2, 1999
