UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report(Date of earliest event reported):
December 29, 1999(November 18, 1999)
ST. MARY LAND & EXPLORATION COMPANY
(Exact name of Registrant as specified in its charter)
Delaware 0-20872 41-0518430
(State or other (Commission File (I.R.S Employer
Jurisdiction of Number) Identification No.)
incorporation or
organization)
1776 Lincoln Street, Suite 1100, Denver, Colorado 80203
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(303)861-8140
Not applicable
(Former name or former address, if changed since last report)
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ITEM 2. Acquisition or Disposition of Assets.
On December 17, 1999, St. Mary Land & Exploration Company completed the
acquisition of King Ranch Energy, Inc. under a merger agreement dated July 27,
1999. In the merger St Mary issued 2,666,252 shares of its common stock to
shareholders of King Ranch, Inc., the former parent of King Ranch Energy. The
merger agreement provides that the shares of St. Mary common stock issued in the
acquisition cannot be transferred until March 31, 2001. As a result of the
merger King Ranch Energy became a wholly owned subsidiary of St. Mary and was
renamed St. Mary Energy Company. In addition, Jack Hunt and William Gardner,
officers of King Ranch, Inc., were appointed to the St. Mary board of directors
under the terms of the merger agreement.
King Ranch Energy is an oil and gas exploration and production company with
oil and gas properties located primarily in the Gulf of Mexico and the onshore
Gulf Coast. 1998 production was 48.8 million cubic feet (MMCF) equivalent per
day. Reported oil and gas reserves at December 31, 1998, plus an acquisition
made in early 1999, were 64.7 billion cubic feet (BCF) equivalent and 82%
natural gas.
The press release of St. Mary dated December 17, 1999 announcing the
completion of the acquisition is attached as an exhibit to this report.
Additional information concerning the acquisition is included in the financial
statements of King Ranch Energy and the pro forma financial statements of St.
Mary referred to under Item 7 below.
St. Mary cautions that this report and the attached press release contain
forward-looking statements that include statements concerning the benefits
expected to result from the acquisition, including expected exploration and
production enhancements. Significant factors that could cause future events or
results to differ materially from those expressed or implied by the
forward-looking statements include St. Mary's ability to successfully integrate
the businesses of St. Mary and King Ranch Energy.
ITEM 5. Other Events.
On November 18, 1999, Robert L. Nance was appointed to St. Mary's board of
directors to replace Richard C. Kraus, who resigned.
ITEM 7. Financial Statements and Exhibits
(a) Financial statements of businesses acquired.
The audited financial statements of King Ranch Energy for the years
ended December 31, 1998, 1997 and 1996 are included in St. Mary's Amendment
No. 2 to Registration Statement on form S-4 (Registration No. 333-85537)
filed with the SEC on November 12, 1999 and are incorporated herin by
reference.
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Pursuant to SEC rules, the unaudited financial statements of King
Ranch Energy for the nine months ended September 30, 1999 and 1998 will be
filed by an amendment to this report not later than March 1, 2000.
(b) Pro forma financial information.
Pursuant to SEC rules, the pro forma financial statements of St. Mary
for the nine months ended September 30, 1999 which give effect to the
acquisition of King Ranch energy will be filed by an amendment to this
report not later than March 1, 2000.
(c) Exhibits.
The following exhibits are furnished as part of this report:
Exhibit 2.1 Agreement and Plan of Merger dated July 27, 1999 among St.
Mary Land & Exploration Company, St. Mary Energy Company,
King Ranch, Inc., and King Ranch Energy, Inc., as amended
by Amendment Nos. 1 and 2 dated November 8, 1999 (filed as
Exhibit 2.1 to St. Mary's Amendment No. 2 to Registration
Statement on Form S-4 (Registration No. 333-85537)filed with
the SEC on November 12, 1999 and incorporated herein by
reference)
Exhibit 23.1 Consent of Deloitte & Touche LLP*
Exhibit 99.1 Press release of St. Mary Land & Exploration Company dated
December 17, 1999*
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*Filed herewith
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SIGNATURES
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Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ST. MARY LAND & EXPLORATION COMPANY
Date:December 22, 1999 By /s/ MARK A. HELLERSTEIN
--------------------------
Mark A. Hellerstein
President and Chief Executive
Officer
Date:December 22, 1999 By /s/ RICHARD C. NORRIS
-------------------------
Richard C. Norris
Vice President - Finance,
Treasurer and Secretary
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Current Report on Form 8-K
under the Securities Exchange Act of 1934 of St. Mary Land & Exploration Company
dated December 29, 1999 of our report on King Ranch Energy, Inc. and
subsidiaries dated March 2, 1999 and contained in Registration Statement
333-85537 of St. Mary Land & Exploration Company on Form S-4 under the
Securities Act of 1933 insofar as such report relates to the financial
statements of King Ranch Energy, Inc. and subsidiaries for the year ended
December 31, 1998.
By /s/ DELOITTE & TOUCHE LLP
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DELOITTE & TOUCHE LLP
Houston, Texas
December 29, 1999
EXHIBIT 99.1
FOR INFORMATION
---------------
Mark A. Hellerstein
Jennifer Dethloff
Adele A. Linneman
FOR IMMEDIATE RELEASE
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ST. MARY COMPLETES ACQUISITION OF KING RANCH ENERGY
DENVER - December 17, 1999 - St. Mary Land & Exploration Company (Nasdaq:
MARY) announced that it completed the acquisition of King Ranch Energy, Inc.
("KRE"), in a merger in which St. Mary issued 2,666,252 common shares to the
stockholders of King Ranch, Inc., the former parent company of KRE. Immediately
prior to the merger, KRE was spun-off to the King Ranch Stockholders in order to
facilitate the merger. The shares issued by St. Mary are restricted from sale
through March 31, 2001. As a result of the merger, KRE became a wholly owned
subsidiary of St. Mary and was renamed St. Mary Energy Company.
KRE's properties are located primarily in the Gulf of Mexico and the
onshore Gulf Coast. Other than accounts payable and accrued plugging and
abandonment costs, KRE has no debt.
Jack Hunt and William J. Gardiner, officers of King Ranch, Inc., were
appointed to St. Mary's Board of Directors pursuant to the terms of the merger
agreement. Also, Robert L. Nance has been appointed to replace Richard C. Kraus
on St. Mary's Board.
Tom Congdon, Chairman of St. Mary, commented, "In the third quarter KRE
produced over 50 MMCF equivalent production per day, or an increase of
approximately 60% to St. Mary's third quarter production rate. In addition, we
are pleased to have added to our shareholder base sophisticated shareholders who
invest for the long term with the objective of building value."
Except for historical information herein, statements in this release,
including information regarding the business of the Company, may be
forward-looking statements. These statements involve known and unknown risks,
which may cause the Company's actual results to differ materially from results
expressed or implied by the forward-looking statements. Statements including
factors such as uncertainties in cash flow, expected merger benefits, the
volatility and level of oil and natural gas prices, production rates and reserve
replacement, reserve estimates, drilling and operating risks, competition, the
impact of the year 2000 computer issue, litigation, environmental matters, the
potential impact of government regulations, and other such matters are
forward-looking statements.
