<PAGE> 1
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997
Commission file number 1-13916
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
(Full title of plan)
Union Pacific Resources Group, Inc.
801 Cherry Street
Fort Worth, Texas 76102
(Name and address of principal executive office of issuer)
The financial statements listed in the accompanying table of contents on the
following page are filed as part of this Form 11-K.
================================================================================
<PAGE> 2
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Administrative Committee of the Plan has duly caused this annual report to be
signed on its behalf by the undersigned hereunto duly authorized.
Union Pacific Resources Group Inc.
Employees' Thrift Plan
Date: June 15, 1998 /s/ Anne M. Franklin
------------------------
By: Anne M. Franklin
Plan Administrator
i
<PAGE> 3
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
TABLE OF CONTENTS TO FINANCIAL STATEMENTS AND
ADDITIONAL INFORMATION
<TABLE>
<CAPTION>
Page
----
<S> <C>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ........................................... 1
REPORT OF INDEPENDENT AUDITORS ..................................................... 2
FINANCIAL STATEMENTS:
Statement of Net Assets Available for Benefits with Fund Information
As of December 31, 1997 ...................................................... 3
Statement of Net Assets Available for Benefits with Fund Information
As of December 31, 1996 ...................................................... 4
Statement of Changes in Net Assets Available for Benefits with Fund Information
For the Year Ended December 31, 1997 ......................................... 5
Statement of Changes in Net Assets Available for Benefits with Fund Information
For the Year Ended December 31, 1996 ......................................... 6
Notes to Financial Statements .................................................... 7
SUPPLEMENTAL SCHEDULES AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1997:
Schedule I - Supplemental Schedule of Assets Held for Investment Purposes ....... 15
Schedule II - Supplemental Schedule of Reportable Transactions ................... 16
EXHIBITS:
23.1 Consent of Independent Public Accountants .................................. 17
23.2 Independent Auditors' Consent .............................................. 18
</TABLE>
ii
<PAGE> 4
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Trustees and Participants of the
Union Pacific Resources Group Inc. Employees' Thrift Plan:
We have audited the accompanying statement of net assets available for benefits
of the Union Pacific Resources Group Inc. Employees' Thrift Plan (the "Plan") as
of December 31, 1997, and the related statement of changes in net assets
available for benefits for the year ended December 31, 1997. These financial
statements, and the supplemental schedules referred to below, are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements and supplemental schedules based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
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 benefits of the Plan as of
December 31, 1997, and the changes in net assets available for benefits for the
year ended December 31, 1997, in conformity with generally accepted accounting
principles.
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 and reportable transactions are presented for the
purpose 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
Employees' Retirement Income Security Act of 1974. The Fund Information in the
statement of net assets available for benefits and the statement of changes in
net assets available for benefits is presented for purposes of additional
analysis rather than to present the net assets available for benefits and
changes in net assets available for 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 LLP
Fort Worth, Texas
June 3, 1998
1
<PAGE> 5
REPORT OF INDEPENDENT AUDITORS
To the Trustees and Participants of the
Union Pacific Resources Group Inc. Employees' Thrift Plan:
We have audited the accompanying statement of net assets available for benefits
of Union Pacific Resources Group Inc. Employees' Thrift Plan (the "Plan") as of
December 31, 1996 and the related statement of changes in net assets available
for benefits for the year then ended. 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 audits.
We conducted our audit in accordance with generally accepted auditing standards.
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, such financial statements present fairly, in all material
respects, the net assets available for benefits for the Plan at December 31,
1996 and the changes in net assets available for benefits for the year then
ended in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental information by fund is
presented for the purpose of additional analysis of the basic financial
statements rather than to present information regarding the net assets available
for benefits and change in net assets available for benefits of the individual
funds. The supplemental information by fund is the responsibility of Plan's
management. Such supplemental information by fund has been subjected to the
auditing procedures applied in our audit of the 1996 financial statements and,
in our opinion, is fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
DELOITTE & TOUCHE LLP
Fort Worth, Texas
June 24, 1997
2
<PAGE> 6
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
=============================================================================
INDEX
TOTAL UPR FIXED TRUST 500 U.S. INTERNAT'L
PLAN INCOME PORTFOLIO GROWTH WELLINGTON GROWTH
=============================================================================================
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Receivables
Contributions - UPR $ 3,773,103 $ -- $ -- $ -- $ -- $ --
Dividends & other 186,004
Investments at fair value (Note 3)
Investment in mutual funds 134,941,992 25,366,127 64,805,384 15,986,026 14,760,211 9,107,623
Investment in unallocated GICs 17,265,301 17,265,301
Investment in stock funds
UPC stock fund 20,157,793
UPRG stock fund 14,996,379
PAYSOP 2,350,970
Investment in common stocks
UPRG common stock, earned 4,761,779
UPRG common stock, unearned 84,938,171
Participant loan balances 5,625,594
---------------------------------------------------------------------------------------------
Total assets 288,997,086 42,631,528 64,805,384 15,986,026 14,760,211 9,107,623
---------------------------------------------------------------------------------------------
LIABILITIES (Note 4):
Interest payable 1,856,222
Note payable 102,203,863
---------------------------------------------------------------------------------------------
Total liabilities 104,060,085 -- -- -- -- --
---------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS: $ 184,937,001 $42,631,528 $64,805,384 $15,986,026 $14,760,211 $ 9,107,623
=============================================================================================
<CAPTION>
PARTICIPANT DIRECTED
===========================================================================
VMMR SMALL/ UPC UPRG
BOND PRIME MIDCAP STOCK STOCK
INDEX PORTFOLIO PORTFOLIO FUND FUND
===========================================================================
<S> <C> <C> <C> <C> <C>
ASSETS:
Receivables
Contributions - UPR $ -- $ -- $ -- $ -- $ --
Dividends & other
Investments at fair value (Note 3)
Investment in mutual funds 2,704,175 1,320,990 891,356
Investment in unallocated GICs
Investment in stock funds
UPC stock fund 20,157,793
UPRG stock fund 14,996,379
PAYSOP
Investment in common stocks
UPRG common stock, earned
UPRG common stock, unearned
Participant loan balances
---------------------------------------------------------------------------
Total assets 2,704,175 1,320,990 891,356 20,157,793 14,996,379
---------------------------------------------------------------------------
LIABILITIES (Note 4):
Interest payable
Note payable
---------------------------------------------------------------------------
Total liabilities -- -- -- -- --
---------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS: $ 2,704,175 $ 1,320,990 $ 891,356 $20,157,793 $14,996,379
===========================================================================
<CAPTION>
PARTICIPANT DIRECTED
================================
UPRG ESOP
LOAN -----------------------------
PAYSOP FUND Allocated Unallocated
=============================================================
<S> <C> <C> <C> <C>
ASSETS:
Receivables
Contributions - UPR $ -- $ -- $ -- $ 3,773,103
Dividends & other 10,384 175,620
Investments at fair value (Note 3)
Investment in mutual funds
Investment in unallocated GICs
Investment in stock funds
UPC stock fund
UPRG stock fund
PAYSOP 2,350,970
Investment in common stocks
UPRG common stock, earned 4,761,779
UPRG common stock, unearned 84,938,171
Participant loan balances 5,625,594
-------------------------------------------------------------
Total assets 2,350,970 5,625,594 4,772,163 88,886,894
-------------------------------------------------------------
LIABILITIES (Note 4):
Interest payable 1,856,222
Note payable 102,203,863
-------------------------------------------------------------
Total liabilities -- -- -- 104,060,085
-------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS: $ 2,350,970 $ 5,625,594 $ 4,772,163 $ (15,173,191)
=============================================================
</TABLE>
The accompanying notes are an integral part of this financial statement.
3
<PAGE> 7
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
=============================================================================
INDEX
TOTAL UPR FIXED TRUST 500 U.S. INTERNAT'L
PLAN INCOME PORTFOLIO GROWTH WELLINGTON GROWTH
=============================================================================================
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at fair value (Note 3)
Investment in mutual funds $ 104,381,051 $23,380,170 $48,065,595 $11,134,463 $10,878,587 $ 8,293,049
Investments in unallocated GICs 19,779,438 19,779,438
Investment in stock funds
UPC stock fund 21,843,840
UPRG stock fund 17,426,039
PAYSOP 2,917,842
Participant loan balances 5,053,489
---------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS: $ 171,401,699 $43,159,608 $48,065,595 $11,134,463 $10,878,587 $ 8,293,049
=============================================================================================
<CAPTION>
PARTICIPANT DIRECTED
============================================================================================
VMMR UPC UPRG
BOND PRIME STOCK STOCK LOAN
INDEX PORTFOLIO FUND FUND PAYSOP FUND
============================================================================================
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at fair value (Note 3) $ 1,573,957 $ 1,055,230 $ -- $ -- $ -- $ --
Investment in mutual funds
Investments in unallocated GICs
Investment in stock funds
UPC stock fund 21,843,840
UPRG stock fund 17,426,039
PAYSOP 2,917,842
Participant loan balances 5,053,489
---------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE $ 1,573,957 $ 1,055,230 $21,843,840 $17,426,039 $2,917,842 $5,053,489
FOR BENEFITS:
=============================================================================================
The accompanying notes are an integral part of this financial statement.
</TABLE>
4
<PAGE> 8
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
================================================================================================
INDEX
TOTAL UPR FIXED TRUST 500 U.S. INTERNAT'L
PLAN INCOME PORTFOLIO GROWTH WELLINGTON GROWTH
================================================================================================
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 8,476,603 $ 2,864,406 $ 1,346,880 $ 617,327 $ 1,231,648 $ 386,778
NET APPRECIATION/
(DEPRECIATION) IN FAIR
VALUE OF INVESTMENTS (1,786,992) (4,332) 14,578,548 2,471,488 1,365,728 (122,269)
CONTRIBUTIONS BY:
PARTICIPANTS 7,663,343 1,710,673 2,241,889 1,519,032 1,090,646 777,554
UPR 14,167,804
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE 5,085,958
NET TRANSFERS BETWEEN
FUNDS (2,988,883) 993,090 486,105 478,802 (68,187)
------------------------------------------------------------------------------------------------
TOTAL ADDITIONS 33,606,716 1,581,864 19,160,407 5,093,952 4,166,824 973,876
------------------------------------------------------------------------------------------------
INTEREST EXPENSE 7,709,216
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE 5,085,958
WITHDRAWALS BY 7,276,240 2,109,944 2,420,618 242,389 285,200 159,302
PARTICIPANTS
------------------------------------------------------------------------------------------------
TOTAL DEDUCTIONS 20,071,414 2,109,944 2,420,618 242,389 285,200 159,302
------------------------------------------------------------------------------------------------
NET INCREASE(DECREASE) 13,535,302 (528,080) 16,739,789 4,851,563 3,881,624 814,574
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 171,401,699 43,159,608 48,065,595 11,134,463 10,878,587 8,293,049
------------------------------------------------------------------------------------------------
END OF YEAR $184,937,001 $ 42,631,528 $ 64,805,384 $15,986,026 $14,760,211 $9,107,623
================================================================================================
</TABLE>
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
===================================================================================================
VMMR SMALL/ UPC UPRG
BOND PRIME MID CAP STOCK STOCK LOAN
INDEX PORTFOLIO PORTFOLIO FUND FUND PAYSOP FUND
===================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 137,310 $ 65,254 $ 77,721 $ 442,496 $ 128,560 $ 20,192 $ 418,001
NET APPRECIATION/
(DEPRECIATION) IN FAIR
VALUE OF INVESTMENTS 60,748 (70,667) 906,114 (2,903,364) (496,170)
CONTRIBUTIONS BY:
PARTICIPANTS 217,893 86,182 19,474
UPR
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE
NET TRANSFERS BETWEEN
FUNDS 882,452 155,001 865,226 (2,071,963) 1,017,567 251,376
---------------------------------------------------------------------------------------------------
TOTAL ADDITIONS 1,298,403 306,437 891,754 (723,353) (1,757,237) (475,978) 669,377
---------------------------------------------------------------------------------------------------
INTEREST EXPENSE
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE
WITHDRAWALS BY 168,185 40,677 398 962,694 672,423 90,894 97,272
PARTICIPANTS
---------------------------------------------------------------------------------------------------
TOTAL DEDUCTIONS 168,185 40,677 398 962,694 672,423 90,894 97,272
---------------------------------------------------------------------------------------------------
NET INCREASE(DECREASE) 1,130,218 265,760 891,356 (1,686,047) (2,429,660) (566,872) 572,105
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 1,573,957 1,055,230 -- 21,843,840 17,426,039 2,917,842 5,053,489
---------------------------------------------------------------------------------------------------
END OF YEAR $2,704,175 $1,320,990 $891,356 $20,157,793 $14,996,379 $2,350,970 $5,625,594
===================================================================================================
</TABLE>
<TABLE>
<CAPTION>
UPRG ESOP
-------------------------
Allocated Unallocated
=========================
<S> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 21,144 $ 718,886
NET APPRECIATION/
(DEPRECIATION) IN FAIR
VALUE OF INVESTMENTS (308,109) (17,264,707)
CONTRIBUTIONS BY:
PARTICIPANTS
UPR 14,167,804
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE 5,085,958
NET TRANSFERS BETWEEN
FUNDS (586)
-------------------------
TOTAL ADDITIONS 4,798,407 (2,378,017)
-------------------------
INTEREST EXPENSE 7,709,216
ALLOCATION OF 197,395
SHARES OF UPR COMMON
STOCK, AT FAIR VALUE 5,085,958
WITHDRAWALS BY 26,244
PARTICIPANTS
-------------------------
TOTAL DEDUCTIONS 26,244 12,795,174
-------------------------
NET INCREASE(DECREASE) 4,772,163 (15,173,191)
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR -- --
-------------------------
END OF YEAR $4,772,163 $(15,173,191)
=========================
</TABLE>
The accompanying notes are an integral part of this financial statement.
5
<PAGE> 9
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
===============================================================================================
INDEX
TOTAL UPR FIXED TRUST 500 U.S. INTERNAT'L
PLAN INCOME PORTFOLIO GROWTH WELLINGTON GROWTH
===============================================================================================
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 7,084,740 $ 659,577 $ 571,903 $ 817,410 $ 871,247 $ 360,642
NET APPRECIATION/
(DEPRECIATION)IN FAIR
VALUE OF INVESTMENTS 19,208,459 9,346 3,019,576 1,187,719 669,056 648,927
CONTRIBUTIONS BY:
PARTICIPANTS 6,457,352 394,080 391,955 996,543 909,185 683,038
UPR 4,473,259 (7,804) 65,092 59,511 43,770
DISTRIBUTION OF UPR STOCK
NET TRANSFERS BETWEEN
FUNDS 43,740,916 45,049,540 2,271,284 (41,114) 1,319,455
-----------------------------------------------------------------------------------------------
TOTAL ADDITIONS 37,223,810 44,796,115 49,032,974 5,338,048 2,467,885 3,055,832
-----------------------------------------------------------------------------------------------
DISTRIBUTIONS:
WITHDRAWALS BY
PARTICIPANTS 8,394,690 1,327,938 375,999 240,460 651,591 306,737
NET TRANSFERS TO/(FROM)
OTHER PLANS &
PARTICIPANTS 1,287,807 308,569 591,380 250,662
-----------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 9,682,497 1,636,507 967,379 240,460 651,591 557,399
-----------------------------------------------------------------------------------------------
NET INCREASE(DECREASE) 27,541,313 43,159,608 48,065,595 5,097,588 1,816,294 2,498,433
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 143,860,386 -- -- 6,036,875 9,062,293 5,794,616
-----------------------------------------------------------------------------------------------
END OF YEAR $171,401,699 $ 43,159,608 $ 48,065,595 $ 11,134,463 $ 10,878,587 $ 8,293,049
===============================================================================================
</TABLE>
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
===================================================================================================
VMMR UPC UPRG
BOND PRIME STOCK STOCK LOAN
INDEX PORTFOLIO FUND FUND PAYSOP FUND
===================================================================================================
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 108,604 $ 24,943 $ -- $ 60,871 $ 49,532 $ 392,140
NET APPRECIATION/
(DEPRECIATION)IN FAIR
VALUE OF INVESTMENTS (49,775) 4,638,966 594,335 689,251
CONTRIBUTIONS BY:
PARTICIPANTS 135,983 40,834 4,909 2,446 5,187 16,524
UPR 9,635 1,085 3,982,679
DISTRIBUTION OF UPR STOCK (9,581,641) 9,581,641
NET TRANSFERS BETWEEN
FUNDS (220,006) 960,145 26,858,864 490,507 (222,028)
----------------------------------------------------------------------------------------------------
TOTAL ADDITIONS (15,559) 1,027,007 21,921,098 14,712,479 743,970 186,636
----------------------------------------------------------------------------------------------------
DISTRIBUTIONS:
WITHDRAWALS BY
PARTICIPANTS 100,755 234,367 77,258 141,123 132,050 205,853
NET TRANSFERS TO/(FROM)
OTHER PLANS &
PARTICIPANTS 3,320 15,381
----------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 100,755 234,367 77,258 144,443 147,431 205,853
----------------------------------------------------------------------------------------------------
NET INCREASE(DECREASE) (116,314) 792,640 21,843,840 14,568,036 596,539 (19,217)
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 1,690,271 262,590 -- 2,858,003 2,321,303 5,072,706
----------------------------------------------------------------------------------------------------
END OF YEAR $ 1,573,957 $ 1,055,230 $ 21,843,840 $ 17,426,039 $ 2,917,842 $ 5,053,489
====================================================================================================
</TABLE>
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
============================================
UNION UNION UNION
PACIFIC PACIFIC PACIFIC
COMPANY EQUITY FIXED
STOCK INDEX INCOME
============================================
<S> <C> <C> <C>
INVESTMENT INCOME:
DIVIDEND & INTEREST $ 485,024 $ 543,571 $2,139,276
NET APPRECIATION/
(DEPRECIATION)IN FAIR
VALUE OF INVESTMENTS 2,830,061 4,993,517 (22,520)
CONTRIBUTIONS BY:
PARTICIPANTS 99,752 1,386,001 1,390,915
UPR 114,746 204,545
DISTRIBUTION OF UPR STOCK
NET TRANSFERS BETWEEN
FUNDS (29,522,545) (44,085,597) (46,599,421)
---------------------------------------------
TOTAL ADDITIONS (26,107,708) (37,047,762) (42,887,205)
---------------------------------------------
DISTRIBUTIONS:
WITHDRAWALS BY
PARTICIPANTS 662,236 1,519,205 2,419,118
NET TRANSFERS TO/(FROM)
OTHER PLANS &
PARTICIPANTS 4,269 61,829 52,397
---------------------------------------------
TOTAL DISTRIBUTIONS 666,505 1,581,034 2,471,515
---------------------------------------------
NET INCREASE(DECREASE) (26,774,213) (38,628,796) (45,358,720)
NET ASSETS AVAILABLE
FOR BENEFITS:
BEGINNING OF YEAR 26,774,213 38,628,796 45,358,720
---------------------------------------------
END OF YEAR $ -- $ -- $ --
=============================================
</TABLE>
The accompanying notes are an integral part of this financial statement.
6
<PAGE> 10
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. PLAN DESCRIPTION
The following description of the Union Pacific Resources Group Inc. Employees'
Thrift Plan (the "Plan") provides only general information. Participants should
refer to the Plan document for a more complete description of the Plan's
provisions.
General
The Plan is a defined contribution pension plan covering: a) all regular
full-time, non-agreement employees, b) agreement employees whose union contracts
allow for their participation, and c) regular part-time employees of Union
Pacific Resources Group Inc. (the "Company" or "UPR") who have completed twelve
months of service and worked at least 1,000 hours. The Board of Directors of
the Company and the Plan Administrator control and manage the operation and
administration of the Plan. Additionally, the Plan is subject to the applicable
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). In
October 1995, the Company sold approximately 17% of its common stock in an
initial public offering (the "Offering"). Prior to consummation of the
Offering, the Company was wholly owned by Union Pacific Corporation ("UPC").
Following the Offering and until October 15, 1996, UPC owned approximately 83%
of the Company's outstanding common stock. Concurrent with the Offering, UPC
announced its intention to distribute its remaining ownership interest in the
Company to its shareholders as a dividend by means of a tax-free distribution
(the "Distribution"). On October 15, 1996, the Distribution was consummated. At
that time, the participants in the Plan received .846946 of a share of the
Company's Common Stock for each share of UPC common stock held in the
participants' accounts. The participants, upon consummation of the
Distribution, received 343,736 shares at $27.875.
Effective as of January 1, 1997, the Company added a leveraged employee stock
ownership feature to the Plan (the "UPRG ESOP") (see Note 4). The UPRG ESOP
operates as a leveraged employee stock ownership plan, and is designed to comply
with Section 4975(e)(7) and the regulations thereunder of the Internal Revenue
Code (the "IRC"), as amended.
Contributions
The Plan permits a participant to make annual employee contributions to the Plan
on a before-tax or after-tax basis. A participant's aggregate before-tax or
after-tax contributions may not exceed 13% of the participant's annual
compensation. The before-tax contributions meet the requirements of section
401(k) of the IRC, so that amounts contributed will not be included in the
participant's income for federal income tax purposes. Conversely, amounts
contributed to the Plan on an after-tax basis will be included in the
participant's income for federal income tax purposes. In prior years, the Plan
provided for payroll based employee stock ownership plan contributions
("PAYSOP"). Aggregate monthly employee contributions may be invested entirely in
the UPR Fixed Income Fund, Vanguard Index Trust - 500 Portfolio Fund ("Index
Trust-500 Portfolio"), Vanguard U.S. Growth Fund ("U.S. Growth"),
Vanguard/Wellington Fund ("Wellington"), Vanguard International Growth Fund
7
<PAGE> 11
("International Growth"), Vanguard Bond Index Fund ("Bond Index"), Vanguard
Money Market Reserves - Prime Portfolio ("VMMR Prime Portfolio"), Rainier
Investment Management Small/Mid Cap Equity Portfolio ("Small/Mid Cap Portfolio")
or any combination thereof, in multiples of 5% in accordance with the personal
election made by each employee.
As of January 1, 1997, the Company is obligated to make contributions in cash to
the UPRG ESOP which, when aggregated with the UPRG ESOP's dividend and interest
earnings, equal the amount required to enable the UPRG ESOP to make the
necessary principal and interest payments on its note payable to the Company
(see Note 4). Shares of the Company's stock are allocated to participant
accounts in amounts necessary to meet the Company's matching requirement equal
to 200% of each participant's basic contribution, limited to 3% of the
participant's annual compensation. From March 1, 1996 to December 31, 1996, all
employer matching contributions were invested in the UPRG Stock Fund. Employer
matching contributions prior to March 1, 1996, but subsequent to the Offering,
were eligible to be invested in any of the available funds including the UPRG
Stock Fund, in multiples of 5% in accordance with the personal election made by
each employee. Prior to the Offering, employer contributions were eligible to be
invested in any of the available funds, including the UPC Stock Fund, in
multiples of 5% in accordance with the personal election made by each employee.
Participant Accounts
Participants' Plan accounts are maintained on a unit basis. Under this method, a
participant's account value is expressed in units of participation by fund,
representing an undivided interest in the underlying assets and income of the
fund. The purchase or redemption price of the units is determined daily by
Vanguard Fiduciary Trust Company (the "Trustee"), based on the current market
values, or contract value in the case of Guaranteed Investment Contracts
("GICs"), of the underlying assets of the fund.
8
<PAGE> 12
The number of fund units and their unit values at December 31, 1997 and 1996
were:
<TABLE>
<CAPTION>
1997 1996
---- ----
UNIT UNIT
UNITS VALUE UNITS VALUE
----- ----- ----- -----
<S> <C> <C> <C> <C>
UPR Fixed Income Fund 4,212,602 $ 10.12 4,260,573 $ 10.13
Index Trust - 500 Portfolio 719,500 90.07 695,014 69.16
U.S. Growth 557,004 28.70 469,017 23.74
Wellington 501,196 29.45 416,007 26.15
International Growth 555,682 16.39 503,830 16.46
Bond Index 268,005 10.09 159,955 9.84
VMMR Prime Portfolio 1,320,990 1.00 1,055,230 1.00
Small/Mid Cap Portfolio 39,704 22.45 -- --
UPC Stock 1,520,196 13.26 1,709,221 12.78
UPRG Stock 1,362,069 11.01 1,310,228 13.30
PAYSOP 213,530 11.01 219,387 13.30
UPRG ESOP - Allocated 602,546 7.92 -- --
</TABLE>
Loans to Participants
In June 1985, the loan provisions of the Plan were approved by the Internal
Revenue Service and became effective. The amount of a loan is limited to
one-half of the vested value of a participant's account, excluding PAYSOP and
subject to a $1,000 minimum and a maximum loan amount of $50,000 less the
highest loan balance outstanding in the previous twelve months. As the loan is
repaid, all principal and interest payments will be credited to the
participant's accounts, excluding PAYSOP, in the same proportions as the
contributions then being made on behalf of the participant. If no contributions
are then being made, the loan repayments will be invested in accordance with the
participant's most recent investment election, unless he or she directs
otherwise to the extent permitted by the Plan. Participants' loans, which are
secured by the participants' individual account balances, bear a fixed rate of
interest set by the Plan Administrator based on interest rates then being
charged on similar loans, and are repayable over periods not exceeding five
years, except loans relating to a principal residence, in which case the term of
the loan shall not exceed fifteen years. The loans bear interest ranging from 6%
to 10.5% and have terms ranging from 1 to 15 years. The number of loans
outstanding at December 31, 1997 and 1996 was 543 and 559, respectively.
Vesting
Participants at all times have a 100% vested interest in their employee
contributions plus actual earnings thereon and their PAYSOP account. A
participant is 100% vested in the portion of his/her account derived from UPRG
ESOP Matching Contributions made after January 1, 1997. A participant's interest
in the portion of his/her account derived from Company Contributions and
Matching Contributions prior to January 1, 1997 are 100% vested after five years
of service. A participant's interest in pre-1997 Company Contributions and
Matching Contributions will also
9
<PAGE> 13
become 100% vested if, while employed by the Company, the participant reaches
age 65, dies, or sustains a total and permanent disability.
Payment of Benefits
A participant may elect to receive a final distribution under the Plan as
either: a) a cash lump sum distribution, or (b) monthly installments over a
specified period of time not to exceed the lesser of: (i) ten calendar years, or
(ii) the life expectancy of the participant or the joint life expectancy of the
participant and his/her beneficiary. For benefit payments equal to or less than
$3,500, the Plan Administrator may direct the Trustee to make a lump sum payment
to the participant or beneficiary. Each distribution will be in cash, except
that a participant may elect to have the portion of his/her account that is
invested in the UPC Stock fund and the UPRG Stock fund distributed in full
shares of stock. The portion of a participant's PAYSOP account and UPRG ESOP
account will be distributed in full shares of stock provided, however, that a
participant might elect to receive a distribution from these accounts in cash.
All installment distributions will be made in cash. In-kind distributions will
be lump sum and any fractional shares will be distributed in cash. A participant
may make an in-service withdrawal from his/her account in accordance with the
Plan's provisions.
Forfeitures
When certain terminations of participation in the Plan occur, the nonvested
portion of a participant's account, as defined by the Plan, represents a
potential forfeiture. Such potential forfeitures reduce subsequent Company
contributions to the Plan. However, if upon reemployment the former participant
fulfills certain requirements as defined in the Plan, the previously forfeited
nonvested portion of the participant's account may be restored through Company
contributions.
Amounts summarized below represent Company contributions forfeited for the year
ended December 31, 1997 and 1996.
<TABLE>
<CAPTION>
1997 1996
------- -------
<S> <C> <C>
Company contributions forfeited $19,363 $60,984
======== =======
</TABLE>
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accounts of the Plan have been maintained on the accrual basis in accordance
with generally accepted accounting principles. The Plan is subject to the
provisions of ERISA and the financial statements and schedules are prepared in
accordance with the financial reporting requirements of ERISA, as permitted by
the Securities and Exchange Commission's amendments to Form 11-K adopted during
1990.
Investment Valuation and Income Recognition
The Plan's investments in shares of registered investment companies are valued
at quoted market prices that represent the net asset value of shares held by the
Plan at year-end Daily
10
<PAGE> 14
Valuation. The Company stock funds are valued at their year-end unit closing
price (comprised of year-end market prices plus uninvested cash position).
Investments in GICs are valued at contract value, which approximates fair value.
Contract value represents cost plus reinvested interest. Participant loans are
valued at cost, which approximates fair value.
Purchases and sales of investments are recorded on a trade date basis. Interest
income is accrued when earned. Dividend income is recorded on the ex-dividend
date. Capital gain distributions are included in dividend income.
Payment of Benefits
Benefit distributions are recorded when paid.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of additions and deductions during the reporting period.
Actual results could differ from those estimates.
3. INVESTMENTS
Until October 15, 1996, Plan investments were maintained in commingled funds of
the Plan Trustee, along with investments of another UPC-administered Thrift
Plan, within a Master Trust. Until October 15, 1996, assets, liabilities,
investment income, and security gains/losses were allocated monthly to the Plan
based on its equity in the investments of the Master Trust.
After October 15, 1996 and during the year ended December 31, 1997, participants
were allowed to allocate their contributions among the following investment
options:
UPR Fixed Income Fund: At December 31, 1997 and 1996, the fund is comprised of
investments in GICs and the Vanguard Retirement Savings Trust. The estimated
fair value of the GICs at December 31, 1997 and 1996 were $17,265,301 and
$19,779,438, respectively. The crediting interest rates of the GICs at December
31, 1997 and 1996 ranged from 6.05% to 7.85% and from 5.19% to 7.85%,
respectively. These rates are guaranteed and not subject to reset. The average
yields, in the aggregate were approximately 7.09% for 1997 and approximately
6.80% for 1996. GICs are held with insurance companies rated at least AA by
Standard & Poors and will mature on or before December 15, 1999. The respective
insurance companies unconditionally guarantee the principal and interest. The
Vanguard Retirement Savings Trust is composed of contracts issued by financial
institutions and backed by high quality bonds and bond mutual funds. As the GICs
expire, the proceeds will be reinvested in the Vanguard Retirement Savings
Trust.
11
<PAGE> 15
Index Trust - 500 Portfolio: At December 31, 1997 and 1996, the fund is invested
in the Vanguard Index Trust 500 Portfolio which seeks to provide long-term
growth of capital and income from dividends by holding all of the 500 stocks
that make up the unmanaged Standard & Poor's 500 Composite Stock Index.
U.S. Growth: At December 31, 1997 and 1996, the fund is invested in the Vanguard
U.S. Growth Portfolio which invests in established U.S. growth stocks.
Wellington: At December 31, 1997 and 1996, the fund is invested in the
Vanguard/Wellington Fund which invests in common stocks and fixed-income
securities.
International Growth: At December 31, 1997 and 1996, the fund is invested in the
Vanguard International Growth Portfolio which invests in foreign common stocks
with high growth potential.
Bond Index: At December 31, 1997 and 1996, the fund is invested in the Vanguard
Bond Index Fund which is designed to closely track the investment performance of
the unmanaged Lehman Brothers Aggregate Bond Index.
VMMR Prime Portfolio: At December 31, 1997 and 1996, the fund is invested in the
Vanguard Money Market Reserves - Prime Portfolio which seeks to provide income
by investing in short-term, high-quality money market instruments issued by
financial institutions, nonfinancial corporations, the U.S. government and
federal agencies.
Small/Mid Cap Portfolio: At December 31, 1997, the fund is invested in the
Rainier Investment Management Small/Mid Cap Equity Portfolio which seeks to
provide long-term growth of capital.
UPC Stock Fund: At December 31, 1997 and 1996, the fund is invested primarily in
UPC common stock.
UPRG Stock Fund and PAYSOP: At December 31, 1997 and 1996, the funds are
invested primarily in Company common stock.
Plan investments with a fair value greater than 5% of the Plan's net assets
available for benefits are identified as follows:
<TABLE>
<CAPTION>
December 31,
1997 1996
---- ----
<S> <C> <C>
UPR Fixed Income Fund
Retirement Savings Trust Fund $ 25,366,227 $ 23,380,170
GICs 17,265,301 19,779,438
Index Trust 500 Portfolio 64,805,384 48,065,595
U.S. Growth Fund 15,986,026 11,134,463
Wellington Fund 14,760,211 10,878,587
UPC Stock Fund 20,157,793 21,843,840
UPRG Stock Fund 14,996,379 17,426,039
</TABLE>
12
<PAGE> 16
4. EMPLOYEE STOCK OWNERSHIP PLAN
On January 2, 1997, the Trustee, on behalf of the UPRG ESOP (the Plan's ESOP
feature), purchased 3,700,000 shares of common stock of the Company (the "ESOP
Shares") for $107,300,000. The ESOP shares were purchased with the proceeds from
a note payable from the Company. The note payable requires repayment of
principal and interest thereon at a fixed rate of 7.5% per annum over a maximum
term of 30 years beginning in January 1997 and is collateralized by the ESOP
shares. Note payments are funded with dividends paid on the ESOP shares (whether
or not allocated) and with cash contributions from the Company. As note payments
are made, shares are released from collateral, based on the proportion of debt
service paid. ESOP shares released from collateral are allocated to participant
accounts in amounts necessary to: (a) meet the Company's 200% matching
requirement and (b) replace the value of any dividends on ESOP shares allocated
to participant accounts which are used to repay the note payable from the
Company. Principal or interest prepayments may be made to ensure that the
Company's matching obligation is met. As a result of 1997 prepayments of
principal and interest, current principal and interest requirements on the note
payable are $8.3 million annually. At December 31, 1997, the note payable
balance of $102,203,863 approximates fair value. Currently scheduled
amortization of the note payable is as follows: 1998 - $4,150,349; 1999 -
$1,019,000; 2000 - $1,100,000; 2001 - $1,188,000; 2002 - $1,282,000; and
thereafter - $93,464,514.
Once the ESOP shares are allocated to participant accounts, the Company has no
rights against such ESOP shares. Accordingly, the financial statements of the
Plan for the year ended December 31, 1997 present separately the assets and
liabilities of the UPRG ESOP and changes therein pertaining to: (a) the accounts
of employees with vested rights in allocated stock (UPRG ESOP - Allocated) and
(b) stock not yet allocated to employees (UPRG ESOP - Unallocated).
At December 31, 1997, the UPRG ESOP's investments are presented in the following
table:
<TABLE>
<CAPTION>
Allocated Unallocated
------------ --------------
<S> <C> <C>
Company Common Stock:
Number of Shares: 196,362 3,502,605
============ ==============
Cost $ 5,069,946 $ 101,575,545
============ ==============
Market $ 4,761,779 $ 84,938,171
============ ==============
</TABLE>
5. RELATED PARTY TRANSACTIONS
The Plan invests in shares of mutual funds managed by an affiliate of the
Trustee. The Trustee acts as trustee for only those investments as defined by
the Plan. Transactions in such investments qualify as party-in-interest
transactions which are exempt from the prohibited transaction rules.
6. PLAN EXPENSES
The Company, as provided by the Plan document, pays the Plan's expenses and
reimbursement by the Plan is not required.
13
<PAGE> 17
7. PLAN AMENDMENTS
Effective January 1, 1997, the Company established the UPRG ESOP (see Notes 1
and 4). During 1997, all employer contributions were invested in the UPRG ESOP.
Additionally, a participant is 100% vested at all times in the portion of
his/her account derived from Company contributions since January 1, 1997. Each
regular full-time employee is automatically enrolled in the Plan on his/her date
of employment with an employee contribution rate of 3% of compensation, as
defined by the Plan, unless such employee completes a form indicating their
election not to participate. Each regular part-time employee is automatically
enrolled in the Plan after completion of twelve months of service and 1,000
hours of employment unless such employee completes a form indicating their
election not to participate. All such contributions are invested in the VMMR
Prime Portfolio until each employee makes his/her personal election.
8. FEDERAL INCOME TAXES
The Internal Revenue Service has determined and informed the Company by a letter
dated July 27, 1995 that the Plan and related trust are designed in accordance
with applicable sections of the IRC. The Plan has been amended since receiving
the determination letter. However, the Plan Administrator and the Plan's tax
counsel believe that the Plan is designed and currently being operated in
compliance with the applicable requirements of the IRC.
With respect to the operation of the Plan, Plan management is aware of certain
operational defects that could adversely affect the tax-exempt status of the
Plan. These operational defects will be corrected through the use of the
Voluntary Compliance Resolution (VCR) program. Submission to the VCR program was
originally made on August 5, 1996. Restated submissions were made in 1997.
9. PLAN TERMINATION
Although the Plan is intended to be continued by the Company, the Company
reserves the right to amend or terminate the Plan. In the event of a Plan
termination or partial termination, or the Company permanently ceases to make
contributions, all invested amounts shall immediately vest and be
nonforfeitable. All funds shall continue to be held for distribution as provided
by the Plan.
14
<PAGE> 18
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
ITEM 27a - SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1997
EIN: 13-2626465
PN: 005
<TABLE>
<CAPTION>
Interest
Identity of Issue or Party Involved Investment Type Rate Cost Current Value
----------------------------------- --------------- ---- ---- -------------
<S> <C> <C> <C> <C>
UPR Fixed Income Fund
AIG Life Unallocated Insurance Contract 7.81% $ 2,602,712 $ 2,602,712
Bayerische Landesbank Unallocated Insurance Contract 6.05% 2,107,022 2,107,022
Hartford Unallocated Insurance Contract 7.85% 2,859,868 2,859,868
Metropolitan Life Unallocated Insurance Contract 7.03% 3,207,912 3,207,912
New York Life Unallocated Insurance Contract 7.16% 3,245,256 3,245,256
Principal Mutual Unallocated Insurance Contract 6.92% 3,242,531 3,242,531
* Vanguard Retirement Savings Trust Registered Investment Company 6.17% 25,436,860 25,366,227
Vanguard:
* Index Trust - 500 Portfolio Registered Investment Company 48,501,013 64,805,384
* Vanguard U.S. Growth Registered Investment Company 12,304,113 15,986,026
* Vanguard/Wellington Fund Registered Investment Company 12,279,642 14,760,211
* International Growth Portfolio Registered Investment Company 8,434,586 9,107,623
* VBIF - Total Bond Market Registered Investment Company 2,642,709 2,704,175
* VMMR - Prime Portfolio Registered Investment Company 1,320,990 1,320,990
Rainier:
* Small/Mid Cap Equity Portfolio Registered Investment Company 961,363 891,356
* UPC Stock Fund UPC Common Stock, $2.50 par value 8,632,653 20,157,793
* UPRG Stock Fund UPRG Common Stock, no par value 12,969,949 14,996,379
* PAYSOP UPRG Common Stock, no par value 903,007 2,350,970
* UPRG ESOP - Allocated UPRG Common Stock, no par value 5,079,341 4,761,779
* UPRG ESOP - Unallocated UPRG Common Stock, no par value 101,575,545 84,938,171
* Participant Loan Fund Participant Loans 6%-10.5% -- 5,625,594
------------- --------------
Total assets held for investment purposes $ 258,307,072 $ 285,037,979
============= ==============
</TABLE>
* Party in Interest.
This supplemental schedule lists assets held for investment purposes at
December 31, 1997 as required by the Department of Labor Rules and Regulations
for Reporting and Disclosure.
15
<PAGE> 19
UNION PACIFIC RESOURCES GROUP INC. EMPLOYEES' THRIFT PLAN
ITEM 27d - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
- --------------------------------------------------------------------------------
EIN: 13-2626465
PN: 005
<TABLE>
<CAPTION>
Total Total Asset Value on
Identity of Party/ Number of Number of Purchase Selling Cost of Transaction Net Gain
Description of Asset Purchases Sales Price Price Asset Date Or Loss
- -------------------- --------- ----- ----- ----- ----- ---- -------
<S> <C> <C> <C> <C> <C> <C> <C>
INDIVIDUAL TRANSACTIONS:
UPRG ESOP :
UPRG Common Stock $ 107,300,000 $ 107,300,000
SERIES TRANSACTIONS:
The Vanguard Group:
UPR Fixed Income 197 - $ 11,397,773 $ 11,397,773
- 344 $ 11,916,156 $ 11,863,261 11,916,156 $ 52,895
The Vanguard
Group:
Index Trust-500 Portfolio 261 - 9,772,223 9,772,223
- 252 7,610,313 6,419,871 7,610,313 1,190,442
The Vanguard Group:
U.S. Growth 226 - 5,870,789 5,870,789
- 180 3,490,644 2,994,075 3,490,644 496,569
UPRG ESOP:
UPRG Common Stock 1 - 107,300,000 107,300,000
34 26,876 27,731 26,876 (855)
</TABLE>
This supplemental schedule lists all series and individual transactions in
excess of 5% of the fair value of plan assets at the beginning of the
year as required by the Department of Labor Rules and Regulations
for Reporting and Disclosure.
16
<PAGE> 20
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
- ------- -------
<S> <C>
23.1 Consent of Independent Public Accountants
23.2 Independent Auditors' Consent
</TABLE>
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report dated June 3, 1998, included in this Annual Report on Form 11-K, into the
Union Pacific Resources Group Inc.'s previously filed Registration Statements
No. 333-22655 and No. 333-52605 on Form S-3 and No. 333-22613 and No.
333-35641 on Form S-8.
ARTHUR ANDERSEN LLP
Fort Worth, Texas
June 15, 1998
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statements No.
333-22655 and No. 333-52605 of Union Pacific Resources Group Inc. on Form S-3
and No. 333-22613 and No. 333-35641 of Union Pacific Resources Group Inc. on
Form S-8 of our report dated June 24, 1997, appearing in this Annual Report on
Form 11-K of the Union Pacific Resources Group Inc. Employees' Thrift Plan for
the year ended December 31, 1997.
DELOITTE & TOUCHE LLP
Fort Worth, Texas
June 15, 1998
