AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 10, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________________________________________________
GENERAL AMERICAN ROYALTY, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
75-2468002
(IRS Employer Identification Number)
4925 GREENVILLE AVENUE, SUITE 1005
DALLAS, TEXAS 75206
(Address of principal executive offices)
JAMES F. SMITH
GENERAL AMERICAN ROYALTY, INC.
4925 GREENVILLE AVENUE, SUITE 1005
DALLAS, TEXAS 75206
(Name and address of agent for service)
(214) 361-8535
(Telephone number, including area code of agent for service)
CONSULTING AGREEMENTS AND COMPENSATION AGREEMENTS
(Full title of the Plan)
_____________________________________________________________
COPY TO:
Robert L. Sonfield, Jr.
Sonfield & Sonfield
770 South Post Oak Lane, Suite 435
Houston, Texas 77056-1913
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after
the effective date of this Registration Statement.
CALCULATION OF REGISTRATION FEE
Proposed
Propsed maximum
maximum aggregate Amount of
Title of securities Amount to be offering price offering registration
to be registered registered per share(1) price(1) fee
- -------------------------------------------------------------------------
Common Stock,
$.001 par value 168,500(2) $.01(3) $1,685 $0.51
- ------------------- ---------- ------- ------ -----
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rue 457 under the Securities Act of 1933.
(2) Reflects shares of common stock issuable upon exercise of the Company's
Common Stock Purchase Warrants ("Warrants").
(3) Based on exercise price of the Warrants.
<PAGE>
GENERAL AMERICAN ROYALTY, INC.
CROSS REFERENCE SHEET REQUIRED BY ITEM 501(B) OF REGULATION S-B
FORM S-8 ITEM NUMBER AND CAPTION CAPTION IN PROSPECTUS
-------------------------------- ---------------------
1. Forepart of Registration Statement and Outside Front Cover Page of
Prospectus Facing Page of Registration Statement and Cover Page of
Prospectus
2. Inside Front and Outside Back Cover Pages of Prospectus Inside Cover
Page of Prospectus and Outside Cover Page of Prospectus
3. Summary Information, Risk Factors and Ratio of Earnings to Fixed Charges
Not Applicable
4. Use of Proceeds Not Applicable
5. Determination of Offering Price Not Applicable
6. Dilution Not Applicable
7. Selling Security Holders Not Applicable
8. Plan of Distribution Not Applicable
9. Description of Securities to be Registered Consulting Agreements
10. Interest of Named Experts and Counsel Not Applicable
11. Material Changes Not Applicable
12. Incorporation of Certain Information by Reference Information
Incorporated by Reference
13. Disclosure of Commission Position on Indemnification
Indemnification for Securities Act Liabilities
<PAGE>
PROSPECTUS
<PAGE>
GENERAL AMERICAN ROYALTY, INC.
168,500 Shares of Common Stock
($.001 Par Value)
This Prospectus is part of a Registration Statement which registers an
aggregate 168,500 shares of common stock, $.001 par value, common stock of
General American Royalty, Inc. (the "Company") which may be issued as set forth
herein to the following named persons:
NAME NUMBER OF SHARES
---- ------------------
Forte Communications, Inc. ("Forte") 28,500 shares
Patricia A. Meding ("Meding") 80,000 shares
James F. Smith ("Smith") 7,000 shares
C.B. Harrison, Jr. ("Harrison") 7,000 shares
George E. Green ("Green") 14,000 shares
Douglas Weedon ("Weedon") 14,000 shares
Sam E. Nicholson ("Nicholson") 14,000 shares
William Amdall ("Amdall") 4,000 shares
On August 28, 1998, Warrants were granted to Forte pursuant to a consulting
agreement (the "Forte Consulting Agreement") and Warrants were granted to Meding
pursuant to a consulting agreement (the "Meding Consulting Agreement"). The
Forte Consulting Agreement and Meding Consulting Agreement are collectively
referred to as the Consulting Agreements. In addition, Warrants were granted to
Smith, Harrison, Green, Weedon, Nicholson and Amdall as compensation for
services (collectively, the "Compensation Agreements"). The Company has been
advised by the Warrantholders that they may sell all or a portion of their
shares of common stock from time to time through securities brokers/dealers only
at current market prices and that no commissions or compensation will be paid in
connection therewith in excess of customary brokers commissions. Forte, Meding,
Smith, Harrison, Green, Weedon, Nicholson and Amdall and the brokers and dealers
through whom sales of the shares are made may be deemed to be "underwriters"
within the meaning of the Securities Act of 1933, as amended, (the "Securities
Act"), and any profits realized by them on the sale of the shares may be
considered to be underwriting compensation.
No other person is authorized to give any information or make any
representation not contained or incorporated by reference in this Prospectus, in
connection with the offer contained in this Prospectus, and, if given or made,
such other information or representation must not be relied upon as having been
authorized by the Company. Neither the delivery of this Prospectus nor any sale
made hereunder shall, under any circumstances, create any implication that there
has been no change in the affairs of the Company since the date hereof.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE COMPANY IS A CRIMINAL
OFFENSE.
This Prospectus does not constitute an offer to sell or the solicitation of
any offer to buy any security other than the securities covered by this
Prospectus, nor does it constitute an offer or solicitation by anyone in any
jurisdiction in which such offer or solicitation is not authorized, or in which
the person making such offer or solicitation is not qualified to do so, or to
any person to whom it is unlawful to make such offer or solicitation.
The date of this Prospectus is September 10, 1998
<PAGE>
i
TABLE OF CONTENTS
AVALIABLE INFORMATION 1
INFORMATION INCORPORATED BY REFERENCE 1
THE COMPANY 2
CONSULTING AGREEMENTS 2
Warrant Terms and Provisions 3
Federal Income Tax Effects 3
Restrictions Under Securities Laws 3
DESCRIPTION OF CAPITAL STOCK 4
Common Stock 4
Registrar and Transfer 4
Dissenters' Rights 4
Preferred Stock 4
LEGAL MATTERS 5
EXPERTS 5
STATEMENT OF INDEMNIFICATION 5
<PAGE>
1
AVAILABLE INFORMATIONAVALIABLE INFORMATIONl
General American Royalty, Inc. (the "Company") is subject to the
requirement to file reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act"), and, in accordance therewith, files
reports and other materials with the Securities and Exchange Commission (the
"Commission"). Reports, proxy statements and other materials filed by the
Company can be inspected and copied (at prescribed rates) at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of all or any part of such material may be
obtained from the Commission upon payment of fees prescribed by the Commission.
The Commission maintains a web site that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. The address of such web site is http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on Form
S-8 (the "Registration Statement") under the Securities Act of 1933, as amended
(the "Act"), with respect to an aggregate of 168,500 shares of the Company's
Common Stock, which may be issued to Forte Communications, Inc. ("Forte") and
Patricia A. Meding ("Meding") consultants of the Company, upon the exercise of
common stock purchase warrants issued to said consultants, pursuant to written
consulting agreements. This Prospectus does not contain all of the information
set forth in the Registration Statement, certain portions of which have been
omitted as permitted by the rules and regulations of the Commission. For
further information with respect to the Company and the shares of the Common
Stock offered by this Prospectus, reference is made to the Registration
Statement, including the exhibits thereto. Statements in this Prospectus as to
any document are not necessarily complete, and where any such document is an
exhibit to the Registration Statement or is incorporated by reference herein,
each such statement is qualified in all respects by the provisions of such
exhibit or other document, to which reference is hereby made, for a full
statement of the provisions thereof. A copy of the Registration Statement, with
exhibits, may be obtained from the Commission's office in Washington, D.C. (at
the above address) upon payment of the fees prescribed by the rules and
regulations of the Commission, or examined there without charges.
INFORMATION INCORPORATED BY REFERENCEINFORMATION INCORPORATED BY REFERENCEl
The Company's Annual Report on Form 10-KSB dated February 12, 1998 for the
fiscal year ended October 31, 1997 and the Company's Quarterly Report on Form
10-QSB dated March 17, 1998, June 12, 1998 and September 8, 1998 for the first
quarter ended January 31, 1998, the second quarter ended April 30, 1998 and the
third quarter ended July 31, 1998 respectively. The Company's Form 8-K, Item 6,
Resignation of Directors, filed June 11, 1998 and Form 8-K, Item 2, Disposition
of Assets and Item 5, Other Events, filed July 31, 1998. The above referenced
reports, which were previously filed with the Commission are incorporated herein
by reference.
All documents filed by the Company pursuant to Section 13, 14 or 15 (d) of
the Exchange Act after the date hereof and prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is
incorporated or deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
THE COMPANY HEREBY UNDERTAKES TO FURNISH WITHOUT CHARGE TO EACH PERSON TO
WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF SUCH PERSON,
A COPY OF ANY OR ALL OF THE DOCUMENTS DESCRIBED ABOVE, OTHER THAN EXHIBITS TO
SUCH DOCUMENTS. REQUESTS SHOULD BE ADDRESSED TO MR. JAMES F. SMITH, PRESIDENT,
GENERAL AMERICAN ROYALTY, INC., ONE ENERGY SQUARE, SUITE 1005, 4925 GREENVILLE
AVENUE, DALLAS, TEXAS 75206, TELEPHONE NUMBER (214) 361-8535.
<PAGE>
9
THE COMPANYTHE COMPANYl
General American Royalty, Inc. (the "Company") is a Delaware corporation
incorporated on December 28, 1992 as Hermes Capital Management, Inc. It
conducted no business activities under that name. On December 23, 1995 it
changed its name to General American Royalty, Inc. and became active in the
acquisition of certain oil and gas royalty, overriding and fee mineral interests
located in Texas and New Mexico. Interests have been purchased in exchange for
shares of Common Stock of the Company, issuance of promissory notes and for
cash. During 1996 the Company completed a private placement of common stock and
a public offering of units that consisted of shares of common stock and stock
purchase warrants. Net proceeds from these offerings were approximately
$485,000, which were used to complete acquisitions of royalty and mineral
interests and to repay debt. The equity unit offering was closed in mid 1997 as
the warrants expired. The Company netted approximately $56,000 through the
exercise of the warrants.
After closing the equity offering in 1997, the Company was prohibited from
obtaining additional equity capital until January of 1998, to comply with
securities regulations on integration of offerings. This restricted the
Company's ability to acquire royalty assets and to repay short-term debt
obligations as they became due with permanent equity capital. The Company
managed the oil and gas royalty and mineral interests it acquired in 1996 until
it became necessary for the Company to sell all its interests in March and July
of 1998 to satisfy short-term debt requirements and payables.
The Company is currently seeking a substantial private company, with
demonstrated success in an attractive industry, to merge with. The Company will
be considering merger candidates engaged in industries other than the energy
industry.
The Company's stock began trading on the OTC Bulletin Board (Symbol TROY)
in February, 1997.
The Company's address is one Energy Square, 4925 Greenville Avenue, Suite
1005, Dallas, Texas, 75206. Its telephone number is 214-361-8535. Its fax
number is 214-361-7715.
CONSULTING AGREEMENTS CONSULTING AGREEMENTSl
On August 28, 1998 the Company entered into the Consulting Agreements with
Forte and Meding pursuant to which options were issued to purchase 80,000 and
28,500 respectively, shares of Common Stock of the Company. Under the terms of
the Consulting Agreement, Forte will consult with and advise the Company with
respect to matters concerning (i) dissemination of press releases and quarterly
and annually reports; (ii) communications with analysts, broker/dealers and
other members of the financial community. Meding will consult with and advise
the Company with respect to matters concerning certain financial matters
including communications with analysts, broker/dealers and other members of the
financial community. The term of the Consulting agreements began on August 28,
1998 and will continue for a period of three (3) years unless sooner terminated
as provided therein.
COMPENSATION AGREEMENTS
The Company has agreed to compensate the following named persons for
services rendered to the Company by granting Warrants to purchase the number of
shares of common stock of the Company set opposite their respective names:
NAME NUMBER OF SHARES
---- ------------------
James F. Smith 7,000 shares
C.B. Harrison, Jr. 7,000 shares
George E. Green 14,000 shares
Douglas Weedon 14,000 shares
Sam E. Nicholson 14,000 shares
William Amdall 4,000 shares
WARRANT TERMS AND PROVISIONSWarrant Terms and Provisionsl
The common stock purchase warrants ("Warrants") create the right to
purchase an aggregate of 168,500 shares of the Company's common stock at $.01
per share. The Warrants were issued as of August 28, 1998 and will expire on
August 27, 2001.
All of the Warrants were issued pursuant to the Consulting Agreements and
Compensation Agreements and were not issued pursuant to any program or plan
being administered by either the Board of Directors of the Company or any
committee of the Board of Directors organized for that purpose. The specific
terms of the Warrants are as follows:
(a) Warrant Exercise Price. The exercise price per share of the
------------------------
Warrants was established by the Board of Directors at $.01 per share.
(b) Term of Warrants. The Warrants may be exercised in whole or
------------------
in part at any time through August 28, 2001, unless the expiration date of the
Warrant and the term of the Consulting agreements are extended by the Company in
writing to a later date.
(c) Manner of Exercise. All or any whole number of such Warrants
-------------------
may be exercised for cash during the term of the Warrants.
(d) Transferability. The Warrants are not transferable without
---------------
the Company's prior written approval.
(e) Redemption. There are no redemption rights afforded to the
----------
Company in connection with the Warrants.
(f) Adjustments. The number of shares of Common Stock of the
-----------
Company purchasable upon exercise of the Warrants and the exercise price of the
Warrants are subject to adjustment upon the occurrence of specified events
primarily involving stock dividends, stock splits, reorganizations,
reclassifications, consolidations and mergers.
(g) No Right As Stockholder. No Warrant holder is by virtue of
--------------------------
ownership of the Warrants, entitled to any rights whatsoever of a stockholder of
the Company.
FEDERAL INCOME TAX EFFECTSFederal Income Tax Effectsl
A Warrant holder does not recognize taxable income on the date of the grant
of the Warrant, which is a non-statutory option, but recognizes ordinary income
generally at the date of exercise in the amount of the difference between the
Warrant exercise price and the fair market value of the common Stock on the date
of exercise. However, in the event that the holder is, or may become, subject
to the restrictions on resale of common stock under Section 16 of the Securities
Exchange Act of 1934, such person generally recognizes ordinary income at the
end of the six-month period following the date of exercise in the amount of the
difference between the option exercise price and the fair market value of the
common stock at the end of the six-month period. Nevertheless, such holders may
elect within 30 days after the date of exercise to recognize ordinary income as
of the date of exercise. The amount of ordinary income recognized by the
Warrant holder is deductible by the company in the year that income is
recognized. The foregoing is not intended to be a complete statement of
applicable law and Russo should rely on its own legal counsel with respect
thereto.
RESTRICTIONS UNDER SECURITIES LAWSRestrictions Under Securities Lawsl
The sale of any shares of Common Stock acquired upon the exercise of the
Warrants must be made in compliance with federal and state securities laws.
Officers, directors and 10% or greater stockholders of the Company, as well as
certain other persons or parties who may be deemed to be "affiliates" of the
Company under the Federal Securities Laws, should be aware that resales by
affiliates can only be made pursuant to an effective Registration Statement,
Rule 144 or any other applicable exemption. Officers, directors and 10% and
greater stockholders are also subject to the "short swing" profit rule of
Section 16(b) of the Securities Exchange Act of 1934. Section 16(b) of the
Exchange Act generally provides that if an officer, director or 10% and greater
stockholder sold any Common Stock of the Company acquired pursuant to the
exercise of a stock option, he would generally be required to pay any "profits"
resulting from the sale of the stock and receipt of the stock option. Section
16(b) exempts all warrant exercises from being treated as purchases and,
instead, treats a warrant grant as a purchase of the underlying security, which
grant\purchase may be matched with any sale of the underlying security within
six months of the date of grant. The foregoing is not intended to be a complete
statement of applicable law and Russo should rely on its own legal counsel with
respect thereto.
DESCRIPTION OF CAPITAL STOCKDESCRIPTION OF CAPITAL STOCKl
The Company is authorized to issue 20 million shares of Common Stock,
$0.001 par value, and 5 million shares of Preferred Stock. The presently
outstanding shares of Common Stock are fully paid and nonassessable. There are
no shares of Preferred Stock issued and outstanding.
COMMON STOCKCommon Stockl
There are presently outstanding 1,031,500 shares of Common Stock.
Voting Rights. Holders of shares of Common Stock are entitled to one vote
--------------
per share on all matters submitted to a vote of the shareholders. Shares of
Common Stock do not have cumulative voting rights; accordingly, the holders of a
majority of the shareholder votes eligible to vote and voting for the election
of the Board of Directors can elect all members of the Board of Directors.
Dividend Rights. Holders of record of shares of Common Stock are entitled
----------------
to receive dividends when and if declared by the Board of Directors out of funds
of the Company legally available therefor.
Liquidation Rights. Upon any liquidation, dissolution or winding up of the
------------------
Company, holders of shares of Common Stock are entitled to receive pro rata all
of the assets of the Company available for distribution to shareholders after
distributions are made to the holders of the Company's Preferred Stock.
Preemptive Rights. Holders of Common Stock do not have any preemptive
rights to subscribe for or to purchase any stock, obligations or other
securities of the Company.
REGISTRAR AND TRANSFER AGENTRegistrar and Transferl
The Company's registrar and transfer agent is Securities Transfer
Corporation, 16910 Dallas Parkway, Suite 100, Dallas, Texas 75248.
DISSENTERS' RIGHTSDissenters' Rightsl
Under current Delaware law, a shareholder is afforded dissenters' rights
which, if properly exercised, may require the Company to purchase his shares
dissenters' rights commonly arise in extraordinary transactions such as mergers,
consolidations, reorganizations, substantial asset sales, liquidating
distributions, and certain amendments to the Company's certificate of
incorporation.
PREFERRED STOCKPreferred Stockl
The Company is also authorized to issue 5 million shares of Preferred
Stock. The Preferred Stock or any series thereof shall have such designations,
preferences and relative, participating, optional or special rights and
qualifications, limitations or restrictions thereof as shall be expressed in the
resolution or resolutions providing for the issue of such stock adopted by the
board of directors and may be made dependent upon facts ascertainable outside
such resolution or resolutions of the board of directors, provided that the
manner in which such facts shall operate upon such designations, preferences,
rights and qualifications, limitations or restrictions of such class or series
of stock is clearly and expressly set forth in the resolution or resolutions
providing for the issuance of such stock by the board of directors.
LEGAL MATTERSLEGAL MATTERSl
Certain legal matters in connection with the securities offered hereby are
being passed upon for the Company by Sonfield & Sonfield, Houston, Texas,
counsel to the Company.
EXPERTSEXPERTSl
The balance sheet as of October 31, 1997 and the statements of operations,
stockholders' equity and cash flows for the year ended October 31, 1997,
incorporated by reference in this Prospectus, have been incorporated by
reference herein in reliance on the report of Hein + Associates LLP, independent
accountants, given on the authority of said firms as experts in accounting and
auditing.
STATEMENT OF INDEMNIFICATIONSTATEMENT OF INDEMNIFICATIONl
Pursuant to Section 145 of the General Corporation Law of the State of
Delaware, the Company has the power to indemnify any person made a party to any
lawsuit by reason of being a director or officer of the Company, or serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
actions suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
Company pursuant to the foregoing provisions, the Company has been informed 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.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
-------------------------------------------
The documents listed in (a) through (c) below are incorporated by reference
in the Registration Statement. All documents subsequently filed by the
Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior to the filing of a
posteffective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold shall be deemed
to be incorporated by reference in the Registration Statement and to be part
thereof from the date of filing of such documents.
(a) Amendment Number 1 to the Registrant's registration statement on
Form 10-SB dated April 12, 1997 and the Registrant's Quarterly Report on Form
10-QSB dated August 12, 1997 for the fiscal quarter ending April 30, 1997, which
were previously filed with the Commission are incorporated herein by reference.
(b) All other reports filed pursuant to Section 13 or 15(d) of the
Exchange Act since the end of the fiscal quarter covered by the Registrant's
Form 10-QSB referred to in (a) above.
(c) The class of securities to be offered hereby is registered under
Section 12 of the Exchange Act. A description of the Registrant's securities is
set forth in Item 11 of its Amendment Number 1 to Form 10-SB which is
incorporated as a part of this Registration Statement.
Item 5: Interests of Named Experts and Counsel.
-------------------------------------------
None
Item 6: Indemnification of Directors and Officers.
---------------------------------------------
(a) Section 145 of the Delaware General Corporation Law provides that:
145. INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS; INSURANCE
(1) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such actions suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contenders or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(2) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, is or was serving at the request
of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
(3) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b), or in defense
of any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(4) Any indemnification under subsections (a) and (b) (unless ordered
by a court) shall be made by the corporation only as authorized in the specific
case upon a determination that indemnification of the director, officer,
employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in subsections (a) and (b). Such
determination shall be made (1) by a majority vote of the directors who are not
parties to such action, suit or proceeding, even though less than a quorum, or
(2) if there are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (3) by the stockholders.
(5) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative, or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the corporation as authorized in this Section. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the board of directors deems appropriate.
(6) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
(7) A corporation shall power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee of agent or the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liability under the provisions of this section.
(8) For purposes of this Section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
any person who is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under the provisions of this Section with respect to the resulting or
surviving corporation as he would have with respect to such constituent
corporation if its separate existence had continued.
(9) For purposes of this Section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to an employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee, or
agent with respect to an employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
Section.
(10) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
(11) The Court of Chancery is hereby vested with exclusive jurisdiction
to hear and determine all actions for advancement of expenses or indemnification
brought under this section or under any bylaw, agreement, vote of stockholders
or disinterested directors, or otherwise. The Court of Chancery may summarily
determine a corporation's obligation to advance expenses (including attorneys'
fees). (As amended by Ch. 186, Laws of 1967, Ch. 421, Laws of 1970, Ch. 437,
Laws of 1974, Ch. 25, Laws of 198 1, Ch. 11 2, Laws of 1983, Ch. 289, Laws of
1986, Ch. 376, Laws of 1990, and Ch. 26 1, Laws of 1994.)
(b) Section 102 of the Delaware General Corporation Law includes the
following provisions:
102. CERTIFICATE OF INCORPORATION; CONTENTS
(1) The certificate of incorporation shall set forth:
(2) In addition to the matters required to be set forth in the
certificate of incorporation by subsection (a) of this section the certificate
of incorporation may also contain any or all of the following matters:
(vii) 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 provision shall 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 of this Title, or (iv) for any
transaction from which the director derived an improper personal benefit. No
such provision shall eliminate or limit the liability of a director for any act
or omission occurring prior to the date when such provision becomes effective.
All references in this paragraph to a director shall also be deemed to refer (x)
to a member of the governing body of a corporation which is not authorized to
issue capital stock and (y) to such other person or persons, if any, who,
pursuant to a provision of the certificate of incorporation in accordance with
subsection (a) of 141 of this title, exercise or perform any of the powers or
duties otherwise conferred or imposed upon the board of directors by this title.
(c) Article Nine of Registrant's Certificate of Incorporation provides:
No director of this corporation shall be liable to the corporation for
monetary damages for an act or omission occurring in the director's capacity as
a director, except to the extent the statutes of the State of Delaware expressly
provided that the director's liability may not be eliminated or limited. Any
repeal or amendment of this paragraph that increases the liability of a director
shall be prospective only, and shall not adversely affect any limitation on the
personal liability of a director of the corporation existing at the time of such
repeal or amendments.
Item 8: Exhibits
--------
The following documents are filed as Exhibits to this Registration
Statement:
4(a) -- Consulting Agreement with Patricia A. Meding
4(b) -- Consulting Agreement with Forte Communications, Inc.
4(c) -- Compensation Agreement with James F. Smith
4(d) -- Compensation Agreement with C.B. Harrison, Jr.
4(e) -- Compensation Agreement with George E. Green
4(f) -- Compensation Agreement with Douglas Weedon
4(g) -- Compensation Agreement with Sam E. Nicholson
4(h) -- Compensation Agreement with William Amdall
5 -- Opinion of Sonfield & Sonfield as to the validity of the
shares being registered.
24.1 -- Consent of Sonfield & Sonfield (included in Exhibit 5)
24.2 -- Consent of Hein + Associates LLP, Independent
Accountants
25 -- Power of Attorney (following signature page of
Registration Statement)
Item 9: Undertakings
------------
The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement 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.
(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.
<PAGE>
10
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 of the
requirements for filing on Form S-8, and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Dallas, State of Texas, on the 10th day of September,
1998.
GENERAL AMERICAN ROYALTY, INC. GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith By:/s/Sam E. Nicholson
------------------- ---------------------
James F. Smith, President Sam E. Nicholson, Treasurer
and Chief Executive Officer and Chief Financial Officer
EXHIBIT 25
POWER OF ATTORNEY
Each of the undersigned hereby authorizes James F. Smith as his
attorney-in-fact to execute in the name of such person and to file such
amendments (including post-effective amendments) to this Registration Statement
as the Registrant deems appropriate and appoints such person as attorney-in-fact
to sign on his behalf individually and in each capacity stated below and to file
all amendments, exhibits, supplements, post-effective amendments and
acceleration requests to this Registration Statement.
Pursuant to the requirements of the Securities Act of 1933, the
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
SIGNATURE CAPACITY DATE
--------- -------- ----
/s/James F. Smith Director September 10, 1998
-----------------
James F. Smith
/s/George E. Green Director September 10, 1998
------------------
George E. Green
/s/Douglas Weedon Director September 10, 1998
-----------------
Douglas Weedon
<PAGE>
20
<PAGE>
13
11
TERMS OF WARRANTS
In consideration for the services described in the Registration Statement
which this description is a part, the Company will issue common stock purchase
warrants (the "Warrants") to purchase a total of 168,500 shares of the Company's
common stock (the "Common Stock") at $.01 per share (the "Exercise Price"). The
Warrants will be issued on the date of the execution of the Agreement and will
expire three (3) years after date of issue. The specific terms of the Warrants
are as follows:
(a) Warrant Exercise Price. The Exercise Price per share of the
------------------------
Warrants was established by the Board of Directors at $.01 per share.
(b) Term of Warrants. The Warrants may be exercised in whole or
------------------
in part at any time during the 36 months after the date of issue, unless the
expiration date of the Warrant and the term of the Agreement are extended by the
Company in writing to a later date.
(c) Manner of Exercise. All or any whole number of such Warrants
-------------------
may be exercised for cash during the term of the Warrants.
(d) Transferability. The Warrants are not transferable without
---------------
the Company's prior written approval.
(e) Redemption. There are no redemption rights afforded to the
----------
Company in connection with the Warrants.
(f) Adjustments. The Exercise Price and the number of shares (and, in
-----------
certain events, the class or classes of capital stock of the Company) purchased
upon the exercise of each Warrant are each, respectively, subject to adjustment
from time to time as hereinafter provided prior to the expiration of any Warrant
by its exercise or by its terms, in case any one or more of the events and
referred to described below shall occur at any time or from time to time; that
is to say, if the Company shall:
(i) issue any shares of its Common Stock as a dividend or
subdivide its outstanding shares of Common Stock into a greater number of shares
then, in either of such cases, the then applicable purchase price per share of
the shares of Common Stock purchasable pursuant to each Warrant in effect at the
time of such action shall be proportionately reduced and the number of shares at
that time purchasable pursuant to each Warrant shall be proportionately
increased; or,
(ii) combine its outstanding shares of Common Stock into a smaller
number of such shares,
then, in such case, the then applicable purchase price per share of the shares
of Common Stock purchasable pursuant to each Warrant in effect at the time of
such action shall be proportionately increased and the number of shares of
Common Stock at that time purchasable pursuant to each Warrant shall be
proportionately decreased; or
(iii) issue by reclassification of its shares of Common Stock any
shares of its capital stock,
then, as a condition of such recapitalization, lawful and adequate provision
shall be made whereby the holder of each Warrant shall have, immediately after
the effective date of any such reclassification, the right to purchase, upon the
basis and on the terms and conditions specified herein, in lieu of the shares of
Common Stock of the Company theretofore purchasable upon the exercise of each
Warrant, such shares of stock or other securities as may be issued or payable
with respect to, or in exchange for the number of shares of Common Stock of the
Corporation theretofore purchasable upon the exercise of each Warrant, had such
recapitalization not taken place; and in any such event, the rights of the
Warrant holder to any adjustment in the number of shares of Common Stock
purchasable upon the exercise of each Warrant, as hereinbefore provided, shall
continue and be preserved in respect of any stock or other securities which the
Warrant holder becomes entitled to purchase.
If after an adjustment the holder of a Warrant upon exercise of it may
receive shares of two or more classes of capital stock of the Company, the Board
of Directors shall in good faith determine the allocation of the adjusted
Exercise Price between or among the classes of capital stock. After such
allocation, that portion of the Exercise Price applicable to each share of each
such class of capital stock shall thereafter be subject to adjustment on terms
comparable to those applicable to Common Stock in this Agreement.
Notwithstanding the allocation of the Exercise Price between or among shares of
capital stock as provided by this Section 8, a Warrant may only be exercised in
full by payment of the entire Exercise Price currently in effect; or
(iv) merge or consolidate with or into another corporation or sell
or convey to another corporation, all or substantially all of the Company's
assets
then, as a condition of such consolidation, merger, sale or conveyance, the
Company, or such successor or purchasing corporation, as the case may be, shall
make lawful and adequate provision whereby the Registered Holder of each Warrant
then outstanding shall receive, on exercise of such Warrant, the kind and amount
of securities and property receivable upon such change, consolidation, merger,
sale or conveyance by a holder of the number of securities issuable upon
exercise of such Warrant immediately prior to such consolidation, merger, sale
or conveyance, and shall forthwith file at the Corporation Office of the Warrant
Agent a statement signed by its Chairman of the Board or President and by its
Secretary or an Assistant Secretary evidencing such provisions. Such provisions
shall include provision for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section 8.
(v) take a record of the holders of its Common Stock for the
purpose of entitling them to purchase shares of its Common Stock at a price per
share more than 10% below the current market price per share of its Common Stock
(as defined below) at the date of taking such record,
then, the number of shares of Common Stock purchasable pursuant to this Warrant
shall be adjusted by multiplying (a) the number of shares of Common Stock which
the holder hereof was entitled to receive immediately prior to such adjustment
(taking into account fractional interests to the nearest 1000th of a share) by
(b) a fraction, the numerator of which is the number of shares of the Common
Stock of the Corporation outstanding (excluding the shares owned by the
Corporation) immediately prior to the taking of such record plus the number of
additional shares offered for purchase, and the denominator of which is the
number of shares of Common Stock of the Corporation outstanding (excluding
shares owned by the Corporation) immediately prior to the taking of such record
plus the number of shares which the aggregate offering price of the total number
of additional shares so offered could purchase at such current market price and
the price per share shall be that number determined by multiplying (a) the price
per share in effect immediately prior to the taking of such record by (b) a
fraction, the numerator of which is the number of shares purchasable hereunder
immediately prior to taking of such record and the denominator of which is the
number of shares purchasable hereunder immediately after the taking of such
record.
(vi) reduce the Exercise Price of any or all classes of warrants,
then, as a condition of such reduction it shall be made uniformly as to all
warrants of that class then outstanding.
For the purpose hereof, the current market price per share of Common Stock
of the Corporation at any date shall be deemed to be the average of the daily
closing prices for the thirty (30) consecutive business days commencing
forty-five (45) business days before the day in question. The closing price for
each day shall be the last sale price, or, in case of no sales on such day, the
average of the closing bid and asked prices, in either case as officially quoted
by any National Securities Exchange, or, if the Common Stock of the Corporation
is not listed or admitted to trading on any such Exchange, the average of the
highest bid and asked prices as reported in the sheets of the National
Association of Securities Dealers, Inc. for the over the counter market in New
York City, or if not so reported, the average of the highest bid and asked
prices as furnished by any New York Stock Exchange firm selected from time to
time by the Company for the purpose.
(g) No Right As Stockholder. No Warrant holder is by virtue of
--------------------------
ownership of the Warrants, entitled to any rights whatsoever of a stockholder of
the Company.
(h) The Warrants are not transferable. However, the shares of common
-----------------------------------
stock issued upon exercise of the Warrants pursuant to an effective Registration
Statement of the Company on Form S-8 are freely transferable. Each
Warrantholder agrees that it will sell such shares of Common Stock only at
current market prices, and that no commissions or compensation will be paid in
connection with any such sale in excess of customary brokers commissions.
<PAGE>
EXHIBIT 4(A)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
Ms. Patricia A. Meding
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Ms. Meding:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
you pursuant to which you agree to consult and advise the Company with respect
to certain financial matters including communications with analysts,
broker/dealers and other members of the financial community. The term of the
agreement will commence on the date hereof and will continue for a period of
three (3) years unless sooner terminated by mutual consent of the parties.
In consideration of the agreement to render such services you are entitled
to receive Eighty Thousand (80,000) Warrants to purchase an equivalent number of
shares of common stock of the Company at an exercise price of $.01 per share for
a period expiring 3 years from and after the date hereof.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/Patricia A. Meding
- -----------------------
Patricia A. Meding
<PAGE>
EXHIBIT 4(B)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
Forte Communications, Inc.
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Ladies/Gentlemen:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
Forte Communications, Inc. pursuant to which Forte Communications, Inc. agrees
to consult and advise the Company with respect to certain (i) dissemination of
press releases and quarterly and annually reports; (ii) communications with
analysts, broker/dealers and other members of the financial community. The term
of the agreement will commence on the date hereof and will continue for a period
of three (3) years unless sooner terminated by mutual consent of the parties.
In consideration of the agreement to render such services you are entitled
to receive Twenty Eight Thousand Five Hundred (28,500) Warrants to purchase an
equivalent number of shares of common stock of the Company at an exercise price
of $.01 per share for a period expiring 3 years from and after the date hereof.
Forte Communications, Inc. agrees that it will sell such shares of Common
Stock only at current market prices, and that no commissions or compensation
will be paid in connection with any such sale in excess of customary brokers
commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
FORTE COMMUNICATIONS, INC.
By:
Name:
Title:
<PAGE>
- ------
EXHIBIT 4(C)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
James F. Smith
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Smith:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Seven Thousand
(7,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/James F. Smith
- -------------------
James F. Smith
<PAGE>
- ------
EXHIBIT 4(D)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
C.B. Harrison, Jr.
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Harrison:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Seven Thousand
(7,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/C.B. Harrison, Jr.
- -----------------------
C.B. Harrison, Jr.
<PAGE>
- ------
EXHIBIT 4(E)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
George E. Green
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Green:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Fourteen Thousand
(14,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/ George E. Green
- ----------------------
George E. Green
<PAGE>
- ------
EXHIBIT 4(F)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
Douglas Weedon
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Weedon:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Fourteen Thousand
(14,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/ Douglas Weedon
- --------------------
Douglas Weedon
<PAGE>
- ------
EXHIBIT 4(G)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
Sam E. Nicholson
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Nicholson:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Fourteen Thousand
(14,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/ Sam E. Nicholson
- -----------------------
Sam E. Nicholson
<PAGE>
- ------
EXHIBIT 4(H)
------------
GENERAL AMERICAN ROYALTY, INC.
One Energy Square, Suite 1005 4925 Greenville Avenue Dallas, Texas 75206
Tel: (214) 361-8535 Fax: (214) 361-7715
VIA FACSIMILE
August 28, 1998
William Amdall
General American Royalty, Inc.
One Energy Square, Suite 1005
4925 Greenville Avenue
Dallas, Texas 75206
Dear Mr. Amdall:
This letter will serve to memorialize the understanding made on the 28th
day of August, 1998 between General American Royalty, Inc. (the "Company") and
the undersigned pursuant to which you are entitled to receive Four Thousand
(4,000) Warrants to purchase an equivalent number of shares of common stock of
the Company at an exercise price of $.01 per share for a period expiring 3 years
from and after the date hereof.
The undersigned agrees that he will sell such shares of Common Stock only
at current market prices, and that no commissions or compensation will be paid
in connection with any such sale in excess of customary brokers commissions.
If the above and foregoing accurately sets forth our agreement, please so
indicate by executing one copy of this letter in the space provided below and
returning to the undersigned.
Yours very truly,
GENERAL AMERICAN ROYALTY, INC.
By:/s/James F. Smith
-------------------
James F. Smith, President
ACCEPTED AND AGREED this ___ day of August, 1998.
/s/ William Amdall
- --------------------
William Amdall
<PAGE>
EXHIBIT 5
S O N F I E L D & S O N F I E L D
A PROFESSIONAL CORPORATION
LEON SONFIELD (1865-1934) ATTORNEYS AT LAW NEW YORK
GEORGE M. SONFIELD (1899-1967) LOS ANGELES
ROBERT L. SONFIELD (1893-1972) 770 SOUTH POST OAK LANE WASHINGTON, D.C.
________________ HOUSTON, TEXAS 77056
FRANKLIN D. ROOSEVELT, JR. (1914-1988) EMAIL:[email protected]
TELECOPIER (713) 877-1547
ROBERT L. SONFIELD, JR. _____
MANAGING DIRECTOR TELEPHONE (713) 877-8333
<PAGE>
August 28, 1998
Board of Directors
General American Royalty, Inc.
4925 Greenville Avenue, Suite 1005
Dallas, Texas 75206
Dear Gentlemen:
In our capacity as counsel for General American Royalty, Inc. (the
"Company"), we have participated in the corporate proceedings relative to the
authorization and issuance by the Company of a maximum of 168,500 shares of
common stock upon exercise of the Warrants issued pursuant to the Consulting
Agreements all as set out and described in the Company's Registration Statement
on Form S-8 (File No. _______) under the Securities Act of 1933 (the
"Registration Statement"). We have also participated in the preparation and
filing of the Registration Statement including the federal income tax
information set out therein under the caption "Consulting Agreements - Federal
Income Tax Effects" and elsewhere in the Prospectus constituting a part of the
Registration Statement.
Based upon the foregoing and upon our examination of originals (or copies
certified to our satisfaction) of such corporate records of the Company and
other documents as we have deemed necessary as a basis for the opinions
hereinafter expressed, and assuming the accuracy and completeness of all
information supplied us by the Company, having regard for the legal
considerations which we deem relevant, we are of the opinion that:
(1) The Company is a corporation duly organized and validly existing
under the laws of the State of Delaware;
(2) The Company has taken all requisite corporate action and all action
required by the laws of the State of Delaware with respect to the authorization,
issuance and sale of common stock to be issued pursuant to the Registration
Statement;
(3) The maximum of 168,500 shares of common stock, when issued and
distributed pursuant to the Registration Statement, will be validly issued,
fully paid and nonassessable;
(4) Based upon the current provisions of Federal income tax laws and
regulations, and on current authoritative interpretations thereof, we believe
the discussion in the Registration Statement under the caption "Consulting
Agreements - Federal Income Tax Effects" of the Federal income tax laws relevant
to the Warrant holders, although necessarily general, considers each material
Federal income tax issue of significance to Warrant holders and the result
which, more likely than not, would obtain under the laws and regulations in
effect as of the date hereof.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement and to the references to our firm in the Registration
Statement.
Yours very truly,
/s/SONFIELD & SONFIELD
- ------------------------
SONFIELD & SONFIELD
<PAGE>
EXHIBIT 24.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the use in the Form S-8 Registration Statement and Prospectus
of General American Royalty, Inc. ("The Company") of our report dated December
10, 1997 accompanying the financial statements of The Company contained in such
Registration Statement, and to the use of our name and the statements with
respect to us, as appearing under the heading "Experts" in the Prospectus.
/s/Hein + Associates LLP
- ---------------------------
Hein + Associates LLP
Certified Public Accountants
September 10, 1998
Dallas, Texas
