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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )
Imperial Petroleum Recovery Corporation
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(Name of Issuer)
Common Stock, $.001 par value
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(Title of Class of Securities)
453079-10-5
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(CUSIP Number)
Gerald J. Laporte, Esq.
Hogan & Hartson L.L.P., 555 Thirteenth Street, N.W., Washington, DC 20004
Telephone: (202) 637-6528
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
July 21, 1997
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(Date of Event that Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box. / /
NOTE: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
CUSIP No. 453079-10-5 SCHEDULE 13D
(1) Names of Reporting Persons and I.R.S. Identification Numbers
(Entities Only)
Henry H. Kartchner
(2) Check the Appropriate Box if a Member of a Group (a) / /
(b) /X/
(3) SEC Use Only
(4) Source of Funds
PF
(5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) / /
(6) Citizenship or Place of Organization
U.S.A.
(7) Sole Voting Power
Number of 2,113,749
Shares
Beneficially (8) Shared Voting Power
Owned By 0
Each
Reporting (9) Sole Dispositive Power
Person 2,113,749
With
(10) Shared Dispositive Power
0
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
2,113,749
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares / /
(13) Percent of Class Represented by Amount in Row (11)
15.4%
(14) Type of Reporting Person
IN
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<PAGE>
CUSIP No. 453079-10-5 SCHEDULE 13D
(1) Names of Reporting Persons and I.R.S. Identification Numbers
(Entities Only)
Food Development Corporation, I.R.S. ID No. 911000242
(2) Check the Appropriate Box if a Member of a Group (a) / /
(b) /X/
(3) SEC Use Only
(4) Source of Funds
WC
(5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) / /
(6) Citizenship or Place of Organization
Washington
(7) Sole Voting Power
Number of 1,015,408
Shares
Beneficially (8) Shared Voting Power
Owned By 0
Each
Reporting (9) Sole Dispositive Power
Person 1,015,408
With
(10) Shared Dispositive Power
0
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
1,015,408
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares / /
(13) Percent of Class Represented by Amount in Row (11)
7.4%
(14) Type of Reporting Person
CO
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<PAGE>
Item 1. Security and Issuer
This Statement on Schedule 13D relates to shares of the Common Stock,
$.001 par value, of Imperial Petroleum Recovery Corporation, a Nevada
corporation ("Imperial" or the "Company"), the principal executive offices of
which are located at 15311 Vantage Parkway West, Suite 160, Houston, Texas
77032. The Company is a development stage company committed to developing and
marketing a proprietary oil sludge remediation process and equipment that use
high energy microwaves to separate water, oil and solids.
Item 2. Identity and Background
This Statement on Schedule 13D is filed on behalf of Henry H.
Kartchner, the Chairman and Chief Executive Officer of the Company, whose
business address is the same as the address of the Company given in Item 1
above. Mr. Kartchner is a citizen of the United States of America.
This Statement on Schedule 13D also is filed on behalf of Food
Development Corporation, a Washington State corporation ("FDC"). The address of
the principal office of FDC is 1135 East Hillsboro Road, Pasco, Washington
99301. Mr. Kartchner is the sole and controlling shareholder of FDC.
During the last five years, neither Mr. Kartchner nor FDC has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors), and neither has been a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction, as a result of which he or it
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
Mr. Kartchner acquired all of the shares of Imperial Common Stock of
which he is the direct beneficial owner with personal funds or in exchange for
contractual commitments, as detailed in Item 5 below. FDC acquired all of the
shares of Imperial Common Stock of which it is deemed to be the direct
beneficial owner with working capital.
Item 4. Purpose of Transaction
Mr. Kartchner and FDC acquired the shares to which this Statement on
Schedule 13D relates for investment purposes. Depending upon market conditions
and other factors that Mr. Kartchner and/or FDC may deem material to their
investment decisions, Mr. Kartchner and FDC may acquire beneficial ownership of
additional securities of the Company by purchase in the open market or in
private transactions, or by other permissible means, if deemed advisable at the
time, and may dispose of all or a portion of the shares of the Company they
currently own or may hereafter acquire.
Except as discussed above, Mr. Kartchner and FDC have no current
plans or proposals that relate to or would result in any of the following,
although they reserve the right to develop such plans or proposals in the
future:
(a) The acquisition by any person of additional securities of the
Company, or the disposition of securities of the Company;
(b) An extraordinary corporate transaction, such as a merger,
reorganization, or liquidation, involving the Company or any of
its subsidiaries;
(c) A sale or transfer of a material amount of assets of the Company
or any of its subsidiaries;
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<PAGE>
(d) Any change in the present board of directors or management of the
Company, including any plans or proposals to change the number or
terms of directors or to fill any existing vacancies on the board;
(e) Any material change in the present capital or dividend policy of
the Company;
(f) Any other material change in the Company's business or corporate
structure;
(g) Changes in the Company's charter, bylaws, or instruments
corresponding thereto or other actions that may impede the
acquisition of control of the Company by any person;
(h) Causing a class of securities of the Company to be delisted from a
national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered
national securities association;
(i) A class of equity securities of the Company becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934; or
(j) Any action similar to any of those set forth in (a) through (i)
above.
Item 5. Interest in Securities of Issuer
Because of his direct beneficial holdings and his status as the
controlling shareholder of FDC, Mr. Kartchner is deemed to be the beneficial
owner of 2,113,749* shares of Common Stock in the Company, or approximately
15.4% of the outstanding shares, based upon 13,155,421 shares outstanding as of
December 31, 1997 and 541,783 shares deemed to be outstanding for purposes of
calculation, which are the shares into which the principal amount of the
Promissory Note discussed below is convertible. Mr. Kartchner has sole power to
vote and dispose of the 2,113,749 shares.
Mr. Kartchner acquired direct beneficial ownership of 1,077,229 of
these shares in September 1995 from Owen K. Stephenson in exchange for Mr.
Kartchner's commitment to provide economic support and credit required by the
Company to fabricate and test the initial prototype of its microwave sludge
treatment system. Mr. Kartchner acquired direct beneficial ownership of another
300 of the 2,113,749 shares when they were distributed as a result of the
Company's 0.03 for 1 forward stock split of November 22, 1996 on 10,000 shares
Mr. Kartchner had purchased in the open market, which 10,000 shares Mr.
Kartchner subsequently sold in the open market. Mr. Kartchner acquired direct
beneficial ownership of another 20,812 of the 2,113,749 shares in April 1997
when the Company issued him shares to make up for shares Mr. Kartchner was
entitled to have received from Mr. Stephenson in September 1995.
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*All numbers of shares of Imperial Common Stock in this Schedule 13D have been
adjusted to account for the Company's 0.03 for 1 forward stock split of November
22, 1996.
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<PAGE>
Because of his status as the controlling shareholder of FDC, Mr.
Kartchner is deemed to have acquired indirect beneficial ownership of 147,200 of
the 2,113,749 shares on May 1, 1997, when they were acquired by FDC in exchange
for FDC's forgiveness of a debt for $73,600 owed by the Company to FDC,
representing operating expenses FDC had advanced on behalf of the Company. Mr.
Kartchner is deemed to have acquired indirect beneficial ownership of another
326,425 of the 2,113,749 shares on July 21, 1997, when they were acquired by FDC
in exchange for FDC's forgiveness of a debt for $163,212.33 owed by the Company
to FDC, representing operating expenses FDC had advanced on behalf of the
Company. Mr. Kartchner is deemed to have acquired indirect beneficial ownership
of another 541,783 of the 2,113,749 shares on August 25, 1997, when FDC became
entitled to purchase them by converting a Promissory Note of the Company that
began to accrue interest on that date in the principal amount of $236,759.18.
The Company executed the Promissory Note payable to FDC in exchange for FDC's
forgiveness of a debt of that amount owed by the Company to FDC, representing
research and development expenses FDC had advanced on behalf of the Company. The
Promissory Note bears interest at the rate of 10% annually. Any portion of the
principal and accrued interest is convertible into shares of Common Stock in the
Company at a conversion price of $0.437 per share. Mr. Kartchner has sole power
to vote and dispose of the total of 1,015,408 shares beneficially owned by FDC.
This 1,015,408 shares beneficially owned by FDC equals 7.4% of the shares deemed
to be outstanding for purposes of calculation.
Item 6. Contracts, Arrangements, Understandings, or Relationships with Respect
to Securities of the Issuer
Other than as described in Item 5 above, neither Mr. Kartchner nor FDC
is a party to any contract, arrangement, understanding, or relationship (legal
or otherwise) with respect to any securities of the Company, including but not
limited to transfer or voting of any of the Company's securities, finder's fees,
joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profit or loss, or the giving or withholding of proxies.
Mr. Kartchner and FDC expressly disclaim that they are acting as part
of a group within the meaning of Section 13(d)(3) of the Act, other than to the
extent that their individual actions as beneficial owners of Imperial Common
Stock may be deemed to be actions of members of a group because of Mr.
Kartchner's status as the controlling shareholder of FDC.
In accordance with Rule 13d-4, Mr. Kartchner and FDC each expressly
declares that the filing of this Statement on Schedule 13D shall not be
construed as an admission that Mr. Kartchner or FDC is, for the purpose of
Section 13(d) or Section 13(g) of the Act, the beneficial owner of any
securities of the Company other than as expressly described in this Statement on
Schedule 13D.
Item 7. Material to be Filed as Exhibits
Exhibit 1 -- Promissory Note of Imperial Petroleum Recovery Corporation
Exhibit 2 -- Joint Filing Agreement
After reasonable inquiry, and to the best of their knowledge, the
undersigned certify that the information set forth in this Statement on Schedule
13D is true, complete and correct.
* * * * * * *
HENRY H. KARTCHNER
Date: January 16, 1998
/s/ Henry H. Kartchner
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Signature
FOOD DEVELOPMENT CORPORATION
Date: January 16, 1998 By: Henry H. Kartchner
Chairman and Chief Executive Officer
/s/ Henry H. Kartchner
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Signature
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PROMISSORY NOTE
Dated: January 15, 1998
FOR VALUE RECEIVED, the undersigned, Imperial Petroleum Recovery Corporation
("Imperial"), promises to pay to the order of Food Development Corporation
("FDC"), the principal sum of Two Hundred Thirty Six Thousand. Seven Hundred
Fifty Nine Dollars, and Eighteen Cents ($236,759.18) plus interest in legal and
lawful money of the United States of America.
Interest. This note shall bear interest at ten percent (10%) per annum
commencing on August 25, 1997.
Payment. All unpaid principal and interest shall be paid no later than November
2, 1998, but no earlier than May 1, 1998.
Prepayment. Imperial may, at any time and without premium or penalty, pay the
full amount or any part of this Note, the amount of such payment being applied
first to accrued unpaid interest and then to reduce the amount of principal
remaining to be paid under this Note. However, at the time of prepayment, FDC
may refuse the payment and instead exercise the conversion rights contained
herein.
Waiver of Notices: Compliance. Imperial expressly waives presentations for
payment, protest and notice of protest, and the filing of suit hereon, as to
this Note and as to each, every and all payments hereof.
Governing Law. This Note shall be governed by, and construed in accordance with
the laws of the State of Texas. Venue shall be Houston, Texas.
Default. This Note will be in default if Imperial fails to make timely payments
and fails to cure such non-payment within seven (7) business days of
notification of non-payment. In the event of default, FDC may declare the entire
remaining balance of this Note immediately due and payable, and may proceed with
any and all legal actions it deems necessary or appropriate.
Attorneys' Fees. If suit is required to enforce the terms of this Note, the
prevailing party shall be entitled to reasonable attorneys' fees and costs and
court costs.
Conversion Rights. At any time prior to November 2, 1998 or thereafter if the
Note remains unpaid, FDC shall be entitled to convert all or any portion of the
principal and accrued interest to common restricted stock of Imperial. The
conversion rate shall be $0.437 per share.
IMPERIAL PETROLEUM RECOVERY CORPORATION
By /s/ C. Brent Kartchner
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C. Brent Kartchner, President
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) promulgated under the
Securities Exchange Act of 1934, the undersigned hereby agree to the filing with
the U.S. Securities and Exchange Commission, on behalf of each of the
undersigned, of a joint statement on Schedule 13D, and any amendments thereto,
containing the information required thereby relating to the shares of Common
Stock, $.001 par value, of Imperial Petroleum Recovery Corporation, and further
agree that this Joint Filing Agreement may be included as an exhibit thereto and
that each of the undersigned will be responsible for the timely filing of such
joint statement and any amendments thereto and for the completeness and accuracy
of the information concerning each contained therein. Each of the undersigned
understands that neither of the undersigned is responsible for the completeness
or accuracy of the information concerning other persons filing the joint
statement or any amendments thereto, unless the undersigned knows or has reason
to believe that such information is incomplete or inaccurate.
Date: January 13, 1998 HENRY H. KARTCHNER
/s/ Henry H. Kartchner
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Signature
Date: January 13, 1998 FOOD DEVELOPMENT CORPORATION
By: Henry H. Kartchner
Chairman and Chief Executive Officer
/s/ Henry H. Kartchner
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Signature
