UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______________ to ___________________.
Commission File No. 0-9946
GOLDEN OIL COMPANY
(Exact name of Registrant as specified in its charter)
DELAWARE 84-0836562
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
550 POST OAK BOULEVARD, SUITE 550, HOUSTON, TEXAS 77027
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code:
(713) 622-8492
Securities registered pursuant
to Section 12(b) of the Act: NONE
----
Securities registered pursuant
to Section 12(g) of the Act:
COMMON STOCK, $.01 PAR VALUE
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes No X
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]
As of February 7, 1997, there were outstanding 1,424,291 shares of the
Registrant's Common Stock, $.01 par value, and the aggregate market value held
by non-affiliates was approximately $463,029.
DOCUMENTS INCORPORATED BY REFERENCE
The information called for by Part III, Items 10, 11, 12 and 13 is
incorporated herein by reference to the Registrant's definitive Proxy Statement
to be filed in connection with the Registrant's 1996 Annual Meeting within 120
days from the end of the fiscal year.
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
PAGE
(A) 1. The following consolidated financial statements
are included in Part II, Item 8:
Report of Independent Accountants.......................18
CONSOLIDATED FINANCIAL STATEMENTS:
Consolidated Balance Sheets as of
December 31, 1996 and 1995..............................19
Consolidated Statements of Operations for the
years ended December 31, 1996, 1995 and 1994............21
Consolidated Statements of Stockholders' Equity
for the years ended December 31, 1996, 1995 and
1994....................................................22
Consolidated Statements of Cash Flows for the
years ended December 31, 1996, 1995 and 1994............23
Notes to Consolidated Financial Statements..............26
2. FINANCIAL STATEMENT SCHEDULES:
Schedule II Valuation and Qualifying Accounts...........42
All other schedules are omitted because they are not
applicable or the information is included in the financial
statements and notes included herewith.
(B) REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the Company's
last fiscal quarter of 1996.
(C) EXHIBITS
The following exhibits are filed as part of this report.
Where such filing is made by incorporation by reference to
a previously filed statement or report, such statement or
report is identified in parenthesis.
3. ARTICLES OF INCORPORATION AND BYLAWS
3.1 Articles of Incorporation (incorporated by reference to
Exhibit 3 of Form 10-K for the year ended December 31,
1985).
3.2 Bylaws (incorporated by reference to Exhibit 3 of Form
10-K for the year ended December 31, 1985).
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10. MATERIAL CONTRACTS
10.1 Pinnacle Petroleum, Inc. Amended and Restated Employees' Stock
Option Plan (incorporated by reference from Exhibit I to
Pinnacle Petroleum, Inc. Proxy Statement dated November 29,
1989).
10.2 Directors' Stock Option Plan (incorporated by reference from
Exhibit II to Pinnacle Petroleum, Inc. Proxy Statement dated
November 29, 1989).
10.3 Agreement and Plan for Merger by and between Golden Oil Company,
Golden Oil Holding Corporation and Cobb Resources Corporation
dated November 28, 1990 (incorporated by reference from Exhibit 1
to Form 8-K dated November 28, 1990).
10.4 Stock Option Agreement between Golden Oil Company and Cobb
Resources Corporation dated November 28, 1990 (incorporated by
reference from Exhibit 2 to Form 8-K dated November 28, 1990).
10.5 Directors Agreement among George O. Lotspeich, B. W. Miller,
Malcolm G. Colberg, William J. Mayhew, Frank J. Yeager, Ralph
T. McElvenny, Jr., Anthony B. Petrelli and Golden Oil Company
dated November 28, 1990 (incorporated by reference from
Exhibit 4 to Form 8-K dated November 28, 1990).
10.6 Asset Purchase Agreement, dated April 5, 1991, by and between
Golden Oil Company, Cobb Resources Corporation and Chace Oil
Company, Inc. (incorporated by reference from Exhibit 10.13 to
Cobb Resources Corporation Form 10-K for the year ended June 30,
1991).
10.7 Shareholders Agreement, dated as of April 5, 1991, between Golden
Oil Company, Cobb Resources Corporation, Horace F. McKay, Jr.
George O. Lotspeich and Frank J. Yeager (incorporated by
reference from Exhibit 10.15 to Cobb Resources Corporation Form
10-K for the year ended June 30, 1991).
10.8 Amendment No. 1 to Directors Agreement, dated as of April 5,
1991, between Golden Oil Company and Malcolm G. Colberg,
George O. Lotspeich, William J. Mayhew, Ralph T. McElvenny,
Jr., B. W. Miller, Anthony B. Petrelli and Frank J. Yeager
(incorporated by reference from Exhibit 10.17 to Cobb
Resources Corporation Form 10-K for the year ended June 30,
1991).
10.9 Amendment No. 1 to Asset Purchase Agreement, dated June 25,
1991, by and between Golden Oil Company, Cobb Resources
Corporation and Chace Oil Company, Inc. (incorporated by
reference from Exhibit 10.14 to Cobb Resources Corporation
Form 10-K for the year ended June 30, 1991).
10.10 Amendment No. 2 to Asset Purchase Agreement, dated as of
September 30, 1991, by and between Golden Oil Company, Cobb
Resources Corporation and Chace Oil Company, Inc.
(incorporated by reference from Exhibit 10.18 to Cobb
Resources Corporation 10-K for the year ended June 30, 1991).
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10.11 Stock Purchase Agreement, dated October 16, 1992, by and between
Golden Oil Company, Cobb Resources Corporation, and Charles Cobb
IV (incorporated by reference from Exhibit 10.11 to Form 10-K for
the year ended December 31, 1992).
10.12 Warrant to Purchase Shares of Common Stock, dated March 29,
1996 by and between Golden Oil Company and Ralph T. McElvenny,
Jr. (filed herewith).
10.13. Note Agreement dated April 12, 1996 by and between Golden Oil
Company, Ralph T. McElvenny, Jr. and Western Bank of
Albuquerque, New Mexico (filed herewith).
22.1 SUBSIDIARIES OF THE COMPANY (filed herewith).
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EXHIBIT 10.12
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ARE SUBJECT TO
CERTAIN RESTRICTIONS, CONTAINED IN PARAGRAPH V HEREOF, WITH RESPECT TO THEIR
TRANSFER.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
OF
GOLDEN OIL COMPANY
RIGHT TO PURCHASE
250,000 SHARES
OF COMMON STOCK
SUMMARY
This Warrant certifies that, for value received, Ralph T. McElvenny, Jr.
("Holder") is entitled to subscribe for and to purchase, at any one time and
from time to time, from Golden Oil Company, a Delaware corporation (the
"Company"), 250,000 shares of the Company's common stock, par value $.01 per
share (such common stock, including any securities into which it may be changed,
reclassified or converted, is herein referred to as the "Common Stock") at the
purchase price of $.20 per share (the "Exercise Price") payable throughout the
Exercise Period as defined below, subject to adjustment as provided herein.
Any purchase hereunder shall be complete upon the delivery to the Company,
or its duly appointed escrow agent, of the Exercise Price set forth herein, paid
by bank draft or personal check of Holder (or the personal representative or
transferee thereof) together with written notification of exercise of purchase
rights under this Warrant and of the number of shares purchased. The expiration
date shall be March 15, 2006 at 5:00 p.m. local Houston, Texas time.
This Warrant is subject to the following provisions, terms and conditions:
I. EXERCISE OF WARRANTS
A. EXERCISE OF WARRANTS. This Warrant may be exercised by the Holder (or
by his duly appointed personal representative or by any transferee in accordance
with Section V hereof) in whole or in part, subject to the provisions hereof
(but not as to a fractional share of Common Stock), by (a) presentation of this
Warrant and its surrender hereof, at the principal office of the Company at 550
Post Oak Boulevard, Suite 550, Houston, Texas 77027 (or such other office or
escrow agency of the Company as may be designated by notice in writing to the
Holder delivered to the address of the Holder appearing on the books of the
Company) with appropriate written notice (containing
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substantially similar information as in the suggested form of notice attached
hereto) duly executed, at any time or times within the period beginning March
29, 1996 and expiring at 5:00 p.m. local Houston, Texas time on March 15, 2006
(the "Exercise Period") and (b) payment to the Company by bank draft or personal
check of the Exercise Price for such shares.
The Company agrees that the shares of Common Stock so purchased shall be
and are deemed to be issued to the Holder as the record owner of such shares of
Common Stock as of the close of business at 5:00 p.m. local Houston, Texas time
on the date on which this Warrant is presented for surrender (in whole or in
part) and payment is made for such shares of Common Stock (the "Exercise Date").
Certificates representing the shares of Common Stock so purchased, together with
any cash for fractional shares of Common Stock paid pursuant to Section II(A),
shall be delivered to the Holder against payment if certificates are held ready
by the Company or in escrow, and in no event later than three (3) days after the
Exercise Date. Unless this Warrant has then expired, upon exercise a receipt
issued by or on behalf of the Company shall be delivered to the Holder
confirming the number of shares exercised and the number of shares which remain
unexercised. A new Warrant representing the number of shares of Common Stock, if
any, in respect of which this Warrant shall not have been exercised shall be
delivered to the Holder against payment on the Exercise Date, if practicable,
and in no event later than three (3) days after this Warrant shall have been
exercised in part.
II. ADJUSTMENTS
A. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES SUBJECT TO WARRANT.
The number of shares of Common Stock issuable pursuant to this Warrant and the
Exercise Price per share of Common Stock shall be proportionately adjusted for
any increase or decrease in the number of issued shares of Common Stock of the
Company resulting from the subdivision or combination of shares or other capital
adjustments, or the payment of any stock dividend after the date of issuance of
this Warrant, or other increase or decrease in such shares effected without
receipt of fair market value consideration by the Company; PROVIDED, HOWEVER,
that no adjustment shall be made unless the aggregate effect of all such
increases and decreases occurring in any one fiscal year after the date of this
Warrant will increase or decrease the number of issued and outstanding shares of
Common Stock of the Company by one percent or more; and, PROVIDED FURTHER, that
the right to purchase fractional shares of Common Stock resulting from any such
adjustment shall be eliminated and fractional shares of Common Stock resulting
from any such adjustment shall be redeemed by the Company for cash payment of
the fair market value for such redeemed fractional share, as determined by the
Board of Directors. Adjustments under this Section II(A) shall be made in good
faith by the Board of Directors.
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B. STATEMENT ON WARRANT CERTIFICATES. This Warrant need not be
amended or modified because of any change in the Exercise Price or in the
number or kind of shares purchasable upon the exercise of this Warrant.
C. NOTICE OF ADJUSTMENT. On the happening of an event requiring an
adjustment of the Exercise Price or the shares purchasable hereunder, the
Company shall forthwith give written notice to the Holder stating the Exercise
Price of the Warrant as adjusted and the adjusted number and kind of securities
or other property purchasable hereunder resulting from the event and setting
forth in reasonable detail the method of calculation and the facts upon which
the calculation is based. The Board of Directors of the Company, acting in good
faith, shall determine this calculation.
III. RESERVATION AND AUTHORIZATION OF COMMON STOCK
The Company covenants and agrees (a) that all shares of Common Stock which
may be issued upon the exercise of this Warrant will, upon issuance, be validly
issued, fully paid and non-assessable and free of all transfer taxes, liens and
charges with respect to the issue thereof; (b) that during the Exercise Period,
the Company will at all times have authorized, and reserved for the purpose of
issue or transfer upon exercise of this Warrant, sufficient shares of Common
Stock to provide for the exercise of this Warrant; and (c) that the Company
will, at its own expense, take all such action as may be necessary to ensure
that the shares of Common Stock issuable upon the exercise of this Warrant be so
issued without violation of any applicable law or regulation, or any requirement
of any securities exchange upon which any capital stock of the Company may be
listed.
IV. LIMITED RIGHTS OF HOLDER
This Warrant shall not entitle the Holder to any voting rights or other
rights as a stockholder of the Company, or to any other rights whatsoever except
the rights herein expressed. No dividends are payable or will accrue on this
Warrant or the shares purchasable hereunder until, and except to the extent
that, this Warrant is exercised.
V. RESTRICTIONS ON TRANSFER
Subject to the provisions of this Section V, this Warrant is transferable
in whole or in part. The Company, however, may treat the registered Holder as
the owner hereof for all purposes until this Warrant shall have been surrendered
for transfer as hereinafter provided. Upon surrender of this Warrant duly
executed by the Holder, the Company shall execute and deliver a new Warrant or
Warrants in the name of the assignee or assignees and in the denominations
specified in the instrument of assignment, and this Warrant shall thereupon be
canceled.
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This Warrant is not transferable directly or indirectly, in whole or in
part, except (a) in compliance with applicable federal and state securities
laws, including but not limited to, the Securities Act of 1933, as amended, and
(b) for which the Company is provided an opinion of counsel to the Holder,
reasonably satisfactory to the Company, to the effect that such transfer does
not violate applicable securities laws.
VI. CLOSING OF BOOKS
The Company will at no time close its transfer books against the transfer
of this Warrant or of any shares of Common Stock of other securities issuable
upon the exercise of this Warrant in any manner which interferes with
requirements for the timely provisions for exercise, receipt and delivery set
forth herein.
VII. WARRANT EXCHANGEABLE; LOSS, THEFT
This Warrant is exchangeable, upon the surrender hereof by any Holder at
the office or agency of the Company referred to in Section I, for a new Warrant
or Warrants of like tenor representing in the aggregate the right to subscribe
for and to purchase the number of shares of Common Stock which may be subscribed
for and purchased hereunder, each such new Warrant to represent the right to
subscribe for and to purchase such number of shares of Common Stock as shall be
designated by such Holder at the time of such surrender. Upon receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant, or upon surrender or cancellation of this
Warrant, the Company will issue to the Holder a new Warrant of like tenor, in
lieu of this Warrant, representing the right to subscribe for and purchase the
number of shares of Common Stock which may be subscribed for and purchased
hereunder. For purposes of this Section VII, the sworn affidavit by the Holder
of the loss, theft, destruction or mutilation of this Warrant shall be deemed
evidence thereof satisfactory to the Company.
VIII. RECOGNITION OF HOLDER
Prior to due presentment for registration of transfer of this Warrant, the
Company may treat the Holder as the person exclusively entitled to receive
notices and otherwise to exercise rights hereunder.
IX. NOTICE AND EFFECT OF DISSOLUTION, ETC.
Incase a voluntary or involuntary dissolution, liquidation or winding up
of the Company (other than in connection with a merger or consolidation covered
by Section XI hereof) is at any time proposed, the Company shall give at least
30 days' prior
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written notice to the Holder. Such notice shall contain information including,
but not limited to: (1) the date on which the transaction is to take place; (2)
the record date (which shall be at least forty (40) days after the giving of the
notice) as of which holders of Common Stock will be entitled to receive
distributions as a result of the transaction; (3) a description of the
transaction; (4) a description of the distributions to be made to holders of
Common Stock as a result of the transaction; and (5) an estimate of the fair
value of the distributions. On the date of consummation of such transaction, if,
as and when it actually occurs, this Warrant and all rights hereunder shall
terminate.
X. METHOD OF GIVING NOTICE
Notices by or on behalf of the Company to Holder (and any transferee or
assignee of Holder) shall be given by registered mail, return receipt requested,
addressed to the address thereof appearing in the records of the Company.
XI. MERGERS, CONSOLIDATIONS
If the Company shall merge or consolidate with another corporation or
entity, the Holder shall thereafter have the right, upon exercise hereof and
payment of the Exercise Price, to receive solely the kind and amount of shares
of stock (including, if applicable, Common Stock), other securities, property or
cash or any combination thereof receivable by a holder of the number of shares
of Common Stock for which this Warrant might have been exercised immediately
before such merger or consolidation (assuming, if applicable, that the holder of
such Common Stock failed to exercise its rights of election, if any, as to the
kind or amount of shares of stock, other securities, property or cash or
combination thereof receivable upon such merger or consolidation):
Dated as of approval and adoption by the Board of Directors of the Company
on March 29, 1996.
Golden Oil Company
By: /s/JEFFREY V. HOUSTON
Jeffrey V. Houston
Vice President and
Chief Financial Officer
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WESTERN BANK Golden Oil Company DT#20969
ALBUQUERQUE, NEW MEXICO 87110-4319 550 Post Oak Blvd Suite 550 Loan Number 3224500
Houston, TX 77027 Date April 12 1996
LENDER'S NAME AND ADDRESS Maturity Date April 12, 2000
"You" means the Lender, BORROWER'S NAME AND ADDRESS Loan Amount $ 400,000.00
its successors and assigns "I" includes each Borrower Renewal of #9756209 plus new
TERMS FOLLOWING A [ ] APPLY ONLY IF above, jointly and money
CHECKED severally
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NOTE - For value received, I promise to pay to you, or your order, at your
address above, the principal sum of: Four hundred thousand dollars and no/100
Dollars $ 400,000.00. plus interest from April 12, 1996 at the rate of 11.25%
per year until April 12, 2000.
[X] ADDITIONAL FINANCE CHARGE- I also agree to pay a nonrefundable fee of $
4,000.00, and it will be [_] paid in cash. [_] paid pro rata over the loan
term. [X] withheld from the proceeds. (If this fee is withheld from the
proceeds, the amount is included in the principle sum.)
[X] VARIABLE RATE- The rate above may then change so as always to be 2% above
the following index rate: WESTERN BANK ALBUQUERQUE PRIME RATE FLOATING. The
interest rate may not change more than _________% each ______________. The
annual interest rate in effect on this note will not at any time be more
than ________% of less than 10%. The interest rate in effect on this note
may change (as often as) 1st day of each calendar month (assuming there is a
change in the base rate) and an increase in the interest rate will cause an
increase in [X] the amount of each scheduled payment. [_] the amount due at
maturity [_] the number of payments.
PAYMENT- I will pay this note as follows:
(a) [X] Interest due: monthly included in payment
Principal due: monthly included in payment
(b) [x] This note has 48 payments. The first payment will be in the amount of
$10,418.85 and will be due 5/12/96 A payment of $ 10,418.85 will
be due on the 12th day of each month thereafter. The final payment of
the entire unpaid balance of principal and interest will be due at
maturity.
INTEREST- Interest accrues on a 360 basis.
[X] MINIMUM INTEREST CHARGE- I agree to pay a minimum interest charge of $25.00
if I pay this loan off before you have earned that much in interest.
[X] LATE CHARGE- I agree to pay a late charge on the portion of any payment made
more than 10 days after it is due equal to 5% of the unpaid amount or $ NA,
whichever is NA.
POST-MATURITY INTEREST- Interest will accrue after maturity on the unpaid
balance of this note on the same basis as interest accrues before maturity,
unless a specific post-maturity interest rate is agreed to in the next sentence
[X] Interest will accrue at the rate of 18 % per year on the balance of this
note not paid at maturity, including maturity by acceleration.
[ ] This loan is made under the New Mexico Bank Installment Loan Act of 1959.
THE PURPOSE OF THIS LOAN IS- business/renewal - to be advanced Line of Credit
SECURITY- You have certain rights that may affect my property as explained on
page 2. This loan [X] is [ ] is not further secured
(a) (X] This loan is secured by mortgage, Assignment of Production, Security
Agreement & Financing Statement dated 6/15/93, Financing Stmt dated
4/12/96
(b) (X) Security Agreement- I give you a security interest in the Property
described below. The rights I am giving you in this Property and the
obligations this agreement secures are defined on page 2 of this
agreement.
Mortgage, Assignment of Production, Security Agreement and Financing Statements
All purchase money interest in Oil and Gas partnerships to be purchased with
proceeds of this line of credit
This property will be used for business purposes.
ANNUAL PERCENTAGE RATE FINANCE CHARGE AMOUNT FINANCED
The cost of my credit The dollar amount the The amount of credit
as a yearly rate. Credit will cost me. Provided to me or on my behalf.
11.95 $104,104.80 $396,000.000
TOTAL OF PAYMENTS I have the right to receive at this time
The amount I will have paid when an intimation of the Amount Financed
I have made all scheduled payments. [X] YES- I want an itemization
$500,104.80 [ ] NO- I do not want an itemization
"e" means an estimate.
$ by cust Filing Fees
$ Nonfiling Insurance
My payment Schedule will be: On demand or
Number of Payments Amount of Payments When Payments Are Due
48 $10,418.85 Principal and interest due beginning
5/12/96 and the same day of each month
thereafter.
[X] This note has a demand feature. [ ] This note is payable on demand and all
disclosures are based on an assumed
maturity of one year.
[X] Variable Rate - [ ] My loan contains a variable rate feature. Disclosures
about the variable rate feature have been provided to
me earlier.
[X] The annual percentage rate may increase during the
term of this transaction if there is an increase in
WESTERN BANK ALBUQUERQUE PRIME RATE FLOATING
Any increase will take the form of increased interest due if the rate increases
by 1% in xxon 4/12/96, the total finance charge will increase to 113.661.60. The
rate may not increase more often than once a month, and may not increase more
than _______% each__________________. The rate will not go xxx below 10%.
Security- I am giving a security interest in:
[X] (brief description of other property) Mortgage, Assignment of Production,
Security Agreement, Financing Statements, All purchase Money interest in
Oil & Gas partnerships to be purchased
[X] the goods or property being purchased.
[X] collateral securing other leans with you may also secure this loan.
[X] my deposit accounts and other rights to the payment of money from you.
[X] Late Charge- I will be charged a late charge on the portion of any payment
made more than 10 days after it is due equal to 5% of the unpaid amount, or
$na, whichever is na.
[ ] Required Deposit- The annual percentage rate does not take into account my
required deposit.
Prepayment-
If I pay off this note early, I [X] may [ ] will not have to pay a penalty.
[X] If I pay off this note early, I will not be entitled to a refund of part of
the additional finance charge.
[X] Assumptions- Someone buying the property securing this obligations cannot
assume the remainder of the obligation on the original terms.
I can see my contract documents for any additional information about nonpayment,
default, and required repayment before the scheduled date, and prepayment
refunds and penalties.
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CREDIT INSURANCE- Credit life insurance and credit disability ITEMIZATION OF AMOUNT FINANCED
insurance are not required to obtain credit, and will not be provided AMOUNT GIVEN TO ME DIRECTLY $ 50,000.00
unless I sign and agree to pay the additional costs. #9756200
AMOUNT PAID ON MY (LOAN) ACCOUNT $121,047.63
Type Premium Term to be advanced $224,952.37
Credit Life
Credit Disability AMOUNTS PAID TO OTHER ON MY BEHALF:
Joint Credit Life to Insurance Companies $
to Public Officials $
I [ ] do [X] do not want credit life insurance. WS 1% orig fee $ 4,000.00
I [ ] do [X] do not want credit disability insurance.
I [ ] do [X] do not want joint credit life insurance.
I [ ] do [X] do not want insurance. (less) PREPAID FINANCE CHARGE(S) $ (4,000.00)
X DOB
X DOB Amount Financed $396,000.00
PROPERTY INSURANCE- I may obtain property insurance from
anyone I want that is acceptable to you. If I get the insurance from or (Add all items financial and subtract prepaid
through you I will pay $ for of coverage. finance charges.)
SIGNATURES-I AGREE TO THE TERMS SET OUT ON
PAGE 1 AND PAGE 2 OF THIS AGREEMENT. I HAVE
RECEIVED A COPY OF THIS DOCUMENT ON TODAY'S
SINGLE INTEREST INSURANCE- I may obtain single interest DATE.
from anyone I want that is acceptable to you. If I get the COSIGNERS- SEE NOTICE ON PAGE 2
insurance from or through you I will pay BEFORE SIGNING.
$ for of coverage. GOLDEN OIL COMPANY, A DELAWARE CORPORATION
Signature Ralph T. McElvenny Jr., President
(Optional)
Signed For Lender Signature Ralph T. McElvenny Jr., Individually
Title
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ADDITIONAL TERMS OF THE NOTE
DEFINITIONS-"I", "me" or "my" means each Borrower who signs this note and each
other person or legal entity (including guarantors, endorsers, and sureties) who
agrees to pay this note (together referred to as "us"). "You" or "your" means
the Lender and its successors and assigns.
APPLICABLE LAW-This note and any agreement securing this note will be governed
by the laws of the state of New Mexico. The federal Truth-in-Lending disclosures
on page 1 are disclosures only and are not intended to be terms of this
agreement. The fact that any part of this note cannot be enforced will not
affect the rest of this note. Any change to this note or any agreement securing
this note must be in writing and signed by you and me.
PAYMENTS-Each payment I made on this loan will be applied first to any charges I
owe other than principal and interest, then to interest that is due, and finally
to principal that is due. No late charge will be assessed on any payment when
the only delinquency is due to late fees assessed on earlier payments and the
payment is otherwise a full payment. The actual amount of my final payment will
depend on the interest rates(if variable) and my payment record. If any payment
due under this loan does not equal or exceed the amount of interest due, you
may, at your option, increase the amount of the payment due and all future
payments to an amount that will pay off this loan in equal payments over the
remaining term of this loan.
PREPAYMENT-I may prepay this loan in whole or in part at any time. If I prepay
in part, I must still make each later payment in the original amount as it
becomes due until this note is paid in full.
INTEREST-Interest accrues on the principal remaining unpaid from time to time,
until paid in full. If "Variable Rate" is checked on page 1, I will pay interest
at the rates in effect from time to time. Decreases in the interest rate for
this note will have the opposite effect on payments that increases would have.
You will figure a change in the interest rate by using the index rate in effect
at the time the interest rate is to change. Changes in the index between
scheduled changes in the interest rate will not affect the interest rate. If the
index specified on page 1 ceases to exist, I agree that you may substitute a
similar index for the original.
INDEX-If you and I have agreed that the interest rate on this note will be
variable and will be related to an index, then the index you select will
function only as a tool for setting the rate on this note. You do not guaranty,
by selecting any index, that the interest rate on this note will have a
particular relationship to the interest rate you charge on any other loans or
any type or class of loans with your other customers.
ACCRUAL METHOD-The amount of interest I will pay on this loan will be calculated
using the interest rate and accrual method stated on page 1. For interest
calculation, the accrual method will determine the number of days in a year. If
no accrual method is stated, then you may use any reasonable accrual method for
calculating interest.
POST-MATURITY INTEREST-Interest will accrue on the principal balance remaining
unpaid after final maturity at the rate specified on page 1. For purposes of
this section, final maturity occurs:
(a) If this loan is payable on demand, on the date you make demand for
payment;
(b) If this loan is payable on demand with alternate payment date(s), on the
date you make demand for payment or on the final alternate payment date,
whichever is earlier;
(c) On the date of the last scheduled payment of principal; or
(d) On the date you accelerate the due date of this loan(demand immediate
payment).
REAL ESTATE OR RESIDENCE SECURITY-If this loan is secured by real estate or a
residence that is personal property, the existence of a default and your
remedies for such a default will be determined by applicable law, by the terms
of any separate instrument creating the security interest and, to the extent not
prohibited by law and not contrary to the terms of the separate security
instrument, by this agreement.
DEFAULT-Subject to any limitations in the "REAL ESTATE OR RESIDENCE SECURITY"
paragraph above. I will be in default on this loan and any agreement securing
this loan if any one or more of the following occurs:
(a) I fail to make a payment in full when due;
(b) I die, am declared incompetent, or become insolvent;
(c) I fail to keep any promise I have made in connection with this loan;
(d) I fail to pay, or keep any other promise on, any other loan or agreement I
have with you;
(e) I make any written statement or provide any financial information that is
untrue or inaccurate at the time it is provided;
(f) Any creditor of mine attempts to collect any debt I owe through court
proceedings set-off or self-help repossession;
(g) The property is damaged, destroyed or stolen;
(h) I fail to provide any additional security that you may require;
(i) Any legal entity (such as a partnership or corporation ) that has agreed
to pay this note merges, dissolves, reorganizes, end its business or
existence, or a partner or majority stockholder dies or is declared
incompetent; or
(j) Anything else happens that causes you to believe that you will have
difficulty collecting the amount I owe you.
If any of us are in default on this note or any security agreement, you
may exercise your remedies against any or all of us.
REMEDIES - Subject to any limitations in the "REAL ESTATE OR RESIDENCE SECURITY"
paragraph above, if I am in default on this loan or any agreement securing this
loan, you may:
(a) Make unpaid principal, earned interest and all other agreed charges I owe
you under this loan immediately due;
(b) Use the right of set-off as explained below;
(c) Demand more security or new parties obligated to pay this loan (or both)
in return for not using any other remedy;
(d) Make a claim for any and all insurance benefits or refunds that may be
available on my default;
(e) Use any remedy you have under sate of federal law; and 1 Use any remedy
given to you in any agreement securing this loan.
By choosing any one or more of these remedies you do not give up your right
to use another remedy later. BY deciding not to use any remedy should I be in
default, you do not give up your right to consider the event a default if it
happens again.
COST OF COLLECTION AND ATTORNEYS' FEES - I agree to pay you all reasonable costs
you incur to collect this debt or realize on any security. This includes to the
extent permitted by law, reasonable attorney's fees. This provision also shall
apply if I file a petition or any other claim for relief under any bankruptcy
rule or law of the United States, or if such petition or other claim for relief
is under any bankruptcy rule or law of the United States, or if such petition or
other claim for relief is filed against me by another.
SET-OFF - I agree that you may set off any amount due and payable under this
note against any right I have to receive money from you.
"Right to receive money from you" means:
(a) Any deposit account balance I have with you;
(b) Any money owed to me on an item presented to you or in your possession for
collection or exchange: and
(c) Any repurchase agreement or other nondeposit obligation.
"Any amount due and payable under this note" means the total amount of which
you are entitled to demand payment under the terms of this note at the time you
set off. This total includes any balance the due date for which you properly
accelerate under this note.
If my right to receive money from you is also owned by someone who has not
agreed to pay this note, your right of set-off will apply to my interest in the
obligation and to any other amounts I could withdraw on my sole request or
endorsement. Your right of set-off does not apply to an account or other
obligation where my rights arise only in a representative capacity. It also does
not apply to any Individual Retirement Account or other tax-deferred retirement
account.
You will not be liable for the dishonor of any check when the dishonor occurs
because you set off this debt against any of my accounts. I agree to hold you
harmless from any such claims arising as a result of our exercise of your right
of set-off.
OTHER SECURITY - Any present of future agreement securing any other debt I owe
you also will secure the payment of this loan. Property securing another debt
will not secure this loan if such property is my principal dwelling and you fail
to provide any required notice of right of rescission. Also, property securing
another debt will not secure this loan to the extent such property is in
household goods.
OBLIGATIONS INDEPENDENT - I understand that my obligation to pay this loan is
independent of the obligation of any other person who has also agreed to pay it.
You may, without notice, release me or any of us, give up any right you may have
against any of us, extend new credit to any of us, or renew or change this note
one or more times and for any term, and I will still be obligated to pay this
loan. You may, without notice, fail to perfect your security interest in,
impair, or release any security and I will still be obligated to pay this loan.
WAIVER - I waive (to the extent permitted by law) demand, presentment, protest,
notice of dishonor and notice of protest.
PRIVACY - I agree that from time to time you may receive credit information
about me from others, including other lenders and credit reporting agencies. I
agree that you may furnish on a regular basis credit and experience information
regarding my loan to others seeking such information. To the extent permitted by
law, I agree that you will not be liable for any claim arising from the use of
information provided to you by others or for providing such information to
others.
FINANCIAL STATEMENTS - I will give you any financial statements or information
that you feel is necessary. All financial statements and information I give you
will be correct and complete.
PURCHASE MONEY LOAN - If this is a Purchase Money Loan, you may include the name
of the seller on the check or draft for this loan.
ADDITIONAL TERMS OF THE SECURITY AGREEMENT
SECURED OBLIGATIONS - This security agreement secures this loan (including all
extensions, renewals, refinancings and modifications) and any other debt I have
with you now or later. Property described in this security agreement will not
secure other such debts if you fail to give any required notice of the right of
rescission with respect to the Property. Also, this security agreement will not
secure other debts if this security interest is in household goods and the other
debt is a consumer loan. This security agreement will last until it is
discharged in writing.
For the sole purpose of determining the extent of a purchase money security
interest arising under this security agreement:
(a) Payments on any nonpurchase money loan also secured by this agreement will
not be deemed to apply to the Purchase Money Loan; and
(b) Payments on the Purchase Money Loan will be deemed to apply first to the
nonpurchase money portion of the loan, if any, and then to the purchase
money obligations in the order in which the items were acquired.
No security interest will be terminated by application of this formula.
"Purchase Money Loan" means any loan the proceeds of which, in whole or in part,
are used to acquire any property securing the loan and all extensions, renewals,
consolidations and refinancings of such loan.
PROPERTY - The word "Property," as used here, includes all property that is
listed in the security agreement on page 1. If a general description is used,
the world Property includes all my property fitting the general description.
Property also means all benefits that arise from the described Property
(including all proceeds, insurance benefits, payments from others, interest,
dividends, stock splits and voting rights). It also means property that now or
later is attached to, is a part of, or results from the Property.
OWNERSHIP AND DUTIES TOWARD PROPERTY - Unless a co-owner(s) of the Property
signed a third party agreement, I represent that I own all the Property. I will
defend the Property against any other claim. I agree to do whatever you require
to perfect your interest and keep our priority. I will not do anything to harm
your position.
I will keep the Property in my possession (except if pledged and delivered to
you). I will keep it in good repair and use it only for its intended purposes. I
will keep it at my address unless we agree otherwise in writing.
I will not try to sell or transfer the Property, or permit the Property to
become attached to any real estate, without our written consent. I will pay all
taxes and charges on the property as they become due. I will inform you any loss
or damage to the Property. You have the right of reasonable access in order to
inspect the Property.
INSURANCE - I agree to buy insurance on the Property against the risks and for
the amounts you require. I will name you as loss payee on any such policy. You
may require added security on this loan if you agree that insurance proceeds may
be used to repair or replace the Property. I agree that if the insurance
proceeds do not cover the amounts I still owe you. I will pay the difference. I
will buy the insurance from a firm authorized to do business in New Mexico. The
firm will be reasonably acceptable to you. I will keep the insurance until all
debts secured by this agreement are paid.
DEFAULT AND REMEDIES - If I am in default, in additional to the remedies listed
in the note portion of this document and subject to any of the limitations in
the "REAL ESTATE OF RESIDENCE SECURITY" paragraph, you may (after giving notice
and waiting a period of time, if required by law):
(a) Pay taxes or other charges, or purchase any required insurance, if I fail to
do theses things (but you are not required to do so). You may add the amount
you pay to this loan and accrue interest on that amount at the interest
rate(s) in effect from time to time, on this note until paid in full:
(b) Require me to gather the Property and any related records and make it
available to you in a reasonable fashion:
(c) Take immediate possession of the Property, but in doing so you may not
breach the peace or unlawfully enter onto my premises. You may sell, lease
or dispose of the Property as provided by law. (If the Property includes a
manufactured home, you will begin the repossession by giving me notice and
an opportunity to cure my default, if required by law.) You may apply what
you receive from the sale of the Property to your expenses and then to the
debt. If what you receive from the sale of the Property is less than what I
owe you, you may take me to court to recover the difference (to the extent
permitted by law); and
(d) Keep the Property to satisfy the debt.
I agree that when you must give notice to me of your intended sale or
disposition of the Property, the notice is reasonable if it is sent to me at my
last known address by first class mail 10 days before the intended sale or
disposition. I agree to inform you in writing of any change in my address.
FILING - A copy of this security agreement may be used as a financing statement
when allowed by law.
ASSUMPTIONS - This security agreement and any loan it secures cannot be assumed
by someone buying the Property from me. This will be true unless you agree in
writing to the contrary. Without such an agreement, if I try to transfer any
interest in the Property, I will be in default on all obligations that are
secured by this security agreement.
THIRD PARTY AGREEMENT
For the purposes of the provisions within this enclosure, "I," "me" or "my"
means the person signing below and "you" means the Lender identified on page 1.
I agree to give you a security interest in the Property that is described on
page 1. I agree to the terms of this note and security agreement but I am in no
way personally liable for payment of the debt. This means that if the Borrower
defaults, my interest in the secured Property may be used to satisfy the
Borrower's debt. I agree that you may, without releasing me or the Property from
this Third Party Agreement and without notice or demand upon me, extend new
credit to any Borrower, renew or change this note or security agreement one or
more times and for any term, or fail to perfect you security interest in,
impair, or release any security (including guaranties) for the obligations of
any Borrower.
I HAVE RECEIVED A COMPLETED COPY OF THIS NOTE AND SECURITY AGREEMENT.
NAME_____________________________________________________
X________________________________________________________
NOTICE TO CONSIGNER
You (the cosigner) are being asked to guaranty this debt. Think carefully
before you do. If the borrower doesn't pay the debt, you will have to. Be sure
you can afford to pay if you have to, and that you want to accept this
responsibility.
You may have to pay up to the full amount of the debt if the borrower does
not pay. You also may have to pay late fees or collection costs, which increase
this amount. The creditor can collect this debt from you without first trying to
collect from the borrower.
The creditor can use the same collection methods against you that can be
used against the borrower, such as suing you, garnishing your wages, etc. If
this debt is ever in default, that fact may become part of your credit record.
This notice is not the contract that makes you liable for the debt.
Attach FTC "preservation of Consumer Claims and Defenses" Notice if
Applicable
GOLDEN OIL COMPANY
EXHIBIT 22.1
NAME OF SUBSIDIARY STATE OF INCORPORATION
Golden Oil Holding Corporation Delaware
Golden Resources, Inc. Delaware
Regal Petroleum, Ltd. Delaware
Spur Petroleum, Inc. Texas
