<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934*
TESORO PETROLEUM CORPORATION
________________________________________________________________________________
(Name of Issuer)
Common Stock, par value $0.16 2/3 per share
________________________________________________________________________________
(Title of Class of Securities)
0008816091
________________________________________________________________________________
(CUSIP Number)
John M. Huggins, Esq.
Baker & Botts, L.L.P.
885 Third Avenue, Suite 1900
New York, New York 10022
(212) 705-5000
________________________________________________________________________________
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
December 14, 1995
________________________________________________________________________________
(Date of Event which 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 [ ].
Check the following box if a fee is being paid with this statement [X]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of less than five percent of such class.
See Rule 13d-7.)
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 should 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).
NOTE: THIS STATEMENT CONSTITUTES AN ORIGINAL REPORT ON SCHEDULE 13D OF EACH
OF THE REPORTING PERSONS (AS DEFINED IN THE SCHEDULE 13D).
<PAGE> 2
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Kevin S. Flannery
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
PF, AF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
United States/Republic of Ireland
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 366,972 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 366,972 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
366,972 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [X]
See Item 5
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
1.5 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
IN
Page 2 of 31 pages
<PAGE> 3
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Whelan Management Corp.
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
WC, AF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
Delaware
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 340,615 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 340,615 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
340,615 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
1.4 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
CO
Page 3 of 31 pages
<PAGE> 4
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
George F. Baker
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
PF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
United States
________________________________________________________________________________
Number of (7) Sole Voting Power 110,000 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 0 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 110,000 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 0 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
110,000 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.4 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
IN
Page 4 of 31 pages
<PAGE> 5
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Alan Kaufman
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
PF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
United States
________________________________________________________________________________
Number of (7) Sole Voting Power 581,500 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 20,000 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 581,500 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 20,000 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
601,500 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [X]
See Item 5
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
2.4 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
IN
Page 5 of 31 pages
<PAGE> 6
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Kaufman Children's Trust
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
WC, AF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
Indiana
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 20,000 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 20,000 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
20,000 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.1 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
00
Page 6 of 31 pages
<PAGE> 7
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
James H. Stone
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
PF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
United States
________________________________________________________________________________
Number of (7) Sole Voting Power 156,000 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 0 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 156,000 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 0 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
156,000 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.6 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
IN
Page 7 of 31 pages
<PAGE> 8
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Robert S. Washburn
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
PF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
United States
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 233,336 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 233,336 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
233,336 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.9 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
IN
Page 8 of 31 pages
<PAGE> 9
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Robert S. and Suzanne P. Washburn Revocable Trust
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
WC, AF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
California
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 39,545 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 39,545 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
39,545 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.2 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
00
Page 9 of 31 pages
<PAGE> 10
CUSIP No. 0008816091
________________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos.
of Above Persons
Robert S. Washburn, Trustee for the Robert S. Washburn Money
Purchase, Pension and Profit Sharing Keogh Plan Trusts
________________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [X]
(b) [ ]
________________________________________________________________________________
(3) SEC Use Only
________________________________________________________________________________
(4) Source of Funds
WC, AF
________________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
________________________________________________________________________________
(6) Citizenship or Place of Organization
California
________________________________________________________________________________
Number of (7) Sole Voting Power 0 shares
Shares Bene- ___________________________________________________________________
ficially (8) Shared Voting Power 193,791 shares
Owned by ___________________________________________________________________
Each Report- (9) Sole Dispositive Power 0 shares
ing Person ___________________________________________________________________
With (10) Shared Dispositive Power 193,791 shares
________________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
193,791 shares
________________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
________________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)
0.8 %
________________________________________________________________________________
(14) Type of Reporting Person (See Instructions)
00
Page 10 of 10 pages
<PAGE> 11
ITEM 1. SECURITY AND ISSUER
The class of equity securities to which this statement relates
is the common stock, par value $0.16 2/3 per share (the "Common Stock"), of
Tesoro Petroleum Corporation, a Delaware corporation (the "Company"). The
principal executive offices of the Company are located at 8700 Tesoro Drive,
San Antonio, Texas 78217.
ITEM 2. IDENTITY AND BACKGROUND
(a) - (c), (f). This statement is being filed by (i) Kevin
S. Flannery ("Flannery"), (ii) Whelan Management Corp., a Delaware corporation
("Whelan"), (iii) George F. Baker ("Baker"), (iv) Alan Kaufman ("Kaufman"),
(v) Kaufman Children's Trust, a trust established under Indiana law ("Kaufman
Trust"), (vi) Robert S. Washburn ("Washburn"), (vii) the Robert S. and Suzanne
P. Washburn Revocable Trust, dated April 27, 1988, a trust established under
California law ("Washburn Revocable Trust"), (viii) Robert S. Washburn, trustee
for the Robert S. Washburn Money Purchase, Pension and Profit Sharing Keogh
Plan Trusts, trusts established under California law (the "Washburn Trusts"),
and (ix) James H. Stone ("Stone"). Flannery and Whelan are sometimes
collectively referred to herein as the "Flannery Entities." Kaufman and the
Kaufman Trust are sometimes collectively referred to herein as the "Kaufman
Entities." Washburn, the Washburn Revocable Trust and the Washburn Trusts are
sometimes collectively referred to herein as the "Washburn Entities."
Flannery, Baker, Kaufman, Stone and Washburn are members of the Committee for
New Management of Tesoro Petroleum Corporation (the "Committee"). The Flannery
Entities, Baker, the Kaufman Entities, the Washburn Entities and Stone are
sometimes collectively referred to herein as the "Reporting Persons."
Flannery's principal occupation or employment is as President
of Whelan and Whelan Securities, Inc. ("Whelan Securities"). Whelan is
engaged in investment advisory services and Whelan Securities is engaged in
broker-dealer services. Flannery owns 75% of the common stock of Whelan. The
principal office of each of the Flannery Entities is P.O. Box 1970, 8 Holley
Street, Lakeville, Connecticut 06039. Flannery is a citizen of the United
States of America and the Republic of Ireland. Information with respect to
each executive officer and director of Whelan (other than Flannery) is included
in Schedule I to this Schedule 13D.
Baker's principal occupation or employment is as President of
Cambridge Capital Holdings, an investment advisory firm and a partner of Baker
Nye, L.P., an investment partnership. Baker's principal office is at Baker
Nye, L.P., 767 Fifth Avenue, Suite 2800, New York, New York 10153. Baker is
a citizen of the United States of America.
Kaufman's principal occupation is as a neurological surgeon.
The Kaufman Trust is a trust established under Indiana law and is for the
benefit of Kaufman's children. Kaufman is the sole trustee of the Kaufman
Trust. The principal office of each of the Kaufman Entities is 5500 Hohman
Avenue, Hammond, Indiana 46320. Kaufman is a citizen of the United States of
America.
Stone's principal occupation or employment is as Chairman of
the Board of Stone Energy Corporation, an oil and gas production company.
Stone's principal office is at
Page 11 of 31 pages
<PAGE> 12
Stone Energy Corporation, 909 Poydras Street, Suite 2650, New Orleans,
Louisiana 70112. Stone is a citizen of the United States of America.
Washburn is a private investor. The Washburn Revocable Trust
is a trust under California law for the benefit of Washburn and his wife
Suzanne P. Washburn. Washburn is a co-trustee of the Washburn Revocable Trust
with Suzanne P. Washburn. Information with respect to Suzanne P. Washburn is
included in Schedule I to this Schedule 13D. The Washburn Trusts are jointly
administered pension and retirement trusts established under California law for
the benefit of Washburn and his designated beneficiaries. Washburn is the sole
trustee of the Washburn Trusts. The principal address of the Washburn Entities
is in care of Whelan Management Corp., P.O. Box 1980, 8 Holley Street,
Lakeville, Connecticut 06039. Washburn is a citizen of the United States of
America.
(d) and (e). During the last five years, no Reporting Person
and no person listed on Schedule I has (i) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) been
a party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding 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.
Each Reporting Person may be deemed to share with each other
Reporting Person beneficial ownership of all securities of the Company
("Company Securities") held by the Reporting Persons and to constitute a
"group" within the meaning of Rule 13d-5 promulgated under the Exchange Act
with respect to the Common Stock. Except as specifically described in Item 5,
each Reporting Person expressly disclaims beneficial ownership of the Company
Securities held by any other Reporting Persons.
Information contained herein with respect to each Reporting
Person is given solely by such Reporting Person, and no other Reporting Person
has responsibility for the accuracy or completeness of information supplied by
such other Reporting Person.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
As of the date hereof, the Flannery Entities had acquired an
aggregate of 366,972 shares (the "Shares") of Common Stock (including options
to purchase an aggregate of 208,000 Shares) for a total consideration of
approximately $935,278. Of those Shares, 140,615 Shares and options to
purchase 200,000 Shares were acquired by Whelan for total consideration of
approximately $861,690 and 18,357 Shares and options to purchase 8,000 Shares
were acquired by the Sean Kenrick Flannery Trust, a trust for which Mr.
Flannery serves as investment officer ("Flannery Trust"), for a total
consideration of approximately $73,588. The source of the funds used by Whelan
to acquire such Shares and options was working capital provided from the
personal funds of Flannery. The source of funds used by the Flannery Trust to
acquire such Shares and options was personal funds of members of the Flannery
family. In addition Page Flannery, the wife of Flannery, has purchased 2,500
Shares for a total consideration of approximately $23,625 out of personal
funds. Certain of the funds used by the Flannery Entities may represent the
proceeds of margin loans granted by brokerage firms in the ordinary course of
business. See Items 5 and 6.
Page 12 of 31 pages
<PAGE> 13
As of the date hereof, Baker had acquired 10,000 Shares and
options to purchase 100,000 Shares for a total consideration of $119,000. The
source of the funds used by Baker to acquire such Shares and options was
personal funds.
As of the date hereof, the Kaufman Entities had acquired an
aggregate of 601,500 Shares for a total consideration of approximately
$5,061,825. Of those Shares, 581,500 Shares were acquired by Kaufman for a
total consideration of approximately $4,942,750 and 20,000 Shares were acquired
by the Kaufman Trust for a total consideration of $119,075. The source of the
funds used by Kaufman to acquire such Shares was personal funds. The source of
funds used by the Kaufman Trust to acquire such Shares were personal funds of
Dr. Kaufman. Certain of the funds used by the Kaufman entities may represent
the proceeds of margin loans granted by brokerage firms in the ordinary course
of business. In addition, Gloria Kaufman, Kaufman's wife, has purchased 10,500
Shares for an aggregate consideration of approximately $89,250. See Item 5.
As of the date hereof, Stone had acquired 46,000 Shares and
options to acquire 110,000 Shares for a total consideration of approximately
$450,268. The source of the funds used by Stone to acquire such Shares and
options was personal funds. Certain of the funds used by Stone may represent
the proceeds of margin loans granted by brokerage firms in the ordinary course
of business.
As of the date hereof, the Washburn Entities had acquired an
aggregate of 233,336 Shares for a total consideration of approximately
$1,061,639. Of those Shares, 39,545 Shares were acquired by the Washburn
Revocable Trust for a total consideration of $179,890 and 193,791 Shares were
acquired by the Washburn Trusts for a total consideration of approximately
$881,749. The source of funds used by the Washburn Revocable Trust to acquire
such Shares was personal funds of Washburn and the source of funds used by the
Washburn Trusts to acquire such Shares was through funds in the Washburn Trusts
provided by Washburn through allowable contributions to the Washburn Trusts.
ITEM 4. PURPOSE OF TRANSACTION
Each of the Reporting Persons acquired its respective Shares
and options to purchase Shares in order to obtain an equity position in the
Company. As more fully explained below, the Reporting Persons plan to seek to
acquire control of the Company through the replacement of the Company's current
Board of Directors with the Committee Nominees.
On December 14, 1995, certain of the Reporting Persons formed
the Committee in order to take concerted action to enhance shareholder value of
the Company. In the opinion of the Committee, the Shares are currently
undervalued, and the Committee believes that the Board of Directors of the
Company should be evaluating all alternatives available to the Company to
maximize the value of the Company for all shareholders. The Committee
believes, however, that the current Board of Directors and incumbent management
have exhibited a sustained inability or unwillingness to take the actions
necessary to enhance shareholder value.
The Committee has determined to commence a consent
solicitation to remove the existing members of the Board of Directors and
replace them with a slate of nominees
Page 13 of 31 pages
<PAGE> 14
(the "Committee Nominees") consisting of Baker, Kaufman, Stone, Gale L.
Galloway ("Galloway") and Douglas Thompson ("Thompson"). Galloway is the
Chairman of the Board and Chief Executive Officer of GLG Energy, Inc., an
independent oil and gas operator. Thompson is the Chairman of Digicon, Inc., a
Delaware corporation based in Houston, Texas engaged in worldwide geophysical
services. The Committee will shortly file preliminary solicitation materials
with the Securities and Exchange Commission with respect to the removal of the
existing Board, the election of the Committee Nominees and various related
matters. Each Reporting Person intends to execute written consents supporting
the actions proposed by the Committee.
If elected, the Committee Nominees intend to conduct a
detailed review of the Company and its assets, corporate structure, dividend
policy, capitalization, operations, properties, policies and personnel. The
Committee Nominees will consider alternative strategies to enhance stockholder
value, including, among other things, changes in the Company's business
policies and plans or corporate structure, along with sales of certain assets
and operations. Based on the Committee's current knowledge of the Company, the
Committee expects that the Committee Nominees, once elected, will adopt a
strategic plan to enhance the value of the Company which will include as a
principal element the prompt disposition of the Company's refinery business in
order to enable the Company to focus on its core exploration and production
business.
On December 26, 1995, the members of the Committee intend to
commence a lawsuit in the United States District Court for the Western District
of Texas, San Antonio Division, against the Company and its Chief Executive,
Bruce A. Smith. The action will seek, among other relief, a judgment (i)
declaring that the Company's Rights Agreement dated December 16, 1985 (the
Company's "poison pill") does not apply to the efforts of the Committee to
solicit consents from other stockholders of the Company; (ii) declaring that
the Company's By-laws permit removal of directors through stockholder action by
written consent; (iii) enjoining the Company from delaying or otherwise
unlawfully interfering with the efforts of the Committee to solicit consents
from other stockholders; and (iv) declaring that the actions and disclosures of
the Committee with regard to their effort to solicit consents are and have been
in compliance with the Securities Exchange Act of 1934, as amended. A copy of
the Committee's complaint, once the lawsuit has been commenced, will be filed
as an exhibit to this Schedule 13D.
The Reporting Persons intend to review on a continuing basis
their respective investments in the Shares and may, subject to the continuing
evaluation of the factors discussed herein, acquire from time to time
additional Shares in the open market or in privately negotiated transactions.
Depending on the factors discussed herein, the Reporting Persons may, from time
to time, retain or sell all or a portion of their respective holdings of the
Shares in the open market or in privately negotiated transactions. In addition
certain Reporting Persons may, from time to time, elect to acquire Shares
through the exercise of options. Any open market or privately negotiated
purchases or sales or option exercises may be made at any time without further
prior notice. Each of the Reporting Persons reserves the right to cease his or
its participation in a group with the other Reporting Persons.
Any action that any of the Reporting Persons might undertake
with respect to the Shares, including the exercise of options to purchase
Shares currently held by certain Reporting Persons, will be dependent upon its
or his individual review of numerous factors, including, among other things,
the availability of Shares for purchase and the price levels of
Page 14 of 31 pages
<PAGE> 15
such Shares, general market and economic conditions, ongoing evaluation of the
Company's business, financial condition, operations and prospects, the relative
attractiveness of alternative business and investment opportunities, the
actions of the management and the Board of Directors of the Company, and other
future developments.
Although the foregoing reflects activities currently
contemplated by the Reporting Persons with respect to the Company, the
foregoing is subject to change at any time, and there can be no assurance that
any of the Reporting Persons will purchase additional Shares or take any of the
other actions referred to above. Except as set forth above and in Item 6, none
of the Reporting Persons has any present plans or intentions that would result
in or relate to any of the transactions described in subparagraphs (a) through
(j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) and (b). As of the date hereof, Whelan directly owned
140,615 Shares and held options to acquire an additional 200,000 Shares that
expire on May 16, 1996. Whelan has the sole power to vote or direct the vote,
and to dispose or to direct the disposition of, the Shares that it owns
directly. As of the date hereof, the Flannery Trust directly owned 18,357
Shares and held options to acquire an additional 8,000 Shares that expire in
January 1996. Flannery has the sole power to vote or direct the vote, and to
dispose or to direct the disposition of, the Shares that the Flannery Trust
owns directly. Flannery, as the principal executive officer and a 75% common
stockholder of Whelan, may also be deemed to own beneficially the Shares owned
by Whelan. The foregoing information does not reflect 2,500 Shares owned by
Flannery's wife as to which Flannery disclaims beneficial ownership. Whelan
Securities, in the ordinary course of its business as a broker-dealer, has
purchased and sold shares of Common Stock for the accounts of its customers.
Flannery has advised the Reporting Persons that all such customer accounts are
non-discretionary and that neither Whelan nor Whelan Securities has any control
over buying, selling or voting shares of Common Stock in such accounts. As a
result, Whelan, Whelan Securities or its clearing agent may be the record owner
of certain of such shares of Common Stock over which it does not possess
beneficial ownership.
As of the date hereof, Baker directly owned 10,000 Shares and
held options to acquire 100,000 Shares that expire on May 16, 1996. Baker has
the sole power to vote or direct the vote, and to dispose or to direct the
disposition of, the Shares that he owns directly.
As of the date hereof, Kaufman owned 581,500 Shares either
directly or through an individual retirement account. Kaufman has the sole
power to vote or direct the vote, and to dispose or to direct the disposition
of, all of such Shares. As of the date hereof, the Kaufman Trust directly
owned 20,000 Shares. Kaufman, as the sole trustee of the Kaufman Trust, has the
sole power to vote or direct the vote, and to dispose or to direct the
disposition of, the Shares owned by the Kaufman Trust. Kaufman disclaims
beneficial ownership of all Shares owned by the Kaufman Trust. The foregoing
information does not include 10,500 Shares owned by Gloria Kaufman, Kaufman's
wife, as to which Kaufman disclaims beneficial ownership.
Page 15 of 31 pages
<PAGE> 16
As of the date hereof, Stone owned 46,000 Shares and held (i)
options to acquire 100,000 Shares that expire on May 16, 1996 and (ii) options
to acquire 10,000 shares that expire in January 1996. Stone has the sole power
to vote or direct the vote, and to dispose or to direct the disposition of,
the Shares that he owns directly.
As of the date hereof, the Washburn Revocable Trust directly
owned 39,545 Shares. Washburn, as a co-trustee of the Washburn Revocable
Trust, shares the power to vote or direct the vote, and to dispose or to direct
the disposition of, all of such Shares. Suzanne Washburn is also a co-trustee
of the Washburn Revocable Trust. As of the date hereof, the Washburn Trusts
directly owned 193,791 Shares. Washburn, as the sole trustee of the Washburn
Trusts, has the sole power to vote or direct the vote, and to dispose or to
direct the disposition of, all of such Shares.
Except as set forth above, neither the filing of this Report
nor any of its contents shall be deemed to constitute an admission that any
Reporting Person is the beneficial owner of any of the shares of Common Stock
owned by another Reporting Person for purposes of Section 13(d) of the Exchange
Act or for any other purpose, and such beneficial ownership is expressly
disclaimed.
(c) Schedule II hereto sets forth a list of each transaction
in the Common Stock effected by the Reporting Persons since October 16, 1995.
(d) Not Applicable.
(e) Not Applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIP WITH RESPECT
TO THE SECURITIES OF THE ISSUER
The information set forth in Item 3 and Item 4 above is hereby
incorporated by reference herein.
The members of the Committee have an oral agreement pursuant
to which each of them has agreed to cooperate in the solicitation of
stockholder consents in favor of (A) amending the Company's bylaws in order to
facilitate the removal and replacement of the current members of the Board, (B)
removing all of the current directors of the Company, and (C) filling the
vacancies created by the action taken in clause (B) with the Committee
Nominees.
Flannery, Baker, Kaufman, Stone and Washburn have agreed to
share expenses associated with the action described above and have established
an initial fund of $500,000 to pay such expenses. However, since the Committee
deems its activities to be in the best interest of the Company and all the
Company's stockholders, the Committee intends, to the extent legally
permissible, to seek reimbursement from the Company for any expenses or costs
incurred in connection therewith and will seek stockholder approval of such
reimbursement if required by law.
Page 16 of 31 pages
<PAGE> 17
Prior to December 14, 1995, Whelan had acquired options to
purchase an aggregate of 400,000 Shares from affiliates of Ardsley Advisory
Partners, the largest single shareholder of the Company, for an aggregate
purchase price of $36,000. Such options are exercisable at an exercise price
of $8.25 per Share and expire on May 16, 1996. Whelan has entered into
agreements dated as of December 14, 1995, pursuant to which Whelan sold a
portion of such options covering 100,000 Shares to each of Baker and Stone.
Baker and Stone each paid $9,000 in consideration of such sale.
Whelan has entered into an agreement dated as of December 14,
1995, under which Washburn will be entitled to receive a portion of the net
profits, if any, from the exercise and sale of the 200,000 Shares underlying
the options held by Whelan if Washburn is not reimbursed for expenses incurred
in connection with the actions contemplated by this Schedule 13D upon
termination of the consent solicitation. The amount payable to Washburn will
be equal to the lesser of (i) 30% of such net profits and (ii) the aggregate
amount of such expenses funded by Washburn as to which no reimbursement is
received.
The Committee has retained Morrow & Co., Inc. for advice and
assistance in solicitation of consents and has executed an engagement letter
with Morrow & Co., Inc. providing for the payment of a fee of $150,000 plus
reimbursement of expenses. The engagement letter provides Morrow & Co., Inc.
with indemnity from certain liabilities including liabilities arising under
Federal securities laws.
A copy of each of the written agreements described in this
Item 6 is attached hereto as Exhibits 2, 3, 4, 5 and 6, respectively, and is
incorporated herein by reference.
Except as described in Item 3, Item 4, Item 5 and this Item 6,
none of the members of the Committee have any contracts, arrangements,
understandings or relationships (legal or otherwise) with any person with
respect to shares of Common Stock, including, but not limited to (i) transfer
or voting of any shares of Common Stock, (ii) finder's fees, (iii) joint
ventures, (iv) loan or option arrangements, (v) puts or calls, (vi) guarantees
of profits, (vii) division of profits or loss, or (viii) the giving or
withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Written Agreement among the Reporting Persons
regarding Joint Filing of Schedule 13D and Powers of Attorney.
2. Option Agreement, dated as of December 14, 1995,
between Whelan and Stone.
3. Option Agreement, dated as of December 14, 1995,
between Whelan and Baker.
4. Agreement, dated as of December 14, 1995, between
Whelan and Washburn.
5. Option Agreements with various affiliates of Ardsley
Advisory Partners.
Page 17 of 31 pages
<PAGE> 18
6. Engagement Letter with Morrow & Co., Inc. (to be
filed by amendment).
Page 18 of 31 pages
<PAGE> 19
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
/s/ Kevin S. Flannery
------------------------------
Kevin S. Flannery
Page 19 of 31 pages
<PAGE> 20
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
-------------------------------
Name: Kevin S. Flannery
Title: President
Page 20 of 31 pages
<PAGE> 21
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
/s/ George F. Baker
-------------------------------
George F. Baker
Page 21 of 31 pages
<PAGE> 22
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
/s/ Alan Kaufman
-------------------------------
Alan Kaufman
Page 22 of 31 pages
<PAGE> 23
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
KAUFMAN CHILDREN'S TRUST
By: /s/ Alan Kaufman
-------------------------------
Name: Alan Kaufman
Title: Trustee
Page 23 of 31 pages
<PAGE> 24
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
/s/ James H. Stone
-------------------------------
James H. Stone
Page 24 of 31 pages
<PAGE> 25
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
/s/ Robert S. Washburn
-------------------------------
Robert S. Washburn
Page 25 of 31 pages
<PAGE> 26
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
ROBERT S. AND SUZANNE P. WASHBURN
REVOCABLE TRUST
By: /s/ Robert S. Washburn
-------------------------------
Name: Robert S. Washburn
Title: Co-Trustee
Page 26 of 31 pages
<PAGE> 27
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
ROBERT S. WASHBURN MONEY
PURCHASE, PENSION AND PROFIT
SHARING KEOGH PLAN TRUSTS
By: /s/ Robert S. Washburn
-------------------------------
Name: Robert S. Washburn
Title: Trustee
Page 27 of 31 pages
<PAGE> 28
SIGNATURE
After reasonable inquiry and to the best of his knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: December 22, 1995
WHELAN MANAGEMENT CORP.
/s/ Kevin S. Flannery
-------------------------------
By: Kevin S. Flannery
President
Page 28 of 31 pages
<PAGE> 29
SCHEDULE I
Robert Thomas
(1) present occupation: Vice President and Chief Financial
Officer of Whelan
(2) business address:
P.O. Box 1970
8 Holley Street
Lakeville, CT 06039
(3) Citizenship: United States of America
Suzanne Washburn
(1) present occupation: homemaker
(2) business address:
Whelan Management Corp.
P.O. Box 1970
8 Holley Street
Lakeville, CT. 06039
(3) Citizenship: United States of America
Page 29 of 31 pages
<PAGE> 30
SCHEDULE II
The following tables set forth all transactions in the Shares
effected by the Reporting Persons since October 16, 1995.
FLANNERY ENTITIES
WHELAN MANAGEMENT CORP.
<TABLE>
<CAPTION>
Number
Type of Transaction Date of Shares Price per Share Location
------------------- ---- --------- --------------- --------
<S> <C> <C> <C> <C>
Purchase 10/16/95 7,500 7 1/2 Exchange
Purchase 10/16/95 8,000 7 5/8 Exchange
Sale 10/18/95 3,000 8 Exchange
Sale 10/18/95 7,000 7 7/8 Exchange
Sale 10/25/95 8,000 8 3/8 Exchange
Sale 10/25/95 42,000 8 1/4 Exchange
Purchase 10/27/95 900 8 3/8 Exchange
Purchase 10/27/95 2,000 8 1/2 Exchange
Purchase 10/30/95 45,000 8 1/4 Exchange
Purchase 11/15/95 500 7 7/8 Exchange
Purchase of Option 11/16/95 400,000 (1) Private
Purchase 12/01/95 1,000 8 3/8 Exchange
Sale 12/07/95 7,500 8 1/2 Exchange
Sale 12/08/95 10,500 8 1/2 Exchange
Sale 12/11/95 13,000 8 1/2 Exchange
Grant of Option 12/14/95 100,000 (2) Private
Grant of Option 12/14/95 100,000 (2) Private
FLANNERY
Sale 10/16/95 8,000 7 5/8 Exchange
Sale 12/19/95 10,000 8 3/8 Exchange
- ---------------
</TABLE>
(1) The options are exercisable at a price of $8.25 per Share. The total
purchase price for the options was $36,000.
(2) The options are exercisable at a price of $8.25 per Share. The total
sale price for the options was $18,000.
Page 30 of 31 pages
<PAGE> 31
BAKER
<TABLE>
<CAPTION>
Number
Type of Transaction Date of Shares Price per Share Location
------------------- ---- --------- --------------- --------
<S> <C> <C> <C> <C>
Acquisition of 12/14/95 100,000 (1) Private
Option
- ---------------
</TABLE>
(1) The options are exercisable at a price of $8.25 per Share. The total
acquisition price for the options was $9,000.
KAUFMAN
None
STONE
<TABLE>
<CAPTION>
Number
Type of Transaction Date of Shares Price per Share Location
------------------- ---- --------- --------------- --------
<S> <C> <C> <C> <C>
Exercise of Option 12/16/95 11,000 8.37 Exchange
Acquisition of 12/14/95 100,000 (1) Private
Option
- ---------------
</TABLE>
(1) The options are exercisable at a price of $8.25 per Share. The total
acquisition price for the options was $9,000.
WASHBURN ENTITIES
WASHBURN TRUSTS
<TABLE>
<CAPTION>
Number
Type of Transaction Date of Shares Price per Share Location
------------------- ---- --------- --------------- --------
<S> <C> <C> <C> <C>
Sale 10/18/95 15,000 $8.375 Exchange
Sale 10/24/95 4,000 $8.375 Exchange
Purchase 12/4/95 3,100 $8.25 Exchange
Purchase 12/7/95 1,900 $8.25 Exchange
</TABLE>
WASHBURN REVOCABLE TRUST
None
Page 31 of 31 pages
<PAGE> 32
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------- -----------
99.1 Written Agreement among the Reporting Persons
regarding Joint Filing of Schedule 13D and Powers
of Attorney.
99.2 Option Agreement, dated as of December 14, 1995,
between Whelan and Stone.
99.3 Option Agreement, dated as of December 14, 1995,
between Whelan and Baker.
99.4 Agreement, dated as of December 14, 1995, between
Whelan and Washburn.
99.5 Option Agreements with various affiliates of Ardsley
Advisory Partners.
<PAGE> 1
EXHIBIT 1
JOINT FILING AGREEMENT
AGREEMENT, dated as of December 14, 1995, by and among the parties
identified on the signature pages hereto.
WHEREAS, each of the parties hereto beneficially owns shares of Common
Stock, par value $0.16 2/3 per share ("Common Stock"), or options to purchase
shares of Common Stock (collectively, the "Company Securities") of Tesoro
Petroleum Corporation, a Delaware corporation; and
WHEREAS, the parties hereto may be deemed to constitute a "group" with
respect to the beneficial ownership of the Company Securities for purposes of
Rule 13d-5 and Schedule 13D promulgated by the Securities and Exchange
Commission;
NOW, THEREFORE, the parties hereto agree as follows:
1. The parties hereto shall prepare a single statement
containing the information required by Schedule 13D with respect to their
respective interests in the Company Securities (the "Schedule 13D"), and the
Schedule 13D shall be filed on behalf of each of them.
2. Each party hereto shall be responsible for the timely
filing of the Schedule 13D and any necessary amendments thereto, and for the
completeness and accuracy of the information concerning him or it contained
therein, but shall not be responsible for the completeness and accuracy of the
information concerning any other party contained therein, except to the extent
that he or it knows or has reason to believe that such information is
inaccurate.
3. The parties hereby designate Kevin S. Flannery,
George F. Baker, Alan Kaufman, James H. Stone and Robert S. Washburn as the
Committee for New Management of Tesoro Petroleum Corporation in order to
facilitate a concerted action to enhance shareholder value of the Company.
4. This Agreement shall continue unless terminated by
any party hereto.
5. John M. Huggins, Esq. shall be designated as the
person authorized to receive notices and communications with respect to the
Schedule 13D and any amendments thereto.
6. This Agreement may be executed in counterparts, each
of which taken together shall constitute one and the same instrument.
<PAGE> 2
SIGNATURE PAGE TO JOINT FILING AGREEMENT
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
/s/ Kevin S. Flannery
----------------------------
Kevin S. Flannery
<PAGE> 3
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
/s/ Alan Kaufman
----------------------------
Alan Kaufman
<PAGE> 4
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
/s/ James H. Stone
----------------------------
James H. Stone
<PAGE> 5
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
/s/ Robert S. Washburn
----------------------------
Robert S. Washburn
<PAGE> 6
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
/s/ Alan Kaufman
----------------------------
Alan Kaufman
<PAGE> 7
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
KAUFMAN CHILDREN'S TRUST
By: /s/ Alan Kaufman
----------------------------
Name: Alan Kaufman
Title: Trustee
<PAGE> 8
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
ROBERT S. AND SUZANNE P. WASHBURN
REVOCABLE TRUST
By: /s/ Robert S. Washburn
----------------------------
Name: Robert S. Washburn
Title: Co-Trustee
<PAGE> 9
SIGNATURE PAGE TO JOINT FILING AGREEMENT
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints Kevin S. Flannery, his or its true and lawful attorney-in-fact and
agent with full power of substitution and re-substitution for him or it and in
his or its name, place and stead, in any and all capacities, to sign the
initial and any or all amendments to his or its Schedule 13D, dated December
22, 1995, with respect to the common stock of Tesoro Petroleum Corporation and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, any national securities
exchange and the corporation, granting unto said attorney-in-fact and agent
full power and authority, to do and perform each and every act and thing
necessary or appropriate to be done in and about the premises, to all intents
and purposes and as fully as he or it might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or his
substitutes may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
ROBERT S. WASHBURN MONEY PURCHASE,
PENSION AND PROFIT SHARING KEOGH
PLAN TRUSTS
By: /s/ Robert S. Washburn
----------------------------
Name: Robert S. Washburn
Title: Trustee
<PAGE> 10
SIGNATURE PAGE TO JOINT FILING AGREEMENT
IN WITNESS WHEREOF, the undersigned have executed this
Agreement in one or more counterparts as of the date first above written.
WHELAN MANAGEMENT CORP.
/s/ Kevin S. Flannery
----------------------------
By: Kevin S. Flannery
President
<PAGE> 1
EXHIBIT 2
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into as of December 14, 1995, by and between Whelan Management Corp. ("Whelan")
and James H. Stone ("Buyer").
WITNESSETH
WHEREAS, Whelan owns options to purchase 400,000 shares of the
common stock, par value $.16 2/3 per share (the "Common Stock"), of Tesoro
Petroleum Corporation (the "Company") expiring on May 16, 1996 described in
Exhibit 1 hereto (the "Whelan Options");
WHEREAS, the options described on Exhibit 1 are exercisable in
part or in full and are freely transferable;
WHEREAS, Whelan wishes to sell to Buyer and Buyer wishes to
buy from Whelan pursuant to the terms contained in this Agreement, options to
purchase 100,000 shares of Common Stock at $8.25 per share which at Whelan's
sole discretion shall consist of options from one or more of the Whelan Options
listed on Exhibit 1 (the "Buyer Options"); and
WHEREAS, Buyer wishes for Whelan to continue to hold the Buyer
Options for the benefit of Buyer;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Purchase of Buyer Options. Buyer hereby purchases
from Whelan and Whelan hereby sells to Buyer the Buyer Options for a purchase
price of $9,000 (the "Purchase Price").
2. Terms of Buyer Options. Buyer and Whelan agree that
the provisions of the Buyer Options shall be identical to the provisions of the
Whelan Options, and that nothing contained in this Agreement shall be
interpreted to alter, in any respect, the provision of the Whelan Options or to
grant Buyer any additional or greater rights under the Buyer Options than
Whelan currently enjoys under the Whelan Options. A copy of one of the Whelan
Options is attached hereto as Exhibit 2.
3. Possession of Buyer Options. Buyer and Whelan agree
that the Buyer Options shall remain in the possession and in the name of Whelan
for the benefit of Buyer unless Buyer otherwise indicates in writing, in which
case Whelan shall promptly comply with the terms
<PAGE> 2
of such written instructions. During the period in which the Buyer Options
remain in Whelan's possession and name, Whelan agrees to promptly exercise all
or part of the Buyer Options for the benefit of Buyer only upon (i) Buyer's
written request and (ii) receipt of Buyer's payment to Whelan of the exercise
price relating to that portion of the Buyer Options to be exercised. Whelan
further agrees to promptly transfer to Buyer the shares of Common Stock issued
upon the full or partial exercise of the Buyer Options pursuant to the previous
sentence.
4. Representations of Whelan. Whelan hereby represents
and warrants to Buyer that Whelan is the owner of all the legal right, title
and interest in and to the Buyer Options, free and clear of any lien,
encumbrance or other adverse claim of any nature.
5. Covenants of Whelan. From and after the date hereof,
Whelan agrees not to dispose of or exercise the Buyer Options except pursuant
to this Agreement. For purposes hereof, the expiration of the Whelan Option by
its terms shall not be deemed to be a disposition.
6. Transfer to Buyer of Buyer Options. At any time,
Whelan shall have the right to transfer the Buyer Options to Buyer, at which
time this Agreement shall terminate.
7. Scope of Buyer Options. The Buyer Options are
options only with respect to 100,000 shares of Common Stock covered by the
Whelan Options, and if the Whelan Options are for any reason invalid or not
honored, Whelan shall have no liability as a result thereof.
IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement as of the date first written above.
WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
-----------------------------
Name: Kevin S. Flannery
Title: President
/s/ James H. Stone
---------------------------------
James H. Stone, Buyer
<PAGE> 1
EXHIBIT 3
OPTION AGREEMENT
This Option Agreement (the "Agreement") is made and entered
into as of December 14, 1995, by and between Whelan Management Corp. ("Whelan")
and George F. Baker ("Buyer").
WITNESSETH
WHEREAS, Whelan owns options to purchase 400,000 shares of the
common stock, par value $.16 2/3 per share (the "Common Stock"), of Tesoro
Petroleum Corporation (the "Company") expiring on May 16, 1996 described in
Exhibit 1 hereto (the "Whelan Options");
WHEREAS, the options described on Exhibit 1 are exercisable in
part or in full and are freely transferable;
WHEREAS, Whelan wishes to sell to Buyer and Buyer wishes to
buy from Whelan pursuant to the terms contained in this Agreement, options to
purchase 100,000 shares of Common Stock at $8.25 per share which at Whelan's
sole discretion shall consist of options from one or more of the Whelan Options
listed on Exhibit 1 (the "Buyer Options"); and
WHEREAS, Buyer wishes for Whelan to continue to hold the Buyer
Options for the benefit of Buyer;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Purchase of Buyer Options. Buyer hereby purchases
from Whelan and Whelan hereby sells to Buyer the Buyer Options for a purchase
price of $9,000 (the "Purchase Price").
2. Terms of Buyer Options. Buyer and Whelan agree that
the provisions of the Buyer Options shall be identical to the provisions of the
Whelan Options, and that nothing contained in this Agreement shall be
interpreted to alter, in any respect, the provision of the Whelan Options or to
grant Buyer any additional or greater rights under the Buyer Options than
Whelan currently enjoys under the Whelan Options. A copy of one of the Whelan
Options is attached hereto as Exhibit 2.
3. Possession of Buyer Options. Buyer and Whelan agree
that the Buyer Options shall remain in the possession and in the name of Whelan
for the benefit of Buyer unless Buyer otherwise indicates in writing, in which
case Whelan shall promptly comply with the terms
<PAGE> 2
of such written instructions. During the period in which the Buyer Options
remain in Whelan's possession and name, Whelan agrees to promptly exercise all
or part of the Buyer Options for the benefit of Buyer only upon (i) Buyer's
written request and (ii) receipt of Buyer's payment to Whelan of the exercise
price relating to that portion of the Buyer Options to be exercised. Whelan
further agrees to promptly transfer to Buyer the shares of Common Stock issued
upon the full or partial exercise of the Buyer Options pursuant to the previous
sentence.
4. Representations of Whelan. Whelan hereby represents
and warrants to Buyer that Whelan is the owner of all the legal right, title
and interest in and to the Buyer Options, free and clear of any lien,
encumbrance or other adverse claim of any nature.
5. Covenants of Whelan. From and after the date hereof,
Whelan agrees not to dispose of or exercise the Buyer Options except pursuant
to this Agreement. For purposes hereof, the expiration of the Whelan Option by
its terms shall not be deemed to be a disposition.
6. Transfer to Buyer of Buyer Options. At any time,
Whelan shall have the right to transfer the Buyer Options to Buyer, at which
time this Agreement shall terminate.
7. Scope of Buyer Options. The Buyer Options are
options only with respect to 100,000 shares of Common Stock covered by the
Whelan Options, and if the Whelan Options are for any reason invalid or not
honored, Whelan shall have no liability as a result thereof.
IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement as of the date first written above.
WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
-----------------------------
Name: Kevin S. Flannery
Title: President
/s/ George F. Baker
---------------------------------
George F. Baker, Buyer
<PAGE> 1
EXHIBIT 4
AGREEMENT
This Agreement (the "Agreement") is made and entered into as
of December 14, 1995, by and between Whelan Management Corp. ("Whelan") and
Robert S. Washburn ("Washburn").
WITNESSETH
WHEREAS, Whelan owns options to purchase 200,000 shares of
common stock, par value $.16 2/3 per share (the "Common Stock"), of Tesoro
Petroleum Corporation (the "Company") at $8.25 per share, subject to
adjustment, which expire on May 16, 1996 (the "Options");
WHEREAS, Washburn has agreed to participate in a consent
solicitation relating to the Company (the "Solicitation") and has agreed to
share in the payment of expenses of the Solicitation (the "Expense Payments")
and to initially contribute $100,000 to the Whelan Management Escrow Account
(the "Whelan Account") in connection therewith;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Contribution. Washburn will upon the execution of
this Agreement contribute to the Whelan Account $100,000.
2. Right to Reimbursement. In the event that Washburn
is not reimbursed for his Expense Payments upon the termination of the
Solicitation, Whelan hereby agrees to pay to Washburn the lesser of (i) 30% of
the Profits (as defined below) or (ii) an amount equal to his Expense Payments.
3. Profits. Whelan and Washburn agree that the profits
(the "Profits") realized from Whelan's exercise of the Options and the sale of
shares of Common Stock acquired upon the exercise of such Options, shall equal
the difference obtained by subtracting (i) the sum of the option price plus the
option strike price from (ii) the net proceeds from the sale of the 200,000
shares of Common Stock acquired pursuant to the exercise of the Options.
4. No Duty to Sell Common Stock. Notwithstanding
anything to the contrary contained in this Agreement, Whelan shall not have any
duty to exercise the Options or sell the shares of Common Stock acquired by
Whelan through the exercise of the Options. In the event that Whelan does not
elect to exercise or sell the Options or to sell shares of Common Stock,
Profits shall be computed as if shares of Common Stock were sold using as
<PAGE> 2
the sales price the last trade, regular way, on the New York Stock Exchange on
the day the Solicitation is terminated.
5. Liability for Options. The Parties hereto agree that
if the Options are for any reason invalid or not honored, Whelan shall have no
liability as a result thereof.
6. Expiration of Options. Upon the expiration of the
Options this Agreement shall terminate.
7. Covenants of Whelan. As long as this Agreement is in
effect, Whelan hereby agrees not to dispose of the Options. For purposes
hereof, the expiration of the Options by their terms shall not be deemed to be
a disposition.
IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement as of the date first written above.
WHELAN MANAGEMENT CORP.
By: /s/ Kevin Flannery
----------------------------
Name: Kevin Flannery
Title: President
/s/ Robert S. Washburn
-----------------------------
Robert S. Washburn
<PAGE> 1
EXHIBIT 5
A R D S L E Y
PARTNERS
TRANSACTION
The purpose of this letter agreement (the "Confirmation") is to set
forth the terms and conditions of the Option Transaction entered into between
Ardsley Partners Fund I, L.P. and Whelan Management Corp. on the Trade Date
specified below (the "Option").
The definitions and provisions contained in the 1991 ISDA Definitions
(as published by the International Swaps & Derivatives Association, Inc.,
("ISDA")) (the "Definitions") are incorporated into this Confirmation. In the
event of any inconsistency between the Definitions and provisions of this
Confirmation, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Option to which this Confirmation relates on the
terms and conditions set forth below.
This Confirmation will be governed by and construed in accordance with
the laws of the State of New York, without reference to choice of law doctrine.
The parties hereto irrevocably submit to the non-exclusive jurisdiction of the
courts of the State of New York and the United States Court for the Southern
District of New York in connection with all matters relating hereto, and waive
any objection to the laying of venue in, and any claim of inconvenient forum
with respect to, these courts.
The terms of the Option to which this Confirmation relates are as
follows:
<TABLE>
<S> <C>
General Terms:
Effective Date: November 16, 1995
Trade Date: November 16, 1995
Option Style: American
Option Type: Call
Seller: Ardsley Partners Fund I, L.P.
Buyer: Whelan Management Corp.
Underlying Stock: Tesoro Petroleum Corporation
Common Stock
</TABLE>
<PAGE> 2
<TABLE>
<S> <C>
Number of Shares: 90,000
Number of Option Units: 900
Strike Price: USD $8.25 per share
Premium: USD $8,100.00 payable as per "Appendix B" which
follows.
Premium Payment Date: November 22, 1995
Business Day: Any day (i) on which commercial banks are open for
business (including dealings in foreign exchange
and foreign currency deposits) in New York and (ii)
which is a scheduled trading day on the New York
Stock Exchange, the Chicago Board Options Exchange
and the Chicago Mercantile Exchange, other than a
day on which trading on any such exchange is
scheduled to close prior to its regular weekday
closing time.
Exchanges: New York Stock Exchange, American Stock Exchange
and NASDAQ.
Calculating Agent: A third party acceptable to Buyer and Seller, whose
determinations and calculations shall be binding in
the absence of manifest error.
Procedure for Exercise:
Exercise Notice: In order to exercise all or part of the Option, an
Exercise Notice in the form set forth below as
appendix "A" shall be sent by facsimile
transmission, telex, hand or overnight delivery to
the Seller. The seller will then sign, date and
time the Exercise Notice and return it to the Buyer
to confirm the Exercise.
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
Expiration Date: May 16, 1996 or, if that date is not a Business
Day, the first following day that is a Business
Day.
Partial Exercise: Allowed. After the Exercise Period, any
unexercised Option Units will be deemed expired
worthless and no longer subject to the terms of
this Confirmation. If only a part of the Option is
exercised, the seller's confirmation(s) of the
Exercise Notice will include a "Remaining Number or
Shares". This quantity shall be considered to be
the new Number of Shares for the Option until the
next Partial Exercise or the Expiration Date,
whichever comes first. Any confirmed Exercise
Notice for partial exercises will become an
addendum to the Confirmation to support changes to
the Number of Shares.
Sellers' Telephone and Facsimile Number Telephone: 203-629-0661
for the purpose of Giving Notice:
Facsimile: 203-629-0661
Market Disruption Event: The occurrence or existence on any Business Day
during the one-half hour period that ends at the
close of trading on the Exchange on any Business
Day of any suspension of or limitation imposed on
trading (by reason of movements in price exceeding
limits permitted by the relevant exchange or
otherwise) on (i) the Exchange in the Underlying
Stock or (ii) in options contracts on the
Underlying Stock, if, in the determination of the
Calculation Agent, such suspension or limitation is
material. The Calculation Agent shall as soon as
reasonably practicable under the circumstances
notify the other party of the existence or
occurrence of a Market Disruption Event for the
purpose of addressing and or recomputing any
necessary adjustments to the Underlying Stock.
</TABLE>
<PAGE> 4
Adjustments to The Option:
During the life of the Option, if any adjustment is made by The Options
Clearing Corporation or its successors ("OCC") in the terms of the outstanding
OCC-issued options ("OCC Options") on the Underlying Stock, an equivalent
adjustment shall be made in the terms of the Option. If any time during the
life of the Option there shall be no outstanding OCC Options on the Underlying
Stock, and an event shall occur for which an adjustment might otherwise be made
under the By-Laws, Rules, and stated policies of OCC applicable to the
adjustment of OCC Options (the "OCC Adjustment Rules"), then adjustment shall
be made in the terms of the Option applying the principles set forth in the OCC
Adjustment Rules. In addition to the foregoing sentence, adjustment shall also
be made (by applying the principles set forth in the OCC Adjustment Rules) in
the terms of the Option for any and all cash dividends, stock dividends, stock
distributions and stock splits on the Underlying Stock, and distributions of
property other than additional Underlying Stock during the life of the Option,
regardless of the size or amount thereof and regardless of whether adjustment
is made by OCC in respect thereof.
<TABLE>
<S> <C>
Settlement Terms:
Physical Delivery: The share quantity of (Number of Option Units
Exercised * 100) will be delivered via the
Depository Trust Co. to the custodian or custodians
to be named by the Buyer.
Physical Delivery Date: 3 Business Days after Valuation Date.
</TABLE>
Default:
If the Buyer fails to make, when due, any payment or delivery required
to be made by it under this Confirmation or under any other transaction with
the Seller within five Business Days (or such shorter grace period provided in
such other transaction) of notice of such failure being given to the Buyer, the
Seller may, by notice to the Buyer, terminate the Option evidenced by this
Confirmation.
Counterparty Representation:
Counterparty hereby represents that it has entered into this contract
in order to offset in whole or in part earnings it expects from assets it has
acquired or anticipates acquiring or liabilities it has incurred or anticipates
incurring.
<PAGE> 5
Transfer:
This Transaction may be assigned or transferred by either party, the
transferring party having given three (3) day's prior notice of such transfer
or assignment.
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to:
Yours sincerely,
By: Ardsley Partners
By: /s/ Kevin M. McCormack
----------------------------
Name: Kevin M. McCormack
Title: Partner
Accepted and agreed as of the
date first above written:
By: WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
--------------------------
Name: Kevin S. Flannery
Title: President
<PAGE> 6
A R D S L E Y
PARTNERS
TRANSACTION
The purpose of this letter agreement (the "Confirmation") is to set
forth the terms and conditions of the Option Transaction entered into between
Ardsley Partners Fund I, L.P. and Whelan Management Corp. on the Trade Date
specified below (the "Option").
The definitions and provisions contained in the 1991 ISDA Definitions
(as published by the International Swaps & Derivatives Association, Inc.,
("ISDA")) (the "Definitions") are incorporated into this Confirmation. In the
event of any inconsistency between the Definitions and provisions of this
Confirmation, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Option to which this Confirmation relates on the
terms and conditions set forth below.
This Confirmation will be governed by and construed in accordance with
the laws of the State of New York, without reference to choice of law doctrine.
The parties hereto irrevocably submit to the non-exclusive jurisdiction of the
courts of the State of New York and the United States Court for the Southern
District of New York in connection with all matters relating hereto, and waive
any objection to the laying of venue in, and any claim of inconvenient forum
with respect to, these courts.
The terms of the Option to which this Confirmation relates are as
follows:
<TABLE>
<S> <C>
General Terms:
Effective Date: November 16, 1995
Trade Date: November 16, 1995
Option Style: American
Option Type: Call
Seller: Ardsley Partners Fund II, L.P.
Buyer: Whelan Management Corp.
Underlying Stock: Tesoro Petroleum Corporation
Common Stock
</TABLE>
<PAGE> 7
<TABLE>
<S> <C>
Number of Shares: 100,000
Number of Option Units: 1,000
Strike Price: USD $8.25 per share
Premium: USD $9,000.00 payable as per "Appendix B" which
follows.
Premium Payment Date: November 22, 1995
Business Day: Any day (i) on which commercial banks are open for
business (including dealings in foreign exchange
and foreign currency deposits) in New York and (ii)
which is a scheduled trading day on the New York
Stock Exchange, the Chicago Board Options Exchange
and the Chicago Mercantile Exchange, other than a
day on which trading on any such exchange is
scheduled to close prior to its regular weekday
closing time.
Exchanges: New York Stock Exchange, American Stock Exchange
and NASDAQ.
Calculating Agent: A third party acceptable to Buyer and Seller, whose
determinations and calculations shall be binding in
the absence of manifest error.
Procedure for Exercise:
Exercise Notice: In order to exercise all or part of the Option, an
Exercise Notice in the form set forth below as
appendix "A" shall be sent by facsimile
transmission, telex, hand or overnight delivery to
the Seller. The seller will then sign, date and
time the Exercise Notice and return it to the Buyer
to confirm the Exercise.
Exercise Period: Any Business Day up to and including the Expiration
Date between 9:00 am and 4:15 p.m. local time in
New York.
</TABLE>
<PAGE> 8
<TABLE>
<S> <C>
Expiration Date: May 16, 1996 or, if that date is not a Business
Day, the first following day that is a Business
Day.
Partial Exercise: Allowed. After the Exercise Period, any
unexercised Option Units will be deemed expired
worthless and no longer subject to the terms of
this Confirmation. If only a part of the Option is
exercised, the seller's confirmation(s) of the
Exercise Notice will include a "Remaining Number or
Shares". This quantity shall be considered to be
the new Number of Shares for the Option until the
next Partial Exercise or the Expiration Date,
whichever comes first. Any confirmed Exercise
Notice for partial exercises will become an
addendum to the Confirmation to support changes to
the Number of Shares.
Sellers' Telephone and Facsimile Number Telephone: 203-629-0661
for the purpose of Giving Notice: Facsimile: 203-629-0661
Market Disruption Event: The occurrence or existence on any Business Day
during the one-half hour period that ends at the
close of trading on the Exchange on any Business
Day of any suspension of or limitation imposed on
trading (by reason of movements in price exceeding
limits permitted by the relevant exchange or
otherwise) on (i) the Exchange in the Underlying
Stock or (ii) in options contracts on the
Underlying Stock, if, in the determination of the
Calculation Agent, such suspension or limitation is
material. The Calculation Agent shall as soon as
reasonably practicable under the circumstances
notify the other party of the existence or
occurrence of a Market Disruption Event for the
purpose of addressing and or recomputing any
necessary adjustments to the Underlying Stock.
</TABLE>
<PAGE> 9
Adjustments to The Option:
During the life of the Option, if any adjustment is made by The Options
Clearing Corporation or its successors ("OCC") in the terms of the outstanding
OCC-issued options ("OCC Options") on the Underlying Stock, an equivalent
adjustment shall be made in the terms of the Option. If any time during the
life of the Option there shall be no outstanding OCC Options on the Underlying
Stock, and an event shall occur for which an adjustment might otherwise be made
under the By-Laws, Rules, and stated policies of OCC applicable to the
adjustment of OCC Options (the "OCC Adjustment Rules"), then adjustment shall
be made in the terms of the Option applying the principles set forth in the OCC
Adjustment Rules. In addition to the foregoing sentence, adjustment shall also
be made (by applying the principles set forth in the OCC Adjustment Rules) in
the terms of the Option for any and all cash dividends, stock dividends, stock
distributions and stock splits on the Underlying Stock, and distributions of
property other than additional Underlying Stock during the life of the Option,
regardless of the size or amount thereof and regardless of whether adjustment
is made by OCC in respect thereof.
<TABLE>
<S> <C>
Settlement Terms:
Physical Delivery: The share quantity of (Number of Option Units
Exercised * 100) will be delivered via the
Depository Trust Co. to the custodian or custodians
to be named by the Buyer.
Physical Delivery Date: 3 Business Days after Valuation Date.
</TABLE>
Default:
If the Buyer fails to make, when due, any payment or delivery required
to be made by it under this Confirmation or under any other transaction with
the Seller within five Business Days (or such shorter grace period provided in
such other transaction) of notice of such failure being given to the Buyer, the
Seller may, by notice to the Buyer, terminate the Option evidenced by this
Confirmation.
Counterparty Representation:
Counterparty hereby represents that it has entered into this contract
in order to offset in whole or in part earnings it expects from assets it has
acquired or anticipates acquiring or liabilities it has incurred or anticipates
incurring.
<PAGE> 10
Transfer:
This Transaction may be assigned or transferred by either party, the
transferring party having given three (3) day's prior notice of such transfer
or assignment.
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to:
Yours sincerely,
By: Ardsley Partners
By: /s/ Kevin M. McCormack
----------------------------
Name: Kevin M. McCormack
Title: Partner
Accepted and agreed as of the
date first above written:
By: WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
--------------------------
Name: Kevin S. Flannery
Title: President
<PAGE> 11
A R D S L E Y
PARTNERS
TRANSACTION
The purpose of this letter agreement (the "Confirmation") is to set
forth the terms and conditions of the Option Transaction entered into between
Ardsley Partners Fund I, L.P. and Whelan Management Corp. on the Trade Date
specified below (the "Option").
The definitions and provisions contained in the 1991 ISDA Definitions
(as published by the International Swaps & Derivatives Association, Inc.,
("ISDA")) (the "Definitions") are incorporated into this Confirmation. In the
event of any inconsistency between the Definitions and provisions of this
Confirmation, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Option to which this Confirmation relates on the
terms and conditions set forth below.
This Confirmation will be governed by and construed in accordance with
the laws of the State of New York, without reference to choice of law doctrine.
The parties hereto irrevocably submit to the non-exclusive jurisdiction of the
courts of the State of New York and the United States Court for the Southern
District of New York in connection with all matters relating hereto, and waive
any objection to the laying of venue in, and any claim of inconvenient forum
with respect to, these courts.
The terms of the Option to which this Confirmation relates are as
follows:
<TABLE>
<S> <C>
General Terms:
Effective Date: November 16, 1995
Trade Date: November 16, 1995
Option Style: American
Option Type: Call
Seller: Ardsley Offshore Fund, Ltd.
Buyer: Whelan Management Corp.
Underlying Stock: Tesoro Petroleum Corporation
Common Stock
</TABLE>
<PAGE> 12
<TABLE>
<S> <C>
Number of Shares: 160,000
Number of Option Units: 1,600
Strike Price: USD $8.25 per share
Premium: USD $14,400.00 payable as per "Appendix B" which
follows.
Premium Payment Date: November 22, 1995
Business Day: Any day (i) on which commercial banks are open for
business (including dealings in foreign exchange
and foreign currency deposits) in New York and (ii)
which is a scheduled trading day on the New York
Stock Exchange, the Chicago Board Options Exchange
and the Chicago Mercantile Exchange, other than a
day on which trading on any such exchange is
scheduled to close prior to its regular weekday
closing time.
Exchanges: New York Stock Exchange, American Stock Exchange
and NASDAQ.
Calculating Agent: A third party acceptable to Buyer and Seller, whose
determinations and calculations shall be binding in
the absence of manifest error.
Procedure for Exercise:
Exercise Notice: In order to exercise all or part of the Option, an
Exercise Notice in the form set forth below as
appendix "A" shall be sent by facsimile
transmission, telex, hand or overnight delivery to
the Seller. The seller will then sign, date and
time the Exercise Notice and return it to the Buyer
to confirm the Exercise.
Exercise Period: Any Business Day up to and including the Expiration
Date between 9:00 am and 4:15 p.m. local time in
New York.
</TABLE>
<PAGE> 13
<TABLE>
<S> <C>
Expiration Date: May 16, 1996 or, if that date is not a Business
Day, the first following day that is a Business
Day.
Partial Exercise: Allowed. After the Exercise Period, any
unexercised Option Units will be deemed expired
worthless and no longer subject to the terms of
this Confirmation. If only a part of the Option is
exercised, the seller's confirmation(s) of the
Exercise Notice will include a "Remaining Number or
Shares". This quantity shall be considered to be
the new Number of Shares for the Option until the
next Partial Exercise or the Expiration Date,
whichever comes first. Any confirmed Exercise
Notice for partial exercises will become an
addendum to the Confirmation to support changes to
the Number of Shares.
Sellers' Telephone and Facsimile Number Telephone: 203-629-0661
for the purpose of Giving Notice:
Facsimile: 203-629-0661
Market Disruption Event: The occurrence or existence on any Business Day
during the one-half hour period that ends at the
close of trading on the Exchange on any Business
Day of any suspension of or limitation imposed on
trading (by reason of movements in price exceeding
limits permitted by the relevant exchange or
otherwise) on (i) the Exchange in the Underlying
Stock or (ii) in options contracts on the
Underlying Stock, if, in the determination of the
Calculation Agent, such suspension or limitation is
material. The Calculation Agent shall as soon as
reasonably practicable under the circumstances
notify the other party of the existence or
occurrence of a Market Disruption Event for the
purpose of addressing and or recomputing any
necessary adjustments to the Underlying Stock.
</TABLE>
<PAGE> 14
Adjustments to The Option:
During the life of the Option, if any adjustment is made by The Options
Clearing Corporation or its successors ("OCC") in the terms of the outstanding
OCC-issued options ("OCC Options") on the Underlying Stock, an equivalent
adjustment shall be made in the terms of the Option. If any time during the
life of the Option there shall be no outstanding OCC Options on the Underlying
Stock, and an event shall occur for which an adjustment might otherwise be made
under the By-Laws, Rules, and stated policies of OCC applicable to the
adjustment of OCC Options (the "OCC Adjustment Rules"), then adjustment shall
be made in the terms of the Option applying the principles set forth in the OCC
Adjustment Rules. In addition to the foregoing sentence, adjustment shall also
be made (by applying the principles set forth in the OCC Adjustment Rules) in
the terms of the Option for any and all cash dividends, stock dividends, stock
distributions and stock splits on the Underlying Stock, and distributions of
property other than additional Underlying Stock during the life of the Option,
regardless of the size or amount thereof and regardless of whether adjustment
is made by OCC in respect thereof.
<TABLE>
<S> <C>
Settlement Terms:
Physical Delivery: The share quantity of (Number of Option Units
Exercised * 100) will be delivered via the
Depository Trust Co. to the custodian or custodians
to be named by the Buyer.
Physical Delivery Date: 3 Business Days after Valuation Date.
</TABLE>
Default:
If the Buyer fails to make, when due, any payment or delivery required
to be made by it under this Confirmation or under any other transaction with
the Seller within five Business Days (or such shorter grace period provided in
such other transaction) of notice of such failure being given to the Buyer, the
Seller may, by notice to the Buyer, terminate the Option evidenced by this
Confirmation.
Counterparty Representation:
Counterparty hereby represents that it has entered into this contract
in order to offset in whole or in part earnings it expects from assets it has
acquired or anticipates acquiring or liabilities it has incurred or anticipates
incurring.
<PAGE> 15
Transfer:
This Transaction may be assigned or transferred by either party, the
transferring party having given three (3) day's prior notice of such transfer
or assignment.
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to:
Yours sincerely,
By: Ardsley Partners
By: /s/ Kevin M. McCormack
---------------------------
Name: Kevin M. McCormack
Title: Partner
Accepted and agreed as of the
date first above written:
By: WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
---------------------------
Name: Kevin S. Flannery
Title: President
<PAGE> 16
A R D S L E Y
PARTNERS
TRANSACTION
The purpose of this letter agreement (the "Confirmation") is to set
forth the terms and conditions of the Option Transaction entered into between
Ardsley Partners Fund I, L.P. and Whelan Management Corp. on the Trade Date
specified below (the "Option").
The definitions and provisions contained in the 1991 ISDA Definitions
(as published by the International Swaps & Derivatives Association, Inc.,
("ISDA")) (the "Definitions") are incorporated into this Confirmation. In the
event of any inconsistency between the Definitions and provisions of this
Confirmation, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Option to which this Confirmation relates on the
terms and conditions set forth below.
This Confirmation will be governed by and construed in accordance with
the laws of the State of New York, without reference to choice of law doctrine.
The parties hereto irrevocably submit to the non-exclusive jurisdiction of the
courts of the State of New York and the United States Court for the Southern
District of New York in connection with all matters relating hereto, and waive
any objection to the laying of venue in, and any claim of inconvenient forum
with respect to, these courts.
The terms of the Option to which this Confirmation relates are as
follows:
<TABLE>
<S> <C>
General Terms:
Effective Date: November 16, 1995
Trade Date: November 16, 1995
Option Style: American
Option Type: Call
Seller: Ardsley Institutional Fund, L.P.
Buyer: Whelan Management Corp.
Underlying Stock: Tesoro Petroleum Corporation
Common Stock
</TABLE>
<PAGE> 17
<TABLE>
<S> <C>
Number of Shares: 50,000
Number of Option Units: 500
Strike Price: USD $8.25 per share
Premium: USD $4,500.00 payable as per "Appendix B" which
follows.
Premium Payment Date: November 22, 1995
Business Day: Any day (i) on which commercial banks are open for
business (including dealings in foreign exchange
and foreign currency deposits) in New York and (ii)
which is a scheduled trading day on the New York
Stock Exchange, the Chicago Board Options Exchange
and the Chicago Mercantile Exchange, other than a
day on which trading on any such exchange is
scheduled to close prior to its regular weekday
closing time.
Exchanges: New York Stock Exchange, American Stock Exchange
and NASDAQ.
Calculating Agent: A third party acceptable to Buyer and Seller, whose
determinations and calculations shall be binding in
the absence of manifest error.
Procedure for Exercise:
Exercise Notice: In order to exercise all or part of the Option, an
Exercise Notice in the form set forth below as
appendix "A" shall be sent by facsimile
transmission, telex, hand or overnight delivery to
the Seller. The seller will then sign, date and
time the Exercise Notice and return it to the Buyer
to confirm the Exercise.
Exercise Period: Any Business Day up to and including the Expiration
Date between 9:00 am and 4:15 p.m. local time in
New York.
</TABLE>
<PAGE> 18
<TABLE>
<S> <C>
Expiration Date: May 16, 1996 or, if that date is not a Business
Day, the first following day that is a Business
Day.
Partial Exercise: Allowed. After the Exercise Period, any
unexercised Option Units will be deemed expired
worthless and no longer subject to the terms of
this Confirmation. If only a part of the Option is
exercised, the seller's confirmation(s) of the
Exercise Notice will include a "Remaining Number or
Shares". This quantity shall be considered to be
the new Number of Shares for the Option until the
next Partial Exercise or the Expiration Date,
whichever comes first. Any confirmed Exercise
Notice for partial exercises will become an
addendum to the Confirmation to support changes to
the Number of Shares.
Sellers' Telephone and Facsimile Number Telephone: 203-629-0661
for the purpose of Giving Notice: Facsimile: 203-629-0661
Market Disruption Event: The occurrence or existence on any Business Day
during the one-half hour period that ends at the
close of trading on the Exchange on any Business
Day of any suspension of or limitation imposed on
trading (by reason of movements in price exceeding
limits permitted by the relevant exchange or
otherwise) on (i) the Exchange in the Underlying
Stock or (ii) in options contracts on the
Underlying Stock, if, in the determination of the
Calculation Agent, such suspension or limitation is
material. The Calculation Agent shall as soon as
reasonably practicable under the circumstances
notify the other party of the existence or
occurrence of a Market Disruption Event for the
purpose of addressing and or recomputing any
necessary adjustments to the Underlying Stock.
</TABLE>
<PAGE> 19
Adjustments to The Option:
During the life of the Option, if any adjustment is made by The Options
Clearing Corporation or its successors ("OCC") in the terms of the outstanding
OCC-issued options ("OCC Options") on the Underlying Stock, an equivalent
adjustment shall be made in the terms of the Option. If any time during the
life of the Option there shall be no outstanding OCC Options on the Underlying
Stock, and an event shall occur for which an adjustment might otherwise be made
under the By-Laws, Rules, and stated policies of OCC applicable to the
adjustment of OCC Options (the "OCC Adjustment Rules"), then adjustment shall
be made in the terms of the Option applying the principles set forth in the OCC
Adjustment Rules. In addition to the foregoing sentence, adjustment shall also
be made (by applying the principles set forth in the OCC Adjustment Rules) in
the terms of the Option for any and all cash dividends, stock dividends, stock
distributions and stock splits on the Underlying Stock, and distributions of
property other than additional Underlying Stock during the life of the Option,
regardless of the size or amount thereof and regardless of whether adjustment
is made by OCC in respect thereof.
<TABLE>
<S> <C>
Settlement Terms:
Physical Delivery: The share quantity of (Number of Option Units
Exercised * 100) will be delivered via the
Depository Trust Co. to the custodian or custodians
to be named by the Buyer.
Physical Delivery Date: 3 Business Days after Valuation Date.
</TABLE>
Default:
If the Buyer fails to make, when due, any payment or delivery required
to be made by it under this Confirmation or under any other transaction with
the Seller within five Business Days (or such shorter grace period provided in
such other transaction) of notice of such failure being given to the Buyer, the
Seller may, by notice to the Buyer, terminate the Option evidenced by this
Confirmation.
Counterparty Representation:
Counterparty hereby represents that it has entered into this contract
in order to offset in whole or in part earnings it expects from assets it has
acquired or anticipates acquiring or liabilities it has incurred or anticipates
incurring.
<PAGE> 20
Transfer:
This Transaction may be assigned or transferred by either party, the
transferring party having given three (3) day's prior notice of such transfer
or assignment.
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to:
Yours sincerely,
By: Ardsley Partners
By: /s/ Kevin M. McCormack
----------------------------
Name: Kevin M. McCormack
Title: Partner
Accepted and agreed as of the
date first above written:
By: WHELAN MANAGEMENT CORP.
By: /s/ Kevin S. Flannery
-------------------------
Name: Kevin S. Flannery
Title: President
