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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
----------
AVIALL, INC.
(Name of Issuer)
Common Stock, $.01 par value per share 05366B102
(Title of class of securities) (CUSIP number)
David E. Zeltner, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153 (212) 310-8000
(Name, address and telephone number of person authorized
to receive notices and communications)
December 4, 1998
(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 that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box [_].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7 for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 17 pages)
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NYFS10...:\80\99980\0025\91\SCHD078V.490
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 2 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON NOLAN ACQUISITION PARTNERS
S.S. OR I.R.S. IDENTIFICATION NO. 75-2787642
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Texas
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 1,306,000
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 1,306,000
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 3 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON NOLAN ACQUISITION GROUP, L.P.
S.S. OR I.R.S. IDENTIFICATION NO. 75-2786370
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 4 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON KINCAID CAPITAL GROUP,
a Texas corporation
S.S. OR I.R.S. IDENTIFICATION NO. 75-2779494
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Texas
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: CO
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 5 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON THOMAS R. KINCAID
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
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 BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States of America
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 6 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON DAN KOMNENOVICH
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
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 BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States of America
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
<PAGE>
- ---------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 7 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON RICHARD JONES
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
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 BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States of America
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 8 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON CONESE CAPITAL, L.L.C.
S.S. OR I.R.S. IDENTIFICATION NO. 58-2423275
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: OO
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 9 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON CONESE FAMILY PARTNERSHIP
(NEVADA), L.P.
S.S. OR I.R.S. IDENTIFICATION NO. 88-0381099
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Nevada
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: PN
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 10 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON CONESE GENERAL PARTNER
(NEVADA), INC.
S.S. OR I.R.S. IDENTIFICATION NO. 88-0381098
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
- ------------------ -------------------------------------------------------------
3 SEC USE ONLY
- ------------------ -------------------------------------------------------------
4 SOURCE OF FUNDS: WC
- ------------------ -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Nevada
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: CO
- ------------------ -------------------------------------------------------------
<PAGE>
- ----------------------------------- ----------------------------------
CUSIP No. 05366B102 13D Page 11 of 17 Pages
- ----------------------------------- ----------------------------------
- ------------------ -------------------------------------------------------------
1 NAME OF REPORTING PERSON EUGENE P. CONESE
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ------------------ -------------------------------------------------------------
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 BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e): [_]
- ------------------ -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: United States of America
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------- --------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 1,306,000
OWNED BY
------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------- --------------------------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 1,306,000
- ------------------ -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING
PERSON: 1,306,000
- ------------------ -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES: [_]
- ------------------ -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 7.2%
- ------------------ -------------------------------------------------------------
14 TYPE OF REPORTING PERSON: IN
- ------------------ -------------------------------------------------------------
<PAGE>
This Amendment No. 1 ("Amendment No. 1") amends the Statement on
Schedule 13D (the "Schedule 13D") filed on November 9, 1998, by and on behalf of
the following persons (collectively, the "Reporting Persons"): Nolan Acquisition
Partners, a Texas general partnership ("NAP"), Nolan Acquisition Group, L.P., a
Delaware limited partnership ("NAG"), Kincaid Capital Group, a Texas Corporation
("Kincaid Capital"), Thomas R. Kincaid ("Kincaid"), Richard Jones ("Jones"), Dan
Komnenovich ("Komnenovich"), Conese Capital, L.L.C., a Delaware limited
liability company ("CCL"), Conese Family Partnership (Nevada), L.P., a Nevada
limited partnership ("CFP"), Conese General Partner (Nevada), Inc., a Nevada
corporation ("CGN") and Eugene P. Conese ("Conese"). Capitalized terms used
herein and not defined herein have the meanings ascribed thereto in the Schedule
13D.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Since the filing of the Schedule 13D, NAP purchased an aggregate of 41,000
shares of Common Stock for total consideration (including brokerage commissions)
of $493,645 derived from the capital of NAP. The source of these funds was equal
capital contributions from NAG and CCL to NAP.
NAG obtained its funding from Kincaid Capital, its general partner, as well as
from its limited partners. Kincaid Capital obtained its funding from Kincaid,
Jones and Komnenovich who used their personal funds.
CCL obtained its funding from CFP, its sole member. CFP obtained its funds from
Conese, one of its limited partners, who used his personal funds.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Persons acquired their shares of Common Stock of the Issuer
because they believe such shares represent a favorable investment opportunity.
Kincaid, Komnenovich, Conese and Eugene P. Conese, Jr. ("Conese, Jr.") have many
years of experience in the aviation business and have offered assistance to
Issuer's management with a view toward increasing shareholder value.
On November 9, 1998, Conese, Kincaid and Komnenovich met with Eric R. Anderson,
Chairman, President and Chief Executive Officer of the Issuer, and Robert
Lambert, a director of the Issuer, to make them aware of the filing of the
original Schedule 13D and the Reporting Persons' interest in being of assistance
to the Issuer in developing a strategic plan to increase shareholder value,
including through participation on the Issuer's Board of Directors.
Representatives of the Reporting Persons were subsequently requested to make
their request for Board representation in writing and, on December 4, 1998,
Conese and Kincaid sent a letter to Mr. Anderson that describes the Reporting
Persons' experience in the aviation industry and requests that Conese, Jr. and
Komnenovich be elected to the Issuer's Board of Directors. The letter expresses
the view that the Reporting Persons could be
12
<PAGE>
enormously helpful in defining the Issuer's strategic plan and creating value
for all shareholders. The letter also states that various shareholders have
encouraged the Reporting Persons' involvement in the Company and would support
the addition to the Board of Directors of persons with substantial equity
investments in the Company. Finally, the letter requested the opportunity for
the Reporting Persons to meet with the directors at an upcoming Board meeting to
explain their strategic vision of the future of the Company and to answer any
questions. A copy of such letter is attached hereto as Exhibit 2 and is
incorporated herein by reference.
By letter dated December 4, 1998, Mr. Anderson indicated surprise that Reporting
Persons had not proposed Conese and Kincaid, the two most senior representatives
of the Reporting Persons, as nominees for directors, but indicated that the
Board would discuss the request at an upcoming meeting and that Mr. Anderson
would make himself available to discuss specific suggestions regarding the
Issuer. A copy of such letter is attached hereto as Exhibit 3 and incorporated
herein by reference. Subsequent to receiving this letter, Conese spoke with Mr.
Lambert and asked him to communicate the Reporting Persons' belief that
Komnenovich and Conese, Jr. have substantial aviation industry experience and
are highly qualified to serve as members of the Board of Directors and would
skillfully represent the interests of all shareholders. Conese also indicated,
however, that any two of Conese, Kincaid, Komnenovich and Conese, Jr. would be
available to serve as directors.
On December 7, 1998, Mr. Anderson spoke with both Komnenovich and Conese, Jr.,
and informed them that the directors would be pleased to meet with
representatives of the Reporting Persons to discuss their suggestions with
respect to the strategic direction of the Issuer. Komnenovich and Conese, Jr.
expressed their willingness to arrange a meeting between themselves and other
representatives of the Reporting Persons and directors of the Issuer. A meeting
is expected to take place in the next few weeks.
The Reporting Persons intend to review their investment in the Issuer on a
continuing basis and, depending on various factors, including the Issuer's
business, affairs and financial position, other developments concerning the
Issuer, the price level of the Common Stock, conditions in the securities
markets and general economic and industry conditions, as well as other
investment opportunities available to them, may in the future take such actions
with respect to their investment in the Issuer as they deem appropriate in light
of the circumstances existing from time to time. Such actions may include,
without limitation, the purchase of additional shares of Common Stock in the
open market, in privately negotiated transactions or otherwise, or the sale at
any time of all or a portion of the shares of Common Stock now owned or
hereafter acquired by them to one or more purchasers.
In the future, actions with respect to the investment in the Issuer are expected
to include continuing to explore with the Issuer the possibility of, or seeking
to influence management of the Issuer with respect to, board representation. In
addition, although there are currently no specific plans or intentions with
respect thereto, NAP may also explore with management of the Issuer the
possibility of, or seeking to influence management of the Issuer with respect
to, business strategies or mergers, business combinations, recapitalizations,
13
<PAGE>
sales of assets, negotiated or open-market stock repurchases or other
extraordinary corporate transactions. The Reporting Persons may in the future
consider a variety of different alternatives to achieving such actions,
including negotiated transactions, tender offers, proxy contests or other
actions. However, it should not be assumed that the Reporting Persons will take
any of the foregoing actions. The Reporting Persons reserve the right to
participate, alone or with others, in plans, proposals or transactions of a
similar or different nature with respect to the Issuer or its securities.
Except as set forth above, as of the date of this statement none of the
Reporting Persons has any plans or proposals, which relate to or would result in
any of the actions set forth in parts (a) through (j) of Item 4. Such persons
may at any time reconsider and change their plans or proposals relating to the
foregoing.
ITEM 5. INTEREST IN SECURITIES OF ISSUER.
(a) As of the date of this Statement, the Reporting Persons beneficially owned
in the aggregate 1,306,000 shares of Common Stock constituting 7.2% of the
outstanding shares of Common Stock (the percentage of shares owned being based
upon 18,171,483 shares outstanding on November 5, 1998, as set forth in the
Company's quarterly report on Form 10-Q for the fiscal quarter ended September
30, 1998). NAP may be deemed to have direct beneficial ownership of all of such
shares of Common Stock. As more fully described in item (b) below, each of the
Reporting Persons may be deemed to be a beneficial owner of such shares.
(b) NAG, as the Managing General Partner of NAP, may be deemed to own
beneficially (as that term is defined in Rule 13d-3 under the Securities
Exchange Act of 1934), shares of Common Stock which NAP may be deemed to possess
direct beneficial ownership. Kincaid Capital, as General Partner of NAG, may be
deemed to own beneficially shares of Common Stock which NAG may be deemed to
beneficially own. Each of Kincaid and Jones, as officers, directors and
stockholders, and Komnenovich, as a director and stockholder, of Kincaid
Capital, may be deemed to beneficially own shares of Common Stock which Kincaid
Capital may be deemed to beneficially own. Each of Messrs. Kincaid, Jones and
Komnenovich disclaims beneficial ownership of such shares of Common Stock for
all other purposes.
CCL, as General Partner of NAP, may be deemed to own beneficially (as that term
is defined in Rule 13d-3 under the Securities Exchange Act of 1934) shares of
Common Stock which NAP may be deemed to possess direct beneficial ownership.
CFP, the sole member of CCL, may be deemed to own beneficially shares of Common
Stock which CCL may be deemed to beneficially own. CGN, as the General Partner
of CFP, may be deemed to own beneficially shares of Common Stock which CFP may
be deemed to beneficially own. Conese, as the sole stockholder of CGN, may be
deemed to beneficially own shares of Common Stock which CGN may be deemed to
beneficially own. Mr. Conese disclaims beneficial ownership of such shares of
Common Stock for all other purposes.
14
<PAGE>
(c) Information concerning transactions in shares of Common Stock by the
Reporting Persons during the past sixty days or since the filing of the Schedule
13D, whichever is less, is set forth on Exhibit 4 attached hereto, which is
incorporated herein by reference.
(d) No other person is known to have the right to receive or the power to direct
the receipt of dividends from, or the proceeds from the sale of, the shares of
Common Stock.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Except as described in the Schedule 13D, as amended by this Amendment No. 1, the
Reporting Persons have no contracts, arrangements, understandings or
relationships with respect to the securities of the Issuer. A copy of the
General Partnership Agreement of NAP, dated as of October 20, 1998, by and
between NAG and CCL is attached as Exhibit 4 hereto, and is incorporated herein
by reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 2: Letter from Conese and Kincaid to Eric Anderson, Chairman,
President and Chief Executive Officer of the Issuer, dated
December 4, 1998.
Exhibit 3: Letter from Eric Anderson to Conese and Kincaid, dated December
4, 1998.
Exhibit 4: Information concerning transactions in shares of Common Stock
effected by the Reporting Persons during the past sixty days or
since the filing of the Schedule 13D, whichever is less.
Exhibit 5: NAP General Partnership Agreement, dated as of October 20, 1998,
by and between NAG and CCL.
15
<PAGE>
SIGNATURE
The undersigned, after reasonable inquiry and to the best of their knowledge and
belief, certify that the information set forth in this Statement is true,
complete and correct.
Dated: December 8, 1998 NOLAN ACQUISITION PARTNERS
By: Nolan Acquisition Group, L.P.,
its Managing General Partner
By: Kincaid Capital Group, a Texas
corporation, its General Partner
By: /s/ Richard Jones
----------------------------------------
Print Name: Richard Jones
Title: Senior Vice President
NOLAN ACQUISITION GROUP, L.P.
By: Kincaid Capital Group, a Texas
corporation, its General Partner
By: /s/ Richard Jones
----------------------------------------
Print Name: Richard Jones
Title: Senior Vice President
KINCAID CAPITAL GROUP, a Texas corporation
By: /s/ Richard Jones
----------------------------------------
Print Name: Richard Jones
Title: Senior Vice President
/s/ Thomas R. Kincaid
----------------------------------------
Thomas R. Kincaid
/s/ Richard Jones
----------------------------------------
Richard Jones
/s/ Dan Komnenovich
----------------------------------------
Dan Komnenovich
16
<PAGE>
CONESE CAPITAL, L.L.C.
By: Conese Family Partnership
(Nevada), L.P., its sole member
By: Conese General Partner (Nevada),
Inc., its General Partner
By: /s/ Eugene P. Conese, Jr.
------------------------------------
Print Name: Eugene P. Conese, Jr.
Title: Vice President
CONESE FAMILY PARTNERSHIP (NEVADA), L.P.
By: Conese General Partner (Nevada),
Inc., its General Partner
By: /s/ Eugene P. Conese, Jr.
------------------------------------
Print Name: Eugene P. Conese, Jr.
Title: Vice President
CONESE GENERAL PARTNER (NEVADA), INC.
By: /s/ Eugene P. Conese, Jr.
------------------------------------
Print Name: Eugene P. Conese, Jr.
Title: Vice President
/s/ Eugene P. Conese
------------------------------------
Eugene P. Conese
17
<PAGE>
EXHIBIT INDEX
Exhibit 2: Letter from Conese and Kincaid to Eric Anderson, Chairman,
President and Chief Executive Officer of the Issuer, dated
December 4, 1998.
Exhibit 3: Letter from Eric Anderson to Conese and Kincaid, dated December
4, 1998.
Exhibit 4: Information concerning transactions in shares of Common Stock
effected by the Reporting Persons during the past sixty days or
since the filing of the Schedule 13D, whichever is less.
Exhibit 5: NAP General Partnership Agreement, dated as of October 20, 1998,
by and between NAG and CCL.
EXHIBIT 2
Nolan Acquisition Partners
December 4, 1998
By Telecopy and Federal Express
- -------------------------------
Mr. Eric Anderson
Chairman, President and Chief Executive Officer
Aviall, Inc.
2075 Diplomat Drive
Dallas, Texas 75234-8999
Dear Eric:
As you know, through Nolan Acquisition Partners we have made a significant
investment in Aviall common stock. Over the last few weeks, we and other
representatives of Nolan have spoken informally with you and Robert Lambert
about having Nolan representatives serve on the Board of Directors of the
Company.
The members of the Nolan group and their affiliates have substantial experience
in the aviation industry and are well known to Aviall. Indeed, in 1996,
Greenwich Air Services, a public company controlled at the time by Eugene
Conese, Sr., acquired all of Aviall's commercial jet engine services businesses.
Eugene Conese, Jr. served as the President and Chief Operating Officer of
Greenwich from 1990 through October 1997.
Thomas Kincaid has 24 years of experience in the aviation industry. In 1979, he
formed International Turbine Service, Inc., a company engaged in the sale of
aircraft engine parts. In 1995, he became President and Chief Executive Officer
of International Airmotive Holding Corporation, a company formed to own
International Turbine Service, Inc. and Dallas Airmotive, Inc., a company
engaged in the business of overhauling aircraft engines whose assets were
acquired from Aviall.
Dan Komnenovich held numerous financial positions at Aviall from 1983 to 1995.
In 1995, he became Executive Vice President and Chief Financial Officer of
International Airmotive Holding Corporation.
In total, Greenwich Air Services and Dallas Airmotive, Inc. have purchased
approximately $450 million of assets from Aviall as a result of these
transactions.
<PAGE>
Eric Anderson
Page Two
December 4, 1998
You have informed us that, at the regularly scheduled Board meeting, which we
believe will be held next week, the Board will be voting to add an additional
outside director and to increase the size of the Board to seven directors. We
formally request that the Board also vote to place Gene Conese, Jr. and Dan
Komnenovich on the Board. (Copies of their CV's are attached hereto.) The Board
would then be expanded to a total of nine directors, with three classes of
directors and a total of seven outside directors.
Eric, we hope you would welcome new representatives on the Board with
substantial industry experience and a substantial equity investment in the
Company. We have made a significant financial investment in the future of the
Company and we are very confident that we can be enormously helpful in defining
the Company's strategic plan and creating value for all of the stockholders.
Indeed, since the filing of our November 6, 1998 Schedule 13D we have been
contacted by various stockholders who have encouraged our involvement in the
Company. These stockholders have made it clear that they support the addition to
the Board of Directors of persons with substantial equity investments in the
Company.
We request the opportunity to meet with the directors in person at the upcoming
Board meeting to explain further our strategic vision for the future of the
Company and to answer any questions. Our legal advisors, Joseph S. Allerhand and
David E. Zeltner, from Weil, Gotshal & Manges, are also prepared to meet with
your legal advisors and to provide any further information that your Board may
need to consider with respect to the nominations of Gene Conese, Jr. and Dan
Komnenovich to the Board.
Please call Eugene at (305) 774-3500 or (305) 774-3536 so that appropriate
arrangements can be made for attendance at the meeting.
Sincerely,
/s/ Eugene P. Conese, Sr.
Eugene P. Conese, Sr.
/s/ Thomas R. Kincaid
Thomas R. Kincaid
cc: Directors of Aviall, Inc.
<PAGE>
Eugene P. Conese, Jr.
Biography
In January 1998, Eugene P. Conese, Jr. formed New Canaan Corporation, a private
investment and holding company, and serves as President and Chief Executive
Officer and is a member of the company's Board of Directors.
Prior to forming New Canaan Corporation, Mr. Conese, Jr. was President and Chief
Operating Officer of Greenwich Air Services, Inc. ("Greenwich"). Mr. Conese, Jr.
joined Greenwich in 1989 as Vice President Strategic Planning and was promoted
to President and Chief Operating Officer in 1990. Under his leadership,
Greenwich grew from a single facility employing 400 workers with annual revenues
of $40 million and one engine line to become the world's largest independent
provider of repair, refurbishment, overhaul and maintenance for gas turbine
engines. By 1997, the company employed more than 3,400 professionals at ten
facilities around the world. With more than 1.7 million square feet of
production space, Greenwich serviced fifteen engine lines and fifty engine
models for more than five hundred customers around the globe. Annual sales in
fiscal 1997 were expected to exceed $800 million, and with Greenwich's
acquisition of UNC, pro forma 1997 sales would exceed $1.8 billion.
Since joining Greenwich in 1989, Conese was instrumental in leading the company
to its current stature with annual internal growth rates exceeding nineteen
percent, leading the industry's consolidation with acquisitions of several
competitors and fifteen quarters of record financial results since becoming a
public company. In 1992, the company expanded its services to include the
introduction of high bypass engine overhaul capabilities. In 1993, Greenwich
went public with an initial offering. A year later, the company acquired Gas
Turbine Company, propelling it into the aeroderivative engine and power station
business.
In 1996, with a secondary public offering that raised $260 million, Greenwich
acquired its largest competitor, the commercial engine services division of
Aviall, Inc., adding new engine lines, component capabilities and facilities to
its service offering. The acquisition of UNC, Inc., the world's largest
independent aviation services company, was announced by Greenwich in February
1997 and Greenwich/UNC was acquired by General Electric Company in September
1997.
Greenwich's success under Mr. Conese's leadership resulted in a compounded
equity return of 91% since the Initial Public Offering in 1993 to its sale in
1997. Greenwich was also the recipient of many growth recognitions including:
May 1996, Florida Trend named Greenwich as the leading Florida stock
appreciation in the small cap stock category, in 1997 was honored as "Emerging
Company of the Year" by the Association for Corporate Growth, South Florida
Chapter and received the coveted Cutting Edge Award.
Conese joined Greenwich from Haskon Corporation where he served as President.
Haskon was the world's largest supplier of silicone rubber seals for the
\\NYFS09\SYS1\DATA\75\65575\0003\91\8CONESE0.DOC
<PAGE>
aerospace industry. In addition, Conese served as President of EPCO
Technologies, a leader in the development and production of plastic products for
the packaging industry. He has also served with Bay Bank Finance and Leasing
Company.
Active in civic and business organizations, Conese is a member of the Greater
Miami Chamber of Commerce, the Wings Club and the Aviation Alliance Committee
and was active in supporting the American Red Cross of South Florida. He has a
B.A. Degree in Economics from Denison University.
2
<PAGE>
DAN P. KOMNENOVICH
- --------------------------------------------------------------------------------
4223 Shenandoah
Dallas, Texas 75205
Home: (214) 520-8389
Office: (214) 956-3080
SUMMARY
Extensive financial experience across diverse industries and markets.
Comfortable dealing with complex organizations on an international scale. Vision
and strategic planning capabilities coupled with strong restructuring and cost
containment skills. Ability to create an environment of change and achievement.
CAREER BACKGROUND
INTERNATIONAL AIRMOTIVE HOLDING CORPORATION 1995-present
Dallas, Texas
International Airmotive Holding Corporation, the holding company for Dallas
Airmotive, Inc. and International Turbine Service, Inc. is a privately owned
worldwide international provider of aviation services to business, general and
regional airline markets. The company was acquired by BBA Group PLC in January,
1997.
Executive Vice President - Finance and Chief Financial Officer
--------------------------------------------------------------
Worldwide responsibility for the integrity of financial data, internal
controls, financial planning and business development.
RYDER AIRLINE SERVICES, INC. (AVIALL, INC.) 1983-1995
Dallas, Texas
A wholly owned subsidiary of Ryder System, Inc. and an international provider of
aviation services to the commercial and general aviation markets.
Senior Vice President - Development 1993-1995
-----------------------------------
Responsible for new business development in domestic and international
markets and the divestment of targeted assets.
o Managed the restructuring and negotiated the sale of three
discontinued businesses with asset values of $450 million.
Senior Vice President - Finance/Chief Financial Officer 1989-1993
-------------------------------------------------------
Managed a staff of 175 with worldwide responsibility for the integrity
of financial data, internal controls, financial planning, materials
management, information systems, and business development.
o Implemented the strategy to spin-off Ryder's aviation
companies resulting in the formation of a publicly traded
company with the revenues of $1 billion annually.
\\NYFS09\SYS1\DATA\75\65575\0003\91\8KOMENO0.DOC
EXHIBIT 3
AVIALL
Eric E. Anderson
Chairman, President and
Chief Executive Officer
December 4, 1998
Eugene P. Conese, Sr.
Thomas R. Kincaid
Nolan Acquisition Partners
125 E. John Carpenter Freeway
Suite 190, L.B. 9
Irving, TX 75062
Dear Gene and Tom:
I wanted to let you know that I received your letter this afternoon. I was
somewhat surprised as to your new director nominees. Based on our discussions on
the day you filed the Schedule 13D and my subsequent telephone conversation with
Dan Komnenovich, both Bob Lambert and I understood that you had requested the
Board consider the two of you for election to the Board. I want to assure you
that the Board will discuss your letter at its upcoming meeting.
I also want to reiterate that I continue to make myself available to discuss any
specific suggestions you have regarding Aviall.
Very truly yours,
/s/ Eric E. Anderson
EXHIBIT 4
TRANSACTIONS IN SHARES OF THE COMPANY
The Reporting Persons engaged in the following transactions in shares of Common
Stock during the past 60 days or since the filing of Schedule 13D, whichever is
less.(1) All transactions involved purchases of shares of Common Stock on the
New York Stock Exchange.
Reporting
Person With Price Per
Direct Share
Beneficial Date of Number of (Excluding
Ownership Transaction Shares Comission)
--------- ----------- ------ ----------
NAP 10/30/98(1) 11,000 10.875
NAP 12/03/98 41,000 12.000
- -------------------------------
(1) The shares purchased on 10/30/98 were reflected as shares of Common Stock
beneficially owned in the Schedule 13D; however, although included in the totals
on Item 5, reference to this specific purchase was inadvertently omitted.
EXHIBIT 5
NOLAN ACQUISITION PARTNERS
GENERAL PARTNERSHIP AGREEMENT
THIS GENERAL PARTNERSHIP AGREEMENT, is made as of October 20,
1998, among Nolan Acquisition Group, L.P., a Delaware limited partnership (the
"Managing General Partner"), and Conese Capital, L.L.C., a Delaware limited
liability company ("Conese Capital") (either of which is referred to herein as a
"Partner" or collectively as "Partners").
R E C I T A L S:
The Partners desire to form Nolan Acquisition Partners (the
"Partnership") pursuant to this General Partnership Agreement (the "Agreement")
for the purposes set forth herein.
A G R E E M E N T S:
NOW THEREFORE, in consideration of the mutual covenants set
forth in this Agreement, the parties hereto hereby agree to form the Partnership
under the Act upon the following terms and conditions:
ARTICLE I
Definitions
In addition to the terms defined elsewhere in this Agreement,
when used in this Agreement the following terms have the following meanings:
Section 1.1 Accounting Period. "Accounting Period" has the
meaning set forth in Section 5.2(b) hereof.
Section 1.2 Act. "Act" means the Texas Revised Uniform
Partnership Act, as amended.
Section 1.3 Affiliate. "Affiliate" means, with respect to a
specified Person, any Person that directly or indirectly through one or more
intermediaries, alone or through an affiliated group, controls, is controlled
by, or is under common control with, such specified Person.
Section 1.4 Bankruptcy. "Bankruptcy" means with respect to a
Person: (i) the commencement against such Person of a proceeding for any relief
under any bankruptcy or insolvency law, or any law relating to the relief of
debtors, readjustment of indebtedness, reorganization, arrangement, composition,
or extension of debts, provided such proceeding shall not have been dismissed,
<PAGE>
nullified, stayed (but only so long as such stay shall continue in force), or
otherwise rendered ineffective within 90 days after the commencement of such
proceeding; (ii) the commencement by such Person of a proceeding for any relief
under any bankruptcy or insolvency law, or any law relating to the relief of
debtors, readjustment of indebtedness, reorganization, arrangement, composition,
or extension of debts; (iii) a decree or order of a court of competent
jurisdiction (a) for the appointment of a receiver, liquidator, or trustee or
assignee in bankruptcy, (b) declaring the insolvency of such Person or of a
substantial part of such Person's property, or (c) for the winding up or
liquidation of the affairs of such Person, which decree or order remains in
force undischarged and unstayed for a period of 90 days; or (iv) a general
assignment by such Person for the benefit of creditors or the admission by such
Person in writing of its inability to pay its debts generally as they become
due.
Section 1.5 Capital Contribution. "Capital Contribution" means
the investment of cash or readily marketable securities in the Partnership.
Section 1.6 Capital Withdrawal. "Capital Withdrawal" means a
withdrawal from a Partner's Capital Account.
Section 1.7 Closing Capital Account. "Closing Capital Account"
has the meaning set forth in Section 4.2.
Section 1.8 Code. "Code" means the Internal Revenue Code of
1986, as from time to time amended.
Section 1.9 Fiscal Year. "Fiscal Year" means the calendar
year.
Section 1.10 Investments. "Investments" has the meaning set
forth in Section 2.4 hereof.
Section 1.11 Net Assets. "Net Assets" means the value of the
assets of the Partnership minus its liabilities, determined as of the close of
business in Irving, Texas on the date of determination.
Section 1.12 Opening Capital Account. "Opening Capital
Account" has the meaning set forth in Section 4.1 hereof.
Section 1.13 Partnership Percentage. "Partnership Percentage"
means, with respect to each Partner for each Accounting Period, the Opening
Capital Account of such Partner for such Accounting Period, divided by the sum
of the Opening Capital Accounts of all Partners for such Accounting Period. The
sum of the Partnership Percentages shall at all times equal 100 percent.
2
<PAGE>
Section 1.14 Person. "Person" means any natural person,
corporation, firm, joint venture, partnership, trust, unincorporated
organization, government or any department, political subdivision or agency of a
government.
Section 1.15 Securities Act. "Securities Act" means the
Securities Act of 1933, as amended.
Section 1.16 Security. "Security" means any publicly traded or
non-publicly traded, domestic or foreign: (i) general or limited partnership
interest; (ii) share of capital stock; (iii) share of beneficial interest;(iv)
bond, note, debenture (whether subordinated, convertible or otherwise), trust
receipt or certificate, loan, participation, account or note receivable, trade
acceptance, contract or other claim, letter of credit, executory contract
(including any notional principal contract), instrument or evidence of
indebtedness; and/or (v) certificate of deposit or commercial paper.
Section 1.17 Treasury Regulations. "Treasury Regulations"
means the regulations promulgated by the Department of the Treasury under the
Code, as from time to time amended.
Section 1.18 Valuation Date. "Valuation Date" means, with
respect to any Accounting Period, the last day of such Accounting Period.
ARTICLE II
Organization
Section 2.1. Formation of Partnership. Commencing on the
effective date of this Agreement, the Partnership shall be organized and formed
as a general partnership pursuant to the Act and this Agreement. The parties
hereto agree to execute or cause to be executed all such documents, and to do or
cause to be done all such filings and other acts necessary (or, in the judgment
of the Managing General Partner, appropriate) to comply with the applicable laws
of the State of Texas and any jurisdiction in which the Partnership conducts its
business.
Section 2.2. Name. The business of the Partnership shall be
conducted under the name "Nolan Acquisition Partners" or under such other name
as the Managing General Partner may from time to time determine.
Section 2.3. Registered Office; Principal Place of Business.
The name of the Partnership's registered agent for service of process in the
State of Texas is Kincaid Capital Group, a Texas Corporation and the address of
the Partnership's registered office and Principal Office in the State of Texas
is 125 East John Carpenter Freeway -- Suite 190, Irving, Texas 75062. The
3
<PAGE>
Managing General Partner may from time to time, upon written notice to all the
Partners, change the registered agent or registered office, change the location
of the Partnership's principal place of business, or establish additional places
of business at such locations as the Managing General Partner from time to time
may determine.
Section 2.4. Purposes and Powers. The Partnership is organized
for the purpose of making a substantial investment in, influencing and/or
acquiring control of a publicly-held corporation, through investments and
trading in Securities (collectively, "Investments"). In furtherance of these
purposes and without limitation, the Partnership is authorized to:
(a) Organize and/or invest in one or more joint ventures,
partnerships (limited or general), corporations, limited liability companies,
mutual funds or other entities; provided, however, that the principal activity
or activities of such entities shall be one or more of the activities enumerated
in subsection (b) hereof;
(b) Purchase, hold, sell, write, exchange, transfer, mortgage,
pledge, and otherwise invest and trade in Securities and other Investments, and
the proceeds therefrom, whether or not venture capital, whether within or
without the United States, and whether or not hedged;
(c) Exercise all rights, powers, privileges, and other
incidents of ownership or possession with respect to Securities, other
Investments and any other assets of the Partnership;
(d) Acquire a long position or a short position with respect
to any Security or other Investment and make purchases or sales increasing,
decreasing, or liquidating such position or changing from a long position to a
short position or from a short position to a long position, without any
limitation as to the frequency of such fluctuation in such positions or as to
the frequency of the changes in the nature of such positions;
(e) Invest or deposit Partnership funds, pending investment or
distribution to Partners, in one or more checking or savings accounts, money
market mutual funds, or other taxable or nontaxable investments;
(f) Acquire Securities and other Investments on margin; borrow
or raise moneys and obtain letters of credit; lend money to any person; issue,
accept, endorse, and execute promissory notes, drafts, bills of exchange,
warrants, bonds, debentures, and other negotiable or nonnegotiable instruments
and evidences of indebtedness (including promissory notes or other evidences of
indebtedness which pay interest measured by reference to Partnership profits or
to any index) from time to time without limitation as to amount or manner and
time of repayment; and secure the payment of such or other obligations of the
Partnership by mortgage upon, or hypothecation or pledge of, all or part of the
property of the Partnership whether at the time owned or thereafter acquired;
4
<PAGE>
(g) Acquire Securities which may not be resold in the absence
of an effective registration statement relating thereto under the Securities Act
or under an exemption from such registration requirements, and to hold such
Securities for investment;
(h) Enter into custodian agreements with banks or securities
brokerage firms, open, maintain, and close bank and brokerage accounts, and draw
checks or other orders for the payment of money or the delivery of instruments;
(i) Purchase, invest and trade in "control" and block
positions;
(j) Enter into agreements with brokerage firms, advisors,
banks and dealers (whether or not affiliated with the Partnership or the
Managing General Partner), open, maintain and close accounts in connection with
such agreements, and draw checks or other orders for the payment of money or the
delivery of instruments;
(k) Delegate discretionary and other authority to manage
Partnership accounts to one or more persons, in the Managing General Partner's
sole and absolute discretion;
(l) Pursue proxy solicitations and any litigation in pursuing
the Partnership's objectives;
(m) Engage independent attorneys, accountants, advisors,
consultants, or such other persons as the Managing General Partner may deem
necessary or advisable;
(n) Maintain for the conduct of Partnership affairs one or
more offices within or without the State of Texas and in connection therewith
rent or acquire office space, engage personnel, and do such other acts as may be
advisable or necessary in connection with such offices and personnel; and
(o) Enter into, make and perform all contracts and other
undertakings, and engage in all other activities and transactions, as the
Managing General Partner may deem necessary, advisable, or appropriate for
carrying out the purposes of the Partnership.
Section 2.5. Term. The Partnership shall continue in existence
until December 31, 2003, unless sooner dissolved as provided in Section 9.1.
5
<PAGE>
ARTICLE III
Capital Contributions;
Admission of Partners
Section 3.1. Capital Contributions of the Partners.
(a) The Managing General Partner shall maintain in the records
of the Partnership a schedule setting forth the name, address, and Capital
Contributions of each Partner. Each of the Partners shall make equal Capital
Contributions to Partnership. No Capital Contributions shall be required by any
Partner in excess of $7,500,000.
(b) An individual capital account ("Capital Account") shall be
established and maintained for each Partner. A Partner shall not be entitled to
earn interest on its Capital Account or to receive any distribution from the
Partnership, except as specifically provided herein.
Section 3.2. Form and Timing of Contributions. All amounts to
be contributed by a Partner under this Article III shall be paid in immediately
available funds (or, in the reasonable discretion of the Managing General
Partner, in readily marketable securities) at the office of the Partnership or
at such other location as may be reasonably requested by the Managing General
Partner at such times as shall be mutually agreed to by the Partners.
ARTICLE IV
Capital Accounts;
Allocations
Section 4.1. Opening Capital Accounts. An Opening Capital
Account shall be established for each Partner on the books of the Partnership as
of the first day of each Accounting Period. A Partner's Opening Capital Account
as of the first day of the Accounting Period in which such Partner is admitted
to the Partnership shall be the amount of such Partner's initial Capital
Contribution made as of such date (net of organizational charges). A Partner's
Opening Capital Account as of the beginning of each Accounting Period after the
Accounting Period in which such Partner is admitted to the Partnership shall be
an amount equal to the Closing Capital Account of such Partner as of the end of
the immediately preceding Accounting Period, decreased by the amount of any
Capital Withdrawals or distributions made by or to the Partner as of the end of
the preceding Accounting Period and increased by any additional Capital
Contribution made by such Partner effective as of the beginning of such
Accounting Period.
Section 4.2. Closing Capital Accounts. The Closing Capital
Account of each Partner as of the end of each Accounting Period shall be
6
<PAGE>
determined by adjusting the Opening Capital Account of such Partner for such
Accounting Period in the following manner: any increase or decrease in the Net
Assets of the Partnership (Net Assets, determined as set forth herein) for the
Accounting Period shall be credited or debited (as the case may be) to the
individual Opening Capital Accounts of all the Partners, including the Managing
General Partner, in proportion to their respective Partnership Percentages.
ARTICLE V
Records and Accounting; Reports
Section 5.1. Records and Accounting. The Managing General
Partner shall maintain complete and accurate records and books of account of the
business of the Partnership at the Partnership's principal office. Each Partner
or its duly authorized representative will have the right to inspect and copy
such books and records upon reasonable notice at all reasonable times during
normal business hours for any noncommercial, equitable purpose; provided,
however, that each Partner agrees that it will not disclose (and will require
its representative to forebear from disclosing) to third parties any information
of a proprietary nature which is obtained upon any such inspection.
Section 5.2. Fiscal Year; Accounting Period; Accounting
Methods.
(a) The Fiscal Year of the Partnership shall end on December
31.
(b) An Accounting Period (i) shall begin on the day after the
close of the preceding Accounting Period (or, if there was no preceding
Accounting Period, at the commencement of operations) and (ii) shall end on the
earlier of the close of each Fiscal Year, the effective date of any Capital
Withdrawal by a Partner, the day preceding the effective date of any Capital
Contribution to the Partnership, or such other date determined by the Managing
General Partner.
(c) The Partnership shall keep its books and records in
accordance with the provisions of this Agreement under the accrual method of
accounting and, as to matters not specifically covered in this Agreement, in
accordance with generally accepted accounting principles. All matters concerning
accounting practices not specifically and expressly provided for by the terms of
this Agreement shall be determined by the Managing General Partner in good
faith. Each such determination shall be final and conclusive as to all the
Partners.
Section 5.3. Expense Accruals.
For purposes of determining the amount of the Partnership's
liabilities, the Managing General Partner may, in its reasonable discretion,
treat estimates of expenses that are incurred on a regular or recurring basis
over yearly or other periods as accruing in equal proportions over any such
period.
7
<PAGE>
Section 5.4. Net Assets.
(a) The Net Assets of the Partnership shall be determined as
of each Valuation Date.
(b) The assets of the Partnership as of any date shall be
deemed to include: (i) all cash on hand or on deposit, including any interest
accrued thereon; (ii) all bills, demand notes, and accounts receivable
(including proceeds of Securities and other Investments sold but not delivered);
(iii) all Securities and other Investments owned or contracted for by the
Partnership; (iv) all stock dividends, cash dividends, and cash distributions
receivable by the Partnership (provided that the Partnership may make
adjustments with regard to fluctuations in the market value of Securities caused
by trading ex-dividend, ex-rights, or by similar practices); (v) all interest
accrued on Securities and other Investments owned by the Partnership, except to
the extent that the same is included or reflected in the valuation of such
Security; (vi) all interests in other partnerships, trusts, companies, mutual
funds, and other entities; and (vii) all other assets of every kind and nature,
including prepaid expenses.
(c) The liabilities of the Partnership as of any date shall be
deemed to include: (i) all outstanding loans, bills and accounts payable; (ii)
all accrued or payable fees and expenses; (iii) the current market value of all
short sale obligations; and (iv) all other liabilities.
Section 5.5. Tax Returns.
(a) The Managing General Partner will cause federal, state,
and local income tax returns for the Partnership to be prepared and timely filed
(subject to the Managing General Partner's discretion to obtain extensions) with
the appropriate authorities.
(b) As soon as reasonably practicable after the end of each
Fiscal Year, the Managing General Partner shall cause to be delivered to each
Person who was a Partner at any time during such Fiscal Year such tax
information and schedules as shall be necessary for the preparation by each such
Person of its federal and state income tax returns. While the Managing General
Partner will attempt to make tax information available on a timely basis, each
Partner acknowledges and agrees that the Partnership's tax returns may be
delayed so that it may be necessary for the Partners to obtain extensions for
the filing of their own tax returns. Furthermore, each Partner agrees that the
Managing General Partner shall not be responsible for tax reporting errors or
delays on the part of partnerships or other entities in which the Partnership
invests.
(c) The Managing General Partner is hereby appointed the "Tax
Matters Partner" of the Partnership for all purposes pursuant to Sections
6221-6231 of the Code.
8
<PAGE>
ARTICLE VI
Withdrawals and Distributions
Section 6.1. Capital Withdrawals. A Partner may withdrawal
from such Partner's Capital Account upon notice to the other Partner and, in
such event, the Partnership shall be dissolved and distributions shall be made
in accordance with Section 6.2(c).
Section 6.2. Distributions.
(a) Cash Flow. The General Partner shall, as expeditiously as
possible after the end of each fiscal quarter of the Partnership, make
distributions of net cash flow (gross revenue less operating expenses), if any,
to the Partners pro rata in accordance with their Percentage Interests.
(b) Proceeds Available Upon Dissolution. Upon the dissolution
and winding up of the Partnership, any proceeds from the sale of securities and
all other assets of the Partnership, after (i) making payment of or provisions
for payment of all liabilities and obligations of the Partnership (other than in
regard to any loans permitted to be made by any Partner) and (ii) the setting up
of such reserves as the person required by law to wind up the Partnership's
affairs may reasonably deem necessary for any contingent liabilities or
obligations of the Partnership (provided, however, that to the extent such
reserves are subsequently determined to be no longer necessary they shall be
distributed as set forth in this Section 6.2) shall be distributed, as
expeditiously as possible, to the Partners pro rata in proportion to their
Percentage Interests.
(c) Distributions In-Kind. Upon the dissolution and
termination of the Partnership, the Managing General Partner shall distribute
the Partnership assets in cash or, in the discretion of the Managing General
Partner, in kind subject to a proportioned share of Partnership liabilities. In
the event of a distribution in kind each Partner shall be entitled to receive
separately that number of each different kind and class of Securities held by
the Partnership equal to the product of (a) such Partner's Percentage Interest
(expressed as a decimal) and (b) the total number of such Securities owned by
the Partnership. In each such distribution each partner shall be treated the
same.
ARTICLE VII
Management
Section 7.1. Authority of the Managing General Partner. The
management and operation of the Partnership shall be vested exclusively in the
Managing General Partner. The Managing General Partner shall have the authority
and power on behalf and in the name of the Partnership to perform all acts and
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enter into and perform all contracts and other undertakings which it may deem
necessary, advisable, or incidental to the purposes of the Partnership set forth
in Section 2.4.
Section 7.1A Limitations on Authority. Without the written
consent of Conese Capital and, anything in this Agreement to the contrary
notwithstanding, the Managing General Partner shall have no authority to:
(a) Do any act in contravention of this Agreement;
(b) Do any act which would make it impossible to carry on the
ordinary business of the Partnership;
(c) Confess a judgment against the Partnership;
(d) Execute and deliver any general assignment for the benefit of the
creditors of the Partnership;
(e) Possess Partnership property or assign the rights of the
Partnership in specific property for other than a Partnership
purpose;
(f) Admit a person as a partner;
(g) Change the location of the Partnership's bank or brokerage
accounts;
(h) Create, incur, assume, refinance or otherwise become liable with
respect to any obligation for borrowed money (including
guarantees of the indebtedness or other obligations of any person
or of any subsidiary or affiliate of the Partnership), issue any
bonds, debentures, notes or other evidence of indebtedness;
(i) Lend money to any person;
(j) Hire any employee for the Partnership; or
(k) Enter into any transaction between the Partnership and a Partner
(or an Affiliate such Partner).
Section 7.1B Limitations on Compensation. The Managing General
Partner shall have no authority to pay for any services performed by the
Managing General Partner or its Affiliates nor shall the Managing General
Partner or its Affiliates receive any salary, fees, commissions, sums, profits,
distributions, rebates or give-ups in connection with the Partnership's
activities, nor shall any Managing General Partner or its Affiliates participate
in reciprocal business arrangements which shall circumvent this prohibition.
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Section 7.2. Activities of the Managing General Partner and
Affiliates.
(a) Although nothing herein shall require the Managing General
Partner, its principals or its respective Affiliates (collectively, "Managing
General Partner Parties") to devote full time or any material proportion of his
or its time to the Partnership, the Managing General Partner hereby agree to use
its reasonable best efforts in connection with the purposes and objectives of
the Partnership and to devote to such purposes and objectives such of their time
and activity (and the time and activity of its employees) during normal business
days and hours as it in its discretion shall deem necessary for the management
of the affairs of the Partnership; provided, however, that nothing contained in
this Section shall preclude any Managing General Partner Party from: (i) acting,
consistent with the foregoing, as a director, stockholder, officer, or employee
of any corporation, a trustee of any trust, a partner of any other partnership,
or an administrative official of any other business or governmental entity,
regardless of whether the Partnership invests in or has dealings with such
corporation, trust, partnership, or other entity; (ii) receiving compensation
for services rendered thereto, or participating in profits derived from
investments in, any such corporation, trust, partnership or other entity; or
(iii) from investing in any Securities or other Investments or property for his
or its own account or for the account of others. Any Managing General Partner
Party may become a director or officer of a company pursued by the Partnership.
(b) The foregoing competing activities and conflicts of
interest are explicitly acknowledged and consented to by each Partner.
Section 7.3 Expenses. The Partnership will pay all its own
investment and administrative expenses (as reasonably determined by the Managing
General Partner) incurred in the Partnership's business, including but not
limited to: (i) all investment expenses relating to securities and other
investment transactions (such as interest on borrowed money, brokerage
commissions, "bid-ask" spreads, mark-ups and other transactional charges,
interest expense (if any) and commitment fees (if any), custodial and clearing
fees, withholding taxes (if any), securities registration fees (if any), finders
fees (if any) and fees of any persons (other than the Managing General Partner)
performing valuations or appraisals of securities, and acquisition and due
diligence expenses including litigation and proxy expenses, as well as travel,
food and lodging; (ii) any premiums for errors or omissions insurance and
insurance protecting the Partnership, its Partners and officers, employees and
agents of its Partners from liabilities to third parties in connection with the
Partnership's affairs; (iii) outside legal, accounting, consulting, auditing and
tax preparation expenses; (iv) costs of printing and mailing reports; and (v)
any extraordinary expenses of the Partnership (such as taxes or expenses in
connection with litigation, whether threatened or actual). However, the
following costs and expenses are not paid by the Partnership: all costs and
expenses incurred by the Managing General Partner and directly attributable to
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salaries, rent and maintaining the offices of the Partnership, all of which
shall be borne by the Managing General Partner without any reimbursement.
Section 7.4. Exculpation. No Managing General Partner Party
and no employee or agent of the Managing General Partner shall be liable to the
Partnership or any other Partner for: (i) any claims, costs, expenses, damages
or losses arising out of the performance of its duties under this Agreement
other than those directly attributable to its own fraud, breach of fiduciary
duty, breach of this Agreement, willful misconduct or gross negligence; (ii)
failure to obtain the lowest negotiated brokerage commission rates, or to
combine or arrange orders so as to obtain the lowest brokerage commission rates
with respect to any transaction on behalf of the Partnership, or for failure to
recapture, directly or indirectly, any brokerage commissions for the benefit of
the Partnership; (iii) failure to obtain the lowest "bid-ask" spreads or
advisory or consulting rates available; or (iv) claims, costs, expenses, damages
or losses due to circumstances beyond its control, including but not limited to,
the bankruptcy, insolvency or suspension of normal business activities of any
bank, brokerage firm or transfer agent holding assets of the Partnership, or due
to the negligence, dishonesty, bad faith or misfeasance of any manager with whom
the Partnership invests, any Affiliate of any partnership or other entity in
which the Partnership invests, or any employee, broker or other agent of the
Partnership.
The Managing General Partner Parties and any Affiliate or
employee of the Managing General Partner shall be entitled to rely on the advice
of legal counsel, accountants, or other independent experts experienced in the
matter at issue, and any act or omission of any Managing General Partner Party,
Affiliate, or employee pursuant to such advice shall in no event subject such
Person to liability to the Partnership or any Partner.
No exculpation shall be permitted hereunder for any violation
of federal or state securities law or any other intentional or criminal
wrongdoing.
Section 7.5. Indemnification. To the maximum extent permitted
by law, the Partnership shall indemnify any Person, including the General
Partners, as well as employees or agents of the Managing General Partner, who
was or is a party, or is threatened to be made a party, to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including any action by or in the right of the
Partnership) by reason of any acts, omissions or alleged acts or omissions by
such Person on behalf of the Partnership, against losses, costs and expenses for
which such Person has not otherwise been reimbursed (including attorneys' fees,
judgments, fines and amounts paid in settlement) actually and reasonably
incurred in connection with such action, suit or proceeding, so long as such act
or omission was not done fraudulently or in bad faith or as a result of willful
misconduct or gross negligence or, with respect to any criminal action or
proceeding, such Person had no reasonable cause to believe its conduct was
unlawful, or constitutes a breach of fiduciary duty or a breach of this
Agreement.
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No indemnification shall be made by the Partnership for any
intentional violation of federal or state securities law or any other
intentional or criminal wrongdoing.
Section 7.5A Losses and Liabilities of the Partnership. The
Partners agree to be liable for the Capital Contributions required to be made by
them to the Partnership, and for any non-tax losses or liabilities incurred by
the Partnership in proportion to their then existing Percentage Interests. Each
Partner agrees to indemnify and save harmless the other Partner to the extent
that any Partner bears a disproportionate share of any such losses or
liabilities of the Partnership. Notwithstanding the above, no Partner shall be
indemnified and held harmless by the other Partners to the extent that such
losses or liabilities arise from fraud, gross negligence, breach of fiduciary
duty, breach of this agreement or dishonest conduct on the part of such Partner.
Section 7.6. Reliance by Third Parties. No Person shall be
required to inquire into the authority of a Managing General Partner to bind the
Partnership. In addition, persons dealing with the Partnership shall be entitled
to rely on a certification by either Managing General Partner with regard to the
authority of any other person to act on behalf of the Partnership in any matter.
Section 7.7. Registration of Assets. Any assets owned by the
Partnership may be registered in the Partnership's name, in the name of a
nominee, or in a "street name." Any corporation, brokerage firm or transfer
agent called upon to transfer any assets to or from the name of the Partnership
shall be entitled to rely upon instructions or assignments signed or purporting
to be signed by either Managing General Partner or its agents without inquiry as
to the authority of the person signing or purporting to sign such instruction or
assignment or as to the validity of any transfer to or from the name of the
Partnership.
ARTICLE VIII
Assignments
Section 8.1. Assignments Only Permitted with Partner Consent.
(a) No Partner may assign (which term shall include, for
purposes of this Article VIII, any sale, gift, pledge, hypothecation or other
disposition or transfer, whether voluntary or involuntary or by operation of
law) any or all of its Partnership Interest without the advance written consent
of the other Partner. Any assignee to whom the other Partner has so consented
shall become a substitute Partner.
(b) If a Partner assigns its entire Partnership Interest, such
Partner will, upon the effective date of such assignment, cease to be a Partner
for all purposes but will not be relieved of any obligations it may have had
under this Agreement before the date of such assignment.
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(c) Any purported assignment of a Partnership Interest of a
Partner in violation of the provisions of this Agreement is void.
ARTICLE IX
Dissolution and Termination of the Partnership
Section 9.1. Dissolution. The Partnership shall dissolve and
wind up its affairs upon the earliest to occur of the following events:
(a) The expiration of the term of the Partnership under
Section 2.5;
(b) Withdrawal of a Partner's entire Capital Account;
(c) An event which makes it unlawful for the Partnership
business to be continued; or
(d) Written notice by either Partner;
(e) Upon the sale of all assets of the Partnership;
(f) Upon the Bankruptcy or receivership of the Partnership or
a Partner; or
(g) Any other event which, under the Act, requires the
dissolution of the Partnership and the winding up of its business and affairs.
Section 9.2. Liquidation and Distribution.
(a) Upon the dissolution of the Partnership under the
circumstances described in Section 9.1, the Managing General Partner the assets
of the Partnership shall be distributed as provided in Section 6.2(c).
Section 9.3. Termination. Each Partner shall be furnished with
a statement which shall set forth the assets and liabilities of the Partnership
as of the date of dissolution. Upon compliance with the distribution plan set
forth in Section 9.2, the Partners shall cease to be such, and the Managing
General Partner or the liquidating trustee shall execute, acknowledge and cause
to be filed a certificate of cancellation of the Partnership. Upon completion of
the dissolution, winding up, liquidation and distribution of the liquidation
proceeds, the Partnership shall terminate.
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ARTICLE X
Miscellaneous Provisions
Section 10.1. Amendments.
(a) This Agreement may be amended from time to time by the
Managing General Partner, without the consent of any Partner: to make any
changes required, in the judgment of the Managing General Partner, to comply
with applicable law. Any other amendment to this Agreement shall require the
written consent of all Partners.
Section 10.2. Signatures. Each Partner shall become a party
hereto by signing such number of counterpart signature pages to this Agreement.
Section 10.3. Notices and Addresses. All notices required to
be given under this Agreement shall be in writing and shall be mailed by
certified or registered mail, hand delivered, or delivered by next business day
courier. Any notice to be sent to the Partnership shall be mailed to the
principal place of business of the Partnership or at such other address as the
Managing General Partner may specify in a notice sent to all of the Partners.
All notices to Partners shall be mailed or delivered to the Partners at such
address as a Partner may notify the Partnership of in writing. Notices shall be
effective on the date three days after the date of mailing or, if hand delivered
or delivered by next day business courier, on the date of delivery.
Section 10.4. Confidentiality. Except as required to be
disclosed by court order or otherwise under applicable law, or except after
obtaining the advance written consent of the Managing General Partner, each
Partner shall keep confidential all information regarding the Partnership
acquisition target.
Section 10.5 GOVERNING LAW. THIS AGREEMENT IS GOVERNED BY AND
TO BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.
Section 10.6. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the Partners, the indemnified parties
hereunder and their respective legal representatives and successors and
permitted assigns.
Section 10.7. Modifications To Be In Writing. This Agreement
constitutes the entire understanding of the parties hereto and no amendment,
modification or alteration will be binding unless the same be in writing and
adopted in accordance with the provisions of Section 10.2.
Section 10.8. Validity and Severability. If any provision of
this Agreement is held invalid or unenforceable, such decision shall not affect
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the validity or enforceability of any other provision of this Agreement, all of
which other provisions shall remain in full force and effect.
IN WITNESS WHEREOF, the undersigned have executed this General
Partnership Agreement as of the date first above written.
MANAGING GENERAL PARTNER GENERAL PARTNER
NOLAN ACQUISITION GROUP, L.P. CONESE CAPITAL, L.L.C.
By: KINCAID CAPITAL GROUP, By: CONESE FAMILY
a Texas Corporation, the PARTNERSHIP NEVADA, L.P.,
General Partner Managing Member
By: Conese General Partner
(Nevada), Inc.,
general partner
By: /s/ Thomas R. Kincaid By: /s/ Eugene P. Conese, Jr.
------------------------------- ---------------------------
Thomas R. Kincaid, President Title: Vice President
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