<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 29, 1994
(November 10, 1994)
HONDO OIL & GAS COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-8979 95-1998768
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
410 East College Boulevard, Roswell, New Mexico 88201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (505) 625-8700
_____________________________________________________________________
(Former name or former address, if changed since last report)
Exhibit Index is located on page 3.
1
Item 5. Other Events
On November 10, 1994, the Company executed an agreement effective as
of September 30, 1994, with its principal lenders, Lonrho Plc and
Thamesedge Ltd., a wholly-owned subsidiary of Lonrho Plc, for
extension of the maturity dates of the Company's four loans.
Commencement of principal amortization has been extended from
September 15, 1995 to October 1, 1996 for three of the loans. The
principal repayment terms of the fourth loan, owed to Thamesedge Ltd.,
have been changed from four equal annual payments commencing November
1, 1995 to three equal annual payments commencing November 1, 1996.
Other terms of the loans remain as described in Note 6 to the
Consolidated Financial Statements in Item 8 of the Company's Annual
Report on Form 10-K for the year ended September 30, 1993.
On October 18, 1994, the Company paid $5,000,000 to Lonrho Plc to
reduce the principal balance of one of the above loans. The agreement
also makes the $5,000,000 available in the form of a facility loan
which may be drawn by the Company. The terms of the facility are
similar to those of the existing loans described above.
Item 7 - Financial Statements and Exhibits
There are no financial statements filed with this report. Refer to
Exhibit Index on page 3 for exhibits required by Item 601 of
Regulation S-K.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
HONDO OIL & GAS COMPANY
Date: November 29, 1994 By: /s/ C.B. McDaniel
______________________________
C.B. McDaniel
Secretary & Counsel
2
EXHIBIT INDEX
Exhibit
Number Subject
------- -------------------------------------------------
10.1 Letter Agreement dated November 10, 1994, by and
among the Company, Via Verde Development Company,
Newhall Refining Co.,Inc., Lonrho Plc and
Thamesedge Ltd., and Note Amendments (excluding
Exhibit E to the Letter Agreement filed as Exhibit
10.2, below) amending prior loan agreements and
notes (previously filed as Exhibits 10.1 through
10.8 to the Company's Annual Report on Form 10-K
for the fiscal year ended September 30, 1993).
10.2 Promissory Note dated October 31, 1994, in the
original principal amount of $5,000,000, from the
Company to Lonrho Plc (additional loan facility).
3
Lonrho Plc.,
Thamesedge Ltd.,
Cheapside House,
138, Cheapside,
London, England EC2V 6BL. November 10, 1994
Dear Sirs:
This Agreement is entered into by and among HONDO OIL & GAS COMPANY, a
Delaware corporation ("Hondo"), and its wholly-owned subsidiaries, VIA VERDE
DEVELOPMENT COMPANY, a California corporation ("Via Verde"), and NEWHALL
REFINING CO., INC., a Delaware corporation ("Newhall"), LONRHO PLC
("Lonrho"), and THAMESEDGE LTD ("Thamesedge"), with reference to:
(a) Note Purchase Agreement dated November 28, 1988, between Pauley
Petroleum Inc. (now Hondo) and Thamesedge, as amended (the
"Thamesedge Note Purchase Agreement"), and Note dated November 30,
1988, for $75,000,000 from Pauley Petroleum Inc to Thamesedge (the
"Thamesedge Note");
(b) Letter agreements dated November 28, 1988 and December 18, 1992
between Hondo and Thamesedge referring to and amending the
Thamesedge Note Purchase Agreement and the Thamesedge Note;
(c) Net Profits Share Agreement dated December 18, 1992, by and among
Hondo, Lonrho and Thamesedge (the "Net Profits Share Agreement");
(d) Amended and Restated Letter Agreement dated December 20, 1991,
between the Company and Lonrho (the "Lonrho Loan Agreement") and
Notes dated September 1, 1991, for $10,000,000, November 1, 1991,
for $9,000,000, and December 20, 1991, for $13,000,000, from Hondo
to Lonrho (the "Lonrho Notes");
(e) Letter Agreement dated December 18, 1992 between Hondo and Lonrho
referring to and amending the Lonrho Loan Agreement and the Lonrho
Notes;
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(f) Amended and Restated Guaranty of Robert O. Anderson dated June 20,
1991, and Amendment to Amended and Restated Guaranty of Robert O.
Anderson dated December 20, 1991, guaranteeing the payment of the
Lonrho Notes described in paragraph (b), above (the "Anderson
Guaranty");
(g) Note dated April 30, 1993, for $3,000,000 from Via Verde to Lonrho
(the "Via Verde Note"), secured by Deed of Trust dated recorded as
Instrument No. 93-840817 in the Real Property Records of Los
Angeles County, California, (the "Via Verde Mortgage"), guaranteed
by Hondo in Guaranty dated April 30, 1993 (the "Hondo Guaranty"),
and subject to a Letter Agreement dated April 30, 1993;
(h) Note dated June 25, 1993, for $4,000,000 from Hondo to Lonrho (the
"Valley Gateway Note"), secured by Deed of Trust dated August 30,
1993, granted by Hondo and Newhall, recorded as Instrument No. 93-
2006475 in the Real Property Records of Los Angeles County,
California, (the "Valley Gateway Mortgage"); and
(i) Letter Agreement dated December 17, 1993, between Hondo, Via Verde,
and Newhall, and Lonrho and Thamesedge, amending the original loan
notes.
The Thamesedge Note, the Lonrho Notes, the Via Verde Note and the Valley
Gateway Note are collectively referred to herein as the "Lonrho
Indebtedness".
Hondo, Lonrho and Thamesedge have agreed to extend the date of repayment
for the Lonrho Indebtedness as follows:
(i) the mandatory redemption dates on the Thamesedge Note are
amended from November 1, 1995, November 1, 1996, November 1,
1997 and November 1, 1998, with an amount due on each date
equal to 25% of the aggregate principal of the Note
outstanding, plus accrued interest to each redemption date, to
November 1, 1996, November 1, 1997, and November 1, 1998, with
an amount due on each date equal to one-third of the aggregate
principal of the Original Notes outstanding at November 1,
1996, plus accrued interest to each redemption date;
(ii) the principal repayment date of the Lonrho Notes, the Via
Verde Note and the Valley Gateway Note is extended from
September 15, 1995, to October 1, 1996, as detailed in the
Note Amendments.
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Hondo, Via Verde and Newhall, and Lonrho and Thamesedge hereby agree as
follows:
1) Effective Date. This Agreement shall be effective for all purposes
on September 30, 1994.
2) Amendment of Notes. The Thamesedge Note, the Lonrho Notes
(collectively), the Via Verde Note and the Valley Gateway Note each
will be amended as provided, respectively, in Exhibits A, B, C and
D to this Agreement. Hondo, Newhall and Via Verde, as applicable,
will execute the Note amendments. Lonrho and Thamesedge, as
applicable, will execute them to acknowledge consent thereto, and
the Note amendments will be attached to the original Notes held by
Lonrho or Thamesedge.
3) Payment of Interest.
(a) Payment in Kind. The provision for the payment of interest in
shares of Hondo's common stock if, in the opinion of the management
Hondo does not have sufficient cash resources to pay interest on
any of the Lonrho Indebtedness, as set out in the Letter Agreement
dated December 17, 1993, will remain in place. Lonrho and
Thamesedge will retain the right to either (i) accept the payment
of interest in kind, or (ii) add the amount of interest due to the
principal of the applicable Note.
(b) Unregistered Shares. Lonrho and Thamesedge each represent
that it recognises that any shares of Hondo's common stock that it
may acquire by the payment of interest in kind will not have been
registered under the Securities Act of 1933 and may not be sold in
the absence of an effective registration under said Act or an
exemption from the registration requirements of said Act.
(c) Registration Rights. If Lonrho or Thamesedge so request at
any time after the date shares of Hondo's common stock are issued
to Lonrho or Thamesedge pursuant to this Agreement, Hondo will use
its best efforts to effect immediate registration under the
Securities Act of 1933 of the shares so issued. Hondo shall have
no further obligation under this paragraph after two registrations
have been effected.
4) Net Profits Share Agreement. The Net Profits Share Agreement will
remain in place.
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5) Guaranties.
(a) Hondo Guaranty. Hondo hereby consents, as guarantor under the
Hondo Guaranty, to the amendments made in this Agreement with
respect to the Via Verde Note and hereby confirms and agrees that
the Hondo Guaranty is and shall continue to be in full force and
effect and is hereby ratified and confirmed in all respects as to
the obligations of Hondo with resepct to the Via Verde Note, as
amended previously and by this Agreement.
(b) Anderson Guaranty. Hondo shall use its' best efforts to
provide the consent of Robert O. Anderson, as guarantor under the
Anderson Guaranty, to the amendments made in this Agreement to the
Lonrho Notes.
6) Mortgages. The Via Verde Mortgage and the Valley Gateway Mortgage
will remain in effect to secure the Via Verde Note and the Valley
Gateway Note, the Thamesedge Note and the Lonrho Notes (each as
amended by this Agreement), respectively. Upon sale of the
properties described in the Via Verde Mortgage or the Valley
Gateway Mortgage, the net proceeds, after payment of expenses of
sale and liens or encumbrances having priority senior to the
applicable mortgage, will be applied to the Notes secured thereby.
7) Additional Loan Facility. On October 18, 1994, Hondo made a
principal payment of $5,000,000 against the Lonrho Note of
$10,000,000 dated September 1, 1991. Lonrho hereby agrees to make
said $5,000,000 re-available to Hondo on the same terms as the Note
dated September 1, 1991, as amended by the Letter Agreement dated
December 17, 1993, and this Letter Agreement. The new loan note is
attached as Exhibit E.
8) Miscellaneous.
(a) Governing Law. The laws of the State of California shall
govern this Agreement.
(b) Assignment of Lonrho Indebtedness. Thamesedge and Lonrho each
may assign its interest in the Notes and Agreements, including this
Agreement, to an affiliate of Lonrho at any time upon notice to
Hondo.
(c) Amendment: Controlling Effect. This Agreement will act as an
amendment to the Thamesedge Note Purchase Agreement, the Lonrho
Loan Agreement and the Letter Agreements related thereto. In case
of conflict in the terms of this Agreement and any other Agreements
among Thamesedge, Lonrho and/or Hondo, this Agreement will control.
Except as amended hereby, the
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terms of the Lonrho Indebtedness, and the Agreements related
thereto, are hereby confirmed, and remain in force and effect.
Please confirm that the foregoing correctly sets forth the Agreement between
us.
Very truly yours,
HONDO OIL & GAS COMPANY
By: /s/ John J. Hoey
---------------------------
John J. Hoey, President.
VIA VERDE DEVELOPMENT COMPANY
By: /s/ John J. Hoey
---------------------------
John J. Hoey
NEWHALL REFINING CO. INC.
By: /s/ John J. Hoey
----------------------------
John J. Hoey
Confirmed and accepted as of the date first above written:
LONRHO PLC
By: /s/ J. F. Price
----------------------------
J. F. Price
THAMESEDGE LTD
By: /s/ J. F. Price
----------------------------
J. F. Price
EXHIBIT A
Thamesedge Note
This Note Amendment dated September 30, 1994 amends that certain 13 1/2%
Senior Subordinated Note due 1998 and dated November 28, 1988, in the
original principal amount of US$75,000,000, from Pauley Petroleum Inc. (now
Hondo Oil and Gas Company), to Thamesedge Ltd. (the "Original Note"). This
Note was subsequently amended by the Letter Agreement and Note Amendment
dated December 17, 1993. Effective on September 30, 1994, the Original Note
is further amended as follows:
1. Principal Amount. The principal amount of the Original Note now
owing is US$36,361,684, including US$5,861,684 in interest accrued at
September 30, 1994, which has been added to principal.
2. Principal Repayment. The mandatory redemption dates on the
Original Note are amended to November 1, 1996, November 1, 1997 and
November 1, 1998, with an amount due on each date equal to one-third of
the aggregate principal of the Original Note outstanding at November 1,
1996, plus interest accrued to each redemption date.
3. Letter Agreement. This Note Amendment is issued and delivered
under that certain Letter Agreement dated November 10, 1994, by and
among Hondo Oil & Gas Company, Via Verde Development Company, Newhall
Refining Co. Inc., Lonrho Plc., and Thamesedge Ltd., and is subject to
the terms and provisions of said Letter Agreement.
HONDO OIL & GAS COMPANY
By: /s/ John J. Hoey
----------------------
John J. Hoey, President.
The undersigned hereby acknowledges and consents to this Note Amendment.
THAMESEDGE LTD
By: /s/ J. F. Price
---------------------
J. F. Price
Authorised signatory
EXHIBIT B
Lonrho Notes
This Note Amendment dated September 30, 1994 amends those certain
Promissory Notes dated September 1, 1991, in the original principal amount of
US$10,000,000, dated November 1, 1991, in the original principal amount of
US$9,000,000, and dated December 20, 1991, in the original principal amount
of US$13,000,000, each from Hondo Oil & Gas Company, to Lonrho Plc (the
"Original Notes"). These notes were subsequently amended by the Letter
Agreement and Note Amendment dated December 17, 1993. Effective September
30, 1994, each of the Original Notes is further amended as follows:
1. Principal Amount. The aggregate principal amount of the Original
Notes now owing in US$36,199,830, including US$4,199,830 in interest
accrued at September 30, 1994, which has been added to principal.
Subsequently, a principal payment of $5,000,000 was made by Hondo to
Lonrho on October 18, 1994, in respect of the Note dated September 1,
1991.
2. Principal Repayment. The principal of these Notes is payable on
October 1, 1996.
3. Additional Facility. Lonrho has agreed to make a further facility
of $5,000,000, available to Hondo on the same terms as the Note dated
September 1, 1991, as amended by the Letter Agreement dated December 17,
1993, and this Letter Agreement.
4. Letter Agreement. This Note Amendment is issued and delivered
under that certain Letter Agreement dated November 10, 1994, by and
among Hondo Oil & Gas Company, Via Verde Development Company, Newhall
Refining Co. Inc., Lonrho Plc, and Thamesedge Ltd and is subject to the
terms and provisions of said Letter Agreement.
HONDO OIL & GAS COMPANY
By: /s/John J. Hoey
---------------------
John J. Hoey, President.
The undersigned hereby acknowledges and consents to this Note Amendment.
LONRHO PLC
By: /s/ J.F. Price
---------------------
J. F. Price
Authorised signatory
EXHIBIT C
Via Verde Note
This Note Amendment dated September 30, 1994 amends that certain
Promissory Note dated April 30, 1993, in the original principal amount of
US$3,000,000, from Via Verde Development Company to Lonrho Plc (the "Original
Note"). This Note was amended by the Letter Agreement and Note Amendment
dated December 17, 1993. Effective on September 30, 1994, the Original Note
is further amended as follows:
1. Principal Amount. The principal amount of the Original Note now
owing is US$3,277,162, including US$277,162 in interest accrued at
September 30, 1994, which has been added to principal.
2. Principal Repayment. The principal of this Note is payable on the
earlier of (i) the sale of the property securing the loan, or (ii) in
ten (10) semi-annual instalments commencing October 1, 1996.
3. Letter Agreement. This Note Amendment is issued and delivered
under that certain Letter Agreement dated November 10, 1994, by and
among Hondo Oil & Gas Company, Via Verde Development Company, Newhall
Refining Co. Inc., Lonrho Plc, and Thamesedge Ltd and is subject to the
terms and provisions of said Letter Agreement.
VIA VERDE DEVELOPMENT COMPANY
By: /s/ John J. Hoey
------------------------
John J. Hoey, President
The undersigned hereby acknowledges and consents to this Note Amendment.
LONRHO PLC
By: /s/ J.F. Price
----------------------
J. F. Price
Authorised signatory
EXHIBIT D
Valley Gateway Note
This Note Amendment dated September 30, 1994 amends that certain
Promissory Note dated June 25, 1993, in the original principal amount of
US$4,000,000, from Hondo Oil & Gas Company to Lonrho Plc (the "Original
Note"). This Note was subsequently amended by the Letter Agreement and Note
Amendment dated December 17, 1993. Effective on September 30, 1994, the
Original Note is further amended as follows:
1. Principal Amount. The principal amount of the Original Note now
owing is US$4,270,796, including US$270,796 in interest accrued at
September 30, 1994, which is added to principal.
2. Principal Repayment. The principal of this Note is payable on the
earlier of (i) the sale of the property securing the loan, or (ii) in
ten (10) semi-annual instalments commencing October 1, 1996.
3. Letter Agreement. This Note Amendment is issued and delivered
under that certain Letter Agreement dated November 10, 1994, by and
among Hondo Oil & Gas Company, Via Verde Development Company, Newhall
Refining Co. Inc., Lonrho Plc, and Thamesedge Ltd and is subject to the
terms and provisions of said Letter Agreement.
NEWHALL REFINING CO. INC.
By: /s/ John J. Hoey
----------------------
John J. Hoey, President.
The undersigned hereby acknowledges and consents to this Note Amendment.
LONRHO PLC
By: /s/ J.F. Price
--------------------
J. F. Price
Authorised signatory
PROMISSORY NOTE
US$5,000,000 October 31,1994
Hondo Oil & Gas Company, a Delaware corporation, ("Borrower") and Lonrho
Plc ("Lender") are parties to that certain letter agreement dated October 12,
1994, and November 10, 1994, by and between Borrower and Lender (herein, as
from time to time supplemented, amended or restated, called the "Credit
Agreement") pursuant to which Lender has agreed to make a facility available
to Borrower in the total amount of US$5,000,000. To date, US$200,000 has
been drawn down against this facility. A further US$4,800,000 remains
available to be drawn.
THEREFORE FOR VALUE RECEIVED, Borrower hereby promises to pay to the
order of Lender the principal sum of FIVE MILLION AND NO/100 DOLLARS
(US$5,000,000), together with accrued interest on the unpaid principal
balance thereof at the Rate of 6% per annum, both interest and principal
payable as herein provided in lawful money of the United States of America at
the offices of Lonrho Plc, Cheapside House, 138 Cheapside, London, England
EC2V 6BL, or at such other place as from time to time may be designated by
Lender.
This Note is issued and delivered under the Credit Agreement, and is
subject to the terms and conditions of the Credit Agreement, which contains
provisions for draw downs on the facility in units of US$100,000 and at 72
business hours notice.
Accrued interest on this Promissory Note shall be payable biannually, in
arrears, on April 1 and October 1 of each year. If, in the opinion of its
management, Borrower does not have sufficient cash resources to pay interest
on this note when due, Borrower may offer to Lender, a payment of the
interest in the shares of Borrower's common stock as defined in Paragraph 3
of the Letter Agreement, dated December 17, 1993. Lender can then either (i)
accept the payment if interest in kind, or (ii) add the amount of interest
due to the principal of the note.
The principal amount of this Note together with all accrued interest
thereon, shall be due and payable on October 1, 1996. All past-due principal
of and past-due interest on this note shall bear interest on each day
outstanding at the Reference Rate of Union Bank, Los Angeles, California,
plus three and one-quarter percent (3 %) per annum, and such past-due
interest shall be due and payable immediately as it accrues.
If this Note is placed in the hands of an attorney for collection after
default, or if all or any part of the indebtedness represented hereby is
proved, established or collected in any court or in any bankruptcy,
receivership, debtor relief, probate of other court proceedings, Borrower and
all endorsers, sureties and guarantors of this Note jointly and severally
agree to pay reasonable attorneys' fees and collection costs to the holder
hereof in addition to the principal and interest payable hereunder.
Borrower and all endorsers, sureties and guarantors of this Note hereby
severally waive demand, presentment for payment, protest, notice of protest,
notice of intention to accelerate the maturity of this Note, diligence in
collection, the bringing of any suit against any party and any notice of or
defense on account of any extensions, renewals, partial payments or changes
in any manner of or in this Note or in any of its terms, provisions and
xcovenants, or any releases or substitutions of any security, or any delay,
indulgence or other act of any trustee or any holder hereof, whether before
or after maturity.
This Note and the rights and duties of the parties hereto shall be
governed by the laws of the State of California, except to the extent the
same are governed by applicable federal law.
HONDO OIL & GAS COMPANY
By: /s/John J. Hoey
_________________________
John J. Hoey, President
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