SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
HONDO OIL & GAS COMPANY
(Name of Issuer)
Common Stock, $1 par value
(Title of class of securities)
438138-10-9
(CUSIP Number)
Rudolph H. Funke, Secretary
Lonrho, Inc.
805 Third Avenue
New York, New York 10022
(Person Authorized to Receive Notices and Communications)
August 23, 1995
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box [ ]
Check the following box if a fee is being paid with the statement [ ]. A
fee is not required only if the reporting person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class
of securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.
(See Rule 13d-7.)
Page 1 of Pages<PAGE>
CUSIP No. 438138-10-9 Page 2 of 16 Pages
Response to Question 1: Lonrho Plc
Response to Question 2: (b)
Response to Question 3: SEC USE ONLY
Response to Question 4: BK
Response to Question 5: N/A
Response to Question 6: Great Britain
Response to Question 7: 10,150,200 (As a result of rights under a
Pledge Agreement; otherwise
such power would be deemed
shared)
Response to Question 8: 0
Response to Question 9: 10,150,200 (As a result of rights under a
Pledge Agreement; otherwise
such power would be deemed
shared)
Response to Question 10: 0
Response to Question 11: 10,150,200
Response to Question 12: N/A
Response to Question 13: 78.0%
Response to Question 14: CO<PAGE>
CUSIP No. 438138-10-9 Page 3 of 16 Pages
Response to Question 1: Lonrho, Inc.
Response to Question 2: (b)
Response to Question 3: SEC USE ONLY
Response to Question 4: AF, WC
Response to Question 5: N/A
Response to Question 6: Delaware
Response to Question 7: 0
Response to Question 8: 10,150,200
Response to Question 9: 0
Response to Question 10: 10,150,200
Response to Question 11: 10,150,200
Response to Question 12: N/A
Response to Question 13: 78.0%
Response to Question 14: CO<PAGE>
CUSIP No. 438138-10-9 Page 4 of 16 Pages
Response to Question 1: Scottsdale Princess, Inc.
Response to Question 2: (b)
Response to Question 3: SEC USE ONLY
Response to Question 4: WC
Response to Question 5: N/A
Response to Question 6: Delaware
Response to Question 7: 0
Response to Question 8: 10,150,200
Response to Question 9: 0
Response to Question 10: 10,150,200
Response to Question 11: 10,150,200
Response to Question 12: N/A
Response to Question 13: 78.0%
Response to Question 14: CO<PAGE>
CUSIP No. 438138-10-9 Page 5 of 16 Pages
INTRODUCTION
This Amendment No. 1 to the Statement on Schedule 13D is
being filed jointly by Lonrho Plc, Lonrho, Inc. and Scottsdale Princess, Inc.
(collectively, the "Reporting Persons") with respect to their beneficial
ownership of shares of Common Stock of Hondo Oil & Gas Company to which this
statement pertains. Lonrho Plc is the parent of each of Lonrho, Inc. and
Scottsdale Princess, Inc.
Lonrho Plc and Lonrho, Inc. have heretofore filed a joint
statement (and amendments thereto) on Schedule 13D with The Hondo Company and
Mr. Robert O. Anderson. The information contained herein with respect to The
Hondo Company and Mr. Robert O. Anderson and members of his family are to the
best knowledge and belief of the Reporting Persons. Reference should be made
to the separate filings on Schedule 13D made or which may be made by The Hondo
Company and Mr. Anderson (including any amendments thereto filed or which they
may file) for information concerning them.
Except as to the Items set out below, no changes have
occurred to the answer of any Items of this Schedule 13D from the information
last reported.
Item 3. Source and Amount of Funds or other Consideration.
Item 3 is amended to add the following at the end thereof:
Reference is made to Item 4 below for information related to
a Settlement Agreement
Item 4. Purpose of Transaction.
Item 4 is amended in its entirety to read as follows:<PAGE>
CUSIP No. 438138-10-9 Page 6 of 16 Pages
The purpose of the acquisition of the shares of Common Stock
by Hondo Company in 1988 was to acquire control of the Issuer.
Other than the shares of Common Stock that may be acquired
pursuant to the Settlement Agreement described in Item 3, no Reporting Person
has any present plans or proposals which relate to or would result in:
(a) the acquisition of additional securities of the Issuer (although the
Reporting Persons retain the right, which they may exercise at any time or
from time to time, in their discretion, to acquire directly shares of Common
Stock, including the acquisition by Lonrho Plc of shares in satisfaction of
some or all of Hondo Company's obligations under the Revolving Credit
Agreement and additional shares of Common Stock from the Issuer in payment of
interest on certain obligations of the Issuer to Lonrho Plc as described in
the Item 6) or the disposition of securities of the Issuer (except that, as
discussed in Item 3, Lonrho Plc reserves the right to sell shares pledged to
it under the Pledge Agreement in order to cause the obligations of Hondo
Company to it under the Revolving Credit Agreement, Note and Pledge Agreement
to be reduced or paid in full, and possible dispositions by Hondo Company
under a Registration Statement filed under the Securities Act of 1933, as
amended, by the Issuer covering sales of certain of such shares), (b) an
extraordinary corporate transaction, such as a merger (except that, as
discussed below, the Reporting Persons and the Anderson Family are proposing a
transaction which would involve the merger of Hondo Company into the Issuer),
reorganization or liquidation, (c) a sale or transfer of a material amount of
assets of the Issuer or any of its subsidiaries (although Lonrho Plc reserves
the right to enforce the rights granted to it by the Issuer under certain
mortgages securing certain loans discussed in Item 6), (d) any change in the
present board of directors or management of the Issuer, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board, (e) any material change in the present capitalization
or dividend policy of the Issuer, (f) any other material change in the
Issuer's business or corporate structure, (g) any changes in the Issuer's
charter, by-laws or instruments corresponding thereto or other actions which
may impede the acquisition of control of the Issuer by any person, (h) causing
a class of securities of the Issuer to be delisted from a national securities
exchange or cease to be authorized to be quoted in an inter-dealer quotation
system of a registered national securities association, (i) causing a class of
equity securities of the Issuer to become eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934 or (j) any action similar to any of those enumerated above.
On August 23, 1995, the Reporting Persons and the members of
the Anderson Family entered into an agreement (the "Settlement Agreement") in
which they agreed to cooperate fully toward accomplishing the goal of a
downstream merger whereby Hondo Company will be merged into the Issuer (the
"Merger"), with the existing Issuer shares owned by Hondo Company being
canceled and an equivalent number of new shares of the Issuer being issued to
the shareholders of Hondo Company and to satisfy amounts owed by Hondo Company
to affiliates of the Anderson Family (presently approximately $9.5 million)
and the amounts owed by Hondo Company to the Reporting Persons (presently
approximately $85.5 million). In connection with the transaction, Scottsdale
will exercise the Option Agreement described in Item 5, as a result of which<PAGE>
CUSIP No. 438138-10-9 Page 7 of 16 Pages
the Issuer shares issued in the Merger, which are not used to satisfy such
debt, will be distributed 75% to the Reporting Persons and 25% to the Anderson
Family. Other shareholders of the Issuer, who presently own approximately 22%
of the Issuer's outstanding capital stock, will continue to own approximately
22% of the Issuer's capital stock after the Merger.
Item 5. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
Item 5 is amended to add the following:
Reference is made to Item 4 above for information with
respect to the Settlement Agreement.
Item 6. Material to be filed as Exhibits.
Item 6 is amended to file the following additional Exhibit:
9. Settlement Agreement dated August 23, 1995 between the
Reporting Persons and the Anderson Family.<PAGE>
CUSIP No. 438138-10-9 Page 8 of 16 Pages
SIGNATURES
After reasonable inquiry and to the best of the knowledge
and belief of the undersigned, the undersigned certify that the information
set forth in this Statement is true, complete and correct.
Dated: August 29, 1995
Lonrho Plc
By: /s/ John F. Price
John F. Price
Under Power of Attorney
dated October 6, 1994
Lonrho, Inc.
By: /s/ John F. Price
John F. Price, President
Scottsdale Princess Inc.
By: /s/ John F. Price
John F. Price, President<PAGE>
CUSIP No. 438138-10-9 Page 9 of 16 Pages
EXHIBIT 1
The undersigned agree that the statement on Schedule 13D to
which this Agreement is attached is filed on behalf of each of them.
Dated: August 29, 1995
Lonrho Plc
By: /s/ John F. Price
John F. Price
Under Power of Attorney
dated October 6, 1994
Lonrho, Inc.
By: /s/ John F. Price
John F. Price, President
Scottsdale Princess Inc.
By: /s/ John F. Price
John F. Price, President<PAGE>
CUSIP No. 438138-10-9 Page 10 of 16 Pages
SETTLEMENT AGREEMENT
Agreement entered into as of this 23rd day of August, 1995
between Lonrho Plc ("Lonrho"), Lonrho, Inc. ("LI"), Scottsdale Princess, Inc.
("SPI") (Lonrho, LI and SPI being collectively hereafter referred to as "The
Lonrho Group") on the one hand and Robert O. Anderson ("ROA"), W. Phelps
Anderson ("WPA") and Robert B. Anderson ("RBA") (ROA, WPA and RBA being
collectively hereafter referred to as "The Andersons") on the other hand, The
Lonrho Group and The Andersons being collectively hereafter referred to as
"the parties."
WHEREAS in October 1986 LI purchased what is now 50% of The
Hondo Company, then known as The Diamond A Cattle Company ("Hondo") and
simultaneously entered into a Shareholders Agreement;
WHEREAS as of the date hereof Hondo owns 10,150,200 of the
shares of Hondo Oil & Gas ("HOG"), being approximately 77% of the outstanding
shares of HOG.
WHEREAS as of July 31, 1995 Hondo owed The Andersons on
various loans the following amounts:
RBA $ 36,847.46
South Spring Company 9,442,956.49
"The Anderson Loans" 9,479,803.95
WHEREAS as of July 31, 1995 Hondo owed the members of The
Lonrho Group on various loans the following amount:
Lonrho Plc $ 68,953,683.60
Lonrho, Inc. 13,541,756.26
Scottsdale Princess, Inc. 2,977,210.41
"The Lonrho Loans" 85,492,650.27
WHEREAS on July 6, 1993 ROA and SPI signed the Scottsdale
Option Agreement (the "Option").
WHEREAS Robert O. Anderson/The Andersons are indebted to The
Bank of America and Citibank (collectively "The Banks").
WHEREAS The Lonrho Group and The Andersons desire to resolve
all outstanding differences between them.<PAGE>
CUSIP No. 438138-10-9 Page 11 of 16 Pages
NOW THEREFORE the parties hereto agree as follows:
1. Basic Understanding: The Lonrho Group and The
Andersons will cooperate fully toward accomplishing the goal of a downstream
merger whereby Hondo is merged into HOG (the "merger"), the existing HOG
shares owned by Hondo are canceled and HOG then issues the equivalent number
of new shares to satisfy The Anderson Loans and The Lonrho Loans and
distribute to the parties the balance of HOG shares in substitution for the
Hondo shares.
2. Specifics:
A. The parties will act in the best interest of all
of the shareholders of HOG, especially including the minority shareholders.
B. The parties will vote their shares of Hondo to
accomplish the merger of Hondo into HOG (or vice versa if subsequent tax
advice indicates to the satisfaction of all parties that an upstream merger or
some other alternative is more advantageous to all shareholders of HOG).
C. The parties agree to cause the distribution to
The Anderson Group and to The Lonrho Group after the merger of HOG shares, out
of what is presently Hondo's 10,150,200 shares of HOG, in an amount sufficient
to pay off The Anderson Loan and the Lonrho Group Loans in full. Both The
Anderson Loan and the Lonrho Group Loans will continue to accrue interest at
their present rates until the merger and the Lonrho Group Loans balance will
increase as to principal for all additional advances between July 31, 1995 and
the merger and Closing hereunder.
D. The merger and Closing hereunder will be held 5
business days after satisfaction of all conditions precedent as listed in
2.K., 2.L., 2.M. and 2.O. below.
E. By way of illustration, if at Closing The
Anderson Loans with interest had increased to $10,000,000 and the Lonrho Group
Loans had increased with interest and additional advances to $90,000,000 and
the price of the shares to be distributed is $24.00 per share, at Closing HOG
shares would be transferred as follows:
Recipient Amount of HOG Shares
The Andersons 416,667* ($10,000,000 + $24)
The Lonrho Group 3,750,000** ($90,000,000 + $24)
TOTAL 4,166,667
* To be divided among The Andersons as they deem
appropriate.
** To be divided among the Lonrho Group as its members
deem appropriate.<PAGE>
CUSIP No. 438138-10-9 Page 12 of 16 Pages
F. The Andersons have informed Lonrho that The
Banks require $9,500,000 to release the security that The Banks have over the
Hondo shares owed by The Andersons and The Anderson Loans. If The Banks are
not prepared to accept 395,833 shares of HOG (395,833 at $24 = $9,500,000) in
full and final settlement, Lonrho will buy 395,833 shares of HOG from Hondo
for $9,500,000 and Hondo will pay $9,500,000 to The Banks as full and final
settlement of The Banks may have against Hondo shares owned by The Andersons,
The Anderson Loans and against Hondo, HOG or The Lonrho Group. The $9,500,000
paid to The Banks will be treated in the books of Hondo as a repayment of The
Anderson Loans. The balance of The Anderson Loans will be paid by transfer of
HOG shares at $24 each.
G. In the event that Lonrho has to pay $9,500,000
to Hondo to enable Hondo to repay The Anderson Loans (2.F. above), The
Andersons will not sell any HOG shares within 1 year of the Closing under this
Agreement or until Lonrho has received at least $9,500,000 in proceeds from
the sale of HOG shares to third parties for cash.
H. After satisfaction of The Anderson Loans and The
Lonrho Group Loans as provided in 2.E. and 2.F. above, SPI will exercise the
Option which will result in the Hondo shares in HOG being distributed 75% to
The Lonrho Group and 25% to The Anderson Group.
I. By way of illustration, continuing the example
in 2.E. above, after distribution of the 4, 166,667 shares of HOG, the
remaining 5, 983,533 shares (10,150,200 - 4, 166,667) would be distributed as
follows:
Recipient Percentage Amount of HOG Shares
Lonrho, Inc. 50 % 2,991,767
Scottsdale Princess, Inc. 25 1,495,883
Robert O. Anderson 15 897,529
W. Phelps Anderson 5 299,177
Robert B. Anderson 5 299,177
TOTAL 100 % 5,983,533
J. Liabilities.
(a) Disclosed. To the extent that Hondo has
any liabilities at the time of its merger into HOG including any expenses
relating to the merger, the parties agree jointly that shares will be sold in
HOG to provide cash to pay disclosed liabilities. The number of shares to be
sold will be divided 50/50.
(b) Undisclosed. The parties will guarantee
all undisclosed liabilities in accordance with their shareholding percentages
as provided in 2.I. above. the Lonrho Group members will jointly and
severally guaranty as to their percentage and The Anderson Group members<PAGE>
CUSIP No. 438138-10-9 Page 13 of 16 Pages
will jointly and severally guaranty as to their percentage and both groups
will, if necessary, provide appropriate security.
K. The parties will cooperate in an effort to
obtain all necessary regulatory approvals (SEC, Hart-Scot, etc.) as might be
legally required before the merger of Hondo and HOG and a Closing hereunder
can occur.
L. T h e p arties will cooperate in a joint
registration to be filed and effective prior to Closing of all HOG shares to
be received at Closing by all parties hereunder so that they may, if desired,
dispose of their respective shares. This is not to be construed as a Plan or
present intention of the part of the parties to dispose of more than 50% of
their pre-merger shareholdings. The cost of the registration shall be borne
by the parties in proportion to their ownership percentages in HOG as of the
Closing.
M. The merger is subject to approvals of the Board
of Directors of HOG and, if necessary, the Shareholders of HOG. The parties
will cooperate to obtain such approvals.
N. ROA will, at his sole cost, obtain all necessary
consents from The Banks as may be necessary in order to implement the
transaction contemplated.
O. This Agreement is subject to approval by the
Board of Directors of Lonrho Plc and any necessary consent by the London Stock
Exchange.
P. Lonrho will support, for a period of five years,
2 nominees by The Andersons to the Board of Directors of HOG provided that The
Andersons own over 10% of the shares of HOG. One of the nominees will be Mr.
Robert O. Anderson and the other will be a person with substantial experience
with a major oil company.
Q. With respect to all pending litigation between
the parties or Hondo, so as to reduce legal fees the parties will cause their
attorneys to advise the respective courts that settlement discussions are in
progress with a view to obtaining an indefinite extension of time to answer
all pending discovery requests, to respond to any unanswered claims, etc.
until Closing. In other words, all pending litigation is to remain at a
standstill and no party is to be prejudiced thereby. To the extent entities
other than The Andersons and The Lonrho Group are involved (i.e. Citibank and
Bank of America), The Andersons will make best efforts to cause Citibank and
Bank of America to similarly agree to a nonprejudicial standstill agreement.
A f ter Closing, the parties will cause all pending litigation to be
discontinued with prejudice.
R. At Closing:
(i) The Shareholders Agreement will be deemed null
and void.<PAGE>
CUSIP No. 438138-10-9 Page 14 of 16 Pages
(ii) T h e parties will exchange complete mutual
releases.
3. Effectiveness: The parties agree to make best efforts
to cause the contemplated transaction to occur. This Settlement Agreement is
legally binding and is only subject to the conditions described in 2.K., 2.L.,
2.M. and 2.O. above. However, if for any reason whatsoever all conditions are
not satisfied within 6 months from the date hereof, either party may terminate
this Agreement and all rights and obligations without any liability hereunder.
4. Miscellaneous:
A. Notices. Any notice, request or other
communication between the parties shall be in writing and shall be delivered
personally or shall be sent by hand, facsimile, or overnight courier (e.g.,
Federal Express, Airborne, or similar service) as set forth below, or to such
other address as either party may hereafter designate by notice to the other
party. Communications under this Agreement dealing with its amendment or
termination, default or service of process must be confirmed by
certified/registered mail (with receipt requested) sent as follows:
(i) If to The Anderson Group or any of its members:
c/o The Hondo Company
410 East College Boulevard
Roswell, New Mexico 88201
Attn: S.H. Cavin, Esq.
Fax: (505) 625-6829
(ii) If to The Lonrho Group or any of its members:
Scottsdale Princess, Inc.
c/o Princess Hotels International, Inc.
805 Third Avenue, 18th Floor
New York, NY 10022
Attn: R.H. Funke, Esq.
General Counsel
Fax: (212) 838-8141
B. No Modifications. Neither this Agreement, nor
any of the terms hereof, may be terminated, amended, waived or modified except
by a writing signed by The Lonrho Group and The Andersons.
C. No Broker. No broker has been engaged nor is
anyone entitled to a finders fee with respect to this transaction.<PAGE>
CUSIP No. 438138-10-9 Page 15 of 16 Pages
D. Entirety of Agreement. This Agreement,
including any and all Attachments hereto, constitutes the entire agreement
between the parties hereto in respect of the matters covered hereby and
supersedes, any and all prior agreements, understandings and communications,
either oral or written, between the parties hereto with respect to the subject
matter thereof.
E. No Waiver. The failure of any party at any time
to require the performance by the other of any of the terms or provisions
herein shall in no way affect the right of that party thereafter to enforce
the same; nor shall the waiver by any party of any breach of any of the terms
or provisions herein be taken or held to be a waiver of any preceding breach
of any such term or provisions, or as a waiver of the term or provision
itself.
F. Successors and Assigns. This Agreement shall be
binding upon, and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns. It is further agreed that
Scottsdale may assign all of its rights and obligations hereunder to any
affiliate, but none other.
G. Headings. The headings of this Agreement are
inserted for convenience only and are not intended to affect the meaning of
any of the provisions hereof.
H. Counterparts. This Agreement may be executed in
several counterparts, each of which shall be an original, but all of which
shall constitute but one and the same instrument. This Agreement may be
delivered by fax with hard copies to follow.
I. Authority. The authority of the person
executing this Agreement to bind the party to this Agreement on behalf of the
entity on whose behalf the Agreement is executed shall be evidenced by his
signature.
J. Governing Law. This Agreement shall be
construed, interpreted and all disputes determined in accordance with, and
shall be governed by, the laws of the State of Texas and all disputes shall be
determined in the Courts thereof in the City of Houston.
K. Construction. All parties participated in the
drafting of this Agreement so that the usual rule that all drafts are to be
construed adversely to the party drafting same shall not apply.<PAGE>
CUSIP No. 438138-10-9 Page 16 of 16 Pages
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
The Lonrho Group: The Anderson Group:
Lonrho Plc
By /s/ Dieter Bock By /s/ Robert O. Anderson
Robert O. Anderson
Lonrho, Inc.
By /s/ R. E. Whitten By /s/ W. Phelps Anderson
W. Phelps Anderson
Scottsdale Princess, Inc.
By /s/ J. F. Price By /s/ W. Phelps Anderson
W. Phelps Anderson
ATTORNEY-IN-FACT for
Robert B. Anderson<PAGE>
