SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)
HONDO OIL & GAS COMPANY
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(Name of Issuer)
Common Stock, $1 par value
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(Title of class of securities)
438138-10-9
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(CUSIP Number)
Rudolph H. Funke, Secretary
Lonrho, Inc.
805 Third Avenue
New York, New York 10022
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(Person Authorized to Receive Notices and Communications)
January 5, 1996
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(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 [X]. A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.
(See Rule 13d-7.)
Page 1 of 39 Pages
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CUSIP No. 438138-10-9 Page 2 of 39 Pages
Response to Question 1: Lonrho Plc
Response to Question 2: (a)
Response to Question 3: SEC USE ONLY
Response to Question 4: BK, OO
Response to Question 5: N/A
Response to Question 6: Great Britain
Response to Question 7: 164,544
Response to Question 8: 10,296,108 (shared with subsidiaries)
Response to Question 9: 164,544
Response to Question 10: 10,296,108 (shared with subsidiaries)
Response to Question 11: 10,460,652 (includes all shares owned by all group
members)
Response to Question 12: N/A
Response to Question 13: 77.1%
Response to Question 14: HC;CO
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CUSIP No. 438138-10-9 Page 3 of 39 Pages
Response to Question 1: Lonrho, Inc.
Response to Question 2: (a)
Response to Question 3: SEC USE ONLY
Response to Question 4: AF
Response to Question 5: N/A
Response to Question 6: Delaware
Response to Question 7: 0
Response to Question 8: 10,150,200 (shared with a parent company and
affiliates)
Response to Question 9: 0
Response to Question 10: 10,150,200 (shared with a parent company and
affiliates)
Response to Question 11: 10,150,200 (may be deemed to beneficially own all
10,460,652 shares owned by group)
Response to Question 12: X (excludes 310,452 shares owned by other
group members)
Response to Question 13: 74.9% (group's percentage ownership is 77.1%)
Response to Question 14: HC; CO
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CUSIP No. 438138-10-9 Page 4 of 39 Pages
Response to Question 1: Scottsdale Princess, Inc.
Response to Question 2: (a)
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 (shared with a parent company and
affiliates)
Response to Question 9: 0
Response to Question 10: 10,150,200 (shared with a parent company and
affiliates)
Response to Question 11: 10,150,200 (may be deemed to beneficially own all
10,460,652 shares owned by group)
Response to Question 12: X (excludes 310,452 shares owned by other
group members)
Response to Question 13: 74.9% (group's percentage is 77.1%)
Response to Question 14: CO
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CUSIP No. 438138-10-9 Page 5 of 39 Pages
Response to Question 1: Thamesedge Ltd.
Response to Question 2: (a)
Response to Question 3: SEC USE ONLY
Response to Question 4: OO
Response to Question 5: N/A
Response to Question 6: Great Britain
Response to Question 7: 0
Response to Question 8: 145,908 (shared with parent)
Response to Question 9: 0
Response to Question 10: 145,908 (shared with parent)
Response to Question 11: 145,908 (may be deemed to beneficially own all
10,460,652 shares owned by group)
Response to Question 12: X (excludes 10,314,744 shares owned by
other group members)
Response to Question 13: 1.1% (group's percentage is 77.1%)
Response to Question 14: CO
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CUSIP No. 438138-10-9 Page 6 of 39 Pages
Response to Question 1: The Hondo Company
Response to Question 2: (a)
Response to Question 3: SEC USE ONLY
Response to Question 4: OO
Response to Question 5: N/A
Response to Question 6: New Mexico
Response to Question 7: 0
Response to Question 8: 10,150,200 (shared with parents)
Response to Question 9: 0
Response to Question 10: 10,150,200 (shared with parents)
Response to Question 11: 10,150,200 (may be deemed to own all 10,460,652
shares owned by group)
Response to Question 12: X (excludes 310,452 shares owned by other
group members)
Response to Question 13: 74.90% (group's percentage is 77.1%)
Response to Question 14: CO
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CUSIP No. 438138-10-9 Page 7 of 39 Pages
INTRODUCTION
This statement is being filed jointly by Lonrho Plc, Lonrho, Inc.,
Scottsdale Princess, Inc., Thamesedge Ltd. and The Hondo Company (collectively,
the "Reporting Persons") with respect to their beneficial ownership of shares of
Common Stock of Hondo Oil & Gas Company. Lonrho Plc is the parent of each of
Lonrho, Inc., Scottsdale Princess, Inc. and Thamesedge Ltd. and, through Lonrho,
Inc. and Scottsdale Princess, Inc., the parent of The Hondo Company.
Prior to October 7, 1994, Lonrho Plc, Lonrho, Inc. and The Hondo Company
filed a joint statement (and amendments thereto) on Schedule 13D with Mr. Robert
O. Anderson. Lonrho, Plc and Lonrho, Inc. determined to report separately from,
in lieu of filing jointly with, The Hondo Company and Mr. Anderson. Accordingly,
Lonrho Plc and Lonrho, Inc. filed, together with Scottsdale Princess, Inc., a
Schedule 13D on October 7, 1994 (the "Original Schedule 13D"). Those Reporting
Persons subsequently filed Amendment No. 1 to their Schedule 13D on August 23,
1995 ("Amendment No. 1"). The Original Schedule 13D, as amended by Amendment No.
1, is referred to collectively as the "Schedule 13D".
Among other things, this Amendment No. 2 adds (i) Thamesedge Ltd. as a
Reporting Person and (b) includes The Hondo Company, which previously filed
reports with Mr. Robert O. Anderson, W. Phelps Anderson and Robert B. Anderson
(the "Anderson Family"). This Amendment No. 2 amends the Schedule 13D and
relfects all information as if a new Schedule 13D were filed. Any information
with respect to the Anderson Family is to the best knowledge and belief of the
Reporting Persons.
Item 1. SECURITY AND ISSUER
This statement relates to the Common Stock, par value $1 per share (the
"Common Stock"), of Hondo Oil & Gas Company, a Delaware corporation (the
"Issuer"). The principal executive offices of the Issuer are located at 401 East
College Boulevard, Rosewell, New Mexico 88201.
Item 2. IDENTITY AND BACKGROUND.
This statement is being filed by (a) Lonrho Plc, a corporation organized
under the laws of England, the principal business office of which is located at
Four Grosvenor Place, London, SW1X 7DL,, England; (b) Lonrho, Inc., a Delaware
corporation, the principal business office of which is located at 805 Third
Avenue, New York, New York 10022; (c) Scottsdale Princess, Inc., a Delaware
corporation, the principal business office of which is located at 7575 East
Princess Drive, Scottsdale, Arizona 85255 ("Scottsdale"); (d) Thamesedge Ltd., a
corporation organized under the laws of England, the principal business office
of which is located at Four Grosvenor Place, London, SW1X 7DL, England
("Thamesedge"); and (e) The Hondo Company, a New Mexico corporation, the
principal business office of which is located at 410 East College Boulevard,
Rosewell, New Mexico
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CUSIP No. 438138-10-9 Page 8 of 39 Pages
88201 ("Hondo Company"). Lonrho Plc, Lonrho, Inc., Scottsdale, Thamesedge and
Hondo Company are referred to herein collectively as the "Reporting Persons."
Lonrho Plc is a public company registered in England and listed on the
London and Johannesburg stock exchanges. Lonrho Plc and its subsidiaries are
engaged in a variety of activities, including mining, agriculture, motor vehicle
and agricultural equipment distribution, manufacturing, freight forwarding and
warehousing, printing and publishing and the ownership and management of
property and hotels.
Lonrho, Inc., an indirect wholly-owned subsidiary of Lonrho Plc, is a
holding company for the shares of The Hondo Company.
Scottsdale, an indirect wholly-owned subsidiary of Lonrho Plc, is a holding
company for a hotel interest.
Thamesedge, a wholly-owned subsidiary of Lonrho Plc, is a finance and
investment company.
Hondo Company is a holding company for the shares of the Issuer.
As a result of their common control relationship, the Reporting Persons,
may be deemed to be a "group" under Rule 13d-5(b)(1) promulgated under the
Securities Exchange Act of 1934 (the "Exchange Act").
The name, business address, present principal occupation or employment, and
the name, principal business and address of any corporation or other
organization in which such employment is conducted, of each executive officer
and director of the Reporting Persons are set forth in Appendix A hereto, and
incorporated herein by reference.
During the last five years, none of the Reporting Persons nor, to the best
knowledge of the Reporting Persons, any person named in Appendix A hereto has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
To the best knowledge and belief of the Reporting Persons, the citizenship
of each person named in Appendix A is set forth in Appendix A hereto, and is
incorporated herein by reference.
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CUSIP No. 438138-10-9 Page 9 of 39 Pages
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The shares of Common Stock beneficially owned by the Reporting Persons were
acquired as follows:
(i) Pursuant to an Exchange Agreement dated as of October 28, 1987
among Hondo Company, Hondo Oil & Gas (a wholly-owned subsidiary of Hondo
Company) and the Issuer (then known as Pauley Petroleum Inc.), on January 19,
1988, the Issuer issued 10,000,000 shares of Common Stock to Hondo Company in
exchange for Hondo Company's transfer to the Issuer of all of the outstanding
stock of Hondo Oil & Gas.
(ii) During the period from December 21, 1987 through January 8, 1988,
Hondo Company purchased an aggregate of 121,000 shares of Common Stock in open
market transactions at prices ranging from $14.50 to $18.00 (or an aggregate of
approximately $2,083,000).
(iii) On January 19, 1988, Hondo Company purchased 350,000 shares of
Common Stock at $20.00 per share (or an aggregate of $7,000,000) from William R.
Pagen under a Stock Purchase and Option Agreement dated as of December 14, 1987
executed by Mr. Pagen on January 19, 1988. The Stock Purchase and Option
Agreement also granted Hondo Company an option to purchase up to an additional
120,000 shares of Common Stock from Mr. Pagen, which option expired unexercised
on January 19, 1988.
(iv) On April 3, 1995, 99,113 and 89,967 shares were issued by the
Issuer to Lonrho Plc and Thamesedge, respectively, in payment of interest of
$1,201,749.50 and $1,090,850.52, respectively, for the six months ended April 1,
1995 on certain indebtedness owed to them by the Issuer, which interest may be
paid if agreed between them in Common Stock of the Issuer. See paragraph (b)
described in Item 6.
(v) On October 5, 1995, 65,431 and 55,941 shares were issued by the
Issuer to Lonrho Plc and Thamesedge, respectively, in payment of interest of
$1,275,911.70 and $1,090,850.52, respectively, for the six months ended October
1, 1995 on certain indebtedness owed to them by the Issuer. See paragraph (b)
described in Item 6.
Funds used by Hondo Company for the purchases of the Issuer's Common
Stock from Mr. Pagen and on the open market were borrowed from Union Bank under
a Revolving Credit Agreement dated January 12, 1988 (which, as amended to date,
is hereinafter referred to as the "Revolving Credit Agreement").
Since September 14, 1992, Hondo Company has sold an aggregate of
320,800 shares of the Issuer's Common Stock under Rule 144 promulgated under the
Securities Act of 1933, as amended (the "Securities Act"), and under a
Registration Statement filed under the Securities Act by the Issuer on behalf of
Hondo Company.
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CUSIP No. 438138-10-9 Page 10 of 39 Pages
(c) On October 3, 1994, Lonrho Plc purchased from Union Bank for
$40,000,000, and received an assignment of, all of Union Bank's rights and
obligations under the Revolving Credit Agreement, the related Promissory Note
issued by Hondo Company thereunder (the "Note"), the Pledge Agreement dated July
24, 1990 between Hondo Company and the Bank (the "Pledge Agreement") and the
guarantees of Lonrho Plc and Mr. Anderson of Hondo Company's obligations under
the Revolving Credit Agreement, the Note and the Pledge Agreement. The Pledge
Agreement secured Hondo Company's obligations under the Revolving Credit
Agreement, the Note and the Pledge Agreement by a pledge of all shares of Common
Stock of the Issuer then or thereafter owned by Hondo Company. Lonrho Plc
obtained the funds used to consummate the purchase from borrowings under
available lines of credit from Lloyd's Bank.
The Revolving Credit Agreement entitled Hondo Company to borrow up to
$55,000,000 but required it to limit the aggregate unpaid principal amount of
loans to be outstanding from October 1, 1992 until September 30, 1993 to
$50,000,000 and thereafter until September 30, 1994 to $40,000,000, at which
time the remaining unpaid principal balance was to be repaid in full. The
Revolving Credit Agreement provides for interest at Union Bank's "Reference
Rate" plus 1-1/4% through March 31, 1991, 1-3/4% thereafter through September
30, 1993 and 3% thereafter through September 30, 1994. During any period that
the loans are not paid when due, the outstanding principal balance under the
Revolving Credit Agreement bears interest at Union's Bank's Reference Rate plus
5-1/4% per annum. There remains outstanding under the Revolving Credit Agreement
$40,000,000 principal amount of indebtedness.
Under the Revolving Credit Agreement Lonrho Plc is entitled to, among other
things, declare all or a portion of the outstanding loans and other amounts
payable thereunder to become due and payable.
Lonrho Plc reserves the right to declare an "Event of Default" and to
exercise its rights and remedies provided under the Pledge Agreement, including
selling the pledged shares from time to time and applying proceeds received
therefrom to the payment of all obligations of Hondo Company under the Revolving
Credit Agreement, Note and Pledge Agreement, inclusive of principal, interest,
fees and expenses. Any surplus cash proceeds and any shares not sold after the
repayment of such amounts will revert to Hondo Company. In this regard, the
Issuer has filed a registration statement under the Securities Act by Lonrho
Plc, Lonrho, Inc. and to enable Lonrho Plc. to sell pledged shares. The effect
of any such sale will be to reduce the number of shares of Common Stock owned
directly by Hondo Company and, through Hondo Company, by Lonrho Plc, Lonrho,
Inc. and Scottsdale.
Item 4. PURPOSE OF TRANSACTION.
The purpose of the acquisition of the shares of Common Stock by Hondo
Company in October 1987 was to acquire control of the Issuer under an
arrangement which effectively provided joint control of the Issuer by Lonrho Plc
and Lonrho, Inc., on the one hand, and the Anderson Family, on the other hand.
The other purchases of the Issuer's Common Stock reflected in Item 3 increased
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CUSIP No. 438138-10-9 Page 11 of 39 Pages
the Reporting Persons' investment and interest in the Issuer's Common Stock. The
purpose of the Revised Settlement Agreement discussed in paragraph (c) of Item 6
is to, among other things, vest control of Hondo Company solely in Lonrho Plc.,
Lonrho. Inc. and Scottsdale and provide a mechanism by which the interest of the
Anderson Family in Hondo Company may become a direct interest in a portion of
the Issuer's Common Stock held by Hondo Company .
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
paragraph (b) of Item 6) or the disposition of securities of the Issuer (except
that Hondo Company, as owner, and Lonrho Plc, as pledgee, reserve the right to
sell shares covered by a registration statement filed under the Securities Act
by the Issuer with respect to 3,609,200 shares of the Issuer's Common Stock, and
Lonrho Plc and Thamesedge reserve the right to sell shares covered by other
registration statements filed under the Securities Act by the Issuer with
respect to shares of the Issuer's Common Stock issued to them by the Issuer in
payment of interest on certain indebtedness owed them by the Issuer; all shares
owned by the Reporting Persons could also be pursuant to Rule 144 under the
Securities Act or another exemtion from the registration provisions of the
Securities Act), (b) an extraordinary corporate transaction, such as a merger,
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 paragraph (b) of 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 (except that the Revised Settlement Agreement
provides for Lonrho Plc to cause Hondo Company to, and Hondo Company has agreed
to, support Robert O. Anderson to be elected as a director of the Issuer for
five years from December 20, 1995), (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.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
Because they may be deemed a group, within the meaning of Rule 13d-5 under
the Exchange Act, each of the Reporting Persons may be deemed to be the
beneficial owner, within the meaning
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CUSIP No. 438138-10-9 Page 12 of 39 Pages
of Rule 13d-3 under the Exchange Act, of 10,460,652 shares of Common Stock of
the Issuer, representing, based on the 13,564,750 shares of Common Stock which
were issued and outstanding on December 8, 1995 as reflected in the Issuer's
Annual Report on Form 10-K for the year ended September 30, 1995, approximately
77.1% of the outstanding shares of the Issuer's Common Stock.
Lonrho, Plc has sole voting and dispositive power with respect to the
164,544 shares of the Issuer's Common Stock owned directly by it and, by virtue
of its ownership interest in each of the other Reporting Persons, may be deemed
to share the right to direct the voting and disposition of 10,296,108 shares of
the Issuer's Common Stock which (a) as to 10,150,200 shares of the Issuer's
Common Stock, by virtue of their 50% and 25% respective ownership interests in
Hondo Company, Lonrho, Inc. and Scottsdale may also be deemed to be beneficial
owners with shared voting and dispositive power (subject, as discussed in
paragraph (c) of Item 6 below to Hondo Company's obligation to retain 1,200,000
shares of the Issuer's Common Stock to satisfy the rights of the Anderson Family
to require Hondo Company to redeem the Anderson Family's interests in Hondo
Company) and (b) as to 145, 908 shares of the Issuer's Common Stock owned by
Thamesedge, Thamesedge may also be deemed to be the beneficial owner with shared
voting and despositive power.
The shareholders of Hondo Company and their approximate respective
percentages of Hondo Company as of December 31, 1995 are set forth below:
Percentage of
Hondo Company
Hondo Company Shareholders Common Stock
-------------------------- ------------
Lonrho, Inc. 50%
Scottsdale 25%
The Anderson Family 25%
See paragraph (c) of Item 6 with respect to the rights of the Anderson
Family to require Hondo Company to redeem the Anderson Family's interest in
Hondo Company in exchange for 1,200,000 shares of the Issuer's Common Stock
owned by the Anderson Family.
Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
(a) Reference is made to Item 3 above for information with respect to the
Pledge Agreement between Hondo Company and Union Bank relating to shares of the
Issuer's Common Stock owned by Hondo Company which pledge was assigned by Union
Bank to Lonrho Plc.
(b) On November 30, 1988, Thamesedge purchased a $75,000,000 13.5% Senior
Note, due in 1998, from the Issuer in a private placement. In December 1995,
Thamesedge agreed to
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CUSIP No. 438138-10-9 Page 13 of 39 Pages
extend the mandatory redemption dates of the notes to November 1, 1997 and
November 1, 1998, with one half of the aggregate principal amount outstanding on
November 1, 1997 due on each such date, plus accrued interest. The Note is
secured by a mortgage on certain real estate owned by the Issuer. At September
30, 1995, the outstanding amount due on this Note was $36,361,000.
On September 1, 1991, November 1, 1991 and December 20, 1991, Lonrho Plc,
Thamesedge and other affiliates of Lonrho Plc loaned the Issuer an aggregate of
$32,000,000. At the time the loans were made the interest rate was similar to
that applicable to the Issuer's former working capital loan with a bank for its
refining and marketing operations. In December 1995, the lenders agreed to
extend the maturity date of these loans to October 1, 1997. This Note is secured
by a mortgage on certain real estate owned by the Issuer. At September 30, 1995,
the outstanding amount due on this Note was $34,375,000.
On April 30, 1993, Lonrho Plc loaned to the Issuer an additional $3,000,000
and, as security, the Issuer granted to Lonrho Plc a mortgage on certain real
property. On June 25, 1993, Lonrho Plc and Thamesedge agreed to loan the Issuer
an additional $4,000,000 (all of which has been advanced) and, as security, the
Issuer granted to Lonrho Plc a mortgage on certain other real property. In
December 1995, the lenders agreed to extend the maturity of each note so that
each is payable on the earlier of (i) the sale of the property securing the
respective note or (ii) in ten semi-annual installments commencing on October 1,
1997.
On December 18, 1992, Lonrho Plc and Thamesedge agreed to defer interest
and certain principal payments. On December 18, 1993, Lonrho Plc and Thamesedge
agreed to add accrued interest at September 30, 1993 to principal and reduce the
interest rate on each of the foregoing loans to 6% per annum effective September
30, 1993 and defer principal payments on the loans described above. As
consideration for the deferral of interest and principal payments, on December
18, 1992, the Issuer granted Lonrho Plc a 5% share of the Issuer's net profits,
as defined, under the Opon Association Contract pursuant to which a wholly-owned
subsidiary of the Issuer is participating in the exploration and development of
oil and gas in the Middle Magdalena Basin, about 125 miles north of Bogota,
Columbia. Following the final payment of the foregoing indebtedness, Lonrho
Plc's share of such net profits will be decreased by one-half.
Lonrho Plc, Thamesedge and the Issuer have agreed that, if the Issuer does
not have sufficient cash resources to pay interest on any of the foregoing
indebtedness when due, then the Issuer may offer to pay such interest in shares
of its Common Stock valued at their market price on the day the interest is due.
Thereupon Lonrho Plc and Thamesedge may either accept such offer or add the
amount of interest then due to the remaining outstanding principal balance of
the applicable obligation. See Item 3 for information concerning shares of the
Issuer's Common Stock that have been issued to Lonrho Plc and Thamesedge
pursuant to this arrangement.
(c) On December 20, 1995, the Reporting Persons (other than Thamesedge) and
the members of the Anderson Family entered into a Revised Settlement Agreement
(as amended on
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CUSIP No. 438138-10-9 Page 14 of 39 Pages
January 5, 1996, the "Revised Settlement Agreement") to replace a Settlement
Agreement dated August 23, 1995 between them (and reported in Amendment No. 1 to
this Schedule 13D). The following summary of the Revised Settlement Agreement is
qualified in its entirety by reference thereto (which appears as Exhibits 10 and
11 to this statement). Under the Revised Settlement Agreement on January 5,
1996, among other things, (a) Scottsdale exercised its right under the Option
Agreement dated as of July 6, 1993 between Robert O. Anderson and Scottsdale
(and reported in the Original Schedule 13D) to acquire 25% of the issued and
outstanding Common Stock of Hondo Company from Mr. Anderson, increasing the
ownership of the Reporting Persons in Hondo Company to 75% and decreasing the
ownership interest of the Anderson Family in Hondo Company to 25%; (b) the
Shareholders' Agreement dated October 17, 1986 among Lonrho, Inc., the Anderson
Family and Hondo Company, which (while not directly related to the Issuer's
Common Stock held by Hondo Company) required Lonrho, Inc., on the one hand, and
the Anderson Family, on the other hand, to designate an equal number of
directors of Hondo Company, became null and void, thus enabling Lonrho, Inc. and
Scottsdale as majority shareholders of Hondo Company, to elect all of Hondo
Company's directors and control Hondo Company's policies; and (c) the Anderson
Family agreed that their 25% interest in Hondo Company is to be exchanged for
1,200,000 shares of Common Stock of the Issuer which they, acting solely through
Robert O. Anderson, would have the right to call at the rate of 400,000 shares
annually for three consecutive years beginning January 5, 1997 against delivery
to Hondo Company for redemption of one-third annually of their aggregate 25%
interest in Hondo Company, while Hondo Company has the right, beginning January
5, 1999, to put to the Anderson Family so much of the 1,200,000 registered
shares of Common Stock of the Issuer which the members of the Anderson Family
have not previously required Hondo Company to transfer in exchange for their
remaining interest in Hondo Company; and (d) Lonrho Plc has agreed to cause
Hondo Company, and Hondo Company has agreed to, support Robert O. Anderson to be
elected as a director of the Issuer for five years from December 20, 1995. Hondo
Company has agreed to cause the Issuer to file a registration statement (or a
post-effective amendment to an existing registration statement) under the
Securities Act by April 4, 1996 covering the resale of the Issuer's shares of
Common Stock deliverable to the Anderson Family (or a pledgee of the Anderson
Family), and use its best efforts to cause such registration statement to be
declared effective as promptly as practicable thereafter but in no event later
than January 5, 1997 and to maintain such registration statement until January
5, 2000.
Item 7. MATERIAL TO BE FILED AS EXHIBITS.
1.* Agreement, dated January 8, 1996 between the Reporting Persons with respect
to their joint filing of this statement.
2(a) Power of Attorney dated October 6, 1994 executed by Lonrho Plc in favor of
John F. Price and Rudolph H. Funke with respect to the execution of the
Schedule 13D, including all amendments thereto.
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CUSIP No. 438138-10-9 Page 15 of 39 Pages
2(b)*Power of Attorney dated January 8, 1996 executed by Thamesedge Ltd. in
favor of John F. Price and Rudolf H. Funke with respect to the execution of
the Schedule 13D, including all amendments thereto.
3. Assignment Agreement dated as of October 3, 1994 between Union Bank and
Lonrho Plc.
4. Second Amended and Restated Revolving Credit Agreement between The Hondo
Company and Union Bank, including as exhibits thereto the forms of the
Note, the Pledge Agreement and the Guarantees of Lonrho Plc and Robert O.
Anderson.
5. Shareholders' Agreement dated October 17, 1986 by and among Robert O.
Anderson, Robert B. Anderson, W. Phelps Anderson, Lonrho, Inc. and The
Hondo Company (then known as The Diamond A Cattle Company).
6. Option Agreement dated as of July 6, 1993 between Robert O. Anderson and
Scottsdale Princess, Inc.
7. Net Profits Share Agreement dated December 18, 1992, among the Company,
Lonrho Plc and Thamesedge, Ltd.
8. Letter Agreement dated December 17, 1993, by and among the Company, Via
Verde Development Company, Newhall Refining Co., Inc., Lonrho Plc and
Thamesedge, Ltd.
9.+ Settlement Agreement dated August 23, 1995 between the Reporting Persons
(other than Thamesedge Ltd. and Hondo Company).
10.* Revised Settlement Agreement dated December 20, 1995 between the Reporting
Persons (other than Thamesedge) and the Anderson Family.
11.* First Amendment dated January 5, 1996 to the Revised Settlement Agreement
between the Reporting Persons (other than Thamesedge) and the Anderson
Family.
- ---------------------------------------
+ Filed with Amendment No. 1 to the Schedule 13D.
* Filed herewith.
All other exhibits were filed with the original Schedule 13D. All
exhibits, other than those filed herewith, are incorporated herein by
reference thereto.
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CUSIP No. 438138-10-9 Page 16 of 39 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: January 8, 1996
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
Thamesedge Ltd.
By: /s/ JOHN F. PRICE
John F. Price
Under Power of Attorney
Dated: January 8, 1996
The Hondo Company
By: /s/ JOHN F. PRICE
John F. Price, President
<PAGE>
CUSIP No. 438138-10-9 Page 17 of 39 Pages
APPENDIX A
----------
I. LONRHO PLC.
Set forth below are the name, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Lonrho Plc.
Name and Principal
Position held Occupation
with Lonrho Plc. or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
Sir John Leahy, Chairman Four Grosvenor Place United Kingdom
K.C.M.G. Lonrho Plc London, SW1X 7DL,
Chairman England
D. Bock Managing Four Grosvenor Place Germany
Managing Director and London, SW1X 7DL,
Director and Chief Executive England
Chief Executive Lonrho Plc
S.E. Jonah Director Four Grosvenor Place Ghana
Director Lonrho Plc London, SW1X 7DL,
England
N.J. Morrell Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
J.L. Platts-Mills Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
P.M. Tarsh Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
Terence Wilkinson Director Four Grosvenor Place South Africa
Director Lonrho Plc London, SW1X 7DL,
England
<PAGE>
CUSIP No. 438138-10-9 Page 18 of 39 Pages
Name and Principal
Position held Occupation
with Lonrho Plc. or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
M.J. Pearce Company Secretary Four Grosvenor Place United Kingdom
Company Secretary Lonrho Plc London, SW1X 7DL,
England
Peter Harper Director- Four Grosvenor Place United Kingdom
Non-Executive Parliamentary London, SW1X 7DL,
Independent Director Affairs England
Hanson Plc
Stephen Walls Chairman Four Grosvenor Place United Kingdom
Non-Executive Albert Fisher London, SW1X 7DL,
Independent Director Group Plc. England
<PAGE>
CUSIP No. 438138-10-9 Page 19 of 39 Pages
II. LONRHO INC.
Set forth below are the name, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Lonrho, Inc.
Name and Principal
Position held Occupation
with Lonrho Inc. or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
John F. Price President 805 Third Avenue United States
President and Princess Hotels New York, New York
Director International, Inc. 10022
James Evans Vice President- 805 Third Avenue United States
Controller Finance New York, New York
Princess Hotels 10022
International, Inc.
Rudolph H. Funke General Counsel 805 Third Avenue United States
Secretary Princess Hotels New York, New York
International, Inc. 10022
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
<PAGE>
CUSIP No. 438138-10-9 Page 20 of 39 Pages
III. SCOTTSDALE.
Set forth below are the names, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Scottsdale.
Name and Principal
Position held Occupation
with Scottsdale or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
John F. Price President 805 Third Avenue United States
President and Princess Hotels New York, New York
Director 10022
James Evans Vice President- 805 Third Avenue United States
Controller Finance New York, New York
Princess Hotels 10022
Rudolph H. Funke General Counsel 805 Third Avenue United States
Secretary Princess Hotels New York, New York
10022
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
P.M. Tarsh Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
<PAGE>
CUSIP No. 438138-10-9 Page 21 of 39 Pages
IV. THAMESEDGE LTD.
Set forth below are the names, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Thamesedge.
Name and Principal
Position held Occupation
with Thamesedge or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
P.M. Tarsh Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
<PAGE>
CUSIP No. 438138-10-9 Page 22 of 39 Pages
V. Hondo Company
Set forth below are the names, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Hondo Company.
Name and Principal
Position held Occupation
with Hondo Company or Employment Business Address Citizenship
- ---------------- ------------- ---------------- -----------
John F. Price President 805 Third Avenue United States
President and Princess Hotels New York, New York
Director 10022
Richard W. Reese Vice President 410 East College Blvd. United States
Vice President Hondo Company Roswell, New Mexico
Ian Brownlow Vice President 410 East College Blvd. United States
Vice President and and Treasurer Roswell, New Mexico
Treasurer Hondo Company
S.H. Cavin Counsel 410 East College Blvd. United States
Secretary Hondo Company Roswell, New Mexico
D. Bock Managing Four Grosvenor Place Germany
Managing Director and London, SW1X 7DL,
Director Chief Executive England
Lonrho Plc
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
<PAGE>
CUSIP No. 438138-10-9 Page 23 of 39 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: January 8, 1996
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
Thamesedge Ltd.
By: /s/ JOHN F. PRICE
John F. Price
Under Power of Attorney
Dated: January 8, 1996
The Hondo Company
By: /s/ JOHN F. PRICE
John F. Price, President
CUSIP No. 438138-10-9 Page 24 of 39 Pages
EXHIBIT 2(b)
POWER OF ATTORNEY
For Executing Schedule 13D and Amendments
Re: Thamesedge Ltd.
Know all by these presents, that the undersigned hereby constitutes and
appoints each of John F. Price and Rudolph H. Funke, signing singly, the
undersigned's true and lawful attorney-in-fact to execute and file on behalf of
the undersigned a Schedule 13D and all amendments thereto that the undersigned
may be required to file with the United States Securities and Exchange
Commission pursuant to Section 13(d) of the Securities Exchange Act of 1934 and
the rules and regulations thereunder with respect to the undersigned's
beneficial ownership of securities in Hondo Oil & Gas Company and take any other
action of any type whatsoever in connection with the foregoing which, in the
opinion of such attorney-in-fact, or either of them, may be of benefit to, in
the best interest of, or legally required of, the undersigned, it being
understood that the documents executed by such attorney-in-fact on behalf of the
undersigned pursuant to this Power of Attorney shall be in such form and shall
contain such terms and conditions as such attorney-in-fact may approve in his
discretion.
The undersigned hereby grants to each such attorney-in-fact full power and
authority to do and perform all and every act and thing whatsoever requisite,
necessary and proper to be done in the exercise of any of the rights and powers
herein granted, as fully to all intents and purposes as such attorney-in-fact
might or could so personally, with full power of substitution, hereby ratifying
and confirming all that such attorney-in-fact, or his substitute or substitutes,
shall lawfully do or cause to be done by virtue of this power of attorney and
the rights and powers herein granted.
The undersigned acknowledges that the foregoing attorneys-in-fact, in
serving in such capacity at the request of the undersigned, are not assuming any
of the undersigned's responsibilities to comply with Section 13(d) of the
Securities Exchange Act of 1934.
The authority granted by this power of attorney shall continue until the
undersigned is no longer required to file a Schedule 13D (or amendments thereto)
with respect to the undersigned's beneficial ownership of securities in Hondo
Oil & Gas Company, unless earlier revoked in writing.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney to be
executed as of the 8th day of January, 1996.
Thamesedge Ltd.
By: /s/ R.E. WHITTEN
Name: R.E. Whitten
Title: Director
CUSIP No. 438138-10-9 Page 25 of 39 Pages
EXHIBIT 10
----------
REVISED SETTLEMENT AGREEMENT
This Revised Settlement Agreement entered into as of this 20th day of
December, 1995 ("the Revision" or the "Agreement") between Lonrho Plc
("Lonrho"), Lonrho, Inc ("LI"), Scottsdale Princess, Inc ("SPI") (Lonrho, LI and
SPI being collectively hereafter referred to as "The Lonrho Group"), Robert 0.
Anderson ("ROA"), W Phelps Anderson ("WPA") and Robert B Anderson ("RBA") (ROA,
WPA and RBA being collectively referred to as "The Andersons") and The Hondo
Company ("Hondo") the Lonrho Group, The Andersons and Hondo being collectively
hereafter referred to as "the parties".
WHEREAS in October 1986, LI purchased what is now 50% of Hondo, 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 75% 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
ROA d/b/a South Spring Company 9,442,956.49
------------
"The Anderson Loans" 9,479,803.95
============
<PAGE>
CUSIP No. 438138-10-9 Page 26 of 39 Pages
WHEREAS as of July 31 1995, Hondo owed the members of The Lonrho Group on
various loans, the following amounts:
Lonrho Plc $68,953,683.60
Lonrho Inc 13,541,756.26
Scottsdale Princess, Inc 2,977,210.41
Outstanding Management Fees 774,693.57
---------------
"The Lonrho Loans" $86,247,343.84
===============
WHEREAS on July 6, 1993, ROA and SPI signed the Scottsdale Option Agreement
(the "Option");
WHEREAS ROA is indebted to The Bank of America and Citibank (collectively
"The Banks");
WHEREAS The Lonrho Group and The Andersons desired to resolve all
outstanding differences between them and on the 23rd day of August 1995 they
entered into a Settlement Agreement ("the Settlement"); and
WHEREAS The Lonrho Group and The Andersons desire to revise the Settlement
and to have Hondo become a party to the Revision.
NOW THEREFORE the parties hereto agree as follows:-
1) LONRHO SUPPORT. Lonrho agrees to cause Hondo to support ROA as a
Director of HOG for 5 years and Hondo will do so.
<PAGE>
CUSIP No. 438138-10-9 Page 27 of 39 Pages
2) LOAN TO HONDO. Lonrho shall lend $9,500,000 to Hondo on such terms as
Lonrho deems appropriate.
3) USE OF LOAN OF HONDO. The parties will cause Hondo to use the loans in
2) above for the sole purpose of the repayment of $9,500,000 due on
The Anderson Loans and this cash will be paid to The Banks in full as
directed by The Andersons. The Andersons accept that this fully repays
RBA's loan with interest.
4) ADDITIONAL LONRHO LOAN. All amounts:
a) Advanced and to be advanced under the Funding Agreement dated
October 16, 1995 and
b) Amounts advanced by Lonrho to Hondo to pay liabilities claimed to
be due and owing by Hondo to Gar Miller and lawyers in New York
and Artesia to be settled against proper invoices
will be charged 1/2 against the amounts due ROA on his loan to Hondo.
If after this charge there remains any amount still due ROA, it will
be paid to them as soon as possible after Closing, if possible within
30 days. If the calculation produces a negative number, The Andersons
will not be assessed any deficiency.
<PAGE>
CUSIP No. 438138-10-9 Page 28 of 39 Pages
5) SCOTTSDALE OPTION. Lonrho will exercise the Scottsdale option for
$1.00 per share.
6) GUARANTEES. All guarantees to or for the benefit of Lonrho or any
Lonrho affiliate (including Thamesedge) by ROA shall be released
including without limitations guarantees in favor of Union Bank.
7) SHARE VALUATION. The Andersons agree that at Closing their 25 percent
shareholding in Hondo is to be exchanged for 1,200,000 registered HOG
shares regardless of their then quoted price, to be divided among The
Andersons in accordance with their respective interests as follows:
ROA 60%
WPA 20%
RBA 20%
8) ANDERSON CALL. The Andersons acting solely through ROA or his
designated representative (i.e. WPA or RBA may not separately call)
have the right to call for 400,000 HOG shares annually for three
consecutive years beginning one year from Closing against delivery to
Hondo for redemption of 1/3rd of The Anderson's current shareholdings
(i.e. 1/3rd of their 25%) in Hondo. Lonrho would cause Hondo to have
available at all times 1,200,000 registered shares in HOG to give
to The Andersons against redemption of their Hondo shares
<PAGE>
CUSIP No. 438138-10-9 Page 29 of 39 Pages
(or such reduced number of HOG shares as is required to meet the
outstanding Anderson call). During the call period (and until
expiration of the put below), The Andersons shall not encumber their
Hondo shares (except as permitted hereunder) and they shall deliver
good, valid and unencumbered title to their Hondo shares. Hondo shall
not encumber the shares of HOG to be delivered (except as permitted
hereunder) and it shall delver good, valid and unencumbered title to
the HOG shares subject to the put and call.
9) HONDO PUT. At the end of 3 years from Closing, Hondo has the right to
put 1,200,000 registered HOG shares to The Andersons in exchange for
their 25 percent shareholding in Hondo (or a reduced number of HOG
shares to the extent The Andersons have exercised any calls under 8)
above).
10) Interest Accrual. Both The Anderson Loan and The Lonrho Group Loans
will continue to accrue interest at their present rates and The Lonrho
Group Loans balance will increase as to principal for all additional
advances between July 31, 1995 and Closing hereunder.
11) HONDO WIND-DOWN. Hondo will cease to carry on business on 16 January,
1996 and to wind up its affairs and aspects of business if possible.
12) LIABILITIES. The only disclosed liabilities of Hondo are discussed in
4) above. ROA confirms that there are no undisclosed liabilities.
<PAGE>
CUSIP No. 438138-10-9 Page 30 of 39 Pages
13) BANK RELEASES. ROA will, at his sole cost, obtain all necessary
consents from The Banks as may be necessary, in order to implement the
transaction contemplated and will obtain general releases from The
Banks in favor of and acceptable in form and substance to Lonrho and
Hondo.
14) LITIGATION. 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 non-prejudicial standstill agreement.
At Closing, the parties will cause all pending litigation to be
discontinued with prejudice.
15) LOAN OF HOG SHARES. Hondo will lend up to 800,000 registered shares to
The Andersons to provide security to The Andersons' bankers in
connection with loan(s) The Andersons are seeking. The security of
this loan will be The Andersons' shares in Hondo which will be
delivered to Lonrho. This share loan would be cleared by the exercise
of the call in 8) and / or the put option 9) above in due course. The
Andersons shall cause their Banks to have no rights to sell the HOG
shares until after The Andersons have called shares under 8) above or
Hondo has put the shares under 9) above, whichever shall first occur.
<PAGE>
CUSIP No. 438138-10-9 Page 31 of 39 Pages
16) CLOSING. Closing shall occur at the offices of R.H. Funke, Esq., as
set forth below, on January 5, 1996 or at such time thereafter as all
of items 2, 3, 4, 5, 6 and 13 above have already or at that time shall
occur together with the following items:
a) The Shareholders Agreement will be deemed null and void,
b) The parties will exchange mutually acceptable general releases,
c) All Directors and Officers of Hondo, other than those nominated
or approved by Lonrho, shall resign and
d) Evidence of authority to sign to be provided by all signatories,
and
17) Effectiveness. The parties agree to make best efforts to cause the
contemplated transaction to Occur as soon as possible. Time is of the
essence. This Revision is legally binding and is only subject to
condition described in 13 above. However, if for any reason whatsoever
all conditions are not satisfied by January 16, 1996, either party may
terminate this Agreement and all rights and obligations without any
liability hereunder.
<PAGE>
CUSIP No. 438138-10-9 Page 32 of 39 Pages
18) MISCELLANEOUS.
a) Notices - Any notice, request or other communication between
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 Andersons or any of their members: Hinkle,
Cox, Eaton, Coffield & Hensley 700 United Bank Plaza
P.O. Box 10 Roswell, NM 88202 Attn: Nancy Cusack, Esq.
Fax: (505) 623 9332
ii) If to The Hondo Company: The Hondo Company P.O. Box
1000 410 East College Boulevard Roswell, NM 88201 Attn:
S. H. Cavin, Esq. Fax: (505) 625 6829
<PAGE>
CUSIP No. 438138-10-9 Page 33 of 39 Pages
iii) 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 modification. 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.
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. This Revision
supersedes the Settlement in all respects.
<PAGE>
CUSIP No. 438138-10-9 Page 34 of 39 Pages
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 provision, or
as a waiver of the term or provision itself.
f) Successors and Assign. This Agreement shall be binding upon, and
shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
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 by 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.
<PAGE>
CUSIP No. 438138-10-9 Page 35 of 39 Pages
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 New York and all disputes shall be
determined in the courts thereof in the City of New York.
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.
l) Representation. All parties acknowledge that they have been
represented by counsel with respect to the subject matter of this
Revision, are signing it voluntarily after having been duly
advised with respect to its meaning and accept its consequences.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
The Lonrho Group: The Anderson Group:
Lonrho Plc R. 0. Anderson
By /s/ John F. Price /s/ R. 0. Anderson
----------------------- -----------------------
John F. Price
Lonrho, Inc. W. Phelps Anderson
By /s/ John F. Price /s/ W. Phelps Anderson
----------------------- -----------------------
John F. Price
Scottsdale Princess, Inc. Robert B. Anderson
By /s/ John F. Price By: /s/ W. Phelps Anderson
----------------------- -----------------------
John F. Price Attorney-in-Fact
The Hondo Company:
By /s/ Robert O. Anderson
-----------------------
CUSIP No. 438138-10-9 Page 36 of 39 Pages
EXHIBIT 11
----------
First Amendment to Revised Settlement Agreement
This First Amendment entered into as of this 5th day of January 1996
("the First Amendment") to the Revised Settlement Agreement dated December 20,
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"), Robert 0. Anderson ("ROA"), W Phelps Anderson ("WPA") and Robert
B Anderson ("RBA") (ROA, WPA and RBA being collectively referred to as "The
Andersons") and The Hondo Company ("Hondo"; the Lonrho Group, The Andersons and
Hondo being collectively hereafter referred to as "the parties").
WHEREAS on December 20, 1995 the parties entered into a Revised
Settlement Agreement (the "Revision"); and
WHEREAS the parties now desire to clarify, correct and/or to amend
certain provision of the Revision.
NOW THEREFORE the parties hereto agree as follows:
1) Definitions. All terms used, but not defined herein,
shall have the meaning ascribed to them in the Revision.
2) Clarification. With respect to paragraph numbered 7 of
the Revision, the words "at Closing" shall be deemed
1
<PAGE>
CUSIP No. 438138-10-9 Page 37 of 39 Pages
deleted as it was always understood between the parties
that under the Revision the Andersons are to receive only
1,200,000 shares of HOG in the aggregate. These shares are
in fact not to be received at Closing, but are to be
delivered in the manner provided in paragraph numbered 8
entitled "Anderson Call".
3) Additional Representation. The Andersons hereby represent
and warrant that there are no lawsuits pending against any
of the Andersons or Hondo except as follows:
a) Bank of America vs. Robert O. Anderson, et al
CV-95-3162;
b) Citibank, N.A. vs. Robert O. Anderson, et al
CV-93-114; and
c) Robert O. Anderson d/b/a The South Spring
Company vs. The Hondo Company; CV-95-71
4) Meaning of the Word registered HOG shares . For purposes of
the Revision, "registered HOG shares" shall mean those HOG
shares delivered to The Andersons or pledged to any of The
Andersons' bankers (including, without limitation, Bank of
America) pursuant to the
2
<PAGE>
CUSIP No. 438138-10-9 Page 38 of 39 Pages
terms of the Revision, all of which shares shall be
registered with the Securities and Exchange Commission
("SEC") in compliance with the Securities Act of 1933, as
amended (the "Act"), and the rules and regulations
promulgated thereunder, through a post effective amendment
to Registration Statement No. 33-52496 or through a new
registration statement, as appropriate, so as to permit the
resale of such HOG shares by The Andersons or such pledgees
without restrictions of any kind (other than the
fulfillment of prospectus delivery requirements). Hondo
shall cause HOG:
(1) to file a registration statement covering such
HOG shares in compliance with the Act within 90
days after the date hereof and use its best
efforts to cause such registration statement to
be declared effective as promptly as practicable
thereafter but in no event later than 12 months
after the date hereof; and
(2) to maintain such registration statement for a
period of 48 months from the date hereof so as to
permit sales pursuant thereto to be made at any
time in compliance with all applicable securities
laws, without further amendment or supplement.
3
<PAGE>
CUSIP No. 438138-10-9 Page 39 of 39 Pages
5) Ratification. Except as specifically modified by this
First Amendment, the Revision continues unchanged and
in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
The Lonrho Group: The Anderson Group:
Lonrho Plc R. 0. Anderson
By /s/ John F. Price /s/ R. 0. Anderson
----------------------- -----------------------
John F. Price
Lonrho, Inc. W. Phelps Anderson
By /s/ John F. Price /s/ W. Phelps Anderson
----------------------- -----------------------
John F. Price
Scottsdale Princess, Inc. Robert B. Anderson
By /s/ John F. Price By: /s/ W. Phelps Anderson
----------------------- -----------------------
John F. Price Attorney-in-Fact
The Hondo Company:
By /s/ Robert O. Anderson
-----------------------
4
