SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 8)
HONDO OIL & GAS COMPANY
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(Name of Issuer)
Common Stock, $1 par value
(Title of class of securities)
438138-10-9
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(CUSIP Number)
Richard A. Rubin, Esq.
Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, New York 10036
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(Person Authorized to Receive Notices and Communications)
October 12, 1998
----------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition 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
[ ]
Page 1 of 29 Pages
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CUSIP No. 438138-10-9 Page 2 of 29 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: England
Response to Question 7: 0
Response to Question 8: 10,343,686 (shared with subsidiaries)
Response to Question 9: 0
Response to Question 10: 10,343,686 (shared with subsidiaries)
Response to Question 11: 10,343,686 (includes all shares owned
by all group members)
Response to Question 12: N/A
Response to Question 13: 70.4%
Response to Question 14: HC; CO
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CUSIP No. 438138-10-9 Page 3 of 29 Pages
Response to Question 1: London Australian & General Property Company Limited
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: England
Response to Question 7: 1,692,486 (includes 909,090 shares
subject to a right to
convert certain debt)
Response to Question 8: 8,651,200 (shared with subsidiary)
Response to Question 9: 1,692,486 (includes 909,090 shares
subject to a right to
convert certain debt)
Response to Question 10: 8,651,200 (shared with subsidiary)
Response to Question 11: 10,343,686 (includes all shares owned
by all group members)
Response to Question 12: X
Response to Question 13: 70.4%
Response to Question 14: HC; CO
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CUSIP No. 438138-10-9 Page 4 of 29 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: 8,651,200
Response to Question 8: 0
Response to Question 9: 8,651,200
Response to Question 10: 0
Response to Question 11: 8,651,200 (may be deemed to beneficially
own all 10,343,686 shares
owned by group)
Response to Question 12: X (excludes 1,692,486 shares
deemed beneficially owned by
other group members)
Response to Question 13: 62.7% (group's percentage is 70.4%)
Response to Question 14: HC; CO
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CUSIP No. 438138-10-9 Page 5 of 29 Pages
Response to Question 1: HOGC Acquisition Corporation
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: 0
Response to Question 9: 0
Response to Question 10: 0
Response to Question 11: 0
Response to Question 12: N/A
Response to Question 13: 0
Response to Question 14: HC; CO
<PAGE>
CUSIP No. 438138-10-9 Page 6 of 29 Pages
INTRODUCTION
This statement is being filed jointly by Lonrho Plc, London Australian
& General Property Company Limited and The Hondo Company (collectively, the
"Reporting Persons") with respect to their beneficial ownership of shares of
Common Stock of Hondo Oil & Gas 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. subsequently 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. (at the time an indirect wholly-owned subsidiary of
Lonrho, Plc and which, at the time, held an option to acquire shares of The
Hondo Company), a Schedule 13D on October 7, 1994 (the "Original Schedule 13D").
Since the Original Schedule 13D, The Hondo Company, Thamesedge
Ltd.("Thamesedge") and London Australian & General Property Company were added
as Reporting Persons. Scottsdale Princess, Inc. ("Scottsdale Princess")
subsequently transferred its interest in The Hondo Company and ceased being a
Reporting Person. Also, all of the shares of the Issuer's Common Stock and all
of the debt of the Issuer (including debt convertible into the Issuer's Common
Stock) owned by Thamesedge, another indirect wholly-owned subsidiary of Lonrho
Plc, was transferred to London Australian & General Property Company, also an
indirect wholly-owned subsidiary of Lonrho Plc. Accordingly, Thamesedge also
ceased being a Reporting Person and London Australian & General Property Company
Limited became a Reporting Person. Subsequently, Lonrho, Inc. was merged with
and into The Hondo Company. Accordingly, Lonrho, Inc. ceased being a Reporting
Person. This Amendment No. 8, among other things, adds HOGC Acquisition
Corporation as a Reporting Person. The Original Schedule 13D, as heretofore
amended, is referred to collectively as the "Schedule 13D". This Amendment No. 8
amends the Schedule 13D and restates it in its entirety (except for previously
filed exhibits).
All information contained in the Schedule 13D, as amended hereby,
concerning Messrs. Robert O. Anderson, W. Phelps Anderson and Robert B. Anderson
is to the best knowledge and belief of the Reporting Persons.
All terms used, but not defined, in this Amendment No. 8 are as defined
in the Schedule 13D as heretofore amended.
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 10375
Richmond Avenue, Suite 900, Houston, Texas 77042.
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CUSIP No. 438138-10-9 Page 7 of 29 Pages
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) London
Australian & General Property Company Limited, a corporation organized under the
laws of England, the principal business office of which is located at Four
Grosvenor Place, London SW1X 7DL ("LAGP"); (c) The Hondo Company, a New Mexico
corporation, the principal business office of which is located at 410 East
College Boulevard, Roswell, New Mexico 88201 ("Hondo Company") and (d) HOGC
Acquisition Corporation, a Delaware corporation, the principal office of which
is located at c/o Parker Chapin Flattau & Klimpl, LLP, 1211 Avenue of the
Americas, New York, New York 10036 ("HOGC"). Lonrho Plc, LAGP, Hondo Company and
HOGC 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 principally in mining, but also other activities, such as the ownership
and management of property and hotels.
LAGP, an indirect wholly-owned subsidiary of Lonrho Plc, is an
investment holding company.
Hondo Company, a wholly-owned subsidiary of LAGP, is a holding company
for the shares of the Issuer.
HOGC, a wholly-owned subsidiary of LAGP, was formed for the purpose of
merging with and into the Issuer, as described in Item 4.
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 8 of 29 Pages
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
(a) 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 of Common
Stock 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) in Item 6.
(v) On October 5, 1995, 65,431 and 55,941 shares of Common
Stock 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) in Item 6.
(vi) On April 1, 1996, 197,944 shares of Common Stock were
issued by the Issuer to Thamesedge in payment of interest of $2,375,329 for the
six months ended April 1, 1996 on certain indebtedness owed to Thamesedge by the
Issuer. See paragraph (b) in Item 6.
(vii) On December 13, 1996, in consideration for providing the
Issuer with $13.5 million of additional borrowing capacity under a Revolving
Credit Agreement originally entered into in June 1996 (the "Revolving Credit
Agreement") and maturity extensions related to indebtedness owed by the Issuer
to Thamesedge, the Issuer granted to Thamesedge the right to convert $13.5
million of the Issuer's Senior Notes originally issued to Thamesedge in 1988
into shares of the Issuer's Common Stock at a conversion price of $12.375 per
share (an aggregate of 1,090,909 shares). This
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CUSIP No. 438138-10-9 Page 9 of 29 Pages
right, which was approved by the Issuer's stockholders at their 1997 annual
meeting, expired unexercised on January 1, 1998. On July 2, 1997, in
consideration for providing the Issuer with an additional $7.0 million of
borrowing capacity under the Revolving Credit Agreement and further maturity
extensions related to indebtedness owed by the Issuer to Thamesedge, the Issuer
granted Thamesedge the right to convert up to $7.0 million of the Senior Notes
at any time prior to the maturity thereof at a conversion price of $7.70 per
share (an aggregate of 909,090 shares), subject to approval by the Issuer's
stockholders. This right was approved by the Issuer's stockholders at their 1998
annual meeting held on March 10, 1998. The Senior Notes and conversion rights
described herein were transferred from Thamesedge to LAGP on August 29, 1997.
See paragraph (b)(i) of Item 6.
The funds for Thamesedge's purchase of $75,000,000 13.5%
Senior Note described in paragraph (b)(i) of Item 6, which has been assigned to
LAGP and which is partially convertible at the option of LAGP into shares of the
Issuer's Common Stock, as described above and in paragraph (b)(i) of Item 6, was
borrowed from Lonrho Plc. LAGP acquired the entire $75,000,000 of such debt from
Thamesedge as an intercompany transfer.
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").
(b) The following intercompany transfers of Common Stock have been made
among the Reporting Persons:
(i) On May 9, 1996, the 164,544 shares of Common Stock then
owned by Lonrho Plc were transferred to Thamesedge.
(ii) On September 27, 1996, Hondo Company transferred an
aggregate of 275,000 shares of Common Stock to Thamesedge.
(iii) On August 29, 1997, Thamesedge transferred all 753,396
shares of the Issuer's Common Stock (as well as all debt owed to it by the
Issuer) to LAGP.
(c) The following dispositions of Common Stock to third parties have
been made by the Reporting Persons:
(i) 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 29 Pages
(ii) On May 14, 1996, Hondo Company transferred 60,000, 20,000
and 20,000 (an aggregate of 100,000) shares of the Issuer's Common Stock to
Robert O. Anderson, Robert B. Anderson and W. Phelps Anderson (collectively, the
"Anderson Family"), respectively, in partial redemption of the Anderson Family's
interest in Hondo Company pursuant to a Second Amendment to Revised Settlement
Agreement among Lonrho Plc, Lonrho, Inc., Scottsdale Princess, Inc. and the
Anderson Family. See paragraph (c) in Item 6.
(iii) On May 31, 1996, Hondo Company transferred 14,000 shares
of Common Stock to a former employee in settlement of certain litigation.
(iv) On October 29, 1996, Hondo Company transferred 10,000
shares of Common Stock in settlement of a claim.
(v) On January 16, 1997, Hondo Company transferred 150,290,
60,348, 60,348 and 29,014 (an aggregate of 300,000) shares of Common Stock to
Robert O. Anderson, Robert B. Anderson, W. Phelps Anderson and Sun Valley Energy
Corporation (a transferee of a portion of the Anderson Family's interest in
Hondo Company), respectively, in partial redemption of their interest in Hondo
Company pursuant to the Second Amendment to the Revised Settlement Agreement
among Lonrho Plc, Lonrho, Inc., Scottsdale Princess, Inc. and the Anderson
Family. See paragraph (c) in Item 6.
(vi) On September 18, 1997, Hondo Company transferred 509,710,
145,145 and 145,145 (an aggregate of 800,000) shares of Common Stock to Robert
O. Anderson, Robert B. Anderson and W. Phelps Anderson, respectively, in as
final redemption of their interest in Hondo Company pursuant to the Third
Amendment to the Revised Settlement Agreement among Lonrho Plc, Lonrho, Inc.,
Scottsdale Princess, Inc. and the Anderson Family. See paragraph (c) in Item 6.
(d) 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 Union Bank (the "Pledge Agreement") and the
guarantees of Lonrho Plc and Robert O. 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. On March 29, 1996, the indebtedness
of Hondo Company (and related instruments) to Lonrho Plc was assigned to
Thamesedge and on August 29, 1997 Thamesedge assigned the indebtedness and
related instruments to LAGP. Accordingly, all rights of Lonrho Plc and
Thamesedge are now rights of LAGP.
On March 29, 1996, the indebtedness of Hondo Company to Lonrho Plc was
assigned to Thamesedge and, accordingly, all rights of Lonrho Plc are now rights
of Thamesedge.
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CUSIP No. 438138-10-9 Page 11 of 29 Pages
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 Thamesedge 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.
Thamesedge 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 to enable
Hondo Company or its pledgee 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, Thamesedge and Lonrho, Inc.
(e) The total consideration to be paid by HOGC for all of the issued
and outstanding shares of the Issuer in the proposed Merger, as defined and
described in Item 4, would be approximately $220,000. Such amount is expected to
be provided to HOGC from the working capital of Lonrho Plc.
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, through Hondo
Company, under an arrangement which effectively provided control of the Issuer
by Lonrho Plc through a subsidiary, 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 the Reporting Persons' investment and interest in the Issuer's
Common Stock. The purpose of the Revised Settlement Agreement, as amended,
discussed in paragraph (c) of Item 6 was to, among other things, vest control of
Hondo Company solely in the Reporting Persons and provide a mechanism by which
the interest of the Anderson Family in Hondo Company could become a direct
interest in a portion of the Issuer's Common Stock held by Hondo Company.
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CUSIP No. 438138-10-9 Page 12 of 29 Pages
Lonrho Plc has previously announced that it intends to restructure its
operations, which may entail the divestiture of certain assets. Accordingly,
Lonrho Plc reserved the right to divest itself of all or part of its investment
in any of the Issuer's direct or indirect controlling stockholders or cause its
subsidiaries to divest themselves of all or part of their investment in the
Issuer. In this regard, on October 9, 1997, Lonrho Plc retained Morgan Stanley &
Co. Incorporated to assess and implement strategic alternatives with respect to
the Reporting Person's investment in the Issuer, which, at the time, the
Reporting Persons believed could have included, without limitation, a possible
recapitalization of the Issuer or a sale or business combination involving the
Issuer or the Reporting Persons' equity interest in the Issuer (including the
sale or assumption of the Issuer's debt obligations to the Reporting Persons).
(See Item 6).
However, in April 1998, the Issuer announced that the rate of decline
in production from certain gas wells in Colombia had been higher than expected
during the first five months of production. The Reporting Persons have been
advised by the Issuer that: (i) an analysis of test results by the Issuer's
independent reserve engineers concluded that it would become uneconomic
(operating costs will exceed operating revenues) to produce the wells before the
end of the Issuer's 1998 fiscal year (ended September 30,1998) and that the
drilling of additional wells would be uneconomic (net profit over the life of a
new well would be less than the cost to drill it); (ii) as a result of the
significant declines in production observed since December 1997 and the recently
completed testing, proved reserves as of June 30, 1998 were estimated to be 0.4
billion cubic feet of natural gas and 0.02 million barrels of associated
liquids, for which the present value of net cash flows is less than $100,000;
(iii) the current production revenue from wells continues to decline and net
cash flow to the Issuer's interest turned negative before the end of September
1998; (iv) no additional wells are planned to be drilled in the area; and (iv)
the Issuer has commenced negotiations for a voluntary surrender of its working
interest in the Opon Association Contract pursuant to the joint operating
agreement discussed in Item 6 of this Schedule 13D in exchange for a release of
the Issuer's liabilities. There can be no assurances that these negotiations
will be successful.
The Issuer has advised the Reporting Persons that the Issuer's
liabilities are approximately $150 million, in excess of its assets of
approximately $2.5 million. At June 30, 1998, the Company was indebted to the
Reporting Persons in the aggregate amount of approximately $112.5 million. The
Issuer has failed to comply with an existing loan covenant to increase reserves
in the Opon area by 13 billion cubic feet of gas by October 1, 1998. The
Reporting Persons, while reserving their right to do so, have not to date given
a notice of default to the Issuer.
On August 24, 1998, the Board of Directors of the Issuer met to discuss
the Company's financial situation. The Board of Directors of the Issuer
appointed a Special Committee of the Board, consisting of John J. Hoey, Douglas
G. McNair and Robert K. Steer (the "Special Committee"), none of whom are
officers or directors of Lonrho Plc or any of its affiliates, other than the
Issuer. The Special Committee was empowered to consider various alternatives and
determined that the only practicable alternatives available to the Company were
bankruptcy, liquidation and a possible transaction with Lonrho Plc. Lonrho Plc
expressed its preference that the Issuer not commence bankruptcy proceedings.
John J. Hoey, President of the Issuer, then approached Lonrho Plc
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CUSIP No. 438138-10-9 Page 13 of 29 Pages
regarding a possible merger of the Company with a wholly-owned subsidiary of
Lonrho Plc and the payment of an amount in cash to the stockholders of the
Issuer.
On October 9, 1998, the Special Committee obtained an opinion of its
financial advisor to the effect that the proposed consideration to be paid was
fair to the stockholders of the Issuer (other than the Reporting Persons) from a
financial point of view, and unanimously determined that the Merger should be
approved and the Merger Agreement should be executed and delivered, and that the
terms of the Merger Agreement are fair to the stockholders of the Issuer, other
than Lonrho Plc and its affiliates. The entire Board of Directors then met and
unanimously approved the Merger and the Merger Agreement.
The Issuer, HOGC and Lonrho Plc entered into an Agreement and Plan of
Merger dated as of October 12, 1998 (the "Merger Agreement") by and among the
Issuer, HOGC and Lonrho Plc, pursuant to which HOGC would be merged with and
into the Issuer with the Issuer becoming a wholly-owned subsidiary of LAGP and
an indirect wholly-owned subsidiary of Lonrho Plc (the "Merger") and each issued
and outstanding share of Common Stock of the Issuer (other than shares owned by
the Lonrho Plc or any subsidiary of Lonrho Plc, shares held in the Issuer's
treasury and shares held by stockholders of the Issuer who perfect appraisal
rights under Delaware law) would be converted into the right to receive $0.05
per share net in cash, without interest thereon. Consummation of the Merger is
subject to certain conditions, including that the Merger has been approved, and
the Merger Agreement has been adopted, by the requisite vote of stockholders of
the Issuer. Lonrho Plc has agreed to vote, or cause to be voted, all shares
(approximately 68.4% of the outstanding shares) of the Issuer's Common Stock
owned by the Reporting Persons in the manner voted by a majority of the other
stockholders of the Issuer.
If the Merger is consummated, Lonrho Plc intends to continue to attempt
to resolve the Issuer's outstanding liabilities at minimum cost and expense. The
Reporting Persons have no present plans to conduct operations through, or to
make any material additional investments in, the Company. However, if an
opportunity arises to utilize the existing net operating losses of the Company,
the Reporting Persons would consider the opportunity, although they have no
current plans, understandings or agreements to use the net operating losses. At
June 30, 1998, the net operating losses of the Company were approximately $138
million. If the Merger is not approved by the Issuer's stockholders, the
Reporting Persons do not intend to invest or lend any additional funds to the
Issuer.
Consummation of the Merger would result in, among other things, (i) the
exchange for cash of all shares of Common Stock of the Issuer (other than those
held by the Reporting Persons) with the Issuer becoming a wholly-owned
subsidiary of LAGP and an indirect wholly-owned subsidiary of Lonrho Plc, (ii)
the sole director of the Company would be John F. Price, (iii) the Issuer's
Common Stock would become eligible for, and the Issuer would cause, the
termination of its registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934 and (iv) the Issuer's Common Stock would cease to be quoted
on the Nasdaq Bulletin Board.
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CUSIP No. 438138-10-9 Page 14 of 29 Pages
Except therefor and except as noted below, 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 (although the Reporting Persons have no present
intention to do so), to acquire directly shares of Common Stock, including as a
result of the potential conversion by LAGP of certain indebtedness owed to it by
the Issuer and the potential acquisition by LAGP of shares of Common Stock from
the Issuer in payment of interest on certain obligations of the Issuer to LAGP,
each as described in paragraph (b) of Item 6) or the disposition of securities
of the Issuer (except as discussed in the preceding paragraph and except that
(i) Hondo Company, as owner, and LAGP, 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; (ii) LAGP
reserves 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 by the Issuer to Thamesedge (and transferred by Thamesedge
to LAGP) or LAGP in payment of interest on certain indebtedness at the time owed
them by the Issuer; and (iii) all shares owned by the Reporting Persons could
also be sold pursuant to Rule 144 under the Securities Act or another exemption
from the registration provisions of the Securities Act), (b) an extraordinary
corporate transaction, such as a merger, reorganization or liquidation of the
Issuer (other than the Merger), (c) a sale or transfer of a material amount of
assets of the Issuer or any of its subsidiaries (although LAGP reserves the
right to enforce the rights under certain mortgages and a security interest held
by it in the shares of the Issuer's subsidiary, Hondo Magdalena Oil & Gas
Limited, securing certain loans made to the Issuer 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 (unless the Merger is
completed), (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 (the Issuer's Common Stock would
cease to be quoted on the Nasdaq OTC Bulletin Board if the Merger is completed),
(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 (unless the Merger is completed) or (j) any action similar
to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
------------------------------------
Because of their ownership structure, the Reporting Persons may be
deemed a group within the meaning of Rule 13d-5 under the Exchange Act, and each
of the Reporting Persons may be deemed to be the beneficial owner, within the
meaning of Rule 13d-3 under the Exchange Act, of an aggregate of 10,343,686
shares of Common Stock of the Issuer (assuming the conversion by LAGP of
$7,000,000 of the indebtedness owed to LAGP by the Issuer which is, as discussed
in paragraph (b)(i) of Item 6, convertible into 909,090 shares of the Issuer's
Common Stock), representing (based on the 13,788,424 shares of Common Stock
which were issued and outstanding on March 15, 1998 and assuming the conversion
by LAGP of such $7,000,000 of the indebtedness), approximately
<PAGE>
CUSIP No. 438138-10-9 Page 15 of 29 Pages
70.3% of the shares of the Issuer's Common Stock that would have been
outstanding on March 15, 1998.
Hondo Company is the owner of 8,651,200 (62.7%) of the Issuer's
outstanding Common Stock and, therefore, may be deemed to have sole voting and
dispositive power over such shares
LAGP is the owner of 783,396 of the Issuer's outstanding Common Stock.
LAGP also has the right, as discussed in paragraph (b)(i) of Item 6, to convert
$7,000,000 of the indebtedness owed to it by the Issuer into 909,090 shares of
Common Stock. By virtue of its ownership of Hondo Company as a wholly-owned
subsidiary, LAGP may also be deemed to have shared voting and dispositive power
over the 8,651,200 shares of the Issuer's outstanding Common Stock owned by
Hondo Company. Accordingly, LAGP may be deemed to be the beneficial owner of an
aggregate of 10,343,686 shares of the Issuer's Common Stock, which (based on
13,788,424 shares of Common Stock issued and outstanding on March 15, 1998 and
assuming the conversion by LAGP of such $7,000,000 of indebtedness) would
constitute approximately 70.4% of the shares of the Issuer's Common Stock that
would have been outstanding on March 15, 1998.
Lonrho Plc, by virtue of its ownership of LAGP and Hondo Company as
indirect wholly-owned subsidiaries, may be deemed to have shared voting and
dispositive power over all 10,343,686 (70.4%) of the Issuer's outstanding Common
Stock which may be deemed beneficially owned by LAGP and Hondo Company.
HOGC does not beneficially own any Common Stock of the Issuer.
See Item 3 for information concerning the Reporting Person's
transactions in the Issuer's Common Stock and Item 4 concerning the proposed
Merger, which are incorporated herein by reference.
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. On March 29, 1996, the indebtedness of Hondo Company
secured by this pledge was assigned by Lonrho Plc to Thamesedge and,
accordingly, Thamesedge became the pledgee of such shares.
(b) The Issuer has, at times, incurred indebtedness to Lonrho Plc,
Thamesedge and LAGP. On March 29, 1996, all of the Issuer's indebtedness to
Lonrho Plc was assigned to Thamesedge and on August 29, 1997 all of the Issuer's
indebtedness to Thamesedge was assigned to LAGP. Accordingly, all such
indebtedness is now owed to LAGP. The following summary of such indebtedness is
qualified in its entirety to the instruments related thereto which are filed as
Exhibits to this Schedule 13D.
(i) On November 30, 1988, Thamesedge purchased a $75,000,000
13.5% Senior Note, originally due in 1998, from the Issuer in a private
placement pursuant to a Note Purchase Agreement. As noted below, the interest
rate applicable to this debt is presently 6% per annum. The
<PAGE>
CUSIP No. 438138-10-9 Page 16 of 29 Pages
entire Senior Note is secured by a mortgage on certain real estate owned by the
Issuer. In December 1995, Thamesedge agreed to extend the mandatory redemption
dates of the Note 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. On December 13, 1996, the Issuer and Thamesedge
agreed, among other things, that (i) the aggregate principal amount of the Note,
plus accrued interest, was to be payable on January 1, 1998, and (ii) subject to
approval by the Issuer's stockholders (which was obtained on March 12, 1997),
Thamesedge would have the option to convert $13,500,000 of the principal amount
of the Note into shares of Common Stock of the Issuer at a conversion price of
$12.375 per share (110% of the closing price of the Issuer's Common Stock on the
American Stock Exchange on December 11, 1996) until January 1, 1998. This
conversion right expired unexercised. On July 2, 1997, the Issuer and Thamesedge
agreed, among other things, that, subject to approval by the Issuer's
stockholders at their next annual meeting (which approval was obtained on March
10, 1998), Thamesedge would have the option to convert $7,000,000 of the
principal amount of the Note into shares of Common Stock of the Issuer at a
conversion price of $7.70 per share (110% of the closing price of the Issuer's
Common Stock on the American Stock Exchange on July 1, 1997), subject to
adjustment in the event of stock dividends, splits, combinations and the like.
On December 18, 1997, the Issuer and LAGP agreed to amend, and subsequently
entered into an amendment to, the Note Purchase Agreement under which the Senior
Note is issued and issued an Amended and Restated Senior Note to, among other
things, extend the mandatory redemption date so that the entire Senior Note is
now due January 15, 1999, subject to potential acceleration if, among other
things, events of default contained in indebtedness of the Issuer occurs and to
reflect prior agreements concerning interest rates, the method of payment of
interest and the Senior Note holder's conversion rights. At December 31, 1997,
the outstanding principal amount due on this Note was $39,733,394 (including, as
discussed below, accrued interest through October 1, 1997 which was added to
principal).
(ii) During calendar year 1991, Lonrho Plc loaned the Issuer
an aggregate of $32,000,000 (the "1991 Loans"). At the time the loans were made
the interest rate on such loans was similar to that applicable to the Issuer's
former working capital loan with a bank for its refining and marketing
operations. On October 18, 1994, the Issuer paid Lonrho Plc $5,000,000 to repay
a portion of the loans made in calendar 1991. At the same time, Lonrho Plc
provided a $5,000,000 loan facility to the Issuer, upon similar terms as these
loans (the"1994 Facility"). As noted below, the interest rate applicable to
these loans is presently 6% per annum. In December 1995, Lonrho Plc agreed to
extend the maturity date of these loans to October 1, 1997. On December 13,
1996, the Issuer and Thamesedge agreed that the principal amount of these loans
was to be payable on January 1, 1998. On December 18, 1997, the Issuer and LAGP
agreed to, and subsequently entered into, a Consolidated, Amended and Restated
Promissory Note with respect to the 1991 Loans (the "1991 Note") and an Amended
and Restated Promissory Note with respect to the 1994 Facility (the "1994 Note")
to, among other things, extend the due date of the principal amount of these
loans so that they are due on January 15, 1999, subject to potential
acceleration if, among other things, events of default contained in indebtedness
of the Issuer occurs and to reflect prior agreements concerning interest rates
and the method of interest payment At December 31, 1997, the outstanding
principal amount due on these loans was approximately $34,137,049 (including, as
discussed below, accrued interest through October 1, 1997 which was added to
principal).
(iii) On April 30, 1993, Lonrho Plc loaned to a subsidiary of
the Issuer an additional $3,000,000 and, as security, the Issuer's subsidiary
granted to Lonrho Plc a Deed of Trust
<PAGE>
CUSIP No. 438138-10-9 Page 17 of 29 Pages
on certain real property. On June 25, 1993, Lonrho Plc loaned the Issuer an
additional $4,000,000 and, as security, the Issuer and another subsidiary of the
Issuer granted to Lonrho Plc a Deed of Trust on certain other real property. As
noted below, the interest rate applicable to these loans is presently 6% per
annum. In December 1995, Lonrho Plc agreed to extend the maturity of each note
so that each became 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 13, 1996, Thamesedge, the Issuer and such
subsidiaries agreed with the borrowers that the payment of the installments of
principal amount of these loans would begin on January 1, 1998. On December 18,
1997, the Issuer and such subsidiaries agreed to, and subsequently entered into,
Amended and Restated Promissory Notes in respect of both loans to, among other
things, provide that the installment payments under each Note would begin
January 15, 1999, subject to potential acceleration if, among other things,
events of default contained in indebtedness of the Issuer occurs and to reflect
prior agreements concerning interest rates and the method of interest payment At
December 31, 1997, the outstanding principal amounts due on these loans were
approximately $3,585,681 and $4,672,858, respectively (including, as discussed
below, accrued interest through October 1, 1997 which was added to principal).
(iv) Thamesedge and the Issuer entered into a Revolving Credit
Agreement dated as of June 28, 1996, under which the Issuer was entitled to
borrow up to $13.5 million from Thamesedge until June 30, 1997. Loans under the
Revolving Credit Agreement bear interest at the rate of 13% per annum. On
December 13, 1996, the Issuer and Thamesedge agreed to extend the maturity date
of indebtedness under the Revolving Credit Agreement to January 1, 1998. On July
2, 1997, the Issuer and Thamesedge agreed to amend and restate the Revolving
Credit Agreement. Under the Amended and Restated Revolving Credit Agreement
dated as of July 2, 1997, Thamesedge agreed to increase the Issuer's borrowing
capacity thereunder by $7.0 million, making the total amount available under the
facility $20.5 million until January 1, 1999, when,, subject to potential
acceleration if events of default occur, all outstanding loans were to become
due and payable. On December 18, 1997, the Issuer and LAGP agreed to further
increase the Issuer's borrowing capacity thereunder to $27.5 million (and an
additional $7.5 million which may be used only to fund any interest added to
principal in the manner discussed below) until January 1, 1999, when all
outstanding loans thereunder become due and payable. The Amended and Restated
Revolving Credit Agreement also provides for potential mandatory prepayments
from "free cash flow", as defined. At December 31, 1997, the outstanding
principal amount under this facility was approximately $18,866,027 (including,
as discussed below, accrued interest through October 1, 1997 which was added to
principal).
On December 18, 1992, Lonrho Plc and Thamesedge agreed to defer
interest and certain principal payments on loans then outstanding. 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 may
transfer to LAGP its rights in and to such share of the Issuer's net profit.
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 loans described in (i) -
<PAGE>
CUSIP No. 438138-10-9 Page 18 of 29 Pages
(iii) above to 6% per annum effective September 30, 1993 and defer principal
payments on the loans. Lonrho Plc, Thamesedge and the Issuer also agreed that,
if the Issuer does not have sufficient cash resources to pay interest on any of
the foregoing indebtedness when due (the Amended and Restated Revolving Credit
Agreement contains a similar provision), 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 LAGP 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 (and
transferred from Thamesedge to LAGP) pursuant to this arrangement.
As part of the agreement entered into on December 13, 1996 described
above among Thamesedge, the Issuer and certain subsidiaries of the Issuer, the
Issuer granted to Thamesedge (in addition to any other security described
above), as security for all of the loans described above (other than the $13.5
million of indebtedness described in (i) above which was convertible into Common
Stock), a security interest in all of the shares of the Issuer's subsidiary,
Hondo Magdalena Oil & Gas Limited. A formal Security Interest Agreement to
document this pledge was entered into on May 13, 1997 and was, based on the
parties' December 18, 1997 agreement, amended by a First Amendment dated March
18, 1998 to, among other things, delete the $13.5 million exclusion. This
security interest has been assigned to LAGP.
(c) The Issuer, HOGC and Lonrho Plc entered into the Merger Agreement
dated as of October 12, 1998 pursuant to which HOGC would be merged with and
into the Issuer with the Issuer becoming a wholly-owned subsidiary of LAGP and
an indirect wholly-owned subsidiary of Lonrho Plc and each issued and
outstanding share of Common Stock of the Issuer (other than shares owned by the
Lonrho Plc or any subsidiary of the Lonrho Plc, shares held in the Issuer's
treasury and shares held by stockholders of the Issuer who perfect appraisal
rights under Delaware law) would be converted into the right to receive $0.05
per share net in cash, without interest thereon. The entering into of the Merger
Agreement followed a unanimous determination by the Special Committee that the
Merger Agreement and the transactions contemplated thereby, including the
Merger, are fair to and in the best interests of the stockholders of the Issuer.
The Special Committee approved the Merger Agreement and the transactions
contemplated thereby, including the Merger, following which the entire Board of
Directors of the Issuer met and unanimously approved the Merger Agreement and
the Merger. Consummation of the Merger is subject to certain conditions,
including that the Merger has been approved, and the Merger Agreement has been
adopted, by the requisite vote of stockholders of the Issuer. Lonrho Plc has
agreed to vote, or cause to be voted, all shares (approximately 68.4% of the
outstanding shares) of the Issuer's Common Stock owned by the Reporting Persons
in the manner voted by a majority of the other stockholders of the Issuer.
<PAGE>
CUSIP No. 438138-10-9 Page 19 of 29 Pages
Item 7. Material to be filed as Exhibits.
--------------------------------
1y Agreement, dated October 12, 1998 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.
2(b)* Power of Attorney dated January 8, 1996 executed by Thamesedge Ltd.
in favor of John F. Price and Rudolph H. Funke with respect to the
execution of the Schedule 13D, including all amendments thereto.
2(c)+ Power of Attorney dated October 15, 1997 executed by London
Australian & General Property Company Limited in favor of John F.
Price and Rudolph H. Funke with respect to the execution of the
Schedule 13D, including all amendments thereto.
2(d)y Power of Attorney dated October 12, 1998 executed by HOGC Acquisition
Corp. in favor of John F. Price 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(a) Letter Agreement dated December 17, 1993 by and among the Issuer, Via
Verde Development Company, Newhall Refining Co., Inc., Lonrho Plc and
Thamesedge, Ltd.
8(b)o Letter Agreement dated as of December 18, 1997 between the Issuer and
LAGP modifying Letter Agreement dated December 17, 1993.
9+ Settlement Agreement dated August 23, 1995 between the Reporting
Persons (other than Thamesedge Ltd. and Hondo Company) and the
Anderson Family.
<PAGE>
CUSIP No. 438138-10-9 Page 20 of 29 Pages
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),
Scottsdale Princess, Inc. and the Anderson Family.
12x Second Amendment dated May 14, 1996 to the Revised Settlement
Agreement between the Reporting Persons (other than Thamesedge),
Scottsdale Princess, Inc. and the Anderson Family.
13+ Third Amendment dated August 28, 1997 to Revised Settlement
Agreement between Lonrho Plc, Lonrho, Inc. and the Anderson Family
14 Letter Agreement dated December 13, 1996 by and among Thamesedge,
the Issuer, Via Verde Development Company and Newhall Refining Co.,
Inc. (incorporated by reference to Exhibit 10.15 to the Issuer's
Annual Report on Form 10-K for the year ended September 30, 1996,
File No. 1-8979).
15 Letter Agreement dated December 18, 1997 by and among Thamesedge,
the Issuer, Via Verde Development Company and Newhall Refining Co.,
Inc. (incorporated by reference to Exhibit 10.17 to the Issuer's
Annual Report on Form 10-K for the year ended September 30, 1997,
File No. 1-8979).
16(a)(1) Amended and Restated Revolving Credit Agreement dated as of July 2,
1997 by and between the Issuer and Thamesedge (incorporated by
reference to Exhibit 10.2 to the Issuer's Quarterly Report on Form
10-Q for the quarter ended June 30, 1997, File No. 1-8979).
16(a)(2)o First Amendment dated as of December 18, 1997 to Amended and
Restated Revolving Credit Agreement between the Issuer and LAGP,
including forms of Promissory Note issued thereunder and First
Guaranty Amendment from Hondo Magdalena.
16(b)(1) Guaranty dated as of July 2, 1997 of Hondo Magdalena Oil & Gas
Limited ("Hondo Magdalena") to Thamesedge guaranteeing the
obligations of the Issuer under the Amended and Restated Revolving
Credit Agreement (incorporated by reference to Exhibit 10.4 to the
Issuer's Quarterly Report on Form 10-Q for the quarter ended June
30, 1997, File No. 1-8979).
16(b)(2)o First Guaranty Amendment dated as of December 18, 1997 of Hondo
Magdalena to LAGP.
17(a) Security Interest Agreement dated May 13, 1997 by and between the
Company, Thamesedge Ltd., Folio Trust Company Limited and Folio
Nominees Limited (incorporated by reference to Exhibit 10.1 to the
Issuer's Quarterly Report on Form 10-Q for the quarter ended June
30, 1997, File No. 1-8979).
17(b)o First Amendment dated March 18, 1998 to Security Interest Agreement
by and between the Issuer, LAGP, Folio Trust Company Limited and
Folio Nominees Limited.
<PAGE>
CUSIP No. 438138-10-9 Page 21 of 29 Pages
18(a)(1) Note Purchase Agreement and Letter Amendment dated November 28, 1988
between the Issuer and Thamesedge (incorporated by reference to
Exhibit 10.2 to the Issuer's Annual Report on Form 10-K for the
fiscal year ended September 30, 1992, File No. 1-8979).
18(a)(2)o Amendment to Note Purchase Agreement dated as of December 18, 1997
between the Issuer and LAGP.
18(b)o Amended and Restated 6% Senior Note due January 15, 1999 from the
Issuer to LAGP
19 o Consolidated, Amended and Restated Promissory Note dated as of
December 18, 1997 from the Issuer to LAGP.
20(a)o Amended and Restated Promissory Note dated as of December 18, 1997
from Via Verde Development Company, a wholly-owned subsidiary of the
Issuer, to LAGP.
20(b)(1) Guaranty dated April 30, 1993 from the Issuer to Lonrho Plc
(incorporated by reference to Exhibit 19.1 to the Issuer's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1993, File No.
1-8979).
20(b)(2)o First Guaranty Amendment dated as of December 18, 1997 from the
Issuer to LAGP.
21 o Amended and Restated Promissory Note dated as of December 18, 1997
from the Issuer to LAGP.
22 y Agreement and Plan of Merger dated as of October 12, 1998 among
Lonrho Plc, HOGC and the Issuer (incorporated by reference to
Exhibit (c) to the Schedule 13E-3 filed by Lonrho Plc, HOGC and the
Issuer on October 12, 1998).
- ---------------------
+ Filed with Amendment No. 1 to the Schedule 13D.
* Filed with Amendment No. 2 to the Schedule 13D.
x Filed with Amendment No. 3 to the Schedule 13D.
+ Filed with Amendment No. 6 to the Schedule 13D.
o Filed with Amendment No. 7 to the Schedule 13D.
y Filed herewith.
All exhibits (other than those filed herewith, filed with an
amendment to this Report or incorporated by reference) were filed
with the Original Schedule 13D.
<PAGE>
CUSIP No. 438138-10-9 Page 22 of 29 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: October 13, 1998
Lonrho Plc
By: /s/ John F. Price
--------------------------
John F. Price
Under Power of Attorney
dated October 6, 1994
London Australian & General Property
Company Limited
By: /s/ John F. Price
--------------------------
John F. Price
Under Power of Attorney
dated October 15, 1997
The Hondo Company
By: /s/ John F. Price
--------------------------
John F. Price, President
HOGC Acquisition Corp.
By: /s/ John F. Price
--------------------------
John F. Price, President
<PAGE>
CUSIP No. 438138-10-9 Page 23 of 29 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.
<TABLE>
<CAPTION>
Name and Principal
Position held Occupation
with Lonrho Plc or Employment Business Address Citizenship
--------------- ------------- ---------------- -----------
<S> <C> <C> <C>
Sir John Craven Director of Four Grosvenor Place United Kingdom
Non-Executive Companies London SW1X 7DL,
Chairman England
S.E. Jonah Director Four Grosvenor Place Ghana
Director Lonrho Plc and London, SW1X 7DL,
Ashanti Goldfields England
Company Limited
N.J. Morrell Director Four Grosvenor Place United Kingdom
Chief Executive/Director Lonrho Plc London, SW1X 7DL,
England
R.E. Whitten Director Four Grosvenor Place United Kingdom
Finance Director Lonrho Plc London, SW1X 7DL,
England
Terence Wilkinson Director Four Grosvenor Place South Africa
Director Lonrho Plc London, SW1X 7DL,
England
M.J. Pearce Company Secretary Four Grosvenor Place United Kingdom
Company Secretary Lonrho Plc London, SW1X 7DL,
England
</TABLE>
<PAGE>
CUSIP No. 438138-10-9 Page 24 of 29 Pages
<TABLE>
<CAPTION>
Name and Principal
Position held Occupation
with Lonrho Plc or Employment Business Address Citizenship
--------------- ------------- ----------------- -----------
<S> <C> <C> <C>
Peter Harper Non-Executive Four Grosvenor Place United Kingdom
Non-Executive Director of London, SW1X 7DL,
Independent Director John Laing Plc and England
Deputy Chairman of
Victrex Plc
J R B Phillimore Business Four Grosvenor Place United Kingdom
Non-Executive Adviser London, SW1X 7DL,
Independent Director England
Sir Alastair Morton Honorary Chairman Four Grosvenor Place United Kingdom
Non-Executive of Eurotunnel; London, SW1X 7DL,
Independent Director Non-Executive England
Director:
National Power PLC
BrockBank Group
Advisor to:
Group Executive Board
of ABB Daimler-Benz
Transportation;
Vice Chancellor:
University of Cambridge
</TABLE>
<PAGE>
CUSIP No. 438138-10-9 Page 25 of 29 Pages
II. London Australian & General Property Company Limited
Set forth below are the names, present principal occupation or
employment, business address and citizenship of each director and executive
officer of London Australian & General Property Company Limited.
<TABLE>
<CAPTION>
Name and Principal
Position held Occupation
with LAGP or Employment Business Address Citizenship
- ------------- ------------- ---------------- -----------
<S> <C> <C> <C>
N.J. Morrell 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
</TABLE>
<PAGE>
CUSIP No. 438138-10-9 Page 26 of 29 Pages
III. 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.
<TABLE>
<CAPTION>
Name and Principal
Position held Occupation
with Hondo Company or Employment Business Address Citizenship
------------------ ------------- ---------------- -----------
<S> <C> <C> <C>
John F. Price President 900 Third Avenue United States
President and Bahamas Hotels, Inc. New York, New York
Director 10022
Richard W. Reese Vice President 9300 San Diego Ave., N.E. United States
Vice President Hondo Company Albuquerque, New Mexico
87122
S.H. Cavin Counsel 410 East College Blvd. United States
Secretary Hondo Company Roswell, New Mexico
88201
R.E. Whitten Director Four Grosvenor Place United Kingdom
Director Lonrho Plc London, SW1X 7DL,
England
N.J. Morrell Director Four Grosvenor Place United Kingdom
Director Lonrho Plc. London, SW1X 7DL
England
</TABLE>
<PAGE>
CUSIP No. 438138-10-9 Page 27 of 29 Pages
IV. HOGC Acquisition Corporation
Set forth below are the names, present principal occupation or
employment, business address and citizenship of each director and executive
officer of Hondo Company.
<TABLE>
<CAPTION>
Name and Principal
Position held with Occupation
HOGC Acquisition Corporation or Employment Business Address Citizenship
- ---------------------------- ------------- ---------------- -----------
<S> <C> <C> <C>
John F. Price President 900 Third Avenue United States
President and Bahamas Hotels, Inc. New York, New York
Director 10022
R.E. Whitten Director Four Grosvenor Place United Kingdom
Vice President, Secretary Lonrho Plc London, SW1X 7DL,
and Director England
</TABLE>
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: October 13, 1998
Lonrho Plc
By: /s/ John F. Price
----------------------------
John F. Price
Under Power of Attorney
dated October 6, 1994
London Australian & General Property
Company Limited
By: /s/ John F. Price
----------------------------
John F. Price
Under Power of Attorney
dated October 15, 1997
The Hondo Company.
By: /s/ John F. Price
---------------------------
John F. Price, President
HOGC Acquisition Corp.
By: /s/ John F. Price
---------------------------
John F. Price, President
EXHIBIT 2(d)
POWER OF ATTORNEY
For Executing Schedule 13D and Amendments
Re: HOGC Acquisition Corporation
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 13th day of October, 1998.
HOGC Acquisition Corporation
By: /s/ John F. Price
--------------------------------
Name: John F. Price
Title: President
