UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
GULF EXPLORATION CONSULTANTS, INC.
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(Name of Issuer)
Common Stock, $.01 Par Value
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(Title of Class of Securities)
402275200
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(CUSIP Number)
Copies of Communication To:
Dennis Mensch
300 East 75th Street
Apt. 29N
New York, New York 10021, (212) 744-2917
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
July 10, 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>
SCHEDULE 13D
CUSIP No. 402275200
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Dennis Mensch
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(E) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
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NUMBER OF 7 SOLE VOTING POWER
SHARES 438,040 shares
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BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
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EACH 9 SOLE DISPOSITIVE POWER
REPORTING 438,040 shares
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PERSON WITH 10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
438,040 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
22%
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14 TYPE OF REPORTING PERSON*
IN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
ITEM 1. SECURITY AND ISSUER.
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The title of the class of equity securities to which this
Schedule 13D relates is common stock, $.01 par value (the "Common Stock"),
of Gulf Exploration Consultants, Inc., a Delaware corporation ("GEC"),
whose principal office in located at 10 Rockefeller Plaza, Suite 1012, New
York, New York, 10020.
ITEM 2. IDENTITY AND BACKGROUND.
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This Schedule 13D is being filed by Dennis Mensch, an individual
("Mensch"). Mensch is a private investor. Mensch's address is 300 East
75th Street, Apt. 29N, New York, New York 10021.
During the last five years Mensch has not been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors).
During the last five years Mensch has not 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.
Mensch is a citizen of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
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Effective July 10, 1996, pursuant to a Letter Agreement, dated
December 22, 1995 (the "Letter Agreement"), among GEC, Minmet plc, Osprey
Investments, Inc. (formerly DRM&S Inc.) ("Osprey") and Mensch, Mensch
exchanged a GEC note, dated February 21, 1995, in the principal amount of
$100,000 (the "Note") plus accrued interest, for 438,040 shares (the
"Shares") of GEC Common Stock.
ITEM 4. PURPOSE OF TRANSACTION.
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Mensch has been informed by GEC that on June 17, 1996, after
obtaining approval of its stockholders, GEC disposed of its interest in an
operating subsidiary, ceased all business activity, effected a 1-for-50
reverse split of its Common Stock, reduced the authorized Common Stock to
10,000,000 shares, and authorized the restructuring of its outstanding
loans as provided for in the Letter Agreement.
The Letter Agreement states, in part, "[a]fter the
Recapitalization, GEC would use its best efforts to seek to find a new
business opportunity for GEC." Mensch agreed to exchange the Note for the
Shares in anticipation of GEC seeking a business combination with an
operating company. Mensch does not know whether GEC will be able to find
any new business opportunity and effect any such business combination.
Mensch is not aware of any negotiations between GEC and any other party
regarding any such business combination.
Pursuant to the Letter Agreement, Mensch is lending $15,866 to
GEC to cover certain outstanding professional fees owed by GEC. Mensch
also agreed to lend GEC an additional $10,000 for use as working capital,
but has no intention of making any subsequent loans to GEC. GEC's
repayment obligations to Mensch will be evidenced by a Promissory Note due
July 1, 1997 in the principal amount of $25,866, plus interest at 7% per
annum, and subject to mandatory repayment in the event of an acquisition by
any person through a business combination or otherwise of a controlling
interest in GEC.
Mensch is a passive investor in GEC and has no plans to
participate in the management of GEC or to become a member of GEC's Board
of Directors.
None of the Shares are held by Mensch as a member of a group and
Mensch disclaims membership in any group.
Except to the extent provided above, Mensch has no plans or
proposals which relate to or would result in a transaction specified in
paragraphs (a) through (j) of Item 4 to Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
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(a) Effective July 10, 1996, Mensch became the beneficial owner
of 438,040 shares of Common Stock upon the exchange of the Note, plus
accrued interest, pursuant to the Letter Agreement.
(b) Mensch possesses the sole power to vote and dispose of the
Shares.
(c) Mensch has not effected transactions in shares of GEC Common
Stock during the sixty days prior to July 10, 1996 except for the
acquisition of the Shares upon the exchange of the Note.
(d) No person is known to have the right to receive or the power
to direct the receipt of dividends from, or the proceeds from the sale of
the Shares acquired by Mensch.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH
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RESPECT TO SECURITIES OF THE ISSUER.
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None
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
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The following are filed as Exhibits to this Schedule 13D:
Exhibit 1 Letter Agreement, dated as of December 22, 1995, among GEC,
Minmet plc, Osprey Investments, Inc. (formerly
DRM&S, Inc.) and Mensch.
Exhibit 2 Letter Agreement, dated July 10, 1996, between GEC and
Mensch, together with form of new Note.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this Statement is true,
complete, and correct.
/s/ Dennis Mensch
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Dennis Mensch
Dated: July 10, 1996
Exhibit 3
MINMET PLC
Grand Canal House
1 Upper Grand Canal Street
Dublin 4 Ireland
December 22, 1995
Gulf Exploration Consultants, Inc.
1270 Avenue of the Americas,
Suite 2900
New York, N. Y. 10020
DRM&S Inc.
c/o Daniel Murphy
Coleman & Company Securities, Inc.
666 Fifth Avenue
New York, N.Y. 10103
Mr. Dennis Mensch
300 East 75th Street
Apt 29N
New York, N.Y. 10021
Gentlemen:
This letter sets forth the terms of the understanding
among Minmet plc, a Republic of Ireland corporation ("Minmet"),
Gulf Exploration Consultants, Inc., a Delaware corporation
("GEC"), DRM&S Inc. ("DRM&S") and Dennis Mensch ("Mensch")
regarding the payment of certain outstanding liabilities and
future expenses of GEC and certain other related matters in
connection with the proposed transaction by Micron Limited
("Micron") involving Emerging Money Limited, a Republic of
Ireland corporation and wholly-owned subsidiary of GEC ("EML"),
and other transactions which would result in the
recapitalization of GEC (the "Recapitalization").
1. At November 15, 1995, GEC had outstanding
liabilities for legal and accounting services totalling
$42,536.82, excluding amounts owed to DRM&S and Mensch under
their respective GEC notes (the "Notes") and to Minmet. Minmet
shall assume 25.4% of such liabilities of GEC or $10,804, and
DRM&S and Mensch shall upon the Recapitalization lend to GEC
such funds as necessary to pay 74.6% of the total liabilities
of GEC or $31,732 (including the $21,743 owed to Reid & Priest
LLP). To Minmet's knowledge, GEC had no other liabilities at
that date nor has GEC incurred any liabilities since such date
other than for legal services. Except for the expenses
specified in Paragraph 2 below, Minmet will not cause GEC to
incur any liabilities or commitments for or on behalf of GEC
without the prior written authorization of DRM&S and Mensch.
All GEC obligations to Minmet will be cancelled as part of the
Recapitalization.
2. Minmet shall bear all expenses to be incurred by
GEC in connection with (i) GEC's quarterly report on Form 10-Q
for the fiscal quarter ended September 30, 1995, (ii) a proxy
statement and related corporate documents for a Special Meeting
of GEC Stockholders (the "Meeting") to vote on certain
proposals related to the Recapitalization, (iii) the printing
and mailing of such proxy statement to GEC stockholders, (iv)
the negotiation of agreements with Micron and EML (v) the
retention of a person or firm to render a fairness opinion and
(vi) all related legal, accounting and other related fees. In
the event the Recapitalization is not consummated prior to
March 1, 1996, Minmet shall bear the expenses incurred by GEC
in connection with the preparation and filing of the GEC Form
10-K for the fiscal year ending December 31, 1995. Minmet
shall also be responsible for the payment of any amounts which
may be owed by GEC to Debra Giles.
3. Upon the completion of the Recapitalization, (i)
DRM&S and Mensch would exchange their Notes for GEC Common
Stock for which each of them would receive 22% of the GEC
shares then to be outstanding, (ii) GEC would transfer its EML
shares to Minmet in exchange for GEC Common Stock presently
owned by Minmet which would reduce Minmet's holding of GEC
Common Stock to 15% of shares then to be outstanding (subject
to adjustment if the valuations of the EML shares would exceed
the valuation of the GEC shares to be exchanged), (iii) the
existing public stockholders of GEC would own the balance of
the outstanding GEC shares and (iv) GEC would have no interest
in EML nor any obligation for any liabilities of EML. GEC
represents to each of DRM&S and Mensch that GEC has no
agreements or plans to issue any shares of its capital stock
whether pursuant to the Recapitalization or otherwise and has
no outstanding options, warrants or other rights to acquire GEC
capital stock nor will any such options, warrants or other
rights be granted, except to the extent set forth in the
preceding sentence.
4. After the Recapitalization, GEC would use its
best efforts to seek to find a new business opportunity for
GEC. It is understood that the extent of the non-competition
provision covering GEC under the Micron Agreement is as set
forth in a letter, dated December 20, 1995, from Micron to GEC,
and a letter, dated December 22, 1995, from Harris Freedman to
GEC, copies of which is attached hereto.
5. Minmet shall indemnify and hold harmless each of
GEC, DRM&S and Mensch from and against any loss, liability,
claim or expense (including reasonable attorneys' fees and
disbursements) (collectively, the "claim") suffered or incurred
by GEC, DRM&S or Mensch which respect to matters occurred or
occurring during the period commencing on December 4, 1994 and
ending upon the consummation of the Recapitalization (the
"Indemnification Period") based upon or arising from any
actions or failures to act by GEC and/or Minmet during the
Indemnification Period (including, but not limited to, those
related to the Recapitalization), excluding any claim resulting
from the gross negligence or willful misconduct by DRM&S or
Mensch, notwithstanding that the claim is made or instituted
after the Indemnification Period.
6. Minmet, DRM&S and Mensch acknowledge that Reid &
Priest LLP shall be acting as United States securities counsel
for GEC and each of them for purposes of the Recapitalization,
and they have no objection to the retention of such firm by the
other or for GEC. Pursuant to Paragraph 2 above, Minmet shall
be responsible for the fees and expenses of Reid & Priest LLP
for services rendered on their behalf related to the
Recapitalization, other than for matters solely for the benefit
of DRM&S or Mensch for which they shall be responsible.
7. Until the Recapitalization is consummated DRM&S
and Mensch shall remain creditors of GEC under their Notes and
Minmet shall remain the majority stockholder of GEC. If the
Recapitalization is not consummated, Minmet will reimburse
DRM&S and Mensch for all payments made by each of them pursuant
to Paragraph 1 above. As neither DRM&S or Mensch is a party to
the Micron transaction nor has any contractual right with
respect to such transaction, it is not necessary for GEC to
obtain the consent of DRM&S or Mensch to the Micron
transaction.
8. This Agreement shall be governed by the laws of
the State of New York.
9. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter
hereof, superseding all prior written or oral agreements, and
cannot be amended, modified or terminated except pursuant to a
writing executed by the parties hereto.
10. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, and
all of which together shall constitute one and the same
document.
Please confirm that this letter correctly sets forth
our agreement with respect to the matters stated herein by
signing, dating and returning this letter to us.
Very truly yours,
MINMET PLC
By: /s/ J. Metcalfe
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Name:
Title: Chairman
AGREED AND ACCEPTED THIS
27th DAY OF DECEMBER, 1995
GULF EXPLORATION CONSULTANTS, INC.
By: /s/ Michael H. Nolan
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Name: Michael H. Nolan
Title: Chief Financial Officer
DRM&S INC.
By: /s/ Bruce A. Smathers (President)
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/s/ Dennis Mensch
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DENNIS MENSCH
<PAGE>
GULF EXPLORATION CONSULTANTS, INC.
10 Rockefeller Plaza
Suite 1012
New York, New York 10020
July 10, 1996
Mr. Dennis Mensch
300 East 75th Street
Apt 29N
New York, New York 10021
Gentlemen:
This letter sets forth the terms of the understanding
between Gulf Exploration Consultants, Inc., a Delaware
corporation ("GEC"), and Dennis Mensch ("Mensch") regarding
certain loans made and to be made by Mensch to GEC, the
proceeds of the new loans to be used by GEC for the payment of
certain of its outstanding legal and accounting fees and for
working capital.
1. Pursuant to Paragraph 1 of a Letter Agreement,
dated as of December 22, 1995 (the "Letter Agreement"), among
GEC, Osprey Investments, Inc. (formerly DRM&S Inc.), Mensch and
Minmet plc, Mensch agreed to lend to GEC one-half of the funds
as necessary to pay 74.6% of the total accounting and legal
fees of GEC existing at November 15, 1995 or $31,732 upon the
consummation of a Recapitalization (as defined in the Letter
Agreement). The Recapitalization became effective on June 17,
1996.
2. In order to fulfill his obligations under the
Letter Agreement, Mensch is loaning $15,866 to GEC, which loan
shall become due and payable by GEC on July 1, 1997, together
with interest at the rate of 7% annum, provided, however, that
GEC shall prepay the outstanding principal and accrued interest
immediately upon the acquisition by any person through a
business combination or otherwise of a controlling interest in
GEC, all as set forth in the new note ("Note") attached hereto.
3. In order to provide GEC with some short-term
working capital, Mensch agrees to lend GEC an additional
$10,000. This $10,000 shall be part of the Note.
4. GEC acknowledges receiving from Mensch the
return of the GEC promissory note, dated February 21, 1995, in
the principal amount of $100,000 (the "Original Note"). GEC
agrees to promptly instruct its transfer agent to issue to
Mensch a certificate for 438,040 shares (the "Shares") of GEC
Common Stock, as provided for in the Letter Agreement in
exchange for the Original Note.
5. GEC represents that there is no proceeding
pending or, to the knowledge of GEC, threatened against GEC,
which, if adversely determined, would have a material adverse
effect on GEC's ability to perform its obligations hereunder or
under the Note.
6. Mensch acknowledges that the Shares have not
been registered under the Securities Act of 1933, as amended,
and that the certificates for the Shares will contain
restrictive legends and stop orders against the Shares
referring to the restrictions on sale or transfer thereof under
such Act. Mensch represents that he is aware of the current
operations, prospects and financial condition of GEC as
described in GEC's Proxy Statement, dated June 6, 1996, Annual
Report on Form 10-K for the year ended December 31, 1995 and
Quarterly Report on Form 10-Q for the quarter ended March 31,
1996.
7. Mensch acknowledges that GEC has not taken the
actions described under the captions "Convertibility of
Preferred Stock," "Issuance of Preferred," "The
Recapitalization," and "The Placement" of the Term Sheet
delivered to Mensch on or before Mensch's acquisition of the
Original Note (the "Term Sheet"). In consideration of the
issuance to Mensch of the Shares, Mensch hereby waives any
claims or demands that he may have against GEC, its officers,
directors, employees, agents and representatives with respect
to any rights to Preferred Stock of GEC that he may have had
under his subscription for the Original Note or the Term Sheet.
8. This letter agreement shall be governed by the
laws of the State of New York.
9. This letter agreement constitutes the entire
agreement between the parties hereto with respect to the
subject matter hereof, superseding all prior written or oral
agreements, and cannot be amended, modified or terminated
except pursuant to a writing executed by the parties hereto.
10. This letter agreement may be executed in
multiple counterparts, each of which shall be deemed an
original, and all of which together shall constitute one and
the same document.
Please confirm that this letter correctly sets forth
our agreement with respect to the matters stated herein by
signing, dating and returning this letter to us.
Very truly yours,
GULF EXPLORATION CONSULTANTS, INC.
By: /s/ Michael H. Nolan
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Name: Michael H. Nolan
Title: Chief Financial Officer
AGREED AND ACCEPTED THIS
10TH DAY OF JULY, 1996
/s/ Dennis Mensch
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DENNIS MENSCH
