<PAGE>
U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
July 22, 1996
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Date of Report (date of earliest event reported)
OGDEN, McDONALD & COMPANY
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Exact name of Registrant as Specified in its Charter
Colorado 0-24682 84-1125214
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State or Other Jurisdiction Commission File IRS Employer Identification
of Incorporation Number Number
1300 Post Oak Boulevard, 9th Floor, Houston, Texas 77056
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Address of Principal Executive Offices, Including Zip Code
(713) 629-8300
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Registrant's Telephone Number, Including Area Code
3140-K South Peoria Street, Suite 230, Aurora, Colorado 80014
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Former Address, if Changed Since Last Report
<PAGE>
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
On July 22, 1996, Ogden, McDonald & Company (the "Company") completed the
acquisition of 100% of the outstanding common stock of Worldwide Petromoly
Corporation ("Petromoly") in exchange for 14,507,500 shares of the Company's
Common Stock (approximately 90.6% of the shares now outstanding).
The stock issuances were made pursuant to an Agreement ("Agreement")
between the Company and Petromoly. The terms of the Agreement were the
result of negotiations between the managements of the Company and Petromoly.
However, the Board of Directors did not obtain any independent "fairness"
opinion or other evaluation regarding the terms of the Agreement, due to the
cost of obtaining such opinions or evaluations.
The foregoing summary of the Agreement is qualified by reference to the
complete text of the Agreement, together with the schedules thereto,
which is filed as Exhibit 10 hereto, and is incorporated herein by this
reference.
As a result of the transaction with Petromoly and the issuance of the
14,507,500 shares of the Company's Common Stock, following are those persons
known by the Company to own 5% or more of the Company's Voting Stock:
<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF OUTSTANDING
NAME AND ADDRESS VOTING SHARES VOTING SHARES
<S> <C> <C>
Petromoly Capital Partners 12,500,000<FN1> 78.1%
9th Floor
1300 Post Oak Boulevard
Houston, Texas 77056
Gilbert Gertner 11,250,000<FN1> 70.3%
9th Floor
1300 Post Oak Boulevard
Houston, Texas 77056
Robert Goldberg 1,250,000<FN1> 7.8%
15010 Falling Creek
Houston, Texas 77056
Lance Rosmarin -0- -0-
9th Floor
1300 Post Oak Boulevard
Houston, Texas 77056
All Directors and Officers 12,500,000<FN1> 78.1%
as a Group (3 Persons)
_______________
<FN>
<FN1>
Petromoly Capital Partners is a Texas general partnership and Gilbert Gertner
and Robert Goldberg are the two general partners. Mr. Gertner owns 90% of the
partnership and Mr. Goldberg owns 10% of the partnership.
</FN>
</TABLE>
Effective on the closing of the acquisition, the Company's officers and
directors were as follows:
Gilbert Gertner - Chairman of the Board and Director
Robert Goldberg - President and Director
Lance Rosmarin - Secretary and Director
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
As described in Item 1 of this Report, on July 22, 1996, the Company
acquired all of the issued and outstanding common stock of Worldwide Petromoly
Corporation in exchange for shares of the Company's Common Stock.
Worldwide Petromoly Corporation currently manufactures, markets and
distributes a line of lubrication products called "PetroMoly", an extended,
high performance engine oil designed to enhance and maintain all types of
engines at their peak levels. These products are based on a new technology
which provides benefits to the users of any engines needing lubrication.
These benefits may include the following: oil can be used up to five times
longer than conventional oils; greater fuel efficiency; seals engine parts;
reduces friction and engine wear; and reduces exhaust emissions.
Currently, sales (approximately $400,000 in 1995) have been concentrated
in the industrial markets because less marketing expense is required. With
the receipt of approximately $4,000,000 in gross proceeds from the recent
private offering, Petromoly intends to expand its product lines and
significantly increase its marketing efforts.
During July 1996, Worldwide Petromoly Corporation sold 2,007,500 shares
of its common stock at $2.00 per share in a private offering to non-U.S.
investors for total gross proceeds of $4,015,000. These shares were exhcnaged
for 2,007,500 of the Company's shares as part of the exchange transaction
described above.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED. The financial state-
ments required by Rule 3-05(b) of Regulation S-X for Worldwide Petromoly
Corporation are not yet available, and will be filed by amendment on or before
October 5, 1996.
(b) PROFORMA FINANCIAL INFORMATION. The pro forma financial information
required by Article 11 of Regulation S-X is not yet available, and will be
filed by amendment on or before October 5, 1996.
(c) EXHIBITS.
Exhibit 10 Agreement between Ogden, McDonald & Company
and Worldwide Petromoly Corporation
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, hereunto duly authorized.
OGDEN, McDONALD & COMPANY
Dated: July 31, 1996 By /s/ Gilbert Gertner
Gilbert Gertner, Chairman of the Board
AGREEMENT
THIS AGREEMENT is made this 22nd day of July 1996, by and between Ogden,
McDonald & Company, a Colorado corporation ("OMC"), and Worldwide Petromoly
Corporation, a Texas corporation ("Petromoly").
WHEREAS, OMC desires to acquire all of the issued and outstanding shares
of common stock of Petromoly in exchange for an aggregate of 14,507,500
authorized but unissued restricted shares of the common stock, no par value,
of
OMC (the "Common Stock") (the "Exchange Offer"); and
WHEREAS, Petromoly desires to assist OMC in a business combination which
will result in the shareholders of Petromoly owning approximately 90.6% of the
then issued and outstanding shares of OMC's Common Stock, and OMC holding 100%
of the issued and outstanding shares of Petromoly's common stock;
NOW, THEREFORE, in consideration of the mutual promises, covenants, and
representations contained herein, THE PARTIES HERETO AGREE AS FOLLOWS:
ARTICLE 1
EXCHANGE OF SECURITIES
1.1 ISSUANCE OF SHARES. Subject to all of the terms and conditions of
this Agreement, OMC agrees to offer one (1) share of Common Stock for each
share of Petromoly common stock issued and outstanding, or a total of
14,507,500 shares (after the proposed 3 for 1 forward split) of OMC's Common
Stock. The Common Stock will be issued directly to the shareholders of
Petromoly which accept the Exchange Offer.
1.2 EXEMPTION FROM REGISTRATION. The parties hereto intend that the
Common Stock to be issued by OMC to Petromoly Capital Partners shall be exempt
from the registration requirements of the Securities Act of 1933, as amended
(the "Act"), pursuant to Section 4(2) of the Act and the rules and regula-
tions promulgated thereunder, and the Common Stock to be issued to the other
shareholders shall be exempt from the registration requirements of the Act
pursuant to Rule 903 of Regulation S.
1.3 INVESTMENT INTENT. Prior to the consummation of the Exchange Offer,
the shareholders of Petromoly accepting the Exchange Offer shall execute
Letters of Acceptance and such other documents containing, among other things,
representations and warranties relating to investment intent and investor
status, restrictions on transferability and restrictive legends such that the
counsel for both OMC and Petromoly shall be satisfied that the exchange of
shares as contemplated by this Agreement shall be exempt from the registra-
tion requirements of the Act and any applicable state or provincial blue sky
laws.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF PETROMOLY
Except as disclosed in Schedule 2 which is attached hereto as Exhibit A
and incorporated herein by reference, Petromoly hereby represents and warrants
to OMC that:
2.1 ORGANIZATION. Petromoly is a corporation duly organized, validly
existing, and in good standing under the laws of Texas, has all necessary
corporate powers to own its properties and to carry on its business as now
owned and operated by it, and is duly qualified to do business and is in good
standing in each of the jurisdictions where its business requires
qualification.
2.2 CAPITAL. The authorized capital stock of Petromoly consists of
20,000,000 shares of Common Stock, $.001 par value, of which 14,507,500 are
currently issued and outstanding. All of the issued and outstanding shares of
Petromoly are duly authorized, validly issued, fully paid, and nonassessable.
There are no outstanding subscriptions, options, rights, warrants, debentures,
instruments, convertible securities, or other agreements or commitments
obligating Petromoly to issue or to transfer from treasury any additional
shares of its capital stock of any class.
2.3 SUBSIDIARIES. Petromoly does not have any subsidiaries or own any
interest in any other enterprise (whether or not such enterprise is a
corporation).
2.4 DIRECTORS AND OFFICERS. Schedule 2 contains the names and titles of
all directors and officers of Petromoly as of the date of this Agreement.
2.5 FINANCIAL STATEMENTS. Petromoly has delivered to OMC its audited
balance sheet and statements of operations and cash flows as of and for the
period ended December 31, 1995 (the "Financial Statements"). The Financial
Statements are complete and correct in all material respects and have been
prepared in accordance with generally accepted accounting principles applied
on a consistent basis throughout the periods indicated. The Financial
Statements accurately set out and describe the financial condition and
operating results of the Company as of the dates, and for the periods,
indicated therein.
2.6 ABSENCE OF CHANGES. Since December 31, 1995, except for changes in
the ordinary course of business which have not in the aggregate been
materially adverse, to the best of Petromoly's knowledge, Petromoly has
conducted its business only in the ordinary course and has not experienced or
suffered any material adverse change in the condition (financial or
otherwise), results of operations, properties, business or prospects of
Petromoly or waived or surrendered any claim or right of material value.
2.7 ABSENCE OF UNDISCLOSED LIABILITIES. Neither Petromoly nor any of its
properties or assets are subject to any material liabilities or obligations of
any nature, whether absolute, accrued, contingent or otherwise and whether due
or to become due, that are not reflected in the financial statements presented
to OMC or have otherwise been disclosed to OMC.
2.8 TAX RETURNS. Within the times and in the manner prescribed by law,
Petromoly has filed all federal, state and local tax returns required by law,
or has filed extensions which have not yet expired, and has paid all taxes,
assessments and penalties due and payable.
2.9 INVESTIGATION OF FINANCIAL CONDITION. Without in any manner
reducing or otherwise mitigating the representations contained herein, OMC
and/or its attorneys shall have the opportunity to meet with accountants and
attorneys to discuss the financial condition of Petromoly. Petromoly shall
make available to OMC and/or its attorneys all books and records of Petromoly.
2.10 TRADE NAMES AND RIGHTS. Schedule 2 sets forth a complete and
accurate schedule of (i) all registered trademarks and service marks and all
trademark and service mark applications, including country of filing, filing
number, date of issue and expiration date used in the business of Petromoly;
and (ii) all registered copyrights of property owned by Petromoly. Except as
set forth in such schedule, to Petromoly's knowledge, no third party has
asserted, or threatened to assert against Petromoly or any of its officers or
directors any conflicting rights to any such intellectual property and
Petromoly has no knowledge of facts that Petromoly believes could reasonably
be expected to give rise to such a claim.
2.11 COMPLIANCE WITH LAWS. Petromoly has complied with, and is not in
violation of, applicable federal, state or local statutes, laws and
regulations (including, without limitation, any applicable building, zoning or
other law, ordinance or regulation) affecting its properties or the operation
of its business, except for matters which would not have a material affect on
Petromoly or its properties.
2.12 LITIGATION. Petromoly is not a party to any suit, action,
arbitration or legal, administrative or other proceeding, or governmental
investigation pending or, to the best knowledge of Petromoly, threatened
against or affecting Petromoly or its business, assets or financial
condition, except for matters which would not have a material affect on
Petromoly or its properties. Petromoly is not in default with respect to any
order, writ, injunction or decree of any federal, state, local or foreign
court, department, agency or instrumentality applicable to it. Petromoly is
not engaged in any lawsuit to recover any material amount of monies due to it.
2.13 AUTHORITY. Petromoly has full corporate power and authority to
enter into this Agreement. The board of directors of Petromoly has taken all
action required to authorize the execution and delivery of this Agreement by
or on behalf of Petromoly and the performance of the obligations of Petromoly
under this Agreement. No other corporate proceedings on the part of Petromoly
are necessary to authorize the execution and delivery of this Agreement by
Petromoly in the performance of its obligations under this Agreement. This
Agreement is, when executed and delivered by Petromoly, and will be a valid
and binding agreement of Petromoly, enforceable against Petromoly in
accordance with its terms, except as such enforceability may be limited by
general principles of equity, bankruptcy, insolvency, moratorium and similar
laws relating to creditors' rights generally.
2.14 ABILITY TO CARRY OUT OBLIGATIONS. Neither the execution and
delivery of this Agreement, the performance by Petromoly of its obligations
under this Agreement, nor the consummation of the transactions contemplated
under this Agreement will to the best of Petromoly's knowledge: (a)
materially violate any provision of Petromoly's articles of incorporation or
bylaws; (b) with or with out the giving of notice or the passage of time, or
both, violate, or be in conflict with, or constitute a material default under,
or cause or permit the termination or the acceleration of the maturity of, any
debt, contract, agreement or obligation of Petromoly, or require the payment
of any prepayment or other penalties; (c) require notice to, or the consent
of, any party to any agreement or commitment, lease or license, to which
Petromoly is bound; (d) result in the creation or imposition of any security
interest, lien, or other encumbrance upon any material property or assets of
Petromoly; or (e) violate any statute or law or any judgment, decree, order,
regulation or rule of any court or governmental authority to which Petromoly
is bound or subject.
2.15 FULL DISCLOSURE. None of the representations and warranties made
by Petromoly herein, or in any schedule, exhibit or certificate furnished or
to be furnished in connection with this Agreement by Petromoly, or on its
behalf, contains or will contain any untrue statement of material fact.
2.16 ASSETS. Petromoly has good and marketable title to all of its
tangible properties and such tangible properties are not subject to any
material liens or encumbrances.
2.17 MATERIAL CONTRACTS AND OBLIGATIONS. Attached hereto on Schedule 2
is a list of all agreements, contracts, indebtedness, liabilities and other
obligations to which Petromoly is a party or by which it is bound that are
material to the conduct and operations of its business and properties, which
provide for payments to or by the Company in excess of $50,000; or which
involve transactions or proposed transactions between the Company and its
officers, directors, affiliates or any affiliate thereof. Copies of such
agreements and contracts and documentation evidencing such liabilities and
other obligations have been made available for inspection by OMC and its
counsel. All of such agreements and contracts are valid, binding and in full
force and effect in all material respects, assuming due execution by the other
parties to such agreements and contracts.
2.18 CONSENTS AND APPROVALS. No consent, approval or authorization of,
or declaration, filing or registration with, any governmental or regulatory
authority is required to be made or obtained by Petromoly in connection with:
(a) the execution and delivery by Petromoly of this Agreement; (b) the
performance by Petromoly of its obligations under this Agreement; or (c) the
consummation by Petromoly of the transactions contemplated under this
Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF OMC
Except as disclosed in Schedule 3 which is attached hereto and
incorporated herein by reference, OMC represents and warrants to Petromoly
that:
3.1 ORGANIZATION. OMC is a corporation duly organized, valid existing,
and in good standing under the laws of Colorado, has all necessary corporate
powers to own properties and to carry on business, and it is not now
conducting any business, except to the extent to which the effecting of the
transaction contemplated by this Agreement constitutes doing business.
3.2 CAPITALIZATION. The authorized capital stock of OMC consists of
800,000,000 shares of no par value Common Stock of which 500,000 shares of
Common Stock are currently issued and outstanding, and 10,000,000 shares of
no par value Preferred Stock, of which no shares are issued or outstanding.
All of the issued and outstanding shares of Common Stock are duly authorized,
validly issued, fully paid and nonassessable and all of such shares have been
issued in accordance with the applicable federal and state securities laws.
There are no outstanding subscriptions, options, rights, warrants, convert-
ible securities, or other agreements or commitments obligating OMC to issue
or to transfer from treasury any additional shares of its capital stock of
any class. On the Closing, there will be 1,500,000 shares of Common Stock
outstanding as a result of the 3 for 1 forward stock split.
3.3 SUBSIDIARIES. OMC does not presently have any subsidiaries or own
any interest in any other enterprise (whether or not such enterprise is a
corporation).
3.4 DIRECTORS AND OFFICERS. Schedule 3 contains the names and titles of
all directors and officers of OMC as of the date of this Agreement.
3.5 FINANCIAL STATEMENTS. OMC has delivered to Petromoly its audited
balance sheet and statements of operations and cash flows as of and for the
period ended June 30, 1995, and its combined unaudited balance sheet and
statements of operations and cash flows as of and for the period ended March
31, 1996 (collectively the "Financial Statements.") The Financial Statements
are complete and correct in all material respects and have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods indicated, except that the unaudited
financial statements do not contain footnotes. The Financial Statements
accurately set out and describe the financial condition and operating results
of the Company as of the dates, and for the periods, indicated therein.
3.6 ABSENCE OF CHANGES. Since March 31, 1996, except for changes in the
ordinary course of business which have not in the aggregate been materially
adverse, to the best of OMC's knowledge, OMC has not experienced or suffered
any material adverse change in its condition (financial or otherwise), results
of operations, properties, business or prospects or waived or surrendered any
claim or right of material value.
3.7 ABSENCE OF UNDISCLOSED LIABILITIES. To the best of OMC's knowledge,
neither OMC nor any of its properties or assets are subject to any liabilities
or obligations of any nature, whether absolute, accrued, contingent or
otherwise and whether due or to become due, that are not reflected in the
financial statements presented to Petromoly.
3.8 TAX RETURNS. Within the times and in the manner prescribed by law,
OMC has filed all federal, state and local tax returns required by law and has
paid all taxes, assessments and penalties due and payable.
3.9 INVESTIGATION OF FINANCIAL CONDITION. Without in any manner
reducing or otherwise mitigating the representations contained herein,
Petromoly shall have the opportunity to meet with OMC's accountants and
attorneys to discuss the financial condition of OMC. OMC shall make available
to Petromoly all books and records of OMC.
3.10 TRADE NAMES AND RIGHTS. OMC does not use any trademark, service
mark, trade name, or copyright in its business, or own any trademarks,
trademark registrations or applications, trade names, service marks,
copyrights, copyright registrations or applications.
3.11 COMPLIANCE WITH LAWS. To the best of OMC's knowledge, OMC has
complied with, and is not in violation of, applicable federal, state or local
statutes, laws and regulations (including, without limitation, any applicable
building, zoning, or other law, ordinance, or regulation) affecting its
properties or the operation of its business.
3.12 LITIGATION. OMC is not a party to any suit, action, arbitration,
or legal, administrative, or other proceeding, or governmental investigation
pending or, to the best knowledge of OMC, threatened against or affecting OMC
or its business, assets, or financial condition. OMC is not in default with
respect to any order, writ, injunction, or decree of any federal, state,
local, or foreign court, department agency, or instrumentality. OMC is not
engaged in any legal action to recover moneys due to it.
3.13 SEC FILINGS. OMC has filed with the SEC in a timely manner, and
has previously delivered to Petromoly true and complete copies of, all forms,
reports, schedules, statements and other documents required to be filed by OMC
since October 1, 1994, under the Securities Act or the Exchange Act. The
common stock of OMC is registered pursuant to Section 12(g) of the Exchange
Act. No form, report, schedule, statement or other document filed by OMC with
the SEC since October 1, 1994, contained any untrue statement of a material
fact or omitted to state any material fact, at the time such document was
filed, necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, other than such
facts as were corrected in any subsequent form, report, schedule, statement or
other document filed by OMC with the SEC. OMC has not filed the Form 10-KSB
for the year ended June 30, 1996, since such report is not required to be
filed until September 28, 1996.
3.14 NO PENDING INVESTIGATION. OMC is not aware of any pending
investigations or legal proceedings by the SEC, any state securities
regulatory agency, or any other governmental agency regarding OMC or any
officers or directors of OMC or any shareholders or controlling persons of
such shareholders.
3.15 AUTHORITY. OMC has full corporate power and authority to enter
into this Agreement and to consummate the transactions contemplated by this
Agreement. The Board of Directors of OMC has taken all action required to
authorize the execution and delivery of this Agreement by or on behalf of OMC,
the performance of the obligations of OMC under this Agreement and the
consummation by OMC of the transactions contemplated under this Agreement. No
other corporate proceedings on the part of OMC are necessary to authorize the
execution and delivery of this Agreement by OMC in the performance of its
obligations under this Agreement. This Agreement is, and when executed and
delivered by OMC, will be a valid and binding agreement of OMC, enforceable
against OMC in accordance with its terms, except as such enforceability may be
limited by general principles of equity, bankruptcy, insolvency, moratorium
and similar laws relating to creditors rights generally.
3.16 ABILITY TO CARRY OUT OBLIGATIONS. Neither the execution and
delivery of this Agreement, the performance by OMC of its obligations under
this Agreement, nor the consummation of the transactions contemplated under
this Agreement will, to the best of OMC's knowledge: (a) violate any
provision of OMC's articles of incorporation or bylaws; (b) with or without
the giving of notice or the passage of time, or both, violate, or be in
conflict with, or constitute a default under, or cause or permit the
termination or the acceleration of the maturity of, any debt, contract,
agreement or obligation of OMC, or require the payment of any prepayment or
other penalties; (c) require notice to, or the consent of, any party to any
agreement or commitment, lease or license, to which OMC is bound; (d) result
in the creation or imposition of any security interest, lien or other
encumbrance upon any property or assets of OMC; or (e) violate any statute or
law or any judgment, decree, order, regulation or rule of any court or
governmental authority to which OMC is bound or subject.
3.17 VALIDITY OF OMC SHARES. The shares of OMC Common Stock to be
delivered pursuant to this Agreement, when issued in accordance with the
provisions of this Agreement, will be duly authorized, validly issued, fully
paid and nonassessable, and such shares will be issued in accordance with the
federal securities laws and the laws of the States of Texas and Colorado.
3.18 FULL DISCLOSURE. None of the representations and warranties made
by OMC herein, or in any exhibit, certificate or memorandum furnished or to be
furnished by OMC, or on its behalf, contains or will contain any untrue state-
ment of material fact, or omit any material fact the omission of which would
be misleading.
3.19 ASSETS. OMC has good and marketable title to all of its properties
free and clear of any and all liens, claims and encumbrances.
3.20 MATERIAL CONTRACTS. OMC does not have any material contracts to
which it is a party or by which it is bound.
3.21 EMPLOYEES. OMC presently has no salaried employees.
3.22 CONSENTS AND APPROVALS. No consent, approval or authorization of,
or declaration, filing or registration with, any governmental or regulatory
authority is required to be made or obtained by OMC in connection with: (a)
the execution and delivery by OMC of its obligations under this Agreement; (b)
the performance by OMC of its obligations under this Agreement; or (c) the
consummation by OMC of the transactions contemplated by this Agreement.
3.23 REAL PROPERTY. OMC does not own, use or claim any interest in any
real property, including without limitation any license, leasehold or any
similar interest in real property.
ARTICLE 4
COVENANTS
4.1 INVESTIGATIVE RIGHTS. From the date of this Agreement until the
Closing Date, each party shall provide to the other party, and such other
party's counsels, accountants, auditors, and other authorized representa-
tives, full access during normal business hours and upon reasonable advance
written notice to all of each party's properties, books, contracts, commit-
ments, and records for the purpose of examining the same. Each party shall
furnish the other party with all information concerning each party's affairs
as the other party may reasonably request. If the transaction contemplated
hereby is not completed, all documents received by each party and/or its
attorneys and accountants, auditors or other authorized representatives shall
be returned to the other party who provided same upon request. The parties
hereto, their directors, employees, agents and representatives shall not
disclose any of the information described above unless such information is
already disclosed to the public, without the prior written consent of the
party to which the confidential information pertains. Each party shall take
such steps as are necessary to prevent disclosure of such information to
unauthorized third parties.
4.2 CONDUCT OF BUSINESS. Prior to the Closing, OMC and Petromoly shall
each conduct its business in the normal course, and shall not sell, pledge, or
assign any assets, without the prior written approval of the other party,
except in the regular course of business. Neither OMC nor Petromoly shall
amend its Articles of Incorporation or Bylaws, declare dividends, redeem or
sell stock or other securities, incur additional or newly-funded liabilities,
acquire or dispose of fixed assets, change employment terms, enter into any
material or long-term contract, guarantee obligations of any third party,
settle or discharge any balance sheet receivable for less than its stated
amount, pay more on any liability than its stated amount, or enter into any
other transaction other than in the regular course of business except as
otherwise contemplated herein. OMC will complete a 3 for 1 forward stock of
its common stock such that there will be 1,500,000 shares issued and
outstanding prior to the Closing.
4.3 INDEMNIFICATION BY PETROMOLY. Petromoly agrees to defend and hold
OMC harmless against and in respect of any and all claims, demands, losses,
costs, expenses, obligations, liabilities, damages, recoveries and
deficiencies, including interest, penalties, and reasonable attorney fees,
that it shall incur or suffer, which arise out of, result from or relate to
any breach of, or failure by Petromoly to perform any of its respective
representations, warranties, covenants and agreements in this Agreement or in
any exhibit or other instrument furnished or to be furnished by Petromoly
under this Agreement, or as a result of OMC's use of a unanimous consent of
shareholders to approve this transaction instead of proxy materials. The
indemnification provided for in this paragraph shall survive the Closing and
consummation of the transactions contemplated hereby and termination of this
Agreement for a period of one year from the Closing or termination, as the
case may be.
4.4 INDEMNIFICATION BY OMC. OMC agrees to indemnify, defend and hold
Petromoly and the Petromoly shareholders harmless against and in respect of
any and all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries and deficiencies, including interest,
penalties, and reasonable attorney fees, that they shall incur or suffer,
which arise out of, result from or relate to any breach of, or failure by OMC
to perform any of its representations, warranties, covenants or agreements in
this Agreement or in any schedule, certificate, exhibit or other instrument
furnished or to be furnished by OMC under this Agreement. The indemnification
provided for in this paragraph shall survive the Closing and consummation of
the transactions contemplated hereby and termination of this Agreement.
ARTICLE 5
CONDITIONS PRECEDENT TO OMC'S PERFORMANCE
5.1 CONDITIONS. The obligations of OMC hereunder shall be subject to
the satisfaction, at or before the Closing, of all the conditions set forth in
this Article 5. OMC may waive any or all of these conditions in whole or in
part without prior notice; provided, however, that no such waiver of a
condition shall constitute a waiver by OMC of any other condition of or any of
OMC's other rights or remedies, at law or in equity, if Petromoly shall be in
default of any of their representations, warranties, or covenants under this
Agreement.
5.2 ACCURACY OF REPRESENTATIONS. Except as otherwise permitted by this
Agreement, all representations and warranties by Petromoly in this Agreement
or in any written statement that shall be delivered to OMC by Petromoly under
this Agreement shall be true and accurate on and as of the Closing Date as
though made at that time.
5.3 PERFORMANCE. Petromoly shall have performed, satisfied, and
complied with all covenants, agreements, and conditions required by this
Agreement to be performed or complied with by it, on or before the Closing
Date.
5.4 ACCEPTANCE BY PETROMOLY SHAREHOLDERS. The holders of not less than
100% of the issued and outstanding shares of common stock of Petromoly shall
have agreed to exchange their shares for shares of OMC Common Stock.
5.5 ABSENCE OF LITIGATION. No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened against Petromoly on or before the Closing Date.
5.6 OFFICER'S CERTIFICATE. Petromoly shall have delivered to OMC a
certificate, dated the Closing Date, and signed by the Chief Executive Officer
of Petromoly, certifying that each of the conditions specified in Sections 5.2
through 5.5 hereof have been fulfilled.
ARTICLE 6
CONDITIONS PRECEDENT TO PETROMOLY'S PERFORMANCE
6.1 CONDITIONS. Petromoly's obligations hereunder shall be subject to
the satisfaction, at or before the Closing, of all the conditions set forth in
this Article 6. Petromoly may waive any or all of these conditions in whole
or in part without prior notice; provided, however, that no such waiver of a
condition shall constitute a waiver by Petromoly of any other condition of or
any of Petromoly's rights or remedies, at law or in equity, if OMC shall be in
default of any of its representations, warranties, or covenants under this
Agreement.
6.2 ACCURACY OF REPRESENTATIONS. Except as otherwise permitted by this
Agreement, all representations and warranties by OMC in this Agreement or in
any written statement that shall be delivered to Petromoly by OMC under this
Agreement shall be true and accurate on and as of the Closing Date as though
made at that time.
6.3 PERFORMANCE. OMC shall have performed, satisfied, and complied with
all covenants, agreements, and conditions required by this Agreement to be
performed or complied with by them, on or before the Closing Date.
6.4 ABSENCE OF LITIGATION. No action, suit or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened against OMC on or before the Closing Date.
6.5 DIRECTORS OF OMC. Effective on the Closing, OMC shall have fixed
the size of its Board of Directors at three (3) persons, such Board of
Directors shall include three persons designated by Petromoly, and the current
directors of OMC shall have submitted their resignations.
6.6 ACCEPTANCE BY PETROMOLY SHAREHOLDERS. The holders of an aggregate
of not less than 100% of the issued and outstanding shares of common stock of
Petromoly shall have agreed to exchange their shares for shares of OMC Common
Stock.
6.7 OFFICERS' CERTIFICATE. OMC shall have delivered to Petromoly a
certificate, dated the Closing Date and signed by the President of OMC
certifying that each of the conditions specified in Sections 6.2 through 6.6
have been fulfilled.
6.8 PRIVATE OFFERING. Petromoly shall have completed its private
offering and raised gross proceeds of at least $2,000,000.
ARTICLE 7
CLOSING
7.1 CLOSING. The Closing of this transaction shall be held at the
offices of Jon D. Sawyer, P.C., 1401 Seventeenth Street, Suite 460, Denver,
Colorado 80202, or such other place as shall be mutually agreed upon, on such
date as shall be mutually agreed upon by the parties, but in no event shall
the Closing be later than July 31, 1996. At the Closing:
(a) Petromoly shall deliver Letters of Acceptance and the
certificates representing the shares of Petromoly held by the shareholders of
Petromoly accepting the Exchange Offer ("Accepting Shareholders") to OMC.
(b) Each Accepting Shareholder shall receive a certificate or
certificates representing the number of shares of OMC Common Stock for which
the shares of Petromoly common stock shall have been exchanged. The
certificates for all shareholders except Petromoly Capital Partners will be
delivered to the law firm of Hanna Heppell Bell & Visosky who will hold such
certificates pursuant to a pooling agreement with such shareholders.
(c) OMC shall deliver an officer's certificate, as described in
Section 6.7 hereof, dated the Closing Date, that all representations,
warranties, covenants and conditions set forth in this Agreement on behalf of
OMC are true and correct as of, or have been fully performed and complied
with by, the Closing Date.
(d) OMC shall deliver a signed Consent and/or Minutes of the
Directors of OMC approving this Agreement and each matter to be approved by
the Directors of OMC under this Agreement.
(e) Petromoly shall deliver an officer's certificate, as described
in Section 5.6 hereof, dated the Closing Date, that all representations,
warranties, covenants and conditions set forth in this Agreement on behalf of
Petromoly are true and correct as of, or have been fully performed and
complied with by, the Closing Date.
(f) Petromoly shall deliver a signed Consent or Minutes of the
Directors of Petromoly approving this Agreement and each matter to be approved
by the Directors of Petromoly under this Agreement.
ARTICLE 8
MISCELLANEOUS
8.1 CAPTIONS AND HEADINGS. The Article and paragraph headings
throughout this Agreement are for convenience and reference only, and shall in
no way be deemed to define, limit, or add to the meaning of any provision of
this Agreement.
8.2 NO ORAL CHANGE. This Agreement and any provision hereof, may not be
waived, changed, modified, or discharged orally, but it can be changed by an
agreement in writing signed by the party against whom enforcement of any
waiver, change, modification, or discharge is sought.
8.3 NON-WAIVER. Except as otherwise expressly provided herein, no
waiver of any covenant, condition, or provision of this Agreement shall be
deemed to have been made unless expressly in writing and signed by the party
against whom such waiver is charged; and (i) the failure of any party to
insist in any one or more cases upon the performance of any of the provisions,
covenants, or conditions of this Agreement or to exercise any option herein
contained shall not be construed as a waiver or relinquishment for the future
of any such provisions, covenants, or conditions, (ii) the acceptance of
performance of anything required by this Agreement to be performed with
knowledge of the breach or failure of a covenant, condition, or provision
hereof shall not be deemed a waiver of such breach or failure, and (iii) no
waiver by any party of one breach by another party shall be construed as a
waiver with respect to any other or subsequent breach.
8.4 TIME OF ESSENCE. Time is of the essence of this Agreement and of
each and every provision hereof.
8.5 ENTIRE AGREEMENT. This Agreement contains the entire Agreement and
understanding between the parties hereto, and supersedes all prior
agreements and understandings.
8.6 CHOICE OF LAW. This Agreement and its application shall be governed
by the laws of the State of Colorado, except to the extent its conflict of
laws provisions would apply the laws of another jurisdiction.
8.7 NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party to whom notice
is to be given, or on the third day after mailing if mailed to the party to
whom notice is to be given, by first class mail, registered or certified,
postage prepaid, and properly addressed as follows:
OMC:
Ogden, McDonald & Company
3140-K South Peoria Street, Suite 230
Aurora, Colorado 80014
with a copy to:
Andrew I. Telsey
Andrew I. Telsey, P.C.
2851 South Parker Road, Suite 720
Aurora, Colorado 80014
Petromoly:
Worldwide Petromoly Corporation
1300 Post Oak Boulevard, 9th Floor
Houston, Texas 77056
with a copy to:
Jon D. Sawyer, P.C. and Mark Licata
Jon D. Sawyer Looper, Reid, Mark & McGraw
1401 17th Street, Suite 460 9 Greenway Plaza, Suite 1717
Denver, Colorado 80202 Houston, Texas 77046
8.8 BINDING EFFECT. This Agreement shall inure to and be binding upon
the heirs, executors, personal representatives, successors and assigns of each
of the parties to this Agreement.
8.9 MUTUAL COOPERATION. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement, and shall execute such other
and further documents and take such other and further actions as may be
necessary or convenient to effect the transaction described herein.
8.10 BROKERS. The parties hereto represent and agree that no broker has
brought about the aforementioned transaction and no finder's fee has been paid
or is payable by any party. Each of the parties hereto shall indemnify and
hold the other harmless against any and all claims, losses, liabilities or
expenses which may be asserted against it as a result of its dealings,
arrangements or agreements with any broker or person, except as described in
this paragraph.
8.11 ANNOUNCEMENTS. OMC and Petromoly will consult and cooperate with
each other as to the timing and content of any announcements of the
transactions contemplated hereby to the general public or to employees,
customers or suppliers.
8.12 EXPENSES. OMC and Petromoly will pay their own legal, accounting
and any other out-of-pocket expenses reasonably incurred in connection with
this transaction, whether or not the transaction contemplated hereby is
consummated.
8.13 EXHIBITS. As of the execution hereof, the parties hereto have
provided each other with the Exhibits provided for hereinabove, including any
items referenced therein or required to be attached thereto. Any material
changes to the Exhibits shall be immediately disclosed to the other party.
AGREED TO AND ACCEPTED as of the date first above written.
OGDEN, MCDONALD & COMPANY WORLDWIDE PETROMOLY CORPORATION
By/s/ Matthew J. Kavanagh, III By/s/ Gilbert Gertner
Matthew J. Kavanagh, III, Gilbert Gertner, Chief Executive Officer
President
<PAGE>
SCHEDULE 2
WORLDWIDE PETROMOLY CORPORATION
("Petromoly")
2.4 Directors and Officers of Petromoly:
Gilbert Gertner - Chairman of the Board, Chief Executive Officer
and Director
Robert Goldberg - President and Director
Lance Rosmarin - Secretary, Treasurer and Director
Kenneth Leitmayr - Vice President
2.6 On January 1, 1996, Petromoly accepted a capital contribution from
its sole shareholder, Petromoly Capital Partners, a Texas general partnership
(the "Partnership"), of assets previously licensed to and utilized in
Petromoly's business, which assets the Board of Directors valued at
$1,500,000. The assets were conveyed to Petromoly under a Quitclaim Bill of
Sale and Assumption Agreement, which included a provision obligating Petromoly
to pay a certain obligation of the Partnership to Gilbert Gertner, when due,
in an amount not to exceed $90,000.
2.17 Quitclaim Bill of Sale and Assumption Agreement dated January 1,
1996, between the Partnership and Petromoly (see disclosure under 2.6 above).
<PAGE>
SCHEDULE 3
OGDEN, MCDONALD & COMPANY ("OMC")
2.4 Directors and Officers of OMC:
Matthew J. Kavanagh - President and Director
Thomas J. Chase - Secretary and Director
Robert G. Hughes - Director
2.20 Material Contracts: None.
