-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OhNpZxXUZyqJd0RNPpEv4Df0JRkZ0C791u9P4wcHCVTWYyxWS+knxZWTqErUBsAk lF1dRXg3+vnEzJ+JlW9z0Q== 0000948830-00-000049.txt : 20000214 0000948830-00-000049.hdr.sgml : 20000214 ACCESSION NUMBER: 0000948830-00-000049 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20000209 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: METEOR INDUSTRIES INC CENTRAL INDEX KEY: 0000912875 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-AUTO & HOME SUPPLY STORES [5531] IRS NUMBER: 841236619 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-12401 FILM NUMBER: 535766 BUSINESS ADDRESS: STREET 1: 216 16TH ST STE 730 CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 3035721135 MAIL ADDRESS: STREET 1: 216 16TH ST STREET 2: STE 730 CITY: DENVER STATE: CO ZIP: 80202 8-K 1 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 FEBRUARY 9, 2000 ------------------------------------------------ Date of Report (date of earliest event reported) METEOR INDUSTRIES, INC. ---------------------------------------------------- Exact name of Registrant as Specified in its Charter COLORADO 0-27968 84-1236619 - --------------------------- --------------- --------------------------- State or Other Jurisdiction Commission File IRS Employer Identification of Incorporation Number Number 1401 BLAKE STREET, SUITE 200 DENVER, COLORADO 80202 ----------------------------------------------------------- Address of Principal Executive Offices, Including Zip Code (303) 572-1135 -------------------------------------------------- Registrant's Telephone Number, Including Area Code ITEM 5. OTHER EVENTS. On February 9, 2000, Meteor Industries, Inc. (the "Company") completed the sale of its subsidiary, Meteor Stores, Inc. ("MSI"), to Capco Energy, Inc. ("Capco"), an affiliate of the Company. The sale was made effective as of December 31, 1999. As of the date of this filing, MSI leases and operates twenty convenience stores (three of which are third party leases which expire at the end of February 2000) in Colorado and New Mexico which operate under the Conoco, Phillips 66, Frontier, Sinclair and Diamond Shamrock brand names. The sale of this operating subsidiary was made to allow the Company to focus on its core business of commercial, wholesale and cardlock petroleum distribution. The Company, through a five year supply contract with Capco, will continue to be the supplier of refined petroleum products to these stores. The total purchase price for the sale of MSI is $1,596,400. Year end adjustments are expected to decrease the purchase price by approximately $100,000. Two Hundred Fifty Thousand dollars was paid in cash at closing and Capco also delivered a promissory note for $1,250,000 payable in monthly installments of interest only during calendar year 2000 and the balance amortized over a 10 year period with a balloon payment of the remaining principal balance on December 31, 2001. Payments may be made either in cash or shares of the Company's Common Stock at a value of $3.00 per share. The promissory note bears interest at 9.25% per annum. The promissory note is secured by the pledge of all of the outstanding shares of Meteor Stores, Inc. and 210,000 shares of the Company's outstanding Common Stock held by a majority-owned subsidiary of Capco. Capco, through a majority-owned subsidiary, currently owns approximately 34% of the Company's Common Stock. Ilyas Chaudhary, a Director of the Company, is an officer, director and a principal shareholder of Capco. Dennis Staal, a Director of the Company, is also an officer of Capco and beneficially owns 35,000 common shares of Capco and 2,286 shares of Series A Preferred shares. Irwin Kaufman, a Director of the Company, is also a director of Capco and owns 20,000 common shares of Capco. Edward Names, President and CEO of the Company personally and through immediate family members may be deemed to beneficially own 64,580 common shares of Capco and 2,286 shares of Series A Preferred shares of Capco. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) EXHIBITS. The following exhibits are filed herewith: EXHIBIT NUMBER DESCRIPTION LOCATION 10.1 Agreement with Capco Energy, Filed herewith electronically Inc., as amended 10.2 Promissory Note from Capco Filed herewith electronically Energy, Inc. 10.3 Pledge and Security Agreement Filed herewith electronically with Capco Energy, Inc. and Capco Asset Management, Inc. 10.4 Product Sales Agreement Filed herewith electronically between Meteor Stores, Inc. and Meteor Marketing, Inc. 2 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. METEOR INDUSTRIES, INC. Dated: February 10, 2000 By /s/ Richard E. Kisser Richard E. Kisser, Chief Financial Officer 3 EX-10.1 2 AGREEMENT BY AND AMONG CAPCO ENERGY, INC., METEOR STORES, INC., METEOR INDUSTRIES, INC. THE SOLE SHAREHOLDER OF METEOR STORES, INC. AGREEMENT AGREEMENT, made this 31st day of December, 1999, by and among Capco Energy, Inc., a Colorado corporation ("Purchaser"), Meteor Stores, Inc. ("MSI" or the "Company"), a New Mexico corporation, and Meteor Industries, Inc., the sole shareholder of MSI ("Shareholder"). WHEREAS, Purchaser desires to acquire all of the issued and outstanding stock of MSI, held by the Shareholder (the "Common Stock"), in exchange for the consideration and upon the terms described herein (the "Purchase"); and WHEREAS, the Shareholder desires to sell all of the outstanding Common Stock of the Company; and WHEREAS, Purchaser, the Company and Shareholder desire to make certain representations, warranties, covenants and agreements in connection with the Purchase and also desire to prescribe various conditions precedent to the Purchase; NOW, THEREFORE, in consideration of the mutual promises, covenants, provisions, and representations contained herein, THE PARTIES HERETO AGREE AS FOLLOWS: ARTICLE 1 THE PURCHASE 1.1 Sale and Delivery of Common Stock. Subject to all the terms and conditions of this Agreement, the Shareholder shall transfer, convey and deliver to Purchaser at the Closing (as defined in paragraph 1.2 hereof) good, valuable and marketable title to the Common Stock, free and clear of all liens, claims and encumbrances except those created by this Agreement in exchange for the consideration described in this Article 1. 1.2 Effective Date and Closing. The effective date of this transaction shall be December 31, 1999 (the "Effective Date"). The closing of the transaction contemplated herein (the "Closing") shall occur at a mutually agreeable time and place, on the earliest practicable date following the day on which all of the obligations and conditions precedent contained herein are complied with. The closing date shall be on or about December 29, 1999, or a soon thereafter as reasonably practicable (the "Closing"). 1.3 Purchase Price. Subject to adjustment pursuant to Section 1.4, subject to the terms of Section 1.5 and subject to all of the other terms and conditions set forth in the Agreement and in reliance on the representations, warranties and covenants hereinafter set forth, Purchaser shall deliver to Shareholder the amount of $1,596,400 (hereinafter referred to as the "Purchase Price"). 1.4 Adjustments. The Total Purchase Price of the Common Stock shall be defined as $1,596,400. Such amount shall be adjusted as follows: (a) During the three month period following the Closing, Purchaser shall have an independent auditor of its choice audit (using generally accepted accounting principles and practices; fixed assets and inventories and the balance sheet and income statement of the Company as of December 31, 1999 (the "Audit"). Such auditor shall present its audit report to Shareholder and to Purchaser. If the audit report would result in a reduction of the purchase 2 price under subsection (b) of this Section 1.4, below, and if Shareholder disagrees with any portion of the audit report which is material to any such adjustment, the Shareholder shall so notify the Purchaser in writing within five (5) days and, the parties shall attempt to resolve such disagreement through good faith bargaining. If the parties are not successful in resolving such disagreement through bargaining within seven (7) days following Shareholder's notice to Purchaser, the parties shall submit the disagreement for arbitration under Section 13.4 below. (b) If the Purchaser's Audit of the Company shows that the Company's shareholder's equity is less than $1,596,400 then the Total Purchase Price shall be reduced by the amount of such shareholder's equity deficiency. 1.5 Payment of Purchase Price. The total Purchase Price shall be paid as follows: (a) $250,000 of the total Purchase Price shall be paid to the Shareholder, by certified or bank check or by electronic wire transfer of immediately available funds, at Closing. (b) $1,100,000 shall be paid at Closing in the form of 366,667shares of Meteor common stock (the Meteor "Common Shares"). The Meteor Common Shares shall be transferred, free and clear of all liens, claims and encumbrances. Any adjustments under Section 1.4 above in excess of $246,400 will result in a refund of Common Shares using a price of $3.00 per share. (c) $246,400 shall be paid on or before March 31, 2000, subject to any adjustments in the purchase price under Section 1.4 above. 1.6 Option to Repurchase Meteor Common Shares. Purchaser shall have the right to repurchase all or part of the Meteor Common Shares transferred pursuant to paragraph 1.5(b) at $3.00 per share plus .77% per month for each unexercised month for eighteen months. These repurchased shares shall have antidilutive provisions. ARTICLE 2 REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SHAREHOLDER As an inducement to the Purchaser to enter into this Agreement, the Company and the Shareholder hereby represent and warrant to Purchaser that: 2.1 Organization. The Company is a corporation duly organized, validly existing, and in good standing under the laws of New Mexico, 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 states where its business requires qualification. 2.2 Capital. The authorized capital stock of the Company consists of 2,500 shares common stock, no par value, of which 2,500 shares of common stock are issued and outstanding including -0- shares that are currently held in the treasury of the Company. All of the issued and outstanding shares of the Company are duly and validly issued, fully paid, and non-assessable. There are no outstanding subscriptions, options, rights, warrants, debentures, instruments, convertible securities, or other agreements or commitments obligating the Company, or any subsidiary to issue or to transfer from treasury additional shares of its capital stock. Except for the common stock 3 outstanding, there are no other equity securities of the Company. No taxes or other payments to governmental authorities will be due from the Purchaser upon transfer of the Common Stock as contemplated by this Agreement. 2.3 Corporate Books and Records. The minute books of the Company contain accurate records of all meetings and accurately reflect all other actions taken by the Board of Directors and the shareholders of the Company. Complete and accurate copies of all such minute books and of the stock register of the Company have been made available by the Company for inspection by the Purchaser. At the Closing, all of those books and records will be in the possession of the Company. 2.4 Subsidiaries. The Company does not have any subsidiaries or own any interest in any other enterprise, except as described in Exhibit 2.4 attached hereto. 2.5 Directors and Officers. Exhibit 2.5 to this Agreement, contains the names and titles of all directors and officers of the Company. 2.6 Financial Statements. Exhibit 2.6 to this Agreement, includes true and complete copies of the unaudited financial statements of the Company for the fiscal periods ended December 31,1998 and 1997, together with all related notes and schedules thereto. Prior to Closing an unaudited balance sheet as of October 31, 1999, and an unaudited income statement for the fiscal year ending October 31, 1999, shall be delivered to Purchaser and be included as part of Exhibit 2.6 (both sets of financial statements are hereinafter referred to as the "The Company Financial Statements"). Except as set forth in Exhibit 2.6, the Company Financial Statements shall have been prepared in accordance with generally accepted accounting principals and practices of the United States (hereinafter referred to as "GAAP"). Exhibit 2.6 sets forth certain year-end adjustments and tailoring transactions, which will be made and entered into to facilitate this Agreement. As revised by such adjustments and tailoring transactions, the Company Financial Statements are true, accurate and complete, and fairly present the financial position of the Company as of the dates and for the periods mentioned therein. 2.7 Absence of Undisclosed Liabilities. As of the respective dates of the Financial Statements included in Exhibit 2.6, the Company did not have any material debt, liability, or obligation of any nature, whether accrued, absolute, contingent or otherwise, and whether due or to become due, that is not reflected in the Financial Statements. As of the Closing Date, the Company does not have any material liabilities not disclosed in the Company Financial Statements, other than as listed on Exhibit 2.7. For purposes of this Section 2.7, a material liability shall mean a liability of $25,000 or more. Notwithstanding the definition of material liability in the preceding sentence, total undisclosed liabilities shall not exceed $50,000. 2.8 Taxes. To the best knowledge and belief of Shareholder, within the times and in the manner prescribed by law, the Company has filed all tax returns required by law and has paid all taxes, assessments and penalties due and payable in the normal course of its business. To the best knowledge and belief of Shareholder, the provisions for taxes, if any, reflected in the Company Financial Statements, are reasonably adequate for taxes for the periods ending on the date of such financial statements and for all prior periods, whether or not disputed. 4 2.9 Compliance with Laws. To the best of Shareholder's knowledge and belief, the Company is in compliance in all material respects with, and is not in violation of, applicable federal, state, or local statutes, laws or regulations affecting its properties or the operation of its business. 2.10 Litigation. Except as shown on Exhibit 2.10 attached hereto, (1) the Company is not a party to any suit, action, arbitration, or legal, administrative or other proceeding, or governmental investigation pending or threatened against or affecting the Company or its business, assets or financial condition (hereinafter referred to as "Actions"); (2) the Company 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 them; (3) the Company is not engaged in any lawsuits to recover monies due to it. 2.11 Authority. The Board of Directors of the Company has authorized the execution of this Agreement and the consummation of the transactions contemplated herein, and the Company and Shareholder have full power and authority to execute, deliver and perform this Agreement and this Agreement is a legal, valid and binding obligation of the Company and Shareholder, and is enforceable in accordance with its terms. 2.12 Ability to Carry Out Obligations. To the best of the Shareholder's knowledge and belief and except as shown on Exhibit 2.12 attached hereto, the execution and delivery of this Agreement by the Company and Shareholder and the performance by the Company and Shareholder of their obligations hereunder will not cause, constitute or conflict with or result in (a) any breach or violation of any of the provisions of or constitute a default under any license, indenture, mortgage, charter, instrument, articles of incorporation, by-laws, or other agreement or instrument to which the Company is a party, or by which it may be bound, nor will any consents or authorizations of any party other than those hereto be required, (b) an event that would permit any party to any agreement or instrument to terminate such agreement or instrument or to accelerate the maturity of any indebtedness or other obligation of the Company, or (c) an event that would result in the creation or imposition of any lien, charge, or encumbrance on any asset of the Company. Purchaser understands, as hereinafter set forth, upon Closing Shareholder intends and is entitled to withdraw and cancel any guaranties executed by it to suppliers and banks. The withdrawal and cancellation of such guaranties by Shareholder, as here in above and here in after referred to shall not constitute any breach or violation of this Agreement by the Company or Shareholder. 2.13 Validity of The Company Shares. The shares of the Company Common stock to be delivered to Purchaser pursuant to this Agreement, when transferred in accordance with the provisions of this Agreement, will be duly authorized validly issued, fully paid and non-assessable; and free and clear of all liens, claims and encumbrances. 2.14 Assets. The Company has good and marketable and insurable title to all its property and such property is not subject to any liens, claims and/or encumbrances other than disclosed in Exhibit 2.6. Exhibit 2.14 hereto lists all plant property and equipment of the Company with a value of $ 10,000. 2.15 Material Contracts. Exhibit 2.15 lists each material contract and agreement of the Company (such contracts and agreements listed, being collectively referred to as "Material Contracts"). The Company has delivered, or will deliver on or about the time of execution of this Agreement, to the Purchaser correct and complete copies of all Material Contracts. 5 2.16 Trade Names and Rights. Except as set forth in Exhibit 2.16 attached hereto, the Company owns all trademarks, service marks, trade names, and copyrights required in its business. A list of trademarks, service marks, trade names and copyrights owned by the Company is included in Exhibit 2.16. No other person or entity owns any trademark, trademark registration or application, service mark, trade name, copyright, or copyright registration or application the use of which is necessary or material in connection with the present or contemplated operations of the Company's business. 2.17 Employees. There are, except as disclosed in Exhibit 2.17 attached hereto, no collective bargaining, bonus, profit sharing, severance, indemnification, compensation or other agreements, trusts, funds, plans or arrangements maintained by the Company or any subsidiary of the Company for the benefit of its directors, officers or employees, and there are no employment, consulting, severance or indemnification arrangements, agreements or understandings between any of the foregoing and the Company. The Company's employee handbook or manual and a complete description of all employee benefits, is included as part of Exhibit 2.17 as of the effective date. All of the Company's employees are at-will employees who have no rights to severance pay. 2.18 Accounts Receivable. Except as covered by any allowance for doubtful accounts booked in the normal course of business in the Company Financial Statements, all accounts receivable of the Company, including those created between the date of the Financial Statements and the Closing, represent transactions in the ordinary course of business, and are current and collectible in the ordinary course of business in the amounts recorded on the Books of the Company. 2.19 Inventories. All inventories of the Company as of October 31, 1999 (to be updated at Closing as of the Effective Date), a complete list of which is attached hereto as Exhibit 2.19, whether or not reflected in the Company Financial Statements, are of a quality and quantity usable and salable in the ordinary course of business and comply in all material respects with applicable standards and regulations of governmental authorities. 2.20 Accounts Payable. The accounts payable reflected on the Company Financial Statements, and those reflected on the books of the Company at the time of the Effective Date will, reflect all amounts owed by the Company in respect of trade accounts due and other payables. 2.21 Insurance. The Company has insurance policies in full force and effect which provide for coverages which are usual and customary in its business as to amount and scope, and are adequate to protect the Company against any reasonably foreseeable risk of loss. Such policies will not remain in full force and effect subsequent to Closing. Exhibit 2.21 attached hereto identifies each of the Company's insurance policies, indicating the carrier, amount of coverage, annual premium, risks covered, placing broker or agent, and period through which the policy is paid up and other relevant information as to each. 2.22 Title to and Utilization of Properties. Exhibit 2.22 attached hereto lists all of the Company owned and leased properties. Except as disclosed on Exhibit 2.22, the Company owns fee simple, insured title to all real property owned by it and has the unbridled fight to use the same, and is not aware of any claim, notice or threat to the effect that its fight to own and use such property is subject in any way to any challenge, claim, assertion 6 of rights, proceedings toward condemnation or confiscation in whole or in part, or is otherwise subject to challenge. The Company has valid leases on its leased properties and the expiration dates of such leases are disclosed on Exhibit 2.22. 2.23 Facilities. To Shareholder's best knowledge and belief, the Company facilities are (as to physical plant and structure) structurally sound and none of its facilities, nor any of the vehicles or other equipment used by The Company in connection with its business, has any material defects and all of them are in all material respects in good operating condition and repair and are adequate for the uses to which they are being put. None of such plants, structures, or equipment is in need of maintenance and repairs except ordinary routine maintenance and repairs. Purchaser acknowledges that its representatives have inspected such facilities and have found them to be sound and free of obvious defects. 2.24 Environmental and Other Permits and Licenses, Related Matters. (a) To Shareholder's best knowledge and belief, the Company currently holds all the health and safety and other permits, licenses, authorizations, certificates, exemptions and approvals of governmental authorities (collectively, "PERMITS"), including, without limitation, environmental permits, necessary for the current use, occupancy and operation of each asset and property of the Company and the conduct of its business, and all such permits and environmental permits are in full force and effect. Neither the Company nor any of the Shareholder has received any notice from any governmental authority revoking, canceling, rescinding, materially modifying or refusing to renew any permit or environmental permit or providing written notice of violations under any environmental law which have not been resolved. The Company is in all material respects in compliance with the permits and all applicable Environmental Laws. Exhibit 2.24(a) identifies all permits that will require the consent of any governmental authority to consummate the transactions contemplated by this Agreement. (b) To Shareholder's best knowledge and belief, all equipment owned or used by the Company, including, but not limited to above ground storage tanks, underground storage tanks, and piping associated with such tanks, is in substantial compliance with all applicable Permits and Environmental Laws including the Federal and State 1998 underground storage tank requirements, and can be operated in the ordinary course of business in substantial compliance with all applicable Permits and Environmental Laws. (c) Except as disclosed in Exhibit 2.24(a): (i) Hazardous Materials have not been generated, used, treated, handled or stored on, or transported to or from (other than petroleum products handled, stored or transported in the normal course of business), or released on any owned real property or leased real property by the Company, and the Company and its Shareholder are unaware of any such generation, use, treatment, handling, storage, transportation, or release by any other person or entity, including but not limited to any predecessor in interest; (ii) the Company has reported all Releases of Hazardous Material in accordance with Environmental Laws; (iii) the Company has not Released any Hazardous Materials, and is not responsible or liable for any Release of Hazardous Materials, which must be remediated under applicable Environmental Law (including, but not limited to, any Release which results in the presence of Hazardous Materials in the environment in quantities or amounts that exceed remediation action levels specified by regulation or by governmental policy or guideline) or that any person or entity or governmental 7 authority has requested or required to be remediated; (iv) the Company has disposed of all wastes, including those containing Hazardous Materials, in material compliance with all applicable Environmental Laws and environmental permits; (v) there are no past, pending or threatened Environmental claims against the Company or any of its assets or properties; (vi) the Company has not transported or arranged for the transportation of any Hazardous Materials to any location that is listed or proposed for listing on the National Priorities List under CERCLA or on the CERCLIS or any analogous state list or which is the subject of any environmental claim; and (vii) neither the Company nor any governmental authority is conducting any remediation on or related to the owned real property, the leased real property or the business of the Company. (d) To Shareholder's best knowledge and belief, Exhibit 2.24(d) sets forth the age, contents or former contents of any storage tanks located on the premises owned or operated by the Company. Except as set forth in Exhibit 2.24(d) the Company has not owned or operated any underground storage tanks as defined in the Resource Conservation and Recovery Act ("RCRA"). Except as set forth in. Exhibit 2.24(d), all tanks and pipes pertinent thereto are presently and have been in the past in good condition and tight. (e) To the best knowledge and belief of Shareholder, there are no wastes, drums or containers disposed of or buried on, in or under the ground or any surface waters located on the premises currently or previously owned or operated by the Company. Neither the Company nor any third parties have disposed of or buried any wastes, drums or containers on, in or under the ground or any surface waters located on the premises owned or operated by the Company. Neither the Company nor any party acting on behalf of the Company disposed of or buried, or arranged to dispose of or bury, any waste, drums or containers in or on the premises of a third party other than those pursuant to and in compliance with RCRA. (f) Certain capitalized terms used in this Section 2.24 are defined as follows: Hazardous Materials - means (a) oil, petroleum and petroleum products, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation, transformers or other equipment that contain polychlorinated biphenyls, and radon gas, (b) any other chemicals, materials or substances defined as or included in the definition of "hazardous substances," "hazardous wastes," "hazardous materials," "extremely hazardous wastes," "restricted hazardous wastes," "toxic substances," "toxic pollutants," "contaminants" or "pollutants," or words of similar import, under any applicable Environmental Law, and (c) any other chemical, material or substance exposure to which is regulated by any governmental authority. Environmental Laws - means any law including but not limited to any federal, state, local, law, ordinance, regulation or rule now in effect and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, relating to the environment, health, safety or Hazardous Materials, including, without limitation, CERCLA; the Resource Conservation and Recovery Act, 42 U.S.C. SS 6901 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. SS 6901 et seq.; the Clean Water Act, 33 U.S.C. SS 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. SS 2601 et seq.; the Clean Air Act, 42 U.S.C. SS 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. SS 300f et seq.; the Atomic Energy Act, 42 U.S.C. SS 2011 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. SS 136 et seq.; and the Federal Food, Drug and 8 Cosmetic Act, 21 U.S.C. SS 301 et seq. and the state or local equivalents of these laws. Release - means disposing, discharging, injecting, spilling, leaking, leaching, dumping, emitting, escaping, emptying, seeping, placing and the like into or upon any land, water or air or otherwise entering into the environment. 2.25 Customers and Suppliers. Exhibit 2.25 lists all major customers and suppliers which are material to the financial condition or operations of the Company. Since October 31,1998, except as disclosed in Exhibit 2.25, there has been no adverse change in the business relationship of the Company with any such customer or supplier. It is understood and agreed that "material" customers and suppliers provided for in this section are defined as customers purchasing product from the Company in excess of $10,000 per year, and suppliers providing supplies and merchandise to the Company in the amount of $10,000 per year. 2.26 Bank Accounts. Exhibit 2.26 sets forth the names and locations of all banks, trust companies, savings and loan associations and other financial institutions at which the Company maintains current accounts of any nature and the names of all persons authorized to draw thereon or make withdrawals therefrom. ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF PURCHASER As an inducement to the Company and the Shareholder to enter into this Agreement, the Purchaser represents and warrants to the Company and Shareholder that: 3.1 Organization. Purchaser is a corporation duly organized, validly existing, and in good standing under the law of California, has all necessary corporate powers to own 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 states were its business requires qualification. 3.2 Capital. As of the date of this Agreement, the authorized capital stock of Purchaser consists of 150,000,000 shares of $.001 par value Common Stock of which 1,000,000 shares of Common Stock are currently issued and outstanding, and 10,000,000 shares of preferred stock $1.00 par value are authorized of which 292,947 shares are currently outstanding. All of the issued and outstanding shares of Purchaser are duly and validly issued, fully paid and non-assessable. 3.3 Authority. The Board of Directors of Purchaser has authorized the execution of this Agreement and the transactions contemplated herein, and Purchaser has full power and authority to execute, deliver and perform this Agreement and this Agreement is the legal, valid and binding obligation of Purchaser, and is enforceable in accordance with its terms and conditions. 3.4 Ability to Carry Out Obligations. Except as described in Exhibit 3.4, the execution and delivery of this Agreement by Purchaser and the performance by Purchaser of its obligations hereunder will not cause, constitute, or conflict with or result in (a) any breach or violation of any of the provisions of or constitute a default under any license, indenture, mortgage, charter, instrument, certificate of incorporation, bylaw, or other agreement or instrument to which Purchaser is a party, or by which it may be 9 bound, nor will any consents or authorizations of any party other than those hereto be required, (b) an event that would permit any party to any agreement or instrument to terminate it or to accelerate the maturity of any indebtedness or other obligation of Purchaser, or (c) an event that would result in the creation or imposition of any lien, charge, or encumbrance on any asset of Purchaser. 3.5 Directors and Officers. Exhibit 3.5 of this Agreement contains the names and titles of all directors and officers of Purchaser. 3.6 Other information. None of the information and documents which have been furnished or made available by the Purchaser or any of its representatives to Seller or any of its representatives in connection with the transactions contemplated by this Agreement is materially false or misleading or contains any material misstatement of fact or omits any material fact necessary to be stated in order to make the statements and information therein not misleading. ARTICLE 4 COVENANTS 4.1 Investigative Rights. The Company shall provide to Purchaser, and its counsel, accountants, auditors, and other authorized representatives, reasonable access to all of the Company's properties, books, contracts, commitments, and records for the purpose of examining the same. The Company shall furnish Purchaser with all information concerning its affairs as Purchaser may reasonably request. Without in any manner reducing or otherwise mitigating the representations contained herein, Purchaser and/or its representatives shall have the opportunity to meet with accountants to discuss the financial condition of the Company. 4.2 Indemnification of the Company and Shareholder. Purchaser shall be liable for and shall indemnify, defend and hold the Company and the Shareholder and its officers, directors, affiliates, agents and the Shareholder 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 result from or relate to any activities of the Company or Purchaser subsequent to the Closing Date or which result from or relate to any breach of, or failure by Purchaser 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 Purchaser under this Agreement. 4.3 Indemnification of Purchaser. The Company and Shareholder shall be liable for and shall agree to indemnify, defend and hold Purchaser and its officers, directors, affiliates and agents 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 result from or relate to any breach of, or failure by the Company to perform any of its respective representations, warranties, covenants and agreements in this Agreement or in any exhibit, schedule, certificate or other instrument furnished or to be furnished by the Company or Shareholder under this Agreement. 10 4.4 Accounts Payable. With regard to all accounts payable and accrued taxes as of the Effective Date, Purchaser will cause such amounts to be paid according to the payment plan and/or requirements of the creditor or taxing authority, without extension, delinquency or other material deviation from the payment term and plan. Purchaser shall, within fifteen (15) days after Closing, arrange for the release of Shareholder and other key employees of the Company from personal guarantees relating to the business of the Company. 4.5 Shareholder's Cooperation After the Closing, Further Action. At any, time and from time to time after the Closing, the Shareholder shall execute and deliver to the Purchaser such other instruments and take such other actions as the Purchaser may reasonably request more effectively to vest title to the Shares in the Purchaser and, to the full extent permitted by law, to put the Purchaser in actual possession and operating control of the Company and its assets, properties and the business. Each of the parties hereto shall use all reasonable efforts to take, or cause to be taken, all appropriate action, do or cause to be done all things necessary, proper or advisable under applicable laws, and execute and deliver such documents and other papers, as may be required to carry out the provisions of this Agreement and to consummate and make effective the transactions contemplated hereby. ARTICLE 5 CONDITIONS PRECEDENT TO PURCHASER'S PERFORMANCE 5.1 Conditions. Purchaser's obligations hereunder shall be subject to the satisfaction, at or before the Closing, of all the conditions set forth in this Article 5. Purchaser may waive any or all of these conditions in whole or in part without prior notice; so long as such waiver is in writing; and provided, however, that no such waiver of a condition shall constitute a waiver by Purchaser of any other condition or any of Purchaser's other rights or remedies, at law or in equity, if the Company and Shareholder 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 the Company and Shareholder in this Agreement or in any written statement that shall be delivered to Purchaser by the Company under this Agreement shall be true and accurate when made and on and as of the Closing Date with the same force and affect as if made at the Closing. 5.3 Performance. Purchaser shall be reasonably satisfied that the Company and Shareholder 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 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 any party hereto on or before the Closing Date. 5.5 Directors of the Company. Effective on the Closing Date the Board of Directors of the Company shall be reorganized and be made up of four individuals named by Purchaser. 5.6 Closing Documents. The Company and the Shareholder shall be prepared to deliver the closing documents set forth in Article 6 of this Agreement. 11 5.7 Officer's Certificate. The Company shall have delivered to Purchaser a certificate, dated the Closing Date, and signed by the President of the Company, certifying that each of the special conditions specified in Sections 6.2 hereof have been fulfilled. ARTICLE 6 CONDITIONS PRECEDENT TO THE COMPANY'S AND SHAREHOLDER'S PERFORMANCE 6.1 Conditions. The Company's and Shareholder's obligations hereunder shall be subject to the satisfaction, at or before the Closing, of all the conditions set forth in this Article 6. The Company and Shareholder may waive any or all of these conditions in whole or in part without prior notice; so long as such waiver is in writing; and provided, however, that no such waiver of a condition shall constitute a waiver by the Company and Shareholder of any other condition of or any of the Company's or Shareholder's rights or remedies, at law or in equity, if Purchaser 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 Purchaser in this Agreement or in any written statement that shall be delivered to the Company and/or Shareholder by Purchaser under this Agreement shall be true and accurate on and as of the Closing Date as though made at that time. (a) The Company shall deliver a signed Consent or Minutes of the Directors of the Company approving this Agreement. Such Minutes shall be certified by an officer of the Company. (b) Each party shall deliver such other documents or information required to be furnished by Closing pursuant to this Agreement. ARTICLE 7 MISCELLANEOUS 7.1 Captions and Headings. The Article and paragraph/section headings through 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. 7.2 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. 7.3 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. 12 7.4 Entire Agreement. This Agreement contains the entire Agreement and understanding between the parties hereto, and supersedes all prior agreements and understandings. 7.5 Choice of Law. This Agreement and its application shall be governed by the laws of the State of Colorado. 7.6 Counterparts. This Agreement may be executed simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 7.7 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 receipt if served personally on the party to whom notice is to be given, by telecopy or telegram, or 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: Purchaser: CAPCO ENERGY, INC. 2922 CHAPMAN AVENUE, SUITE 202 ORANGE, CA 92869 ATTENTION: IMRAN, JATTALA, VICE PRESIDENT Shareholder: METEOR INDUSTRIES, INC. 1401 BLAKE STREET, SUITE 200 DENVER, COLORADO 80202 The Company: METEOR STORES, INC. 1401 BLAKE STREET, SUITE 200 DENVER, CO 80202 7.8 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. 7.9 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. 7.10 Brokers. 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, finder or person. 7.11 Announcements. Purchaser, Shareholder and the Company 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. Except to the extent that the parties consent in writing otherwise, no party to this Agreement shall make, or cause to be made, any press release or public announcement in respect of this Agreement or the transactions contemplated hereby or otherwise communicate with any news media. Nevertheless, the parties agree that the Purchaser or an affiliate of the Purchaser may make such disclosure (on Form 8-K, by press release or otherwise) regarding the terms of this Agreement and the transactions contemplated hereby as it deems necessary to comply with 13 applicable securities laws or the rules and regulations of the NASDAQ, including a press release following the execution of this Agreement. 7.12 Expenses. Except as specifically provided in this Agreement, all direct costs and expenses including legal, and any other out-of-pocket expenses incurred by Shareholder, in connection with this transaction, shall be paid by the Shareholder. All costs and expenses including legal, accounting and any other out-of-pocket expenses incurred by the Purchaser, in connection with this transaction, shall be paid by the Purchaser. 7.13 Survival of Representations and Warranties. Except as otherwise provided in this Section 9.13, the representations, warranties, covenants and agreements of the parties set forth in this Agreement or in any instrument, certificate, opinion, or other writing providing for in it, shall survive the Closing for a period of one year irrespective of any investigation made by or on behalf of any party. 7.14 Assignment. This Agreement may not be assigned by operation of Law or otherwise by the Shareholder, the Company or the Purchaser. AGREED TO AND ACCEPTED as of the date first above written. PURCHASER: CAPCO ENERGY, INC. SHAREHOLDER: METEOR INDUSTRIES, INC. /s/ Ilyas Chaudhary /s/ Dennis R. Staal, Director By ____________________________ ________________________________ SELLER: METEOR STORES, INC. /s/ Paul W. Greaves, President By ______________________________ 14 Exhibit 2.4 SUBSIDIARIES Hatch Pyramid LLC Socorro Pyramid LLC Meteor Properties of Colorado LLC Exhibit 2.5 DIRECTORS AND OFFICERS OF THE COMPANY Paul W. Greaves President, Director Richard E. Kisser Secretary/Treasurer, Director Edward J. Names Director Exhibit 2.6 FINANCIAL STATEMENTS See attached. Exhibit 2.7 UNDISCLOSED LIABILITIES Conoco upgrades contingent liability for approximately $650,000. Requires purchase of Conoco products. Exhibit 2.10 LITIGATION None. Exhibit 2.12 ABILITY TO CARRY OUT OBLIGATIONS This transaction will require the consent of Norwest Bank. Consent has been requested and will be obtained before the audit adjustment period. Exhibit 2.14 ASSETS See attached. Exhibit 2.15 MATERIAL CONTRACTS - Hillco, Inc. Lease - Graves Oil & Butane Co., Inc. Lease 1. 551 E. Main, Farmington, NM (#144) 2. 761 S. Miller, Farmington, NM (#143) 3. 1721 E. 20th Avenue, Farmington, NM (#141) 4. 191 Alameda, NW, Albuquerque, NM (#121) - Limited Liability Lease 1. 9160 Coors NW, Albuquerque, NM (#122) - Coors Pyramid LLC 2. 603 Franklin, Hatch, NM (#103) - Hatch Pyramid LLC 3. 3920 Bloomfield Highway, Farmington, NM (#142) - Bloomfield Pyramid LLC 4. 105 . Main, Ft. Morgan, CO (#303) - Meteor Carroll, LLC 5. 530 W. Platte, Ft. Morgan, CO (#304 - Mustangs) - Meteor Properties of Colorado LLC 6. 321 East 8th Avenue, Yuma, CO (#306 - Threshers) - Meteor Properties of Colorado LLC 7. 1113 W. Edison, Brush, CO (#305 - Diggers) - Meteor Properties of Colorado LLC - Meteor Marketing, Inc. Supply Agreement (SEE ATTACHED) Exhibit 2.16 TRADE NAMES AND RIGHTS Conoco, Inc. Phillips 66 Diamond Shamrock Sinclair Frontier Exhibit 2.17 EMPLOYEES See attached. Exhibit 2.19 INVENTORIES See Attached. Exhibit 2.21 INSURANCE See attached. Exhibit 2.22 TITLE TO AND UTILIZATION OF PROPERTIES See Attached. Exhibit 2.24 ENVIRONMENTAL AND OTHER PERMITS AND LICENSES 2.24(a) Environmental and Other Permits and Licenses 2.24(b) Environmental and Other Permits and Licenses; Related Matters 2.24(d) Age, Contents or Former Contents of Any Storage Tanks Located on Premises Owned or Operated by Company Exhibit 2.25 CUSTOMERS AND SUPPLIERS LISTS See attached. Exhibit 2.26 BANK ACCOUNTS See attached. Exhibit 3.4 ABILITY TO CARRY OUT OBLIGATIONS None. Exhibit 3.5 DIRECTORS AND OFFICERS OF PURCHASER AMENDMENT TO AGREEMENT This Amendment to that certain Agreement, made the 31st day of December, 1999, which was entered into by and among Meteor Industries, Inc. and Capco Energy, Inc. and Meteor Stores, Inc. is made this 8th day of February, 2000. First: Article 1.4(b) shall be deleted in its entirety and replaced by the following: (b) The Purchase Price shall be adjusted downward by the tax affected operating loss of the Company for November and December of 1999. No Audit adjustments to the Company's balance sheet or pro forma balance sheet included in Exhibit 2.6 shall result in a Purchase Price adjustment. Second: Section 1.5(b) of the Agreement is amended to read as follows: 1.5 $1,250,000 shall be paid at Closing in the form of a note. The note shall bear interest of 9.25%. Payments on the note shall be interest only during calendar year 2000. The remaining payments on the note will be calculated based on a ten-year amortization, with a balloon payment of the unpaid principal balance on December 31, 2001. The first payment will be due on April1, 2000. The note shall be secured by all of the outstanding shares of Meteor Stores, Inc. and 210,000 shares of common stock of Meteor Indus-tries, Inc. The payments can either be made in cash or in shares of Meteor Industries, Inc. common stock valued for note payment purposes at $3.00 per share. Any adjustment under Section 1.4 in excess of $96,400 will result in a reduction of the note. Third: Section 1.6 shall be deleted in its entirety. Fourth: Exhibit 2.15 is amended to include the following disclosures: a. Limited Liability Lease No. 1 (Coors Road #8) is an operating agreement instead of a lease and such operating agreement shall stay in effect until such time as the other LLC interest holders are bought out. (See Coors Pyramid LLC agreement) b. Limited Liability Lease No. 2 is canceled and the Hatch store is to be operated pursuant to the LLC agreement c. Limited Liability leases Nos. 5, 6, 7 expire on January 31, 2000. d. Leases for the Byers and Simla locations are hereby added to the list and are attached. e. The CFN Agreement , the Cardlock Agreement and updated Product Sales Agreement attached are hereby added to Exhibit 2.15 f. Meteor Marketing, Inc. will continue to occupy the Las Cruces Bulk Plant and warehouse at the rate of $2,500 per month until a new Operator/Tenant can be found. g. The two LLC agreements (Hatch and Coors) are hereby added as part of Exhibit 2.15 and attached hereto. h. The liquor license between El Boracho and Meteor Stores, Inc. is hereby added as an additional exhibit and attached hereto. i. The sublease with Coastal Transport regarding the 4208 S. Broadway warehouse shall be added as part of Exhibit 2.15 and is attached hereto. j. McLanes and ATM agreements shall be added as part of 2.15 and are attached hereto. Exhibit 2.24 is amended as follows: a. Additional updated Environmental Status Reports relating to the following properties are hereby added to Exhibit 2.24 and are attached hereto. 1. 761 S. Miller, Farmington 2. No. 3 at 20th Street, Farmington 3. Lohman St., Las Cruces 4. Byers, Colorado Store 5. Simla, Colorado Store 6. Quik Chek , Las Cruces 7. Elks Store, Las Cruces b. New automatic tank gauging systems are being installed at the 2nd and Alameda , Albuquerque location and the Deming, New Mexico locations. This shall be accomplished and paid for by Meteor Industries, Inc. by March, 2000. Fifth: Exhibit 2.22 shall be amended by adding a list of all Company leases and identifying the Lessor, the present monthly rental payments, the expiration dates and other relevant data. Such list is attached hereto and shall include Fort Morgan location. Agreed to and accepted as of the date first above written. PURCHASER: CAPCO ENERGY, INC. SHAREHOLDER: METEOR INDUSTRIES, INC. /signed/ Imran Jattala /signed/ Edward J. Names By:___________________________________ By:__________________________________ COMPANY: METEOR STORES, INC. /signed/ Imran Jattala By:___________________________________ 2 EX-10.2 3 PROMISSORY NOTE $1,250,000.00 December 31, 1999 Capco Energy, Inc., a Colorado corporation, ("Obligor"), for value received, hereby promises to pay to the order of Meteor Industries, Inc. ("Payee"), in lawful money of the United States at the address of Payee set forth below, the principal sum of One Million Two Hundred Fifty Thousand and 00/100 Dollars ($1,250,000.00), together with simple interest on the unpaid principal at the rate of nine and one quarter percent (9.25%) per annum. Subject to the provisions for acceleration herein the payments on this Note during calendar year 2000 shall be interest only payments paid monthly. Beginning on January 1, 2001, and subject to the provisions for acceleration herein, payments shall be made on all unpaid principal together with all accrued interest amortized over ten years, in equal monthly payments, with a balloon payment of the remaining principal balance on December 31, 2001. The first payment which shall include interest on this Note for three months in the amount of $28,906 shall be due on April 1, 2000. Payments can be made in cash or in shares of Meteor Industries common stock to be valued for note payment purposes at $3.00 per share. This Note may be prepaid, in whole or in part, at any time without permission or penalty in cash or in Meteor common stock valued at the closing price on the day of payment. Interest shall be computed on the basis of a 360-day year and actual days elapsed. This Note shall be prepaid upon Payee's request if Obligor or its parent company completes a public offering of common stock. If payment on this Note shall become due on a Saturday, Sunday or public holiday under the laws of the State of Colorado, such payment shall be made on the next succeeding business day and such extension of time shall be included in computing interest in connection with such payment. Immediately upon the occurrence of an "Event of Default" (as defined below), Payee may, at its option, declare immediately due and payable the entire unpaid principal amount of this Note, together with all interest thereon, plus any other amounts payable at the time of such declaration pursuant to this Note. An Event of Default shall be defined as each of the following: (i) failure of Obligor to make any payment of interest and/or principal within thirty (30) days after the due date; (ii) Obligor shall admit in writing its inability to pay its debts as they become due, shall make a general assignment for the benefit of creditors or shall file any petition for action for relief under any bankruptcy, reorganization, insolvency or moratorium law, or any other law or laws for the relief of, or relating to, debtors; or (iii) an involuntary petition shall be filed against Obligor under any bankruptcy, reorganization, insolvency or moratorium law, or any other law or laws of for the relief of, or relating to, debtors unless such petition shall be dismissed or vacated within thirty (30) days of the date hereof. If Payee should institute collection efforts, of any nature whatsoever, to attempt to collect any and all amounts due hereunder upon the default of Obligor, Obligor shall be liable to pay to holder all reasonable costs and expenses of collection incurred by Payee, including, without limitation, reasonable attorney fees, whether or not suit or other action or proceeding be instituted and specifically including but not limited to collection efforts that may be made through a bankruptcy court. This Note shall be governed by and construed and interpreted in accordance with the laws of the State of Colorado. IN WITNESS WHEREOF, the parties hereto have executed this Note as of the day and year first above written. Any payment shall be deemed made upon receipt by Payee. Payee or Obligor may change their address for purposes of this paragraph by giving to the other party notice in conformance with this paragraph of such new address. "OBLIGOR" CAPCO ENERGY, INC. /signed/ Imran Jatalla By:____________________________________ Print Name: Imran Jatalla Title: Executive Vice President "GUARANTOR" CAPCO ASSET MANAGEMENT, INC. /signed/ John R. Aitken By:____________________________________ Print Name: John R. Aitken Title: President 2 EX-10.3 4 PLEDGE AND SECURITY AGREEMENT THIS PLEDGE AND SECURITY AGREEMENT is made and entered into as of the 31st day of December 1999, by Capco Energy, Inc., a Colorado corporation and Capco Asset Management, Inc. (a majority-owned subsidiary of Capco Energy, Inc.) (such entities are collectively hereinafter called "Pledgor"), whose offices are located at 2922 E. Chapman Avenue, Suite 202, Orange, California 92869, in favor of Meteor Industries, Inc.; and its successors and assigns (hereinafter called "Secured Party"), whose address is 1401 Blake Street, Suite 200, Denver, Colorado 80202. 1. RECITALS 1.1 Secured Party has entered into an Agreement dated December 31, 1999, and amended February 8, 2000, by and among Secured Party, Capco Energy, Inc. and Meteor Stores, Inc. ("MSI") (the "Purchase Agreement") and has received a promissory note, executed by Capco Energy, Inc. and Guaranteed by Capco Asset Management, Inc., in the amount of $1,250, 000 ("Note") for the sale of all of the outstanding stock of MSI to Pledgor pursuant to the Agreement. 1.2 The Purchase Agreement requires the Pledgor to deliver to Secured Party a pledge and security interest in 210,000 shares of the issued and outstanding common stock of Meteor Industries, Inc., a Colorado corporation, now owned or hereafter acquired by Pledgor and all of the outstanding shares of Meteor Stores, Inc. 1.3 Pledgor is the owner of 210,000 shares of the common stock of the Meteor Industries, Inc. and all of the outstanding shares of Meteor Stores, Inc. (the "Common Stock"). 2. PLEDGE OF STOCK 2.1 Pledgor hereby grants to Secured Party a security interest in the Common Stock, together with all earnings thereon, all additions thereto, all proceeds thereof from sale or otherwise, all substitutions therefor, and all securities issued with respect thereto as a result of any stock dividend, stock split, warrants or other rights, reclassification, readjustment or other change in the capital structure of the Company, and the securities of any corporation or other properties received upon the conversion or exchange thereof pursuant to any merger, consolidation, reorganization, sale of assets or other agreement or received upon any liquidation of the Company or such other corporation (all hereinafter called the "Pledged Securities"). 2.2 Upon the execution of this Agreement, Pledgor has delivered to the Secured Party certificates for the Pledged Securities, together with appropriate stock transfer powers therefor duly executed by Pledgor in blank, with signatures guaranteed free and clear of any prior lien, claim, charge or encumbrance. 2.3 Secured Party shall receive, hold and dispose of the Pledged Securities subject and pursuant to all the terms, conditions and provisions hereof until the Obligation (defined below) bas been discharged in full. Agent shall be under no duty to exercise, or to withhold the exercise of, any of the rights, powers, privileges and options expressly or implicitly granted to Secured party in this Agreement, and shall not be responsible for any failure to do so or delay in so doing. 3. RELEASE OF AND LEGEND ON SHARES Upon receipt by the holder of the Note of funds in the amount of the required principal and interest due under the terms of the Note, the certi-ficates of the Pledged Securities shall be released from this Agreement and delivered to Pledgor, free and clear of all liens, claims and encumbrances (the "Released Certificates"), and the stock legend set forth in Section 3.2 below shall be removed from the Released Certificates. A legend shall be placed on the certificates evidencing the Pledged Securities in substantially the following form: THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A PLEDGE AND SECURITY AGREEMENT DATED AS OF DECEMBER 31, 1999 (THE "AGREEMENT" ) WHICH PLEDGES THESE CERTIFICATES TO AND GRANTS A SECURITY INTEREST IN THESE CERTIFICATES TO SECURED PARTY DEFINED IN THE AGREEMENT. NO TRANSFER OF THE CERTIFICATES WILL BE MADE ON THE BOOKS OF METEOR INDUSTRIES, INC. UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE TERMS OF THE AGREEMENT. THE CORPORATION WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY OF THE AGREEMENT WITHIN FIVE (5) DAYS AFTER RECEIPT OF WRITTEN REQUEST THEREFOR. 4. OBLIGATION SECURED This Agreement shall secure, in such order of priority as Secured Party may elect: (a) payment of the sum of $1,250,000 with interest thereon, extension and other fees, late charges, prepayment premiums and attorneys' fees, according to the terms of that Promissory Note dated December 31, 1999, made by Pledgor, payable to the order of Secured Party, and all extensions, modifications, renewals or replacements thereof (hereinafter called the "Note") ; and (b) payment, performance and observance by Pledgor of each covenant, condition, provision and agreement contained herein and of all monies expended or advanced by Secured Party pursuant to the terms hereof, or to preserve any right of Secured Party hereunder, or to protect or preserve the Pledged Securities or any part thereof. All of the indebtedness and obligations secured by this Agreement are hereinafter collectively called the "obligation." 5. REPRESENTATIONS AND WARRANTIES OF PLEDGOR Pledgor hereby represents and warrants that: 5.1 Pledgor (i) are duly organized, validly existing and in good standing under the laws of the state in which they are organized; (ii) are qualified to do business and is in good standing under the laws of each state in which they are doing business; (iii) has full power and authority to own their properties and assets and to carry on their business as now conducted; and (iv) are fully authorized and permitted to execute and deliver this Agreement. The execution, delivery and performance by Pledgor of this Agreement and all other documents and instruments relating to the Obligation 2 will not result in any breach of the terms and conditions of, nor constitute a default under, any agreement or instrument under which Pledgor is a party or is obligated. Pledgor are not in default in the performance or observance of any covenants, conditions or provisions of any such agreement or instrument. 5.2 The address of Pledgor set forth at the beginning of this Agreement is the chief executive office of Pledgor. 5.3 The Pledged Securities are and shall be duly and validly issued and pledged in accordance with applicable law, and this Agreement shall not contravene any law, agreement or commitment binding Pledgor or the company, and Pledgor shall defend the right, title, lien and security interest of Secured party in and to the pledged Securities against the claims and demands of all persons and other entities whatsoever. 5.4 Pledgor has the right, power and authority to convey good and marketable title to the Pledged Securities; and the Pledged Securities and the proceeds thereof are and shall be free and clear of all claims, mortgages, pledges, liens, encumbrances and security interest of every nature whatsoever other than as imposed hereby, as imposed by the Purchase Agreement, and pursuant to federal and state securities laws. 6. VOTING Notwithstanding the terms of this Agreement, Pledgor shall have all rights to vote the Pledged Securities pursuant to the terms and conditions of the Articles of Incorporation of Meteor Industries, Inc. so long as an event of default set forth in section 8 has not occurred whereupon Secured Party shall have all of the voting rights attached to those Pledged Securities not previously released pursuant to section 3 hereof. 7. COVENANTS OF PLEDGOR 7.1 Pledgor shall not sell, transfer, assign or otherwise dispose of any of the Pledged Securities or any interest therein without obtaining the prior written consent of Secured Party and shall keep the Pledged Securities free of all security interests or other encumbrances except the lien and security interests granted herein. 7.2 Pledgor shall pay when due all taxes, assessments, expenses and other charges which may be levied or assessed against the Pledged Securities. 7.3 Pledgor shall give Secured Party immediate written notice of any change in Pledgor's name as set forth above and of any change in the location of Pledgor's chief executive office. 7.4 Pledgor, at its cost and expense, shall protect and defend the Secured Party against all claims and demands of other parties against the Pledged Securities. Pledgor shall pay all claims and charges that in the reasonable opinion of Secured Party might prejudice, imperil or otherwise affect the Pledged Securities. Each party hereto shall promptly notify all other parties hereto of any levy, distraint or other seizure, by legal process or otherwise, of all or any part of the Pledged Securities and of any threatened or filed claims or proceedings that might in any way affect or impair the terms of this Agreement. 7.5 If Pledgor shall fail to pay any taxes, assessments, expenses or charges to keep all of the Pledged Securities free from other security 3 interests, encumbrances or claims, or to perform otherwise as required herein, Secured Party may advance the monies, necessary to pay the same or to so perform. 7.6 All rights, powers and remedies granted Secured Party herein, or otherwise available to Secured Party, are for the sole benefit and protection of Secured Party, and Secured Party may exercise any such right, power or remedy at its option and in its sole and absolute discretion without any obligation to do so. In addition, if, under the terms hereof, Secured Party is given two or more alternative courses of action, Secured Party may elect any alternative or combination of alternatives at its option and in its sole and absolute discretion. All monies advanced by Secured Party under the terms hereof, all amounts paid, suffered or incurred by Secured Party under the terms hereof and all amounts paid, suffered or incurred by Secured Party in exercising any authority granted herein, including reasonable attorneys' fees, shall be added to the obligation, shall be secured hereby, shall bear interest at the highest rate payable on the Note until paid, and shall be due and payable by Pledgor to Secured Party immediately without demand. 7.7 Secured Party and Agent shall use such reasonable care in handling, preserving and protecting the Pledged Securities in its possession as it uses in handling similar property for its own account. 7.8 Immediately upon demand by Secured Party, Pledgor shall execute and deliver to Secured Party such other and additional applications, acceptances, stock powers, authorizations, irrevocable proxies, dividend and other orders, chattel paper, instruments or other evidences of payment and such other documents as Secured Party may reasonably request to secure to Secured party the rights, powers and authorities intended to be conferred upon Secured Party by this Agreement. All assignments and endorsements by Pledgor shall be in such form and substance as may be reasonably satisfactory to Secured Party. 8. EVENTS OF DEFAULT; REMEDIES 8.1 The occurrence of any of the following events or conditions shall constitute and is hereby defined to be an "Event of Default": a. Any failure to pay any principal or interest or any other part of the obligation when the same shall become due and payable and such failure continues for thirty (30) days after written notice thereof to Pledgor. b. Any failure or neglect to perform or observe any of the terms, provisions, or covenants of this Agreement, the Note, or any other document or instrument executed or delivered to secure the Obligation (other than a failure or neglect described in one or more of the other provisions of this paragraph 8.1) and such failure or neglect continues unremedied for a period of thirty (30) days after written notice thereof to Pledgor. c. Any warranty, representation or statement contained in this Agreement, the Note, or any other document or instrument executed or delivered to secure the Obligation that shall be or shall prove to have been false when made or furnished. d. The filing by Pledgor, any endorser of the Note or any guarantor of the Obligation or against Pledgor or such endorser or guarantor in which Pledgor or such endorser or guarantor acquiesces or which is not dismissed within forty-five (45) days after the filing thereof of any 4 proceeding under the federal bankruptcy laws now or hereafter existing or any other similar statute now or hereafter in effect; the entry of an order for relief under such laws with respect to Pledgor or such endorser or guarantor; or the appointment of a receiver , trustee, custodian or conservator of all or any part of the assets of Pledgor or of such endorser or guarantor. e. The liquidation, termination or dissolution of Pledgor or any endorser or guarantor. f. Any levy or execution upon, or judicial seizure of, any portion of the Pledged Securities. g. Any attachment or garnishment of, or the existence or filing of any lien or encumbrance against any portion of the Pledged Securities. h. The institution of any legal action or proceedings to enforce a lien or security interest in any portion of the Pledged Securities. i. The occurrence of any event of default under the Note or any other document or instrument executed or delivered to secure the Obligation. 8.2 Upon the occurrence of any Event of Default and at any time while such Event of Default is continuing, Secured Party shall have the following rights and remedies and may do one or more of the following: a. Declare all or any part of the Obligation to be immediately due and payable, and the same, with all costs and charges, shall be collectible thereupon by action at law; b. Transfer the Pledged Securities or any part thereof into its own name or that of its nominee so that Secured party or its nominee may appear of record as the sole owner thereof; c. Exercise any and all rights of conversion, exchange, subscription, or any other rights, privileges or options pertaining to any of the Pledged Securities including, but not limited to, the right to exchange, at its discretion, any or all of the Pledged Securities upon the merger, consolidation, reorganization, recapitalization or other readjustment of Meteor Industries, Inc. or upon the exercise by Pledgor or Secured Party of any right, privilege or option pertaining to any of the shares of the Pledged Securities, and in connection therewith to deposit and deliver such shares of Pledged Securities with any committee, depository, transfer agent, registrar or any other agency upon such terms as Secured Party may determine without liability except to account for the property actually received by it; d. Receive and retain any dividend or other distribution on account of the Pledged Securities; and e. Sell any or all of the Pledged Securities in accordance with the provisions hereof, but Secured Party shall have no duty to exercise any of the aforesaid rights, privileges or options and shall not be responsible for any failure to do so or delay, in so doing Pledgor waives all rights to be advised or to receive any notices, statements or communications received by Secured Party or its nominee as the record owner of all or any of the Pledged Securities. Any cash received and retained by Secured Party as additional collateral hereunder may be applied to payment in the manner provided in Subparagraph 8.3(c) below. 5 8.3 Secured Party shall have the right, for and in the name, place and stead of Pledgor, to execute endorsements, assignments or other instruments of conveyance or transfer with respect to all or any of the Pledged Securities and any instruments, documents and statements that Pledgor is obligated to furnish or execute hereunder. Pledgor shall execute and deliver such additional documents as may be necessary to enable Secured Party to implement such right. 8.4 Pledgor shall pay all costs and expenses, including without limitation court costs and reasonable attorneys' fees, reasonably incurred by Secured Party in enforcing payment and performance of the obligation or in exercising the rights and remedies of Secured Party hereunder. All such costs and expenses shall be secured by this Agreement and by all other lien and security documents securing the Obligation. In the event of any court proceedings, court costs and attorneys' fees shall be set by the court and not by jury and shall be included in any judgment obtained by Secured Party. 8.5 In addition to any remedies provided herein for an Event of Default, Secured Party shall have all the rights and remedies afforded a secured party under the Uniform Commercial Code and all other legal and equitable remedies allowed under applicable law. No failure on the part of Secured Party to exercise any of its rights hereunder arising upon any Event of Default shall be construed to prejudice its rights upon the occurrence of another or subsequent Event of Default. No delay on the part of Secured Party in exercising any such rights shall be construed to preclude it from the exercise thereof at any time while that Event of Default is continuing. Secured Party may enforce any one or more rights or remedies hereunder successively or concurrently. By accepting payment or performance of any of the Obligation after its due date, Secured Party shall not thereby waive the agreement contained herein that time is of. the essence, nor shall Secured Party waive either its right to require prompt payment or performance when due of the remainder of the Obligation or its right to consider the failure to so pay or perform an Event of Default. 9. MISCELLANEOUS PROVISIONS 9.1 The acceptance of this Agreement by Secured Party shall not be considered a waiver of or in any way to affect or impair any other security that Secured Party may have, acquire simultaneously herewith, or hereafter acquire for the payment or performance of the Obligation, nor shall the taking by Secured Party at any time of any such additional security be construed as a waiver of or, in any way to affect or impair the right and interest granted herein; Secured Party may resort, for the payment or performance of the Obligation, to its several securities therefor in such order and manner as it may determine. 9.2 Without notice or demand, without the necessity for any additional endorsements, without affecting the obligations of Pledgor hereunder or the personal liability of any person for payment or performance of the Obligation, and without affecting the rights and interests granted herein, Secured Party, from time to time may: (i) extend the time for payment of all or any part of the Obligation, accept a renewal note therefor, reduce the payments thereon, release any person liable for all or any part thereof, or otherwise change the terms of all or any part of the Obligation; ( ii) take and hold other security for the payment or performance of the Obligation and enforce, exchange, substitute, subordinate, waive or release any such, security; (iii) join in any extension or subordination agreement; or (iv) release any part of the Pledged Securities from this Agreement. 6 9.3 Pledgor waives and agrees not to assert: (i) any right to require Secured Party to proceed against any guarantor, to proceed against or exhaust any other security for the Obligation, to pursue any other remedy available to Secured Party, or to pursue any remedy in any particular order or manner; (ii) demand, diligence, presentment for payment, protest and demand, and notice of extension, dishonor, protest, demand and nonpayment, relating to the obligation; and (iii) any benefit of and any right to participate in, any other security now or hereafter held by Secured Party. 9.4 The terms herein shall have the meanings in and be construed under the Uniform Commercial Code. This Agreement shall be governed by and construed according to the internal laws of the State of Colorado. Each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be void or invalid, the same shall not affect the remainder hereof which shall be effective as though the void or invalid provision had not been contained herein. 9.5 No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by a written agreement executed by Pledgor and a duly authorized officer of Secured Party. 9.6 This is a continuing agreement, which shall remain in full force and effect until actual receipt by Secured Party of written notice of its termination as to future transactions and shall remain in full force and effect thereafter until all of the Obligation incurred before the receipt of such notice shall have been paid and performed in full. 9.7 Time is of the essence hereof. This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their heirs, personal representatives, successors and assigns. The term "Secured Party" shall include not only the original Secured Party hereunder but also any future owner and holder, including pledgees, of the note or notes evidencing the Obligation. The provisions hereof shall apply to the parties according to the context thereof and without regard to the number or gender of words or expressions used. 9.8 All notices required or permitted to be given hereunder shall be in writing and may be given in person or by united States mail, by delivery service or by electronic transmission. Any notice directed to a party to this Agreement shall become effective upon the earliest of the following: (i) actual receipt by that party; (ii) delivery to the designated address of that party, addressed to that party; or (iii) if given by certified or registered united States mail, three days after deposit with the United States Postal Service, postage prepaid, addressed to that party at its designated address. The designated address of a party shall be the address of that party shown in the Purchase Agreement or from time to time, may specify by notice to the other parties. 9.9 An executed copy of this Agreement and/or any financing statement relating hereto shall be sufficient for filing and/or recording as a financing statement. 7 IN WITNESS WHEREOF, these presents are executed as of the date indicated above. CAPCO ENERGY, INC. /signed/ Imran Jatalla By: ____________________________________ Print Name: Imran Jatalla Title: Executive Vice President CAPCO ASSET MANAGEMENT, INC. /signed/ John R. Aitken By: ____________________________________ Print Name: John R. Aitken Title: President 8 EX-10.4 5 PRODUCT SALES AGREEMENT This Agreement made and entered into this 31st day of December, 1999, by and between Meteor Stores, Inc., hereinafter known as "Marketer", and Meteor Marketing, Inc., a Wyoming corporation, hereinafter known as "Distributor". The Distributor agrees to furnish motor fuels and oils ("Products") and related items to the Marketer in accordance with State and Federal Government Regulation pursuant to the commodity schedules attached hereto. It is agreed the Distributor shall not be liable to the Marketer by reason of Product shortages beyond its control. It is further agreed that the Distributor will sell Products to Marketer at the prices and terms described in the attached Commodity Schedules. The Marketer, in consideration of the above agrees to purchase those Products which are sold by the Distributor exclusively for a period of five (5) years from the above date. It is further agreed by both parties that this agreement will automatically extend on a year to year basis. Either party may give the other a 60 day prior written notice of intent not to extend. After one year, either party may terminate this agreement upon thirty (30) days notice if the terms are not competitive in any or all pricing aspects of this Agreement. Distributor hereby agrees to supply fuel in a reasonably timely manner and failure to do so shall be deemed to be a breach of this Agreement. Where there is a temporary failure to supply product Marketer may purchase fuel from another authorized supplier and where there is a permanent failure to supply product this Agreement may be terminated. In the event this Agreement is canceled by either party, it is agreed that the Marketer shall have the right to remove all signs, poles, credit card imprinters, or other equipment that the Distributor has placed or erected on the Marketer's premises. It is further agreed that the Marketer shall abide by the suppliers image program as described in Exhibit A attached hereto. If Marketer changes suppliers or brands on any particular site, Marketer shall be liable for any and all unamortized improvement loans and program funds provided by major oil company suppliers related to that site. The amount of such contingent liability at December 31, 1999, is approximately $650,000 (a schedule of such contingent liabilities shall be attached hereto). Marketer shall have the right to change a site from a branded site to an unbranded site so long as there are no contingent liabilities relating to that site at the time of conversion. Marketer recognizes that it is handling hazardous substances and agrees that in receiving, storing, handling and using Product(s) purchased from Distributor, Marketer will exercise the strictest care required by law and that it will comply with any and all applicable federal, state and local laws, ordinances and regulations pertaining to the storage and use of petroleum products. Marketer further understands and warrants that it has sole responsibility for the storage, maintenance and use of all inventories of Product(s) purchased from Distributor and for corrective action and claims of third Parties resulting from any failure to comply with the above. Marketer HEREBY INDEMNIFIES AND HOLD DISTRIBUTOR, ITS SUCCESSORS AND ASSIGNS, HARMLESS AGAINST ALL LOSSES, CLAIMS, CAUSES OF ACTION TO COMPLY WITH THE PRECEDING SENTENCES. The performance and interpretation of this Agreement shall be governed by New Mexico law and all applicable federal law. If either party to this Agreement obtains a judgment against the other for breach of any provision hereof, damages shall include all reasonable attorneys' fees and costs as well as interest at 1.5% per month. Marketer: Distributor: /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President 2 COMMODITY SCHEDULE (MOTOR FUELS) MARKETER: Meteor Stores, Inc. DATE: 12/31/99 DELIVERY POINT: Retail Outlets in New Mexico PRODUCT: Branded Gasoline And Colorado GRADE: Regular Unleaded This schedule is attached to and made a part of a Product Sales Agreement between Marketer and Distributor dated December 31, 1999. 1. Quantity. Marketer's annual requirements are estimated to be 9,000,000 gallons ("Estimated Annual Quantity"), for delivery in approximately equal monthly quantities. Delivery shall be made to Marketer or its agents upon reasonable notice to Distributor. 2. Delivery. Where delivery is made to Marketer's business location, delivery shall be complete upon unloading of transport truck. Marketer shall allow delivery to take place at night. 3. Title. Title to Products shall pass to Marketer upon delivery of Products. 4. Risk of Loss. Risk of loss of Product shall pass to Marketer upon delivery of Products. 5. Inspection. Marketer shall have the right, at its expense, to have an inspection made at delivery point, provided such inspection shall not delay shipment. Should Marketer fail to make inspection, it shall accept Distributor's inspection and measurement. 6. Prices. The price to be paid by Marketer shall be Distributor's applicable price in effect at the time and place of delivery. Such price shall be Distributor's delivered cost plus $.005 per gallon for full transport quantity deliveries . All prices charged by Distributor are subject to the provisions of applicable law. 7. Leased Equipment. Distributor shall pay for all sign lease costs and credit card imprinters lease fees. 8. Payment Terms. All billings shall be paid on a load to load basis or within 10 days of delivery (or 5 days of delivery for Conoco products) of the Products whichever occurs first, payment shall be made in good and immediately available funds and subject to a total company credit limit of $250,000. All credit terms are subject to change, at the sole discretion of the Distributor, after twenty-four (24) hours notice to Marketer. Financial statements of Marketer shall be made available to Distributor upon reasonable request. 9. Annual Rebate. If Marketer purchases and pays for at least n/a gallons of the Products described herein during the twelve month period commencing on the date hereof, and extends this agreement for a subsequent year. Distributor shall issue a credit of n/a cent(s) per gallon on such Products, which credit shall be applied to future purchases. Distri-butor will provide Marketer with a monthly summary of Products purchased. 10. Records. With regard to branded gasoline products sold by Distributor to Marketer for sale or resale through branded retail outlets supplied by Marketer, Distributor and/or its delegate may, at any reasonable time, examine, copy and audit such records and/or metering devices which it deems necessary to assure adherence to the requirement that only Distributor's branded products are being sold through such outlets. 3 ACCEPTED: Marketer ACCEPTED: Distributor /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President Date: 12/31/99 Date: 12/31/99 4 COMMODITY SCHEDULE (MOTOR FUELS) MARKETER: Meteor Stores, Inc. DATE: 12/31/99 DELIVERY POINT: Retail Outlets in New Mexico PRODUCT: Branded Gasoline And Colorado GRADE: Unleaded Plus This schedule is attached to and made a part of a Product Sales Agreement between Marketer and Distributor dated December 31, 1999. 1. Quantity. Marketer's annual requirements are estimated to be 2,000,000 gallons ("Estimated Annual Quantity"), for delivery in approximately equal monthly quantities. Delivery shall be made to Marketer or its agents upon reasonable notice to Distributor. 2. Delivery. Where delivery is made to Marketer's business location, delivery shall be complete upon unloading of transport truck. Marketer shall allow delivery to take place at night. 3. Title. Title to Products shall pass to Marketer upon delivery of Products. 4. Risk of Loss. Risk of loss of Product shall pass to Marketer upon delivery of Products. 5. Inspection. Marketer shall have the right, at its expense, to have an inspection made at delivery point, provided such inspection shall not delay shipment. Should Marketer fail to make inspection, it shall accept Distributor's inspection and measurement. 6. Prices. The price to be paid by Marketer shall be Distributor's applicable price in effect at the time and place of delivery. Such price shall be Distributor's delivered cost plus $.005 per gallon for full transport quantity deliveries. All prices charged by Distributor are subject to the provisions of applicable law. 7. Leased Equipment. Distributor shall pay for all sign lease costs and credit card imprinters lease fees. 8. Payment Terms. All billings shall be paid on a load to load basis or within 10 days of delivery (or 5 days of delivery for Conoco products) of the Products whichever occurs first, payment shall be made in good and immediately available funds and subject to a total company credit limit of $250,000. All credit terms are subject to change, at the sole discretion of the Distributor, after twenty-four (24) hours notice to Marketer. Financial statements of Marketer shall be made available to Distributor upon reasonable request. 9. Annual Rebate. If Marketer purchases and pays for at least n/a gallons of the Products described herein during the twelve month period commencing on the date hereof, and extends this agreement for a subsequent year. Distri-butor shall issue a credit of n/a cent(s) per gallon on such Products, which credit shall be applied to future purchases. Distributor will provide Marketer with a monthly summary of Products purchased. 10. Records. With regard to branded gasoline products sold by Distributor to Marketer for sale or resale through branded retail outlets supplied by Marketer, Distributor and/or its delegate may, at any reasonable time, examine, copy and audit such records and/or metering devices which it deems necessary to assure adherence to the requirement that only Distributor's branded products are being sold through such outlets. 5 ACCEPTED: Marketer ACCEPTED: Distributor /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President Date: 12/31/99 Date: 12/31/99 6 COMMODITY SCHEDULE (MOTOR FUELS) MARKETER: Meteor Stores, Inc. DATE: 12/31/99 DELIVERY POINT Retail Outlets in New Mexico PRODUCT: Branded Gasoline And Colorado GRADE: Unleaded Premium This schedule is attached to and made a part of a Product Sales Agreement between Marketer and Distributor dated December 31, 1999. 1. Quantity. Marketer's annual requirements are estimated to be 1,500,000 gallons ("Estimated Annual Quantity"), for delivery in approximately equal monthly quantities. Delivery shall be made to Marketer or its agents upon reasonable notice to Distributor. 2. Delivery. Where delivery is made to Marketer's business location, delivery shall be complete upon unloading of transport truck. Marketer shall allow delivery to take place at night. 3. Title. Title to Products shall pass to Marketer upon delivery of Products. 4. Risk of Loss. Risk of loss of Product shall pass to Marketer upon delivery of Products. 5. Inspection. Marketer shall have the right, at its expense, to have an inspection made at delivery point, provided such inspection shall not delay shipment. Should Marketer fail to make inspection, it shall accept Distributor's inspection and measurement. 6. Prices. The price to be paid by Marketer shall be Distributor's applicable price in effect at the time and place of delivery. Such price shall be Distributor's delivered cost plus $.005 per gallon for full transport quantity deliveries. All prices charged by Distributor are subject to the provisions of applicable law. 7. Leased Equipment. Distributor shall pay for all sign lease costs and credit card imprinters lease fees. 8. Payment Terms. All billings shall be paid on a load to load basis or within 10 days of delivery(or 5 days of deliver for Conoco products) of the Products whichever occurs first, payment shall be made in good and immediately available funds and subject to a total company credit limit of $250,000. All credit terms are subject to change, at the sole discretion of the Distributor, after twenty-four (24) hours notice to Marketer. Financial statements of Marketer shall be made available to Distributor upon reasonable request. 9. Annual Rebate. If Marketer purchases and pays for at least n/a gallons of the Products described herein during the twelve month period commencing on the date hereof, and extends this agreement for a subsequent year. Distributor shall issue a credit of n/a cent(s) per gallon on such Products, which credit shall be applied to future purchases. Distributor will provide Marketer with a monthly summary of Products purchased. 10. Records. With regard to branded gasoline products sold by Distributor to Marketer for sale or resale through branded retail outlets supplied by Marketer, Distributor and/or its delegate may, at any reasonable time, examine, copy and audit such records and/or metering devices which it deems necessary to assure adherence to the requirement that only Distributor's branded products are being sold through such outlets. 7 ACCEPTED: Marketer ACCEPTED: Distributor /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President 8 COMMODITY SCHEDULE (MOTOR FUELS) MARKETER: Meteor Stores, Inc. DATE: 12/31/99 DELIVERY POINT: Retail Outlets in New Mexico PRODUCT: Branded Gasoline And Colorado GRADE: Diesel This schedule is attached to and made a part of a Product Sales Agreement between Marketer and Distributor dated December 31, 1999. 1. Quantity. Marketer's annual requirements are estimated to be 500,000 gallons ("Estimated Annual Quantity"), for delivery in approximately equal monthly quantities. Delivery shall be made to Marketer or its agents upon reasonable notice to Distributor. 2. Delivery. Where delivery is made to Marketer's business location, delivery shall be complete upon unloading of transport truck. Marketer shall allow delivery to take place at night. 3. Title. Title to Products shall pass to Marketer upon delivery of Products. 4. Risk of Loss. Risk of loss of Product shall pass to Marketer upon delivery of Products. 5. Inspection. Marketer shall have the right, at its expense, to have an inspection made at delivery point, provided such inspection shall not delay shipment. Should Marketer fail to make inspection, it shall accept Distributor's inspection and measurement. 6. Prices. The price to be paid by Marketer shall be Distributor's applicable price in effect at the time and place of delivery. Such price shall be Distributor's delivered cost plus $.005 per gallon for full transport quantity deliveries. All prices charged by Distributor are subject to the provisions of applicable law. 7. Leased Equipment. Distributor shall pay for all sign lease costs and credit card imprinters lease fees. 8. Payment Terms. All billings shall be paid on a load to load basis or within 10 days of delivery (or 5 days of delivery for Conoco products) of the Products whichever occurs first, payment shall be made in good and immediately available funds and subject to a total company credit limit of $250,000. All credit terms are subject to change, at the sole discretion of the Distributor, after twenty-four (24) hours notice to Marketer. Financial statements of Marketer shall be made available to Distributor upon reasonable request. 9. Annual Rebate. If Marketer purchases and pays for at least n/a gallons of the Products described herein during the twelve month period commencing on the date hereof, and extends this agreement for a subsequent year. Distributor shall issue a credit of n/a cent(s) per gallon on such Products, which credit shall be applied to future purchases. Distributor will provide Marketer with a monthly summary of Products purchased. 10. Records. With regard to branded gasoline products sold by Distributor to Marketer for sale or resale through branded retail outlets supplied by Marketer, Distributor and/or its delegate may, at any reasonable time, examine, copy and audit such records and/or metering devices which it deems necessary to assure adherence to the requirement that only Distributor's branded products are being sold through such outlets. 9 ACCEPTED: Marketer ACCEPTED: Distributor /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President 10 COMMODITY SCHEDULE LUBRICATING OILS AND GREASES SPECIAL PROVISIONS MARKETER: Meteor Stores Inc. DATE: December 31, 1999 This schedule is attached to and made a part of a Product Sales Agreement between Marketer and Distributor dated December 31, 1999. 1. Products. Lubricating Oils and Greases as listed in space below: All Meteor Marketing, Inc. products 2. Quantity. Marketer's annual requirements estimated to be 1,000 gallons for delivery in approximately equal monthly quantities upon reasonable notice to Distributor. 3. Prices. Distributor's established prices in effect on date of delivery. 4. Title. Title to Products shall pass to Marketer upon delivery of Products. 5. Risk of Loss. Risk of loss of Product shall pass to Marketer upon delivery of Products. 6. Inspection. Marketer shall have the right, at its expense, to have an inspection made at delivery point, provided such inspection shall not delay shipment. Should Marketer fail to make inspection, it shall accept Distributor's inspection and measurement. 7. Payment Terms. All billings shall be paid within 10 days of delivery of the Products in good and immediately available funds and subject to a total company credit limit of $250,000. All credit terms are subject to change, at the sole discretion of the Distributor, after twenty-four (24) hours notice to Marketer. Financial statements of Marketer shall be made available to Distributor upon reasonable request. ACCEPTED: Marketer ACCEPTED: Distributor /signed/ Imran Jatalla /signed/ Paul W. Greaves By: _____________________________ By: ______________________________ Paul W. Greaves Title: Executive Vice President Title: President 11 COMMODITY SCHEDULE (MOTOR FUELS) Distributor's applicable price and terms Fuel Prices will be rack plus common carrier freight plus one half cent per gallon. Payment for Conoco products will be net five days or load to load which ever comes first. Payment will be by EFT from Marketers bank account. 12 SUPPLIERS IMAGE PROGRAM The Distributor's branded suppliers have certain image and upgrade standards that Marketer must abide by. Some branded suppliers have image enhancement programs that must be complied with. Some branded suppliers have various programs to fund certain image enhancements. Distributor will supply marketer with copies of branded supplier standards and programs. If Marketer uses any of these programs Marketer will be liable to purchase the branded fuels to meet the program requirements. 13 DISTRIBUTORS FLEET FUELING PROGRAM In the event that Distributor enters into any fleet fueling programs Marketer agrees to participate in the Distributors program at all locations which Distributor selects. Terms of the program will be determined but will in general allow Distributor or program customers to fuel at Marketers sites. Marketer will be paid a per gallon rate which maybe less than the prices normally charged by Marketer. 14 -----END PRIVACY-ENHANCED MESSAGE-----