Affiliated Resources Corporation Announces New Acquisition
2 February 2000
Affiliated Resources Corporation Announces New Acquisition
HOUSTON--Feb. 2, 2000--Affiliated Resources Corporation (OTCBB:ARCX) today announced that it has acquired an 85% interest in Seneca Energy Partners L.P., a Texas Limited Partnership, engaged in the oil and gas business, in a stock for partnership unit transaction. The transaction also provides for a management agreement with Seneca's General Partner, Lonestar Investment Management, L.L.C., a Texas Limited Liability Company.Under terms of the agreement dated December 27, 1999, Lonestar exchanged 85% of Seneca's limited partnership units for 800,000 shares of Affiliated common stock and an irrevocable option to purchase 425,000 shares of Affiliated common stock for a price of $.10 per share. Lonestar, which remains General Partner and retains its 1% interest, will continue to manage Seneca. The venture will reimburse Lonestar for out-of-pocket expenses which includes an accrued expense of $45,000. The remaining 14% of Seneca will be retained by current limited partners, Jay R. Beatty and Michael R. Bradle, Affiliated's new president and chief operating officer.
Currently, Seneca has an interest in 16 oil and gas wells in West Virginia with a reserve report value of approximately $182,000. According to Peter C. Vanucci, chairman and CEO of Affiliated, "This acquisition is the beginning of a new business entity designed to increase shareholder value and improve cash flow. To this end, Seneca's management has identified $3,000,000 of additional working interests which the company intends to fund with the proceeds of a private placement of preferred stock it intends to conduct at a later date. I am delighted to be able to add an entity that will not only produce positive benefits to our shareholders but is also consistent with our existing Chemway business which blends and packages petroleum products."
Affiliated Resources Corporation is engaged, through its Chemway division, in the blending, packaging and distribution of automotive aftermarket fluids and is currently pursuing related acquisitions.
Statements included in this press release which are not historical in nature, are intended to be, and are hereby identified as "forward-looking statements" for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended by Public Law 104-67 and provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipate," "believe," "intends," "estimates," "expects," and similar expressions. Affiliated Resources Corporation cannot guarantee that agreements or contracts will be fulfilled by its customers or distributors. The Company cautions readers that forward-looking statements, including, without limitation, those relating to the Company's future business prospects are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements.