SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 7)(1)
Puroflow Incorporated
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(Name of issuer)
COMMON STOCK, $.01 PAR VALUE
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(Title of class of securities)
746 375 104
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(CUSIP number)
STEVEN WOLOSKY, ESQ.
OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
505 Park Avenue
New York, New York 10022
(212) 753-7200
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(Name, address and telephone number of person
authorized to receive notices and communications)
August 12, 1999
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(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box
/ /.
Note. six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom copies
are to be sent.
(Continued on following pages)
(Page 1 of 15 Pages)
Exhibit Index on Page 12
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1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
<PAGE>
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CUSIP No. 746 375 104 13D Page 2 of 15 Pages
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
STEEL PARTNERS II, L.P.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
DELAWARE
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,406,000
OWNED BY
EACH ----------------------------------------------------------------
REPORTING
PERSON WITH
8 SHARED VOTING POWER
-0-
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,406,000
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,406,000
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.57%
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14 TYPE OF REPORTING PERSON*
PN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 3 of 15 Pages
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================================================================================
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
WARREN LICHTENSTEIN
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
USA
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,406,000
OWNED BY
EACH ----------------------------------------------------------------
REPORTING
PERSON WITH
8 SHARED VOTING POWER
- 0 -
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,406,000
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,406,000
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.57%
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14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 4 of 15 Pages
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================================================================================
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
ROBERT FRANKFURT
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
USA
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NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY
EACH ----------------------------------------------------------------
REPORTING
PERSON WITH
8 SHARED VOTING POWER
- 0 -
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
-0-
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
-0-
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14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 5 of 15 Pages
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================================================================================
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
JAMES BENENSON, JR.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
USA
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY
EACH
REPORTING ----------------------------------------------------------------
PERSON WITH
8 SHARED VOTING POWER
-0-
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
-0-
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
-0-
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 6 of 15 Pages
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================================================================================
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
STEVEN WOLOSKY
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
USA
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY
EACH ----------------------------------------------------------------
REPORTING
PERSON WITH
8 SHARED VOTING POWER
-0-
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
-0-
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
-0-
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 7 of 15 Pages
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================================================================================
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
THE FULL VALUE COMMITTEE
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,406,000
OWNED BY
EACH ----------------------------------------------------------------
REPORTING
PERSON WITH
8 SHARED VOTING POWER
-0-
----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,406,000
----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,406,000
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.57%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP No. 746 375 104 13D Page 8 of 15 Pages
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The following constitutes Amendment No. 7 ("Amendment No. "7") to the
Schedule 13D filed by the undersigned. This Amendment No. 7 amends the Schedule
13D as specifically set forth.
Item 3 is hereby amended and restated in its entirety as follows:
Item 3. Source and Amount of Funds.
The aggregate purchase price of the 1,406,000 Shares of Common Stock
owned by Steel Partners II is $1,190,859. The Shares of Common Stock owned by
Steel Partners II were acquired with partnership funds.
Item 4 is hereby amended to add the following:
Item 4. Purpose of Transaction.
On August 9, 1999 the Reporting Persons sent a letter (the
"August Letter") to the Board of Directors of the Issuer in response to letter
and press release, each dated August 4, 1999, publicly announcing the Issuer's
offer to settle the current proxy contest. Subsequent to delivery of the August
Letter, the Reporting Persons received a response from the Issuer, dated August
12, 1999 (the "Response Letter"). The Response Letter indicated that the Board
of Directors of the Issuer had no intention of settling the current proxy
contest on terms Steel Partners believes are in the best interest of the Issuer
and its stockholders. Steel Partners believes that any such "demands",
settlement should include, among other things (i) an agreement by the Board to
eliminate any and all related party transactions, including those transactions
between the Company and its non-employee directors and (ii) an amendment of the
Company's Poison Pill Rights Plan to raise the acquisition threshold to 25%.
Although the Reporting Persons had hoped to come to a negotiated settlement with
the Issuer in the best interests of the Issuer and its stockholders, the
Reporting Persons now believe their only option is to continue with their proxy
contest in order to have their slate elected to the Board of Directors of the
Issuer. The August Letter and the Response Letter are filed as Exhibits 5 and 6,
respectively, to this Amendment No. 7 to Schedule 13D and incorporated herein by
reference.
Item 5(a) is hereby amended to read as follows:
Item 5. Interest in Securities of the Issuer.
(a) The aggregate percentage of Shares of Common Stock
reported owned by each person named herein is based upon 8,000,321
<PAGE>
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CUSIP No. 746 375 104 13D Page 9 of 15 Pages
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Shares outstanding, which is the total number of Shares of Common Stock
outstanding as reported in the Issuer's Definitive Proxy Statement on Schedule
14A filed April 26, 1999.1
As of the close of business on August 17, 1999, Steel Partners
II beneficially owns 1,406,000 Shares of Common Stock, constituting
approximately 17.57% of the Shares outstanding. Mr. Lichtenstein beneficially
owns 1,406,000 Shares, representing approximately 17.57% of the Shares
outstanding. Mr. Lichtenstein has sole voting and dispositive power with respect
to the 1,406,000 Shares owned by Steel Partners II by virtue of his authority to
vote and dispose of such Shares. All of such Shares were acquired in open market
transactions.
Item 5(c) is hereby amended to read as follows:
(c) Steel Partners II, L.P. engaged in the following
transactions in the Issuer's Common Stock in the last 60 days.
Number of Shares Purchase Price Per Date of Purchase
Purchased Share
10,000 .98875 8/4/99
10,000 .98875 8/5/99
15,000 .83250 8/16/99
34,900 .87840 8/17/99
Item 7. Material to be Filed as Exhibits.
1. Joint Filing Agreement between Steel Partners and
Warren G. Lichtenstein (previously filed).
2. Joint Filing Agreement between Steel Partners,
Warren Lichtenstein, Robert Frankfurt, James
Benenson, Jr. and Steven Wolosky (previously
filed).
- --------
1Although the Issuer's most recent public filings indicate 8,100,321 shares
outstanding, the Reporting Persons believe that 100,000 of such shares were
acquired by individuals pursuant to a stock issuance which was without proper
corporate purpose and which was designed to entrench management, as stated in
the complaint filed by Steel Partners with the United States District Court,
District of Delaware. If such shares were included in a calculation of
beneficial ownership, the Reporting Persons would be deemed to own 17.35% of the
outstanding shares Common Stock.
<PAGE>
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CUSIP No. 746 375 104 13D Page 10 of 15 Pages
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3. Preliminary Proxy Statement (previously filed).
4. Letter to the Board of Directors of Puroflow,
Incorporated dated June 3, 1999. (previously filed)
5. Letter to the Board of Directors of Puroflow,
Incorporated dated August 9, 1999.
6. Letter from Puroflow Incorporated to Steel Partners
II, L.P. dated August 12, 1999.
<PAGE>
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CUSIP No. 746 375 104 13D Page 11 of 15 Pages
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SIGNATURES
After reasonable inquiry and to the best of his knowledge and
belief, each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: August 18, 1999 STEEL PARTNERS II, L.P.
By: Steel Partners, L.L.C.
General Partner
By: /s/ Warren G. Lichtenstein
------------------------------
Warren G. Lichtenstein
Chief Executive Officer
/s/ Warren G. Lichtenstein
----------------------------------
WARREN G. LICHTENSTEIN
/s/ Robert Frankfurt
----------------------------------
ROBERT FRANKFURT
/s/ James Benenson, Jr.
----------------------------------
JAMES BENENSON, JR.
/s/ Steven Wolosky
----------------------------------
STEVEN WOLOSKY
<PAGE>
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CUSIP No. 746 375 104 13D Page 12 of 15 Pages
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EXHIBIT INDEX
Exhibit Page
1. Joint Filing Agreement between Steel -
Partners and Warren G. Lichtenstein
(previously filed)
2. Joint Filing Agreement between Steel -
Partners, Warren Lichtenstein, Robert
Frankfurt, James Benenson, Jr. and
Steven Wolosky. (previously filed)
3. Preliminary Proxy Statement -
(previously filed
4. Letter to the Board of Directors of -
Puroflow, Incorporated dated June 3,
1999. (previously filed)
5. Letter to the Board of Directors of 12
Puroflow, Incorporated dated August 9,
1999.
6. Letter from Puroflow Incorporated to 14
Steel Partners II, L.P. dated August
12, 1999.
<PAGE>
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CUSIP No. 746 375 104 13D Page 13 of 15 Pages
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STEEL PARTNERS II, L.P.
150 East 52nd Street, 21st Floor
New York, New York, 10022
August 9, 1999
BY FACSIMILE
The Board of Directors
Puroflow Incorporated
16559 Saticoy Street
Van Nuys, California 91004
Gentlemen:
Steel Partners is writing this letter in response to your recent letter
and press release, each dated August 4, 1999, publicly announcing your offer to
settle our proxy contest. Steel Partners has made it clear throughout its
negotiations that a board whose majority is composed of Steel's nominees is the
best way to enhance stockholder value. While Steel Partners is highly confident
that we would be able to accomplish our objectives if we were to proceed with
our proxy solicitation, we concur that it would be in the best interests of all
parties involved if we could avoid the expense and unrest such actions would
involve. To that end, we continue to be willing to have discussions with the
Board of Directors and its representatives, with a view towards reaching a
settlement prior to the Company's annual meeting.
While we believe the Company's most recent proposal represents a start
toward reaching a settlement, we believe the offer omits certain important items
requested by Steel Partners in its negotiations with the Board. Those items
include:
1. That any standstill agreement Steel Partners would enter
into would terminate immediately prior to the next annual
meeting. This would allow Steel Partners to seek a majority of
the board seats at the next annual meeting should Steel be
unable to accomplish its goal of enhancing value for all
stockholders as a result of its minority position on the
board; 2. That the Board of Directors would agree to amend the
Company's Poison Pill Rights Plan so that the acquisition
threshold is raised to 25%, allowing additional equity
participation in the Company without eliminating the alleged
protection that the Poison Pill Rights Plan affords
stockholders; and
<PAGE>
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CUSIP No. 746 375 104 13D Page 14 of 15 Pages
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3. That the Board of Directors would agree to eliminate any
and all related party transactions, including those
transactions between the Company and its non-employee
directors.
Until receiving your letter, we believed the Board understood
the importance of these provisions to any settlement. As such, Steel Partners is
unwilling to accept the terms of your proposal unless these items are included.
However, if the Company were to agree to the modifications listed above, Steel
Partners would accept the Company's proposal of a minority position on the Board
of Directors.
We hope that the recent tenor of our discussions and
correspondence will lead to an agreement between the Company and Steel, and
believe such an agreement will only serve to enhance shareholder value, a goal
that should be the main objective for both parties. Our offer will remain open
until Wednesday, August 11, and we look forward to your response.
Sincerely,
Warren G. Lichtenstein
Managing Partner
<PAGE>
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CUSIP No. 746 375 104 13D Page 15 of 15 Pages
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Puroflow Incorporated
16559 Saticoy Street
Van Nuys, California 91406
August 12, 1999
Steel Partners II, L.P.
150 East 52nd Street
21st Floor
New York, New York 10022
Attn: Mr. Warren G. Lichtenstein
Gentlemen:
The Board of Directors of Puroflow have requested that I respond to
your letter of August 9, 1999.
The Board of Puroflow made a fair and equitable proposal on August 4,
1999 to settle the outstanding issues relating to the present proxy contest.
Your letter of August 9, 1999 in response to the Puroflow proposal
negated any possibility of settling this matter for the benefit of Puroflow
stockholders and an end to the litigious nature of the manner in which you
conduct the affairs of Steel Partners. The Board of Puroflow has no intentions
of acquiesing [sic] to your demands.
The Board of Directors of Puroflow do not prpose [sic] that we continue
the "fencing and paper war" that you have provided in your attempt to settle
this matter in a fair and equitable arrangements for the existing stockholders.
We now consider your complete rejection of our proposal, dated August 4, 1999
recinded [sic] with any attempts to deal with you in a fair and equitable
manner.
Very truly yours,
/s/ Reuben M. Siwek
--------------------
Reuben M. Siwek
Chairman of the Board
RMS:ms
cc: Michael Figoff
Robert Smith
Tracy Pugmire
Daniel H. Burch -- MacKenzie Partners, Inc.
