UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G
Under the Securities Exchange Act of 1934
(Amendment No. 3 )*
Medical Graphics Corporation
_____________________________________________________
(Name of Issuer)
Common Stock, $ .05 Par Value
______________________________________________________
(Title of Class of Securities)
584907108
____________________________________
(CUSIP Number)
Check the following box if a fee is being paid with this
statement | |. (A fee is not required only if the filing person:
(1) has a previous statement on file reporting beneficial
ownership of more than five percent of the class of securities
described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of
such class). (See Rule 13d-7).
*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 the disclosures provided
in a prior cover page.
The information required in the remainder of the cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") 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 1 of 12 Pages
CUSIP No. 584907109 13G Page 2 of 12
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(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Special Situations Fund III, L.P. ("The Fund")
F13-3737427
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) | |
(b) |X|
- ----------------------------------------------------------------
(3) SEC USE ONLY
- ----------------------------------------------------------------
(4) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER OF (5) SOLE VOTING POWER 537,618
SHARES -------------------------------------------------
BENEFICIALLY (6) SHARED VOTING POWER None
OWNED BY -------------------------------------------------
EACH (7) SOLE DISPOSITIVE POWER 537,618
REPORTING -------------------------------------------------
PERSON WITH (8) SHARED DISPOSITIVE POWER None
- ----------------------------------------------------------------
(9) AGGREGATE AMOUNT BENEFICALLY OWNED BY EACH REPORTING PERSON
537,618
- ----------------------------------------------------------------
(10) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES
CERTAIN SHARES*
- ----------------------------------------------------------------
(11) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
20.6
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(12) TYPE OF REPORTING PERSON*
IV
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CUSIP No. 584907109 13G Page 3 of 12
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(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MGP Advisers Limited Partnership ("MGP)
F13-3263120
- ----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) | |
(b) |X|
- ----------------------------------------------------------------
(3) SEC USE ONLY
- ----------------------------------------------------------------
(4) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- ----------------------------------------------------------------
NUMBER OF (5) SOLE VOTING POWER None
SHARES -------------------------------------------------
BENEFICIALLY (6) SHARED VOTING POWER None
OWNED BY -------------------------------------------------
EACH (7) SOLE DISPOSITIVE POWER 537,618
REPORTING -------------------------------------------------
PERSON WITH (8) SHARED DISPOSITIVE POWER None
- ----------------------------------------------------------------
(9) AGGREGATE AMOUNT BENEFICALLY OWNED BY EACH REPORTING PERSON
537,618
- ----------------------------------------------------------------
(10) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES
CERTAIN SHARES*
- ----------------------------------------------------------------
(11) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
20.6
- ----------------------------------------------------------------
(12) TYPE OF REPORTING PERSON*
IA
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CUSIP No. 584907109 13G Page 4 of 12
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(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AWM Investment Company, Inc. ("AWM")
11-2086452
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) | |
(b) |X|
- ----------------------------------------------------------------
(3) SEC USE ONLY
- ----------------------------------------------------------------
(4) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- ----------------------------------------------------------------
NUMBER OF (5) SOLE VOTING POWER 195,306
SHARES -------------------------------------------------
BENEFICIALLY (6) SHARED VOTING POWER None
OWNED BY -------------------------------------------------
EACH (7) SOLE DISPOSITIVE POWER 732,924
REPORTING -------------------------------------------------
PERSON WITH (8) SHARED DISPOSITIVE POWER None
- ----------------------------------------------------------------
(9) AGGREGATE AMOUNT BENEFICALLY OWNED BY EACH REPORTING PERSON
732,924
- ----------------------------------------------------------------
(10) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES
CERTAIN SHARES*
- ----------------------------------------------------------------
(11) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
28.1
- ----------------------------------------------------------------
(12) TYPE OF REPORTING PERSON*
IA
- ----------------------------------------------------------------
CUSIP No. 584907109 13G Page 5 of 12
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(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Austin W. Marxe
###-##-####
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) | |
(b) |X|
- ----------------------------------------------------------------
(3) SEC USE ONLY
- ----------------------------------------------------------------
(4) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- ----------------------------------------------------------------
NUMBER OF (5) SOLE VOTING POWER 195,306
SHARES -------------------------------------------------
BENEFICIALLY (6) SHARED VOTING POWER 537.618
OWNED BY -------------------------------------------------
EACH (7) SOLE DISPOSITIVE POWER 732,924
REPORTING -------------------------------------------------
PERSON WITH (8) SHARED DISPOSITIVE POWER None
- ----------------------------------------------------------------
(9) AGGREGATE AMOUNT BENEFICALLY OWNED BY EACH REPORTING PERSON
732,924
- ----------------------------------------------------------------
(10) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES
CERTAIN SHARES*
- ----------------------------------------------------------------
(11) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
28.1
- ----------------------------------------------------------------
(12) TYPE OF REPORTING PERSON*
IN
- ----------------------------------------------------------------
Page 6 of 12 Pages
Item 1.
(a) Name of Issuer: Medical Graphics Corporation
(b) Address of Issuer's Principal Executive Offices:
350 Oak Grove Parkway, ST. Paul, MN 55127
Item 2.
(a)-(c) Name of Person Filing; Address of Principal Business
Office; and Place of Organization: This statement is
filed on behalf of (i) Special Situations Fund III, L.P.,
a Delaware limited partnership (the "Fund"), (ii) MGP
Advisers Limited Partnership, a Delaware Limited
Partnership ("MGP"), (iii) AWM Investment Company, Inc.,
a Delaware corporation ("AWM") and (iv) Austin W. Marxe.
Each of the foregoing is hereinafter individually
referred to as a "Reporting Person" and collectively as
the "Reporting Persons." The principal office and
business address of the Reporting Persons is 153 East 53
Street, New York, New York 10022. The busines of the
Fund is to acquire, purchase, invest in, sell, convey,
transfer, exchange and otherwise trade in principally
equity and equity related securities. MGP is a general
partner of and investment adviser to the Fund. MGP is
registered as an investment adviser under the Investment
Advisers Act of 1940, as amended. The principal business
of MGP is to act as a general partner of and investment
adviser to the Fund. AWM, a Delaware corporation
primarily owned by Austin Marxe, serves as the sole
Page 7 of 12 Pages
general partner of MGP. AWM is a registered investment
adviser under the Investment Advisers Act of 1940 and also
serves as the investment adviser to, and general partner of,
Special Situations Cayman Fund, L.P., a limited partnership
formed under the laws of the Cayman Islands (the "Cayman
Fund"). Austin W. Marxe is also the principal limited partner
of MGP and is the President and Chief Executive Officer of
AWM. Mr. Marxe is principally responsible for the selection,
acquisition and disposition of the portfolio securities by AWM
on behalf of MGP, the Fund and the Cayman Fund.
2(b) Title of Class of Securities: See cover sheets.
2(c) CUSIP Number: See cover sheets.
Item 3. If this statement is filed pursuant to Rule 13d-
1(b), or 13d-2(b), check whether the person filing
is a:
(a) ( ) Broker or Dealer registered under section 15 of the
Act
(b) ( ) Bank as defined in section 3(a) (6) of the Act
(c) ( ) Insurance Company as defined in section 3(a) (19) of
the Act
(d) (x) Investment Company Act registered under section 8 of
the Investment Company Act
(e) (x) Investment Adviser registered under section 203 of
the Investment Advisers Act of 1940
(f) ( ) Employee Benefit Plan, Pension Fund which is subject
to the provisions of the Employee Retirement Income
Page 8 of 12 Pages
Security Act of 1974 or Endowment Fund
(g) (x) Parent Holding Company, in accordance with $240.13d
-1 (b) (ii) (G)
(h) ( ) Group, in accordance with $240.13d-1 (b) (1) (ii)
(H)
See Exhibit A attached hereto.
Item 4. Ownership:
(a) Amount Beneficially Owned: 732,924 shares of Common Stock
are beneficially owned by Austin W. Marxe and AWM; this
amount consists of 446,709 shares of common stock and the
right to purchase 90,909 shares of common stock at $4.125
per share until February 23, 1998 owned by the Fund, and
165,003 shares of common stock and the right to purchase
30,303 shares of common stock at $4.125 per share until
February 23, 1998 owned by the Cayman Fund. 537,618
shares of Common Stock are beneficially owned by the Fund
and MGP. This amount consists of 446,709 shares of common
stock and rights to purchase 90,909 shares of common
stock until February 23, 1998.
(b) Percent of Class: 28.1 percent of the Common Stock are
beneficially owned by Austin Marxe and AWM. 20.6 percent
of the Common Stock are beneficially owned by MGP and the
Fund.
(c) Number of Shares as to Which Such Person Has Rights to
Vote and/or Dispose of Securities: The Fund has the
sole power to vote or to direct the vote and to dispose
Page 9 of 12 Pages
or to direct the disposition of all securities reported
hereby which are beneficially owned by the Fund. MGP has
the sole power to dispose or to direct the disposition of
all securities reported hereby which are beneficially
owned by MGP. AWM has the the sole power to vote or to
direct the vote of securities reported hereby which are
beneficially owned by AWM by virtue of it being the
Investment Adviser to the Special Situations Cayman Fund,
L.P.. AWM has the sole power to dispose or to direct the
disposition of all securites reported hereby which are
beneficially owned by AWM. Austin Marxe has the sole
power to vote or to direct the vote of securities
reported hereby which are beneficially owned by Austin
Marxe by virtue of being the primary owner of and
President and Chief Executive Officer of AWM. Austin W.
Marxe has shared power to vote or to direct the vote of
all shares beneficially owned by Austin Marxe by virtue
of being an Individual General Partner of the Fund.
Austin W. Marxe has the sole power to dispose or to
direct the disposition of all securities reported hereby
Item 5. Ownership of Five Percent or Less of a Class: If this
statement is being filed to report the fact that as of
the date hereof the reporting person has ceased to be the
beneficial owner of more that five percent of the class
of securities, check the following .
Page 10 of 12 Pages
Item 6.Ownership of More than Five Percent on Behalf of
Another Person: The Fund and the Cayman Fund as owners
of the securities in question, have the right to receive
any dividends from, or proceeds from the sale of, such
securities.
Item 7. Identification and Classification of the Subsidiary
Which Acquired the Security being Reported on By the Parent
Holding Company: See Exhibit A attached hereto.
Item 8. Identification and Classification of Members of the
Group: Not applicable
Item 9. Notices of Dissolution of Group: Not applicable.
Item 10. Certification:
Each of the undersigned certifies that, to the
best of its or his knowledge and belief, the securities
referred to above were acquired in the ordinary course of
business and were acquired for the purpose of and do not
have the effect of changing or influencing the control of
the issuer of such securities and were not acquired in
connection with or as a participant in any transaction
having such purpose or effect.
Page 11 of 12 Pages
SIGNATURE
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: January 29, 1997
SPECIAL SITUATIONS FUND III, L.P.
By:/s/ Austin W. Marxe
Austin W. Marxe
Individual General Parnter
MGP ADVISERS LIMITED PARTNERSHIP
By:/s/ Austin W. Marxe
Austin W. Marxe
President and Chief Executive Officer
AWM INVESTMENT COMPANY, INC.
By: /s/ Austin W. Marxe
Austin W. Marxe
President and Chief Executive Officer
/s/ Austin W. Marxe
AUSTIN W. MARXE
Page 12 of 12 Pages
EXHIBIT A
This Exhibit explains the relationship between the
Reporting Persons. AWM is the sole general partner of MGP, a
registered investment adviser under the Investment Advisers
Act of 1940, as amended. MGP is a general partner of and
investment adviser to the Fund. AWM is a registered
investment adviser under the Investment Advisers Act of 1940
and also serves as the general partner of, and investment
adviser to, the Cayman Fund. Austin W. Marxe is the principal
owner and President of AWM.
