<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
---------------
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
National Auto Credit, Inc.
(Name of Issuer)
Common Stock, $0.05 Par Value Per Share
(Title of Class of Securities)
632900 10 6
(CUSIP Number)
Ernest C. Garcia II
2575 E. Camelback Road, Suite 700
Phoenix, Arizona 85016
(602) 778-5025
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 29, 2000
(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 that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box 9.
Note. Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.
(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 ("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> 2
CUSIP NO. 632900 10 6 13D PAGE 2 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Ernest C. Garcia II
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO, WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 2,077,010 (1)
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 2,077,010 (1)
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,077,010
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 18%
14 TYPE OF REPORTING PERSON*
IN
(1) Consists of (i) 613,858 shares owned by Verde Reinsurance Company, Ltd., an
entity in which Mr. Garcia is the sole shareholder, and (ii) 1,463,146 shares
owned by Mr. Garcia, individually.
*See Instructions
<PAGE> 3
CUSIP NO. 632900 10 6 13D PAGE 3 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Ray Fidel
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 203,210
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 203,210
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 203,210
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.8%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 4
CUSIP NO. 632900 10 6 13D PAGE 4 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Steven P. Johnson
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 623,200 (1)
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 623,200 (1)
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 623,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.4%
14 TYPE OF REPORTING PERSON*
IN
(1) Consists of (i) 135,480 shares owned by Mr. Johnson, individually, (ii)
243,860 shares owned by the Ernie Garcia III 2000 Trust of which Mr. Johnson is
trustee, and (iii) 243,860 shares owned by the Brian Garcia 2000 Trust of which
Mr. Johnson is trustee. Mr. Johnson disclaims beneficial ownership of all shares
referred to in clauses (ii) and (iii) of this footnote.
*See Instructions
<PAGE> 5
CUSIP NO. 632900 10 6 13D PAGE 5 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Mark Sauder
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 81,290
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 81,290
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 81,290
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 6
CUSIP NO. 632900 10 6 13D PAGE 6 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
EJMS Investors Limited Partnership
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF SHARES 7 SOLE VOTING POWER 54,190
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 54,190
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 54,190
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 7
CUSIP NO. 632900 10 6 13D PAGE 7 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Colin Bachinsky
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 13,550
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 13,550
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 13,550
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 8
CUSIP NO. 632900 10 6 13D PAGE 8 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Chris Rompalo
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 6,770
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 6,770
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 6,770
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 9
CUSIP NO. 632900 10 6 13D PAGE 9 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Donna Clawson
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 6,770
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 6,770
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 6,770
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 10
CUSIP NO. 632900 10 6 13D PAGE 10 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Mary Reiner
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 8,130
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 8,130
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 8,130
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 11
CUSIP NO. 632900 10 6 13D PAGE 11 OF 22 PAGES
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS (ENTITIES ONLY)
Kathy Chacon
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
NUMBER OF SHARES 7 SOLE VOTING POWER 5,420
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 8 SHARED VOTING POWER 0
WITH
9 SOLE DISPOSITIVE POWER 5,420
10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON* 5,420
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1%
14 TYPE OF REPORTING PERSON*
IN
*See Instructions
<PAGE> 12
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Statement of
Ernest C. Garcia II
Ray Fidel
Steven P. Johnson
Mark Sauder
EJMS Investors Limited Partnership
Colin Bachinsky
Chris Rompalo
Donna Clawson
Mary Reiner
and
Kathy Chacon
Pursuant to Section 13(d)
of the Securities Exchange Act of 1934
in respect of
NATIONAL AUTO CREDIT, INC.
This Schedule 13D is jointly filed pursuant to Rule 13d-1(k)(1)
promulgated by the Securities and Exchange Commission ("SEC") under Section
13(d) of the Securities Exchange Act of 1934, as amended (the "Act") by Mr.
Garcia, Ray Fidel, Steven P. Johnson, Mark Sauder, EJMS Investors Limited
Partnership, Colin Bachinsky, Chris Rompalo, Donna Clawson, Mary Reiner, and
Kathy Chacon (each a "Reporting Person"), with respect to their respective
beneficial ownership of the Common Stock.
The Reporting Persons may be deemed to constitute a "group" for
purposes of Section 13(d)(3) of the Act. Pursuant to Rule 13d-4 under the
Securities Exchange Act of 1934 (the "Exchange Act"), each Reporting Person
disclaims beneficial ownership, for the purposes of Regulation 13D under the
Exchange Act, of any shares of securities of NAC held beneficially or otherwise
by any other Reporting Person. Each Reporting Person declares that the filing of
this statement shall not be construed as an admission that such Reporting Person
is, for the purposes of Section 13(d) or 13(g) of the Exchange Act, the
beneficial owner of any securities covered by this statement other than those
securities expressly set forth in this statement as being beneficially owned by
such Reporting Person.
Based on information supplied by National Auto Credit, Inc. ("NAC"),
and adding the 2,709,530 shares of common stock issuable to the Reporting
Persons as described below in Item 6, there were 11,519,132 shares of common
stock, $0.05 par value per share of NAC outstanding on January 5, 2001.
ITEM 1. SECURITY AND ISSUER.
<TABLE>
<S> <C>
Title of Class of
Equity Security: Common Stock, $0.05 par value per share
Name of Issuer: National Auto Credit, Inc., a Delaware corporation
</TABLE>
<PAGE> 13
<TABLE>
<S> <C>
Address of 30000 Aurora Road
Principal Office: Solon, Ohio 44139
</TABLE>
ITEM 2. IDENTITY AND BACKGROUND.
<TABLE>
<S> <C>
A. Name: ERNEST C. GARCIA II ("Garcia")
Business Address: 2575 E. Camelback Road, Suite 700
Phoenix, Arizona 85016
Principal Occupation:
(1) Chairman of Ugly Duckling Corporation, a used automobile
retail sales and finance company, 2525 E. Camelback Rd.,
Suite 500, Phoenix, Arizona 85016;
(2) Sole Director, President and Chief Executive Officer of
Cygnet Capital Corporation, which provides various
financial services primarily to the sub-prime segment of
the automobile finance industry; and
(3) President, sole director and sole shareholder of Verde
Investments, Inc., and Verde Reinsurance Company, Ltd.,
each of which is involved in real estate and other types
of investments.
Citizenship: United States
B. Name: RAY FIDEL
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Occupation: President of ZoomLot Corporation, which provides various
financial services primarily to the sub-prime segment of the
automobile finance industry
Citizenship: United States
C. Name: STEVEN P. JOHNSON
Business Address: 2575 E. Camelback Road, Suite 700
Phoenix, Arizona 85016
Principal Occupation: Senior Vice President and Secretary of Cygnet Capital Corporation, which
provides various financial services primarily to the sub-prime
segment of the automobile finance industry
Citizenship: United States
D. Name: MARK SAUDER
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Occupation: Executive Vice President of ZoomLot Corporation, which
provides various financial services primarily to the sub-prime
segment of the automobile finance industry
Citizenship: United States
H. Name: EJMS INVESTORS LIMITED PARTNERSHIP
State of Organization: Arizona
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Business: Organized for estate planning purposes
</TABLE>
<PAGE> 14
<TABLE>
<S> <C>
I. Name: COLIN BACHINSKY
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Occupation: Vice President of ZoomLot Corporation, which provides various
financial services primarily to the sub-prime segment of the
automobile finance industry
Citizenship: United States
J. Name: CHRIS ROMPALO
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Occupation: Technology Director of ZoomLot Corporation, which provides
various financial services primarily to the sub-prime segment of
the automobile finance industry
Citizenship: United States
K. Name: DONNA CLAWSON
Business Address: 3010 E. Camelback Road, Suite 100
Phoenix, Arizona 85016
Principal Occupation: Financial Director of ZoomLot Corporation, which provides
various financial services primarily to the sub-prime segment of
the automobile finance industry
Citizenship: United States
L. Name: MARY REINER
Business Address: 2575 E. Camelback Road, Suite 700
Phoenix, Arizona 85016
Principal Occupation: Administrative Assistant to Ernest C. Garcia II
Citizenship: United States
M. Name: KATHY CHACON
Business Address: 2575 E. Camelback Road, Suite 700
Phoenix, Arizona 85016
Principal Occupation: Administrative Assistant to Steven Johnson
Citizenship: United States
</TABLE>
During the last five years, the persons mentioned above have not (i)
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors), or (ii) been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
been subject to a judgment, decree, or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or state
securities laws, or finding any violations with respect to such laws.
<PAGE> 15
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Verde Reinsurance Company, Ltd. used its working capital to purchase
an aggregate of 370,000 shares of Common Stock on the following dates and at
the following purchase prices:
<TABLE>
<CAPTION>
DATE SHARES PURCHASED PURCHASE PRICE
---- ---------------- --------------
<S> <C> <C>
May 31, 2000 45,000 $0.835
July 19, 2000 20,000 $0.755
July 28, 2000 35,000 $0.810
August 8, 2000 25,000 $0.820
August 10, 2000 95,000 $0.830
August 17, 2000 50,000 $0.810
August 24, 2000 100,000 $0.805
</TABLE>
The Reporting Persons received an aggregate of 2,709,540 shares of
Common Stock as part of the consideration issued in the Merger described in Item
6. The Certificate of Merger relating to this transaction was filed on December
29, 2000.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Persons acquired shares of Common Stock for investment
purposes. The Reporting Persons may acquire additional equity securities of NAC,
or dispose of NAC equity securities, from time to time for investment.
The Reporting Persons are entitled to nominate one person for election
to the board of directors of NAC pursuant to the Merger Agreement described in
Item 6. The Reporting Persons received Series C Preferred Stock in the Merger
that may be redeemed at the option of the holders or NAC upon the occurrence of
certain events as described in Item 6.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
REPORTING GROUP
As of the date hereof, the Reporting Persons beneficially own an
aggregate of 2,709,540 shares of Common Stock, or approximately 23.5% of the
Common Stock deemed outstanding.
ERNEST C. GARCIA II
(a) Mr. Garcia beneficially owns an aggregate of 2,077,010 shares,
approximately 18%, of the Common Stock of NAC, consisting of: (i) 613,858 shares
owned by Verde Reinsurance Company, Ltd., an entity in which Mr. Garcia is the
sole shareholder, and (ii) 1,463,146 shares owned by Mr. Garcia, individually.
(b) Mr. Garcia has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
RAY FIDEL
(a) Mr. Fidel beneficially owns an aggregate of 203,210 shares,
approximately 1.8%, of the Common Stock of NAC.
(b) Mr. Fidel has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
<PAGE> 16
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
STEVEN P. JOHNSON
(a) Mr. Johnson beneficially owns an aggregate of 623,200 shares, approximately
5.4%, of the Common Stock of NAC consisting of (i) 135,480 shares owned by Mr.
Johnson, individually, (ii) 243,860 shares owned by the Ernie Garcia III 2000
Trust of which Mr. Johnson is trustee, and (iii) 243,860 shares owned by the
Brian Garcia 2000 Trust of which Mr. Johnson is trustee. Mr. Johnson disclaims
beneficial ownership of all shares referred to in clauses (ii) and (iii) of this
footnote.
(b) Mr. Johnson has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
MARK SAUDER
(a) Mr. Sauder beneficially owns an aggregate of 81,290 shares, less
than 1%, of the Common Stock of NAC.
(b) Mr. Sauder has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
EJMS INVESTORS LIMITED PARTNERSHIP
(a) EJMS Investors Limited Partnership beneficially owns an aggregate
of 54,190 shares, less than 1%, of the Common Stock of NAC.
(b) Eric and Jennifer Splaver share the voting and investment power
with respect to all of the shares of Common Stock referred to in paragraph (a)
above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
<PAGE> 17
(e) Not applicable.
COLIN BACHINSKY
(a) Mr. Bachinsky beneficially owns an aggregate of 13,550 shares, less
than 1%, of the Common Stock of NAC.
(b) Mr. Bachinsky has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
CHRIS ROMPALO
(a) Mr. Rompalo beneficially owns an aggregate of 6,770 shares, less
than 1%, of the Common Stock of NAC.
(b) Mr. Rompalo has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
DONNA CLAWSON
(a) Ms. Clawson beneficially owns an aggregate of 6,770 shares, less
than 1%, of the Common Stock of NAC.
(b) Ms. Clawson has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
MARY REINER
(a) Ms. Reiner beneficially owns an aggregate of 8,130 shares, less
than 1%, of the Common Stock of NAC.
<PAGE> 18
(b) Ms. Reiner has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
KATHY CHACON
(a) Ms. Chacon beneficially owns an aggregate of 5,420 shares, less
than 1%, of the Common Stock of NAC.
(b) Ms. Chacon has sole voting power and sole investment power with
respect to all of the shares of Common Stock referred to in paragraph (a) above.
(c) See Item 6 below.
(d) Except as set forth above in this Item 5, no other person is known
to have the right to receive or the power to direct the receipt of dividends
from or the proceeds from the sale of securities.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
On December 15, 2000, each of the Reporting Persons entered into a
Merger Agreement with ZoomLot Corporation, NAC, and ZLT Acquisition Corp., a
wholly-owned subsidiary of NAC. Pursuant to the Merger Agreement, ZoomLot
Corporation was merged into ZLT Acquisition on December 29, 2000 (the "Merger").
The Reporting Persons owned all of the outstanding common stock of ZoomLot
Corporation prior to the Merger.
As consideration for the Merger, the Reporting Persons beneficially
received an aggregate of 270,953 shares of NAC Series B Preferred Stock and
729,047 shares of NAC Series C Preferred Stock. In conjunction with the
repurchase by NAC of shares of NAC held by Reading Entertainment, Inc. and
certain of its affiliates, and under the terms of the Series B Preferred Stock,
the Series B Preferred Stock was automatically converted into 2,709,530 shares
of Common Stock. The Series C Preferred Stock does not have any voting rights
and is not convertible into any other securities of NAC. At any time after
January 1, 2003, the Series C Preferred Stock may be redeemed at the option of
either the holders or NAC upon the occurrence of any Valuation Event or the
achievement of the Objectives described in the following paragraph.
333,334 shares of Series C Preferred Stock will be forfeited if, by
December 31, 2003, ZoomLot has failed to break even on a cash basis for a
minimum period of six (6) consecutive months, and 333,333 shares of the Series C
Preferred Stock will be forfeited if, by December 31, 2003, ZoomLot has not
achieved at least $4.5 million of earnings before interest, taxes, depreciation
and amortization for a period of twelve (12) consecutive months (collectively,
the "Objectives"). However, if certain "valuation events" occur prior to
December 31, 2003, the performance objectives will be deemed to have been
achieved. Such valuation events generally consist of either (a) transactions
that would involve an investment in ZoomLot or one of its subsidiaries of at
least $10 million and the pre-investment valuation of ZoomLot or one of its
subsidiaries of at least $30 million; (b) a change of control of NAC; or (c) the
termination of the key executives of ZoomLot without cause (collectively, the
"Valuation Events").
<PAGE> 19
Additionally, in connection with the Merger, NAC committed to (1)
provide up to $6.5 million in financing to ZoomLot, subject to certain
performance and development criteria being met, and (2) advance funds to ZoomLot
to enable it to repay an approximately $5 million advance to ZoomLot by Cygnet
Capital Corporation, an affiliated entity of Ernest C. Garcia II, which
repayment will be refunded to NAC if the performance objectives referred to
above are not met, and the valuation events referred to above do not occur, by
December 31, 2003.
The Reporting Persons are party to a Lockup, Standstill, and Voting
Agreement with NAC, dated December 15, 2000 (the "Voting Agreement"). The Voting
Agreement generally provides, that (i) until December 31, 2007 provided the
Reporting Persons in the aggregate own beneficially in excess of 8% of the votes
that could be cast by the holders of all NAC's outstanding voting stock, each
Reporting Person will vote all of his shares of voting securities issued by NAC
on each and every matter that is submitted to the shareholders of NAC in the
same proportions in which all other shares of NAC voting stock are voted; (ii)
until June 30, 2003, each Reporting Person agrees to abide by certain standstill
and non-solicitation agreements; and (iii) until September 30, 2004 in the case
of forfeitable shares and in the case of non-forfeitable shares, half on June
30, 2002 and half on December 31, 2002, each Reporting Person also agrees not to
sell or otherwise dispose of any shares of capital stock of NAC without the
prior written consent of NAC.
The Reporting Persons are party to a Registration Rights Agreement with
NAC, dated December 15, 2000. Pursuant to the Registration Rights Agreement, NAC
agreed to file a registration statement with the SEC to register for resale
those shares of Common Stock, issued or issuable, in connection with the Merger.
In addition, NAC granted the Reporting Persons certain piggy-back registration
rights.
In addition, Ray Fidel, Mark Sauder, and Eric Splaver each entered into
an Employment Agreement with NAC, dated December 15, 2000, and certain former
employees of ZoomLot Corporation entered into a Transfer of Intellectual
Property Agreement with NAC, dated December 15, 2000.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
EXHIBIT NO. AGREEMENT
---------- ---------
4.1 Certificate of Designations, as filed with the Delaware
Secretary of State on December 29, 2000 (incorporated by
herein by reference to Exhibit 4.1 to the Current Report on
Form 8-K filed by NAC on January 2, 2001)
4.2 Registration Rights Agreement, dated December 15, 2000
(incorporated by herein by reference to Exhibit 4.2 to the
Current Report on Form 8-K filed by NAC on January 2, 2001)
4.3 Lockup, Standstill and Voting Agreement, dated December 15,
2000 (incorporated by herein by reference to Exhibit 4.2 to
the Current Report on Form 8-K filed by NAC on January 2,
2001)
10.1 Merger Agreement, dated December 15, 2000 (incorporated by
herein by reference to Exhibit 10.1 to the Current Report on
Form 8-K filed by NAC on January 2, 2001)
99.1 Agreement re Joint Filing of Schedule 13D, filed herewith
<PAGE> 20
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: January 8, 2001 /s/ Ernest C. Garcia II
---------------------------------------------
Ernest C. Garcia II
Dated: January 8, 2001 /s/ Ray Fidel
---------------------------------------------
Ray Fidel
Dated: January 8, 2001 /s/ Steven P. Johnson
---------------------------------------------
Steven P. Johnson
Dated: January 8, 2001 /s/ Mark Sauder
---------------------------------------------
Mark Sauder
Dated: January 8, 2001 EJMS Investors Limited Partnership
/s/ Eric Splaver
---------------------------------------------
By: Eric Splaver
Title: Partner
Dated: January 8, 2001 /s/ Colin Bachinsky
---------------------------------------------
Colin Bachinsky
Dated: January 8, 2001 /s/ Chris Rompalo
---------------------------------------------
Chris Rompalo
Dated: January 8, 2001 /s/ Donna Clawson
---------------------------------------------
Donna Clawson
Dated: January 8, 2001 /s/ Mary Reiner
---------------------------------------------
Mary Reiner
Dated: January 8, 2001 /s/ Kathy Chacon
---------------------------------------------
Kathy Chacon
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. AGREEMENT
----------- ---------
<S> <C>
4.1 Certificate of Designations, as filed with the Delaware
Secretary of State on December 29, 2000 (incorporated by
herein by reference to Exhibit 4.1 to the Current Report on
Form 8-K filed by NAC on January 2, 2001)
4.2 Registration Rights Agreement, dated December 15, 2000
(incorporated by herein by reference to Exhibit 4.2 to the
Current Report on Form 8-K filed by NAC on January 2, 2001)
4.3 Lockup, Standstill and Voting Agreement, dated December 15,
2000 (incorporated by herein by reference to Exhibit 4.2 to
the Current Report on Form 8-K filed by NAC on January 2,
2001)
10.1 Merger Agreement, dated December 15, 2000 (incorporated by
herein by reference to Exhibit 10.1 to the Current Report on
Form 8-K filed by NAC on January 2, 2001)
99.1 Agreement re Joint Filing of Schedule 13D, filed herewith
</TABLE>
