<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Pharmhouse Corp.
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(Name of Issuer)
Common Stock, Par Value $.01
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(Title of Class of Securities)
717137103
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(CUSIP Number of Class of Securities)
Patricia Renda
WisdomTree Associates, L.P.
1633 Broadway, 38th Floor
New York, New York 10019
(212) 843-2782
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
Copies to:
Roger D. Blanc
Willkie Farr & Gallagher
153 East 53rd Street
New York, NY 10022
(212) 821-8000
May 3, 1996
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(Date of Event which Requires
Filing of this Schedule)
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: |_|
Check the following box if a fee is being paid with this
statement: [X]
<PAGE>2
SCHEDULE 13D
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CUSIP No. 717137103 Page 2 of 12 Pages
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1 NAME OF REPORT PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
WisdomTree Capital Management, Inc. I.D. #13-3729429
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- -------------- --------- --------------------------------------------------
7 SOLE VOTING POWER
0 shares of Common Stock
--------- --------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 130,000 shares of Common Stock
OWNED BY
EACH
REPORTING --------- --------------------------------------------------
PERSON WITH 9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
--------- --------------------------------------------------
10 SHARED DISPOSITIVE POWER
130,000 shares of Common Stock
- ---- ----------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
130,000 shares of Common Stock
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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)
5.83%
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14 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>3
SCHEDULE 13D
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CUSIP No. 737137103 Page 3 of 12 Pages
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1 NAME OF REPORT PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
WisdomTree Associates, L.P. I.D. #13-3729430
- ---- ----------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ---- ----------------------------------------------------------------------
3 SEC USE ONLY
- ---- ----------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
- ---- ----------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ---- ----------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- -------------- --------- --------------------------------------------------
7 SOLE VOTING POWER
0 shares of Common Stock
--------- --------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 130,000 shares of Common Stock
OWNED BY --------- --------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 0 shares of Common Stock
--------- --------------------------------------------------
10 SHARED DISPOSITIVE POWER
130,000 shares of Common Stock
- ---- ----------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
130,000 shares of Common Stock
- ---- ----------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- ---- ----------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.83%
- ---- ----------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
- ---- ----------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>4
SCHEDULE 13D
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CUSIP No. 737137103 Page 4 of 12 Pages
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1 NAME OF REPORT PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Jonathan L. Steinberg I.D. ####-##-####
- ---- ------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ---- ------------------------------------------------------------------------
3 SEC USE ONLY
------------------------------------------------------------------------
- ----
4 SOURCE OF FUNDS*
AF
- ---- ------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- ---- ------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- -------------- --------- ----------------------------------------------------
7 SOLE VOTING POWER
0 shares of Common Stock
--------- ----------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 130,000 shares of Common Stock
OWNED BY --------- ----------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 0 shares of Common Stock
--------- ----------------------------------------------------
10 SHARED DISPOSITIVE POWER
130,000 shares of Common Stock
- ---- ------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
130,000 shares of Common Stock
- ---- ------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- ---- ------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.83%
- ---- ------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ---- ------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>5
Item 1. Security and Issuer.
This statement on Schedule 13D, dated May 13, 1996, relates
to the common stock, par value $0.01 per share (the "Common Stock") of
Pharmhouse Corp., a Delaware corporation (the "Company"), and is being filed
pursuant to Rule 13d-1 under the Securities Exchange Act of 1934, as amended.
The address of the principal executive offices of the Company is 860
Broadway, New York, New York 10003. Item 2. Identity and Background.
This Schedule 13D is being filed on behalf of WisdomTree
Associates, L.P. (the "Partnership"), WisdomTree Capital Management, Inc. (the
"General Partner") and Jonathan L. Steinberg ("Mr. Steinberg" and collectively,
the "Reporting Entities"). The Partnership and the General Partner are each
organized in the State of New York. The business address of the Partnership,
the General Partner and Mr. Steinberg is 1633 Broadway, 38th Floor, New York,
New York 10019.
The present principal employment of Mr. Steinberg is as
Chairman, Chief Executive Officer and Treasurer of Individual Investor Group,
Inc. ("I.I. Group"), as Chairman, Chief Executive Officer and Treasurer of the
General Partner and as co-manager of the Partnership. The business address of
I.I. Group is 1633 Broadway, 38th Floor, New York, New York 10019.
The principal business of the Partnership is as an investment
fund that invests and reinvests in securities of relatively small, less
well-known public companies. The
<PAGE>6
principal business of the General Partner is management of the Partnership.
The name, business address and principal employment of
the executive officers and directors of the General Partner and I.I. Group
are set forth in Schedule A hereto and are incorporated by reference.
During the last five years, neither the Reporting
Entities nor, to the best of the Reporting Entities' knowledge, any of the
other persons identified in Schedule A hereto has been convicted in a
criminal proceeding (excluding traffic violations and similar misdemeanors) or
has been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which such person was or is 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 violation with respect to such laws. All of the persons
listed in Schedule A are United States citizens. Item 3. Source and Amount of
Funds or Other Consideration.
The 130,000 shares of Common Stock of the Company acquired
by the Partnership were acquired in brokered transactions for an aggregate
purchase price of $540,732.70 (the "Partnership Shares"). The source of
funds for the Partnership Shares was investment capital contributed by the
Partnership. Item 4. Purpose of Transaction.
The Reporting Entities have acquired the shares of
Common Stock for the purpose of investment. The Reporting
<PAGE>7
Entities may maintain their investment at current levels or sell all or a
part of their investment. In any such case, the decision by the Reporting
Entities would depend upon a continuing evaluation of the Company's business,
prospects and financial condition, the market for shares of Common Stock, other
investment opportunities available to the Reporting Entities, general economic
conditions, stock market conditions, availability of funds and other
factors and future developments that the Reporting Entities may deem
relevant from time to time. Any acquisition or disposition of shares of
Common Stock by the Reporting Entities may be effected through open
market or privately negotiated transactions, or otherwise.
Except to the extent set forth above, or in any other
Item hereof, the Reporting Entities and, to the best of their knowledge, the
persons listed in Schedule A hereto, do not have any present plans or
proposals that relate to or would result in any of the actions required to be
described in Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) As of May 8, 1996, each of the Reporting
Entities beneficially owned a total of 130,000 shares of the Common Stock of
the Company, constituting 5.83% of the shares of Common Stock then
outstanding, based on 2,228,978 shares of Common Stock outstanding as
disclosed in the Company's annual report on Form 10-K for the year ended
February 3, 1996. To the best of the knowledge of the Reporting Entities,
none of the individuals listed on Schedule A, with the exception of Mr.
Steinberg,
<PAGE>8
beneficially owns any shares of the Common Stock of the Company, except
pursuant to their interests in the Partnership and the General Partner.
(b) The Reporting Entities and Russell Anmuth, a
Vice President of the General Partner and co-manager of the Partnership, share
voting and dispositive power with respect to the Partnership Shares. To the
best of the knowledge of the Reporting Entities, none of the individuals
listed on Schedule A, with the exception of Mr. Steinberg and Mr. Anmuth,
have any voting or dispositive power with respect to the Partnership Shares.
(c) Information concerning transactions in the Common
Stock effected by the Reporting Entities during the past 60 days is set
forth in Schedule B hereto and is incorporated by reference. Except as
set forth in Schedule B, no transactions in the Common Stock have been effected
by any of the Reporting Entities or, to the best of the knowledge of the
Reporting Entities, by any of the persons identified in Schedule A, during the
past 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
Neither the Reporting Entities nor, to the best of
the Reporting Entities' knowledge, any of the individuals listed on
Schedule A hereto, has any contracts, arrangements, understandings, or
relationships (legal or otherwise) with any person with respect to any
securities of the Company, including,
<PAGE>9
but not limited to, transfer or voting of any of the securities, finder's
fees, joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or losses, or the giving or
withholding of proxies, with the exception of a Margin Agreement by
and between Paine Webber Incorporated and the Partnership.
Item 7. Material to be Filed as Exhibits.
1. Margin Agreement by and between Paine Webber
Incorporated and the Partnership.
<PAGE>10
SCHEDULE A
The following table sets forth the name and principal employment of
each of the officers and directors of WisdomTree Capital Management, Inc. and
Individual Investor Group, Inc., as well as the business address of each
director of such entities not employed by such entities.
WisdomTree Capital
Management, Inc. Position
Jonathan L. Steinberg Chairman, Chief Executive Officer, Treasurer and
Director
Robert Schmidt President and Director
Scot Rosenblum Vice President, Secretary and Director
Russell Anmuth Vice President
Individual Investor
Group, Inc. Position
Jonathan L. Steinberg Chairman, Chief Executive Officer and Director
Robert Schmidt President, Chief Operating Officer and Director
Scot Rosenblum Vice President, Secretary and Director
Henry Clark Controller and Assistant
Secretary
Peter M. Ziemba Assistant Secretary
Bruce Sokoloff Director; Executive Vice President, Reliance Group
Holdings, Inc., 55 East 52nd Street, New York,
New York 10055
<PAGE>11
SCHEDULE B
The Partnership
1. On May 1, 1996, the Partnership purchased 11,000 shares of Common
Stock of the Company in brokered transactions at a price of $3.65 per
share.
2. On May 2, 1996, the Partnership purchased 2,000 shares of Common
Stock of the Company in brokered transactions at a price of $3.70 per
share.
3. On May 3, 1996, the Partnership purchased 5,000 shares of Common
Stock of the Company in brokered transactions at a price of $3.57 per
share.
4. On May 7, 1996, the Partnership purchased 2,000 shares of Common
Stock of the Company in brokered transactions at a price of $3.95 per
share.
<PAGE>12
SIGNATURES
After reasonable inquiry and to the best of our knowledge and belief,
the undersigned certify that the information set forth in this statement is
true, complete and correct.
Dated: May 13, 1996 WISDOMTREE ASSOCIATES, L.P.
By: WisdomTree Capital
Management, Inc.,
General Partner
By:/s/ Scot A. Rosenblum
Name: Scot A. Rosenblum
Title: Vice President
Dated: May 13, 1996 WISDOMTREE CAPITAL
MANAGEMENT, INC.
By:/s/ Scot A. Rosenblum
Name: Scot A. Rosenblum
Title: Vice President
Dated: May 13, 1996 By:/s/ Jonathan L. Steinberg
-------------------------
Jonathan L. Steinberg
<PAGE>1
MICROFILM I.D. NUMBER
PAINEWEBBER
<TABLE>
INSTITUTIONAL CLIENT'S AGREEMENT
<S> <C> <C> <C>
FULL ACCOUNT TITLE BRANCH ACCOUNT NUMBER BROKER
- -------------------------------------------- ---- --- ---- ---- ---- ---- ---- ----- ---- ---- ---- -----
- -------------------------------------------- ---- --- ---- ---- ---- ---- ---- ----- ---- ---- ---- -----
</TABLE>
Gentlemen:
In consideration of your opening and carrying one or more accounts of the
undersigned for the purchase and sale of property, the undersigned
agrees as follows:
1. The word "property" as used herein shall mean all securities,
including but not limited to monies, stocks, options, bonds,
notes, futures contracts, commodities, certificates of deposit and
other obligations, contracts or securities. "You" or "your" means
PaineWebber Incorporated, its successor firms, subsidiaries,
correspondents or affiliates and employees.
2. All transactions for the undersigned shall be subject to
the constitution, rules, regulations, interpretations, by-laws,
customs and usages of the exchange or market and its clearing house,
if any, where the transactions are executed. Such transactions are
also subject, where applicable, to the provisions, rules and
regulations of the Securities and Exchange Commission, the Commodity
Futures Trading Commission and the Board of Governors of the Federal
Reserve System in existence at this time and as later amended and
supplemented.
3. You may change the terms of this Agreement at any time upon prior
written notice to the undersigned. If such changes are not
acceptable, the undersigned will notify you in writing of such
non-acceptance and the undersigned's account(s) will be cancelled.
The undersigned will remain liable for any outstanding debits and/or
charges on the account(s). By continuing to accept the services
offered by you, the undersigned indicates the acceptance of these
changes.
4. All orders for the purchase and sale of any property will be given by
the undersigned and executed with the distinct understanding that an
actual purchase or sale is intended and that it is the intention and
obligation of the undersigned in every case to deliver property to cover
any and all sales and in the case of purchases to receive and pay for
property and that the undersigned will do so upon your demand. In case
you make a short sale of any property at the direction of the
undersigned or in case the undersigned fails to deliver to you any
property which you have sold at the direction of the undersigned, you
are authorized to borrow the property necessary to enable you to make
delivery to the purchaser and the undersigned agrees to be responsible
for the cost or loss you may incur, or the cost of obtaining the
property if you are unable to borrow it. No settlement of the
undersigned's account(s) may occur without your first receiving all
property for which the account is short and all property in which the
account(s) are long being paid for in full and the property then
delivered. You and your correspondents are constituted
<PAGE>2
agents of the undersigned to complete all such transactions and are
authorized to make advances and expend monies as are required.
5. The undersigned, when placing with you any sell order for a short
account, will designate it as such and hereby authorizes you to mark the
order as being "short". When placing with you any order for a long
account, the undersigned will designate it as such and hereby authorizes
you to mark the order as being "long". Any sell order which the
undersigned shall designate as being for a long account is for property
which is owned by the undersigned and, if you are unable to deliver this
property from any account(s) of the undersigned, the placing of the
order will constitute a representation by the undersigned that the
securities will be delivered as required and that the undersigned will
reimburse you for any expense incurred.
6. All property held or purchased shall be subject to a lien in your favor
for the discharge of all indebtedness and other obligations of the
undersigned, however and whenever arising, and may be held by you as
security for the payment of any such obligations or indebtedness to you
in any account you maintain for the undersigned. You are authorized
without notice to the undersigned whenever you deem it advisable from
time to time (a) to transfer interchangeably between accounts of the
undersigned any or all property so held, without regard to whether you
have in your possession or subject to your control other property of the
same kind and amount and (b) in the usual course business to pledge,
repledge, hypothecate (either for the amount owed you or for a greater
or lesser sum) and lend the same to you as broker or to others from time
to time, separately or commingled with property carried for other
clients, and you shall not be required to deliver to the undersigned the
same property but only property of the same kind and amount.
7. The undersigned shall at all times be liable for the payment of
any amounts advanced, any debit balance or other obligations owing
in any account(s) of the undersigned with you and the undersigned
shall be liable to you for any deficiency remaining in any such
account(s) in the event of the liquidation thereof, in whole or in
part, by you or by the undersigned. The undersigned shall make
payment of any such balance, obligation, deficiency, indebtedness,
including interest and commissions, upon demand, and any costs of
collection, including attorney's fees, if incurred by you.
8. All amounts advanced and other balances due shall be charged interest
in accordance with your usual custom which may include the compounding
of interest, including any increases in rates which reflect
adjustments in the call money rate, and such other charges as you may
make to cover your facilities and extra services. Payment of all
amounts advanced and other balances due, together with the interest
thereon, shall be made by the undersigned to you at any of your
offices which will act as the undersigned's agent for the
transmittal of such amounts and other balances due to you at New
York, New York.
THE UNDERSIGNED HAS READ AND UNDERSTANDS THE STATEMENT OF
CREDIT PRACTICES DESCRIBING INTEREST CHARGES PRINTED ON THE REVERSE
SIDE.
9. You may employ sub-brokers and shall be responsible only for
reasonable care in their selection. You may deal with market makers
or members of any exchange known as specialists or known as odd lot
dealers and in the execution of orders they may act as sub-brokers for
the undersigned and may also buy or sell the property for themselves as
dealers for their own account.
<PAGE>3
10. The undersigned agrees to maintain in account(s) with you such
positions and margin as required by all applicable statutes, rules,
regulations, procedures, and customs, or as you deem necessary or
advisable and, where applicable, to satisfy any and all margin calls
issued in connection with such business.
11. You shall have the right in accordance with your general policies
regarding your margin maintenance requirements in existence at the time,
or if in your discretion you consider it necessary for your protection
to require additional collateral or the liquidation of any account of
the undersigned, or in the event a petition in bankruptcy or for
appointment of a receiver is filed by or against the undersigned, or an
attachment is levied against the account(s) of the undersigned to sell
any or all property in the account(s) of the undersigned with you,
whether carried individually or jointly with others, to buy any or all
property which may be short in such account(s), to cancel any open
orders and to close any or all outstanding contracts, all without demand
for margin or additional margin, other notice of sale or purchase, or
other notice or advertisement. Any such sales or purchases may be made
at your discretion on any exchange or other market where such business
is usually transacted, or at public auction or private sale, and you may
be the purchasers for your own account. It is understood a prior
demand, or call, or prior notice of the time and place of such sale or
purchase shall not be considered a waiver of your right to sell or buy
without demand or notice as herein provided.
12. The undersigned expressly agrees you will not be bound by
any representation or agreement made by any of your employees or agents
which purports to affect or diminish your rights under this agreement.
13. In the event any one or more of the provisions contained in
this agreement shall for any reason be held to be invalid,
illegal, or unenforceable in any respect, such finding or holding
shall only affect the provision(s) involved and the remainder of this
agreement and the application of all provisions shall not be affected.
14. The undersigned's address below is and will continue to be a
correct address until your Lincoln Harbor Office receives written
notice of any change. Notices and communications sent to the
undersigned at such address will constitute personal delivery to the
undersigned, whether actually received or not. All reports of
execution of orders and account statements shall be conclusive if not
objected to by the undersigned in writing immediately by notice sent to
you by registered mail.
15. All transactions made for the account(s) of the undersigned shall
be governed by the terms of this agreement. This agreement and
its enforcement shall be construed and governed by the laws of the
State of New York, and shall be binding upon the undersigned, its
successors and assigns.
16. ARBITRATION IS FINAL AND BINDING ON THE PARTIES. THE PARTIES
ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT, INCLUDING THE
RIGHT TO JURY TRIAL. PRE-ARBITRATION DISCOVERY IS GENERALLY
MORE LIMITED THAN AND DIFFERENT FROM COURT PROCEEDINGS. THE
ARBITRATOR'S AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS
OR LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK
MODIFICATION OF RULINGS BY THE ARBITRATORS IS STRICTLY LIMITED.
THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE SECURITIES
INDUSTRY.
<PAGE>4
I AGREE, AND BY CARRYING AN ACCOUNT FOR ME PAINEWEBBER AGREE(S),
THAT ANY AND ALL CONTROVERSIES WHICH MAY ARISE BETWEEN ME AND
PAINEWEBBER CONCERNING ANY ACCOUNT, TRANSACTION, DISPUTE OR THE
CONSTRUCTION, PERFORMANCE, OR BREACH OF THIS OR ANY OTHER AGREEMENT,
WHETHER ENTERED INTO PRIOR, ON OR SUBSEQUENT TO THE DATE HEREOF, SHALL
BE DETERMINED BY ARBITRATION. ANY ARBITRATION UNDER THIS AGREEMENT SHALL
BE HELD UNDER AND PURSUANT TO AND BE GOVERNED BY THE FEDERAL
ARBITRATION ACT, AND SHALL BE CONDUCTED BEFORE AN ARBITRATION PANEL
CONVENED BY THE NEW YORK STOCK EXCHANGE, INC. OR THE NATIONAL
ASSOCIATION OF SECURITIES DEALERS, INC. I MAY ALSO SELECT ANY OTHER
NATIONAL SECURITY EXCHANGE'S ARBITRATION FORUM UPON WHICH PAINEWEBBER
IS LEGALLY REQUIRED TO ARBITRATE THE CONTROVERSY WITH ME, INCLUDING,
WHERE APPLICABLE, THE MUNICIPAL SECURITIES RULE-MAKING BOARD. SUCH
ARBITRATION SHALL BE GOVERNED BY THE RULES OF THE ORGANIZATION
CONVENING THE PANEL. I MAY ELECT IN THE FIRST INSTANCE THE ARBITRATION
FORUM, BUT IF I FAIL TO MAKE SUCH ELECTION, BY REGISTERED LETTER OR
TELEGRAM ADDRESSED TO YOU AT YOUR MAIN OFFICE, BEFORE THE
EXPIRATION OF FIVE DAYS (5) AFTER RECEIPT OF A WRITTEN REQUEST FROM
YOU TO MAKE SUCH ELECTION, THEN YOU MAY MAKE SUCH ELECTION. THE AWARD
OF THE ARBITRATORS, OR OF THE MAJORITY OF THEM, SHALL BE FINAL, AND
JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT OF
COMPETENT JURISDICTION.
NO PERSON SHALL BRING A PUTATIVE OR CERTIFIED CLASS ACTION
TO ARBITRATION, NOR SEEK TO ENFORCE ANY PRE-DISPUTE ARBITRATION
AGREEMENT AGAINST ANY PERSON WHO HAS INITIATED IN COURT A PUTATIVE
CLASS ACTION; WHO IS A MEMBER OF A PUTATIVE CLASS WHO HAS NOT OPTED
OUT OF THE CLASS WITH RESPECT TO ANY CLAIMS ENCOMPASSED BY THE
PUTATIVE CLASS ACTION UNTIL: (I) THE CLASS CERTIFICATION IS
DENIED; (II) THE CLASS IS DECERTIFIED; OR (III) THE CUSTOMER IS
EXCLUDED FROM THE CLASS BY THE COURT. SUCH FORBEARANCE TO ENFORCE AN
AGREEMENT TO ARBITRATE SHALL NOT CONSTITUTE A WAIVER OF ANY RIGHTS
UNDER THIS AGREEMENT EXCEPT TO THE EXTENT STATED HEREIN.
I EXPRESSLY AGREE THAT SERVICE OF PROCESS IN ANY ACTION SHALL
BE SUFFICIENT IF SERVED BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED,
AT MY LAST ADDRESS KNOWN TO YOU. I EXPRESSLY WAIVE ANY DEFENSE TO
SERVICE OF PROCESS AS SET FORTH ABOVE.
17. This agreement may be assigned by you and will inure to the benefit
of your successors and assigns and you may transfer or assign the
account(s) of the undersigned to them, which shall be binding on the
undersigned, its successors and assigns.
18. BY SIGNING THIS AGREEMENT, THE UNDERSIGNED ACKNOWLEDGES THAT YOU AND
YOUR SUCCESSORS AND ASSIGNS ARE AUTHORIZED IN THE USUAL COURSE OF
BUSINESS TO LEND, RELEND, HYPOTHECATE, REHYPOTHECATE, PLEDGE OR
REPLEDGE SEPARATELY OR TOGETHER WITH THE PROPERTY OF OTHERS EITHER TO
YOURSELVES OR TO OTHERS ANY PROPERTY WHICH YOU MAY BE CARRYING FOR THE
UNDERSIGNED ON MARGIN. THIS AUTHORIZATION SHALL APPLY TO ALL
ACCOUNTS CARRIED BY YOU FOR THE UNDERSIGNED AND SHALL REMAIN IN FULL
FORCE UNTIL WRITTEN NOTICE OF REVOCATION IS RECEIVED BY YOU.
BY SIGNING THIS AGREEMENT THE CUSTOMER ACKNOWLEDGES THAT: 1. THE
SECURITIES IN THE CUSTOMER'S MARGIN ACCOUNT MAY BE LOANED TO THE BROKER
OR LOANED OUT TO OTHERS; 2. THE CUSTOMER HAS RECEIVED A COPY OF THIS
AGREEMENT. THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION CLAUSE AT
PAGE 1 AT PARAGRAPH 16.
___________________ ___________________________ __________
SIGNATURE PLEASE PRINT NAME AND TITLE DATE
_______________________________________________________________
NO. OR STREET ADDRESS CITY OR TOWN STATE POSTAL CODE
<PAGE>5
Statement of Credit Practices
(SEC Rule 10b-16)
Effective August 22, 1992
To Our Clients
The following discussion provides a description of our interest
charges and other matters relating to the extension or maintenance of
credit in connection with your accounts. Since it is intended to be
all-inclusive, some of the discussion may go beyond your own particular
situation.
Applicability of Interest Charge
You will be charged interest on any credit extended to you
by PaineWebber for the purpose of purchasing, carrying, trading, or maintaining
any securities, commodities, or other product or service in your
PaineWebber account.
Interest Rate
The annual rate of interest which you will be charged is based upon
the PaineWebber Base Loan Rate ("Base Loan Rate") which will be
internally established by PaineWebber from time to time based on PaineWebber's
assessment of commercially recognized interest rates. Such rates may include
but are not limited to the prime rate, discount rate, broker call rate,
federal funds rate, LIBOR, and other regularly published lending rates.
The agreements with our clients for the extension of credit are governed by the
laws of the State of New York where PaineWebber maintains its principal place
of business. The interest charge for each interest period is due and payable
at the close of that interest period. The exact amount due may be obtained
from your Investment Executive or the Branch Office Manager of the branch
office servicing your account. Interest charges not paid at the close of
the interest period will be added to the opening debit balance in your
account for the next interest period. Please note that the PaineWebber Base
Loan Rate is an internally computed rate that may change without notice.
The rates at which interest is charged on funds borrowed are
dependent upon the amount borrowed and are based on our usual sliding scale of
percentages added to the current Base Loan Rate.
Average Net Loan (Debit) Balance
for Each Interest Period Interest Rate
-------------------------------------- --------------------------------------
Under $25,000 2 1/2% above Base Loan Rate
$25,000 to $49,999 2% above Base Loan Rate
$50,000 to $74,999 1 1/2% above Base Loan Rate
$75,000 to $99,999 1% above Base Loan Rate
$100,000 and up 3/4% above Base Loan Rate
Change of Rate Without Prior Notice
Your stated interest rate will change without notice each period in
accordance with changes in your average net loan (debit) balance and
the PaineWebber Base Loan Rate. If your interest rate is to be increased
for any other reason, at least 30 days prior written notice will be
given by PaineWebber. Certain accounts may be assigned adjusted rates as
warranted by overall business relationships in the discretion of PaineWebber.
<PAGE>6
Computation of Interest Charge
The following is set forth so that you can understand how
interest charges are computed and so that you may verify interest charges
shown on your statement.
We calculate daily loan (debit)* or credit balances for your account
by taking the balances as of the close of the previous interest period (or
the opening balance on a new account) and calculate for each day a new net
loan (debit) balance** from the previous daily balance by taking into
consideration both debits and credits which occurred that day. The market
value of securities sold not long or not in good deliverable form will be
deducted from the credit balance in your account. Credit balances
resulting from a short sale are disregarded because this credit balance is
used to collateralize stock borrowed to make delivery against a short sale.
At the end of the interest period the daily net loan (debit) balances for
each day of the interest period are totaled and divided by the number of loan
(debit) days in the interest period giving the average net loan (debit)
balance which forms the basis for interest calculations.
The applicable interest period is from the 22nd day of each month
to the 21st day of the following month, except for the months of December
and January. In December the applicable interest period is November 22 to
December 31; in January the applicable interest period is January 1 to January
21.
Your statement should be retained to assist you in verifying
interest charges.
The "Credit Summary" section of your statement provides the
interest charge for the current interest period as well as the average net
loan (debit) balance and the interest rate applied. You can verify your
interest charge based on a 360 day year within a few cents by using the
following formula:
Average Net Loan Loan (Debit) Days in
(Debit) Balance X Interest Rate X Interest Period 360
* Loan (Debit) Balance - This represents the amount of money owed us
on any given day.
** Net Loan (Debit) Balance - This is the debit
balance minus credit balance (ndb=db-cb).
<PAGE>7
Table 1 set forth below provides the effective annual interest
rate for your stated interest rate for 365 days for the above interest
calculations.
Marking to the Market
If you sell short (or short against the box), and the market value
of the security you sold increases above your selling price, the increase
will be charged to your account - see Activity section (with an offsetting
credit to the Short Account - see Short Account Activity section) and interest
on the increase will be charged in the Activity section. Conversely, any
decrease in market value will be credited to your account and the
interest charges will be accordingly reduced.
This practice of determining the change in current market value
is commonly referred to as "marking to the market" and is normally done
once a week.
Other Charges
Separate interest charges may be made in the account in
connection with:
a) prepayments - payments to a client of the proceeds of a
security sale before the regular settlement date.
b) "when issued" transactions - when the market price of the
"when issued" security changes from the contract price by an
amount that exceeds the cash deposit, interest may be charged
on such difference.
c) late payments - payments for securities purchased which are
received past settlement date.
Liens and Additional Collateral
For all securities which we have or at any time may hold or carry
for you in any account of yours (either individually or jointly with
others), or which may be deposited with us for any purposes, including
safekeeping, we as a pledgee have a general lien for the discharge of all
your obligations to us, however arising and irrespective of the number of
accounts you have with us. We may require you to deposit additional
collateral in accordance with the rules and regulations of the Federal Reserve
Board, the New York Stock Exchange, the American Stock Exchange, and any
other regulatory agency to whose jurisdiction we are subject. In addition,
we may require you to deposit such additional collateral as we, in our sole
discretion, determine is needed as security for your obligation to us.
Ordinarily, a request for additional margin will be made when the equity in
the account falls below 30 percent of the market value of all marginable
securities in the account (the equity is the excess market value of the
securities in the account over the loan or debit balance).
Although we do not limit the factors which may cause us to
require additional margin, factors such as market fluctuation, high
concentration or the overall credit standing of the account will be
considered. These margin calls may be met by delivery of either additional
marginable securities or cash.
<PAGE>8
Table 1: Effective Annual Interest Rates
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Stated Effective Stated Effective Stated Effective Stated Effective
Interest Annual Rate* Interest Annual Rate* Interest Annual Interest Annual Rate*
----- ----- -----
Rate Rate Rate Rate* Rate
---- ---- ---- ----- ----
4.00% 4.13% 8.00% 8.42% 12.25% 13.15% 16.25% 17.78%
4.25% 4.40% 8.25% 8.69% 12.50% 13.44% 16.50% 18.07%
4.50% 4.66% 8.50% 8.97% 12.75% 13.72% 16.75% 18.37%
4.75% 4.92% 8.75% 9.24% 13.00% 14.01% 17.00% 18.66%
5.00% 5.19% 9.00% 9.52% 13.25% 14.29% 17.25% 18.96%
5.25% 5.45% 9.25% 9.79% 13.50% 14.58% 17.50% 19.26%
5.50% 5.72% 9.50% 10.07% 13.75% 14.87% 17.75% 19.56%
5.75% 5.99% 9.75% 10.35% 14.00% 15.16% 18.00% 19.86%
6.00% 6.26% 10.00% 10.62% 14.25% 15.44% 18.25% 20.16%
6.25% 6.52% 10.25% 10.90% 14.50% 15.73% 18.50% 20.46%
6.50% 6.79% 10.50% 11.18% 14.75% 16.02% 18.75% 20.76%
6.75% 7.06% 10.75% 11.46% 15.00% 16.31% 19.00% 21.06%
7.00% 7.33% 11.00% 11.74% 15.25% 16.61% 19.25% 21.36%
7.25% 7.60% 11.25% 12.02% 15.50% 16.90% 19.50% 21.66%
7.50% 7.87% 11.75% 12.59% 15.75% 17.19% 19.75% 21.97%
7.75% 8.15% 12.00% 12.87% 16.00% 17.48% 20.00% 22.27%
</TABLE>
*Based on 365 Day Year Compounded Monthly.
