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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. _____)*
Lifeline Systems, Inc.
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(Name of Issuer)
Common Stock, $.02 Par Value
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(Title of Class of Securities)
532192 10 1
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(CUSIP Number)
Ms. Kathleen A. Barry, Lifeline Systems, Inc., 640 Memorial Drive, Cambridge,
Massachusetts 02139 (617) 679-1000
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(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
February 11, 1994
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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 [_].
Check the following box if a fee is being paid with the statement [X]. (A fee
is not required only if the reporting 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.)
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.
*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).
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CUSIP NO. 532192 10 1 SCHEDULE 13D PAGE 2 OF 8 PAGES
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NAME OF REPORTING PERSON
1 S.S. OD I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Ronald Feinstein
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [_]
(b) [X]
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SEC USE ONLY
3
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SOURCE OF FUNDS*
4
00
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) or 2(e) [_]
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
United States
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SOLE VOTING POWER
7
NUMBER OF 333,534 (beneficial interest disclaimed in 16,000)
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
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EACH SOLE DISPOSITIVE POWER
9
REPORTING 338,308 (beneficial interest disclaimed in 16,000)
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
322,308
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12 [X]
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
5.6%
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TYPE OF REPORTING PERSON*
14
IN
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*SEE INSTRUCTION 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 2 of 7 pages
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SCHEDULE 13D
Item 1. Security and Issuer
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Common Stock, $.02 par value per share ("Common Stock"), of Lifeline
Systems, Inc. (the "Company"), 640 Memorial Drive, Cambridge,
Massachusetts 02139
Item 2. Identity and Background
-----------------------
(a) Ronald Feinstein
(b) c/o Lifeline Systems, Inc., 640 Memorial Drive,
Cambridge, Massachusetts 02139
(c) President and Chief Executive Officer of the
Company, 640 Memorial Drive, Cambridge,
Massachusetts 02139
(d) None
(e) None
(f) U.S.
Item 3. Source and Amount of Funds or Other Consideration
-------------------------------------------------
Mr. Feinstein became the beneficial owner (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) of over
5% of the Common Stock upon the grant by the Company to Mr. Feinstein,
on February 11, 1994, at no cost to Mr. Feinstein, of a fully-vested
option to purchase 40,000 shares of Common Stock.
Item 4. Purpose of Transaction
----------------------
Mr. Feinstein was granted the options described in Item 3 above
pursuant to the Company's 1994 Stock Option Plan. Mr. Feinstein may in
the future exercise some or all of the options held by him, purchase
Common Stock on the open market or otherwise, or dispose of Common
Stock on the open market or otherwise, subject to a number of factors,
including, among others, market conditions and the market price of the
Common Stock, the condition of the Company, the availability of funds
and the availability of other business opportunities.
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Item 5. Interest in Securities of the Issuer
------------------------------------
(a) As of February 11, 1994, the date of the event which required the
filing of this statement, Mr. Feinstein beneficially owned
305,790 shares of Common Stock, except as this amount may be
limited by the explanations contained in the following
paragraphs:
1. 289,790 shares are owned directly by Mr. Feinstein. Includes
108,501 shares that Mr. Feinstein has the right to acquire
within sixty days after February 11, 1994. Also includes
2,506 shares which Mr. Feinstein beneficially owns through
his interest in the Company's Employees' Savings and
Investment Plan (the "401(k) Plan"), as to which shares Mr.
Feinstein possesses sole dispositive power but possesses no
voting power.
2. 16,000 shares are held by Mr. Feinstein's children. Mr.
Feinstein has sole voting and dispositive power over such
shares, but he disclaims any beneficial interest.
Item 5(c) below describes the acquisitions of Common Stock by Mr.
Feinstein subsequent to February 11, 1994.
(b) See Item 5(a) above.
(c) This Item 5(c) describes the acquisitions of Common Stock by Mr.
Feinstein between the date sixty days prior to February 11, 1994
and the date of the filing of this statement:
On August 27, 1994, options to purchase 30,000 shares of Common
Stock became vested under an option granted by the Company to Mr.
Feinstein on August 27, 1992. Mr. Feinstein became the beneficial
owner of 2,211, 57 and 1,092 shares of Common Stock though
purchases of Common Stock by the 401(k) Plan on June 30, 1994 at
prices ranging from $3.83 to $4.375 per share, on March 31, 1994
at prices ranging from $4.375 to $4.625 per share and on December
31, 1993 at prices ranging from $3.75 to $4.75 per share,
respectively (as to which shares Mr. Feinstein possesses sole
dispositive power but possesses no voting power). On April 29,
1994, Mr. Feinstein purchased 250 shares of Common
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Stock under the Company's Employee Stock Purchase Plan at a price
of $3.83 per share. As described in Item 3 above, Mr. Feinstein
received on February 11, 1994 a fully-vested option to purchase
40,000 shares of Common Stock.
(d) Mr. Feinstein's children own 16,000 shares of Common Stock and
have the right to receive any dividends that may be declared and
any proceeds from the sale of such shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to the Securities of the Issuer
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Pursuant to the terms of an employment agreement, as amended,
effective as of August 27, 1992, Ronald Feinstein became the Executive
Vice President and Chief Operating Officer of the Company on October
1, 1992, and the President and Chief Executive Officer on January 1,
1993. Pursuant to the terms of Mr. Feinstein's agreement, on September
1, 1992, the Company sold to Mr. Feinstein 83,333 shares of the
Company's Common Stock at a price of $3.00 per share (which
represented the fair market value of the Common Stock on August 27,
1992) for an aggregate price of $250,000. The Company loaned $250,000
to Mr. Feinstein for seven years at an annual interest rate of 5.98%
pursuant to the terms of a promissory note (the "Note") which is
secured by the Common Stock that Mr. Feinstein purchased. Furthermore,
on February 11, 1994, Mr. Feinstein received, subject to the approval
by the stockholders of the Company's 1994 Stock Option Plan, a
nonstatutory fully-vested option under such plan to purchase 40,000
shares of Common Stock at an exercise price of $5.00 per share (which
represented the fair market value on the date of grant). The Note will
accelerate and become immediately due and payable on the twentieth
business day following a determination (the "Determination Date") by
the Chief Financial Officer of the Company, with the approval of the
Chairman of the Stock Option Plans Committee, that the value of such
option exceeds (i) the sum of $450,000 plus (ii) the federal and state
taxes in effect on the Determination Date applicable to long-term
capital gain, determined as if 40,000 shares, with a total cost of
$200,000, were sold on the Determination Date.
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Pursuant to his employment agreement, Mr. Feinstein also received a
nonstatutory stock option to purchase up to 150,000 shares of Common
Stock at an exercise price of $3.00 per share (which represented the
fair market value on the date of grant), vesting one-fifth on the date
of grant and one-fifth on each of the next four anniversary dates. In
addition, Mr. Feinstein was granted a stock option to purchase up to
100,000 shares of Common Stock at $3.00 per share (which represented
the fair market value on the date of grant), subject to a vesting
schedule that is based on the achievement of certain financial
performance objectives by the Company. Upon a change in control of the
Company, (i) the stock option for 150,000 shares described above would
be accelerated and deemed to be vested and (ii) the stock option for
100,000 shares described above would also be accelerated and deemed to
be vested, provided that the Company has achieved a certain level of
profitability for the four quarters preceding such change in control.
Notwithstanding the foregoing, in the event that there is a change in
control prior to August 27, 1995 and no options are then exercisable,
the option covering 100,000 shares will become immediately exercisable
with respect to 50,000 shares.
The Company also granted to Mr. Feinstein the following options for
his service as a director of the Company, each of which options is
currently fully-vested: options to purchase 1,001 shares at $2.42 per
share granted on January 1, 1990; options to purchase 4,500 shares at
$10.00 per share granted on January 9, 1991; and options to purchase
3,000 shares at $14.375 per share granted on January 9, 1992.
Item 7. Material to be filed as Exhibits
--------------------------------
The following is a list of exhibits to this Schedule 13D. The following
exhibits have, as indicated below, previously been filed by and on behalf of the
Company with the Securities and Exchange Commission under the Securities and
Exchange Act of 1934 and are referred to and incorporated herein by reference to
such filings.
Exhibit 1. Nonqualified Stock Option Agreement between the Company
--------- and Mr. Feinstein, dated as of January 2, 1990.
(Filed with the Company's 10-Q for the quarter ended
June 30, 1990)
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Exhibit 2. Amended Employment and Noncompetition Agreement between
--------- Mr. Feinstein and the Company, dated August 27, 1992.
(Filed with the Company's 10-K for the year ended
December 31, 1992)
Exhibit 3. Secured Promissory Note between Mr. Feinstein and the
--------- Company, dated September 1, 1992.
(Filed with the Company's 10-K for the year ended
December 31, 1992)
Exhibit 4. Security and Pledge Agreement between Mr. Feinstein and
--------- the Company, dated September 1, 1992.
(Filed with the Company's 10-K for the year ended
December 31, 1992)
Exhibit 5. Nonstatutory Stock Option Agreement, as amended,
--------- between Mr. Feinstein and the Company, dated
August 27, 1992.
(Filed with the Company's 10-K for the year ended
December 31, 1992)
Exhibit 6. Special Non-Statutory Stock Option Agreement, as
--------- amended, between Mr. Feinstein and the Company, dated
August 27, 1992.
(Filed with the Company's 10-K for the year ended
December 31, 1992)
Exhibit 7. Non-Statutory Stock Option Agreement between Mr.
--------- Feinstein and the Company, dated February 11, 1994.
(Filed with the Company's 10-Q for the quarter ended
March 31, 1994)
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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.
/s/ Ronald Feinstein
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Ronald Feinstein
Dated: November 16, 1994
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