SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4 )*
RENT-A-WRECK OF AMERICA, INC.
---------------------------------------
(Name of Issuer)
COMMON STOCK
-----------------------------------
(Title of Class of Securities)
760098-10-3
---------------------
(CUSIP Number)
William L. Richter, Richter & Co., Inc.
450 Park Avenue, 28th Floor, New York, New York 10022; (212) 421-6300
---------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notes and Communications)
January 17, 1997
----------------------------
Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
* 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).
(Continued on following page(s))
Page 1 of 15 Pages
<PAGE>
13D
CUSIP NO. 760098-10-3 Page 2 of 15 Pages
---------------
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S IDENTIFICATION NO. OR ABOVE PERSON
WILLIAM L. RICHTER
###-##-####
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) |X|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (See Instructions)
OO
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
Number of 2,229,590 (including shares shown on pages 3-4
hereof)
Shares
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8 SHARED VOTING POWER
Beneficially 23,908
Owned by
----------------------------------------------------------------
Each 9 SOLE DISPOSITIVE POWER
Reporting 1,622,340 (including shares shown on pages 3-4
hereof)
----------------------------------------------------------------
Person 10 SHARED DISPOSITIVE POWER
With 23,908
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,253,498
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (See Instructions) |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
39.9%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON (See Instructions)
IN
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<PAGE>
13D
CUSIP NO. 760098-10-3 Page 3 of 15 Pages
-------------
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S IDENTIFICATION NO. OR ABOVE PERSON
RICHTER INVESTMENT CORP.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) |X|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (See Instructions)
N/A
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
Number of
1,897,725 (including shares shown on page 3 hereof)
Shares
-----------------------------------------------------------------
8 SHARED VOTING POWER
Beneficially
Owned by
-----------------------------------------------------------------
Each 9 SOLE DISPOSITIVE POWER
Reporting 1,097,975 (including shares shown on page 3 hereof)
-----------------------------------------------------------------
Person 10 SHARED DISPOSITIVE POWER
With
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,897,725
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (See Instructions) |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
34.1%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON (See Instructions)
CO
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<PAGE>
13D
CUSIP NO. 760098-10-3 Page 4 of 15 Pages
----------------
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S IDENTIFICATION NO. OR ABOVE PERSON
RICHTER & CO., INC.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) |X|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (See Instructions)
N/A
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
Number of
272,975
Shares
--------------------------------------------------------------
8 SHARED VOTING POWER
Beneficially
Owned by
--------------------------------------------------------------
Each 9 SOLE DISPOSITIVE POWER
Reporting 272,975
--------------------------------------------------------------
Person 10 SHARED DISPOSITIVE POWER
With
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
272,975
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (See Instructions) |_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.5%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON (See Instructions)
BD,CO
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<PAGE>
Item 1. Security and Company.
This Statement relates to Common Stock, par value $.01 per
share (the "Common Stock"), of Rent-A-Wreck of America, Inc. (the "Company" or
the "Issuer"). The principal executive offices of the Company are located at
11460 Cronridge Drive, Suite 118, Owings Mills, Maryland 21117.
Item 2. Identity and Background.
This Statement is being filed by:
(a) William L. Richter, Richter Investment Corp., a
Delaware corporation ("RIC"), and Richter & Co.,
Inc., a Delaware corporation ("RCI").
(b) Office address: Richter & Co., Inc. 450 Park Avenue,
28th Floor, New York, New York 10022.
(c) William L. Richter is President of Richter & Co.,
Inc., which is a broker-dealer wholly owned by
Richter Investment Corp., a holding company. Mr.
Richter is a director and Vice Chairman of the
Company, and is a director and Co- Chairman of Avesis
Incorporated, which markets and administers discount
benefit programs. The names, residence or business
addresses and present principal occupation or
employment of the executive officers and directors of
Richter Investment Corp. and Richter & Co, Inc. are
set forth in Appendix 1 hereto and incorporated
herein by this reference.
(d) To the best of the filing persons' knowledge, during
the last five years, none of the persons named in
this Item 2 or in Appendix 1 hereto has been
convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) To the best of the filing persons' knowledge, during
the last five years, none of the persons named in
this Item 2 or in Appendix 1 hereto has been 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.
(f) All individuals named in this Item 2 or in Appendix 1
hereto are citizens of the United States.
Item 3. Source and Amount of Funds or Other Consideration.
A. RCI. RCI holds in its trading account shares of Issuer's Common
Stock acquired (i) by open market purchases at various times from working
capital, and (ii) in April 1989 pursuant to an Asset Purchase Agreement between
RCI and Richter, Cohen & Co., a New York limited partnership. RCI purchased
shares of Common Stock pursuant to the Asset Purchase Agreement for a total
aggregate purchase price of $7,750 with funds from its working capital. Pursuant
to the Asset Purchase Agreement, the purchase price may be adjusted upon the
sale of such Common Stock by
Page 5 of 15 Pages
<PAGE>
RCI as follows: (i) 100% of the sale proceeds in excess of $.50 up to $2.00 per
share and (ii) 80% of the sale proceeds in excess of $2.00 per share, will be
for the benefit of Richter, Cohen & Co. The purchase was made in conjunction
with the succession of RCI to the broker/dealer business of Richter, Cohen & Co.
in accordance with Rule 15b1-3 promulgated under the Securities Exchange Act of
1934.
RCI rendered placement and financial advisory services to
Issuer in connection with a private offering (the "Offering") pursuant to
Regulation D of the Securities Act of 1933, as amended ("Securities Act") by
Issuer of 200 investment units ("Units") consisting of Convertible Debentures in
the aggregate principal amount of $1,100,000 (the "Debentures") and Warrants to
acquire 500,000 shares of Common Stock exercisable at $1.50 per share (the
"Offering Warrants") as described in that certain Private Placement Agreement
dated July 31, 1989 between Issuer and RCI. Each Unit consists of a Debenture in
the principal amount of $5,500 and a Warrant to purchase 2,500 shares of Common
Stock. The Debentures were mandatorily convertible at the option of the Issuer
into shares of Series A Convertible Preferred Stock ("Series A Preferred") on
the basis of $.80 in principal of Debentures for each share of Series A
Preferred. The Debentures were converted to Series A Preferred on October 28,
1989 by the Company.
The Private Placement Agreement did not become effective until
August 11, 1989 and was the event giving rise to Reporting Persons' initial
Schedule 13D filing. The Offering closed on October 18, 1989. In consideration
for its services under the Private Placement Agreement, Issuer agreed to (i) pay
to RCI a cash fee equal to 6% of the $1,100,000 proceeds of Offering and (ii)
issue upon completion of the Offering a five-year warrant ("RCI Warrant") to
acquire (x) 82,500 shares of Common Stock at an exercise price of $.80 per share
and (y) 30,000 shares of Common Stock at $1.50 per share, each warrant to be on
similar terms (other than exercise price) as the Offering Warrants.
The RCI Warrant was issued as follows:
(a) warrants to purchase 49,500 shares of Common Stock at
$.80 per share in the name of RCI;
(b) warrants to purchase 18,000 shares of Common Stock at
$1.50 per share in the name of RCI;
(c) warrants to purchase 33,000 shares of Common Stock at
$.80 per share in the name of William L. Richter; and
(d) warrants to purchase 12,000 shares of Common Stock at
$1.50 per share in the name of William L. Richter.
In February 1992, the Company extended an offer to all holders
of the Corporation's option and warrants that were immediately exercisable to
exercise at a reduced exercise price (the "Offer"). The Offer closed on March
13, 1992. In connection with the Offer, RCI exercised warrants to acquire 84,375
shares of Common Stock at an average price of $.328 per share (consisting of
61,875 shares at $.267 per share and 22,500 shares at $.50 per share), for an
aggregate consideration of $27,750. The exercise price was paid with RCI's
working capital.
Page 6 of 15 Pages
<PAGE>
Effective on April 1, 1992, RCI was granted a five year
warrant to acquire 100,000 shares of Common Stock at $1.25 per share as
additional consideration for acting as financial advisor and assisting the
Company with the initiation, design, structuring and negotiation of the
Commercial Installment Sales and Financial Agreement with Agency Auto Sales,
Inc. (RCI is also paid a fee of $75 per vehicle financed through the vehicle
acquisition program funded through the agreement with Agency; such fees,
however, may not exceed 4% of the maximum credit extended to the Company under
the agreement.) Of those 100,000 warrants, 20,000 were assigned to Mr. Richter
pursuant to the terms of his employment with RCI and another 20,000 were
assigned to another employee of RCI. These warrants are exercisable from April
1, 1992 through March 31, 1997.
B. RIC. RIC purchased 80 Units for an aggregate purchase price of
$440,000 from working capital funds of RIC. As consideration for (i) a Bridge
Loan of $300,000 to Issuer pursuant to a Loan Agreement, dated July 31, 1989
between RIC and Issuer, and (ii) a Commitment Letter, dated July 31, 1989 (the
"Commitment") whereby RIC agreed to purchase all of the Unites which were not
otherwise placed pursuant to the Offering, RIC received a five (5) year warrant
("RIC Warrant") to purchase 125,000 shares of Common Stock at an exercise price
of $1.50 per share, subject to adjustment. Issuer has also paid to RIC a fee of
$25,000.
The RIC Warrant was issued as follows:
(a) warrants for 75,000 shares of Common Stock in the
name of RIC, and
(b) warrants for 50,000 shares of Common Stock in the
name of William L. Richter.
RIC served as Trustee for the Debentures. The Debentures were
converted to Series A Preferred on October 28, 1989 by the Company. RIC serves
as voting trustee (via a "Proxy") for the holders of the Series A Preferred
(other than management or former management of the Issuer) and, in that
capacity, may vote 93.8% of the outstanding shares of such Series A Preferred
(or, 1,349,750 shares out of 1,439,125) until the earlier of such time as each
owner of record converts his or her Series A Preferred to Common Stock or less
than $500,000, in the aggregate, of Series A Preferred remains outstanding. By
virtue of his having 85.2% of the voting power of the outstanding stock of RIC,
Mr. Richter also can be deemed to have voting control over such Series A
Preferred. The Series A Preferred may be converted at any time at the option of
the holder to Common Stock on a share-for-share basis.
In connection with the Offer, RIC exercised warrants to
acquire 275,000 shares of Common Stock at $.50 per share, for an aggregate
consideration of $137,500. The exercise price was paid with RIC's working
capital. RIC continues to hold 550,000 shares of Series A Convertible Preferred
Stock ("Series A Preferred") acquired in earlier private placements.
C. William L. Richter. Mr. Richter is entitled to the
aforementioned warrants otherwise issuable to RIC or RCI as compensation for his
services to RCI and RIC. In his individual capacity, William L. Richter
purchased 16 Units for an aggregate price of $88,000. Mr. Richter purchased 2
Units as Custodian for his son Ari J. Richter for an aggregate purchase price of
$11,000. The Debentures, Offering Warrants and any Common Stock acquired upon
conversion of the Debentures with the exercise of the Warrants are, and will be,
acquired for investment purposes.
Page 7 of 15 Pages
<PAGE>
In connection with the Offer, Mr. Richter exercised warrants
held in his name as follows:
No. of Shares Subject Exercise Price
Security Exercised to Exercise per Share
------------------ --------------------- --------------
Warrant 46,875 .667
Warrant 31,406 1.00
Warrant 41,250 .267
Warrant 105,000 .50
------- ----
224,531* $126,156*
* These figures include warrants to acquire 78,281 shares of
Common Stock held in the name of Richter, Cohen & Co., a New York Limited
Partnership that were either allocated to Mr. Richter under the terms of the
limited partnership agreement or were purchased by him from other partners in
that partnership and then exercised. The purchase price for this exercise was
furnished by Mr. Richter to Richter, Cohen & Co., which, in turn, paid the
Company. All such Common Stock has been issued in the name of Mr. Richter.
Further, in connection with the Offer, Mr. Richter caused his
IRA to exercise warrants to acquire 25,000 shares of Common Stock at $.50 per
share, for an aggregate consideration of $12,500. Mr. Richter also exercised on
behalf of Ari J. Richter, his son, warrants to acquire 5,000 shares of Common
Stock at $.50 per share, for an aggregate consideration of $2,500. (Such shares
are held by Mr. Richter as custodian for his son under the Uniform Gift to
Minors Act. Mr. Richter's son currently is over the age of legal majority.) On
January 28, 1992, Sandra A. Richter, Mr. Richter's wife, purchased on the open
market, through her IRA, 1,200 shares of Common Stock at $1.33 per share. Mr.
Richter may be deemed to beneficially own the securities owned by his son and
wife.
Mr. Richter owns 50% of the equity securities of Richter,
Cohen & Co., Inc. ("RC&Co, Inc."). The remaining 50% is owned by another
individual. Although Mr. Richter does not exercise sole control over RC&Co.,
Inc., Mr. Richter has included in the shares beneficially owned by him in this
report the 22,708 shares of Common Stock owned by RC&Co., Inc. Such shares were
purchased by a predecessor, Richter, Cohen & Co., a New York limited
partnership, from its working capital in 1983 and distributed to its partners in
1989.
Securities acquisitions reported in this Amendment No. 4 to
Schedule 13D were the result of additional shares of Series A Preferred becoming
subject to the Proxy held by RIC. No funds were expended in connection with such
transactions.
Page 8 of 15 Pages
<PAGE>
Item 4. Purpose of Transaction.
A. RCI.
----
RCI is holding in its trading account shares of Issuer's
Common Stock. The shares of Common Stock were acquired as described in Item 3 of
this filing. RCI, as compensation for its services to Issuer as Placement Agent
in the Offering, received five-year warrants exercisable immediately upon
issuance to purchase (i) 82,500 shares of Common Stock exercisable at $.80 per
share and (ii) 30,000 shares of Common Stock exercisable at $1.50 per share. The
warrants were issued upon completion of the Offering by Issuer as follows: (a)
warrants to purchase 49,500 shares of Common Stock at $.80 per share in the name
of RCI and (b) warrants to purchase 18,000 shares of Common Stock at $1.50 per
share in the name of RCI, (c) warrants to purchase 33,000 shares of Common Stock
at $.80 per share in the name of William L. Richter and (d) warrants to purchase
12,000 shares of Common Stock at $1.50 per share in the name of William L.
Richter. Mr. Richter became entitled to these warrants as compensation for his
services to RCI. The warrants and any shares of Common Stock acquired upon
exercise of the warrants are, and will be, acquired for investment purposes and
as compensation for services rendered by RCI to Issuer in connection with the
Offering.
RCI may acquire additional shares of Common Stock for
investment purposes in the ordinary course of business and may acquire shares of
Common Stock upon exercise of the warrants. Additionally, RCI is a broker/dealer
registered with the Securities and Exchange Commission and the National
Association of Securities Dealers, Inc., and as such from time to time, has
bought and sold Issuer's Common Stock for its own account.
B. RIC.
----
RIC received, as compensation for the Bridge Loan and
Commitment, warrants as follows: (a) warrants to purchase 75,000 shares of
Common Stock in the name of RIC and (b) warrants to purchase 50,000 shares of
Common Stock in the name of William L. Richter. Mr. Richter is entitled to these
warrants pursuant to his employment agreement with RIC.
The funds used by RIC in making the purchase of the Units were
from its working capital. Debentures and Warrants in favor of RIC, RCI and Mr.
Richter and any shares of Common stock acquired by exercise of the Warrants or
conversion of the Debentures were, and will be, acquired for investment
purposes.
As noted in Item 3, RIC holds a Proxy to vote the Series A
Preferred shares (except those held by management or former management of the
Issuer). The Series A Preferred is convertible at any time and at the option of
the holder, into shares of Common Stock of Issuer. The conversion is available
on the basis of one share of Common Stock for one share of Series A Preferred
Stock. The holders of the Series A Preferred Stock, as a class, have the right
to elect a maximum of four (4) directors to the Board of Directors of Issuer (of
which there shall be a maximum of seven (7) directors) until such time as less
than $500,000 in Series A Preferred Stock remains outstanding at which time such
right shall terminate and the remaining holders will have voting rights on an
equal basis with holders of Common Stock.
Page 9 of 15 Pages
<PAGE>
C. William L. Richter.
-------------------
Mr. Richter acquired the Common Stock and warrants as noted in
Item 3 of this filing for investment purposes. Registration rights are held with
respect to various of the securities reported herein.
Transactions reported in this Amendment No. 4 to Schedule 13D
resulted from the expiration of derivative securities owned by Reporting
Persons, the sale of shares of Issuer Common Stock by RC & Co, Inc. and the
transfer and conversion of Series A Preferred shares subject to the Proxy held
by RIC. Shareholders other than Reporting Persons have investment control over
such Series A Preferred shares.
Item 5. Interest in Securities of the Company.
(a) The aggregate number and percentage of Common Stock
beneficially owned by William L. Richter is 2,253,498 (including the securities
referred to in the next sentence) and 39.9%, respectively. RIC is the beneficial
owner of 1,897,725 shares of Common Stock or 34.1% (including the securities
referred to in the next sentence). RCI is the beneficial owner of 272,975 shares
of Common Stock or 6.5%.
The shares held by RCI include 46,600 shares of Common Stock
held in RCI's trading account; warrants for 60,000 shares of Common Stock
exercisable at $1.25 per share; warrants for 26,000 shares of Common Stock
exercisable at $.80 per share; and warrants for 36,000 shares and options for
20,000 shares exercisable at $1.00 per share. (RCI also holds warrants for
45,000 shares and options for 25,000 shares exercisable at $1.15 per share on
July 1, 2002, subject to accelerated vesting upon meeting certain performance
targets.)
The shares held by RIC include the shares held by RCI, its
wholly-owned subsidiary, and 1,349,750 shares of Preferred Stock deemed
beneficially owned by RIC due to a proxy held by RIC to vote such shares. RIC
also has investment control over 550,000 of the shares of Preferred Stock
referred to in the previous sentence.
The shares held by Richter include the shares held by RIC and
RCI (due to Mr. Richter's positions as an executive officer and director of such
corporations); 178,750 shares of Preferred Stock; 13,750 shares of Preferred
Stock and 6,200 shares of Common Stock held by family members; warrants to
acquire 20,000 shares of Common Stock exercisable at $1.25 per share; warrants
to acquire 20,000 shares of Common Stock exercisable at $.80 per share; warrants
to acquire 24,000 shares and options to acquire 13,334 shares exercisable at
$1.00 per share; and 22,708 shares of Common Stock held by a corporation of
which Mr. Richter owns 50%, RC & Co, Inc. The shares of Preferred Stock
described in this paragraph are also included in the number of shares deemed to
be owned by RIC in the previous paragraph due to RIC's proxy. (Richter also
holds warrants to acquire 30,000 shares and options to acquire 16,666 shares
exercisable at $1.15 per share on July 1, 2002, subject to accelerated vesting
upon meeting certain performance targets.)
(b) See Items 7 through 10 on the Cover Pages of this
Amendment No. 4 to Schedule 13D.
Page 10 of 15 Pages
<PAGE>
(c) The following transactions with respect to the Company's
securities and involving the reporting persons have taken place during the
preceding 60 days:
(i) In January 1997, stockholders unrelated to the
Reporting Persons who have investment control over an aggregate of
59,625 Series A Preferred shares exercised their right to convert their
shares for an equal number of Common Shares for no additional
consideration. Upon conversion, the shares were no longer subject to
the proxy held by RIC and are, therefore, no longer deemed to be
beneficially held by RIC.
(ii) On February 26, 1997, RC & Co, Inc. sold 3,000
shares of Issuer Common Stock for $1.5625 per share and 11,000 shares
for $1.50 per share. On February 28, 1997, RC & Co, Inc. sold 12,000
shares of Issuer Common Stock for $1.50 per share. The sales were
effected through open market transactions.
(d) Other than the Series A Preferred shares reported herein
as owned directly by Reporting Persons, other shareholders have the power to
receive and the power to direct the receipt of dividends from, and the proceeds
from the sale of, the Series A Preferred shares subject to the Proxy held by
RIC.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Company.
Except as described herein, there are no contracts, arrangements,
understandings or relationships between the reporting persons and any other
person with respect to any securities of the Company.
Pursuant to the voting agreement entered into by the investors (other
than management or former management of the Issuer) in connection with the
previous Private Offerings, RIC holds the right to vote such shares of Series A
Preferred. The holders of the Series A Preferred Stock, as a class, shall have
the right to elect a maximum of four (4) designees to the Board of Directors of
Issuer as provided above. Such right commenced with the issuance of the Series A
Preferred Stock and terminate at such time that less than $500,000 of Series A
Preferred Stock remains outstanding.
A significant shareholder of the Company, David A. Schwartz, has
pledged 800,000 of his shares of Common Stock of Issuer (the "Pledged Stock") to
an unrelated third party ("Lender") as security for a loan made by said Lender
to Mr. Schwartz (the "Schwartz Agreement"). RIC may, at its option, in the event
of a default by Mr. Schwartz under the Schwartz Agreement, pay on Mr. Schwartz's
behalf all sums then due and owing from Mr. Schwartz to Lender. Upon payment by
RIC to Lender, RIC shall have a security interest in the Pledged Stock. Mr.
Schwartz shall have sixty (60) days to repay RIC the amount paid by it plus
interest. If Mr. Schwartz fails to repay RIC within such time, RIC shall be
entitled to (i) retain such number of Pledged Shares evidencing the amount paid
by it plus accrued interest or (ii) sell such number of Pledged Shares to third
parties as required to repay RIC the amount plus accrued interest. The Pledged
Stock constitutes approximately 19.6% of the Common Stock of Issuer outstanding
(exclusive of any warrants, options or other agreements of any person to acquire
Common Stock of Issuer).
Page 11 of 15 Pages
<PAGE>
Item 7. Material to be Filed as Exhibits.
1. Loan Agreement, dated July 31, 1989 between Richter Investment Corp.
and Issuer. (1)
2. Private Placement Agreement, dated July 31, 1989 between Richter & Co.,
Inc. and Issuer. (1)
3. Commitment Letter, dated July 31, 1989 between Richter Investment Corp.
and Issuer. (1)
4. Form of Letter between David Schwartz and Richter Investment Corp. (1)
5. Form of Letter between David Schwartz, Issuer and Richter Investment
Corp. (1)
6. Stock Purchase Warrant issued to Richter & Co., Inc. dated July 1, 1993
for the purchase of 93,000 shares of the Company's Common Stock. (2)
7. Stock Purchase Warrant issued to William L. Richter dated July 1, 1993
for the purchase of 62,000 shares of the Company's Common Stock. (2)
8. Voting Agreement among Richter Investment Corp. and certain holders of
the Company's Series A Preferred Stock. (3)
9. Certification of Joint Filing pursuant to Rule 13d-1(f).
- ----------------------------
(1) Incorporated by reference to Exhibits to Reporting Persons' initial
Schedule 13D for August 10, 1989.
(2) Incorporated by reference from the Company's Report on Form 8-K dated
June 30, 1993.
(3) Incorporated by reference from the Company's Report on Form 10-K for
the year ended March 31, 1990.
Page 12 of 15 Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, we certify that the information set forth in this statement is true,
complete and correct.
February 28, 1997
/s/ William L. Richter
-------------------------------------
William L. Richter
RICHTER & CO., INC.
By: /s/ William L. Richter
---------------------------------
William L. Richter
President
RICHTER INVESTMENT CORP.
By: /s/ William L. Richter
---------------------------------
William L. Richter
President
Page 13 of 15 Pages
<PAGE>
Appendix 1
<TABLE>
<S> <C> <C> <C>
1. Richter Investment Corp.
------------------------
Directors
---------
Benson A. Selzer 315 E. 62nd St. Chairman, DRS Industries;
New York, NY 10021 officer and director of several other
public and private companies
Richard L. Rubin 40 Old Corner Road Professor of Political Science
Bedford, New York 10506 and Public Policy at Swarthmore
College; engaged in various
Investments
William L. Richter 450 Park Avenue, 28th Floor Chairman and President of Richter
New York, New York 10022 Investment Corp. and Richter &
Co., Inc.; Co-Chairman of Avesis
Incorporated, Vice-Chairman of
Rent-A-Wreck of America, Inc.;
Mr. Richter exercises
approximately 85% of the voting
control of Richter Investment Corp.
Executive Officers
------------------
William L. Richter 450 Park Avenue, 28th Floor President
New York, New York 10022
L. Christine Lynch 450 Park Avenue, 28th Floor Vice President and Secretary
New York, New York 10022
2. Richter & Co., Inc.
-------------------
Directors
---------
William L. Richter 450 Park Avenue, 28th Floor Director
New York, New York 10022
Executive Officers
------------------
William L. Richter 450 Park Avenue, 28th Floor President
New York, New York 10022
L. Christine Lynch 450 Park Avenue, 28th Floor Vice President
New York, New York 10022
</TABLE>
Page 14 of 15 Pages
<PAGE>
EXHIBIT 9
CERTIFICATION REGARDING JOINT FILING OF
---------------------------------------
SCHEDULE 13D PURSUANT TO RULE 13d-l(f)
--------------------------------------
OF THE SECURITIES AND EXCHANGE COMMISSION
-----------------------------------------
William L. Richter, Richter & Co., Inc. and Richter Investment
Corp. do hereby certify that the Schedule 13D to which this certification is
attached as Exhibit 4 is being filed with the Securities and Exchange Commission
on behalf of each of the undersigned.
Dated: February 28, 1997
--
RICHTER & CO., INC.
By: /s/ William L. Richter
--------------------------------------
William L. Richter
President
RICHTER INVESTMENT CORP.
By: /s/ William L. Richter
--------------------------------------
William L. Richter
President
/s/ William L. Richter
--------------------------------------
William L. Richter
Page 15 of 15 Pages
