UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ________)*
Physicians Insurance Company of Ohio
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(Name of Issuer)
Class A Common Shares, $1.00 par value per share
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(Title of Class of Securities)
719410-10-2
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(CUSIP Number)
James F. Mosier
13515 Yarmouth Drive, NW
Pickerington, Ohio 43147
(614) 864-7100
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 9, 1996
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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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SCHEDULE 13D
CUSIP NO. 719410-10-2
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON:
The Ondaatje Corporation
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions):
(a)____ (b)____
3. SEC USE ONLY:
4. SOURCE OF FUNDS (See Instructions):
WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e):
____
6. CITIZENSHIP OR PLACE OF ORGANIZATION:
Ontario, Canada
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7. SOLE VOTING POWER: 850,000
8. SHARED VOTING POWER: 0
9. SOLE DISPOSITIVE POWER: 850,000
10. SHARED DISPOSITIVE POWER: 0
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
850,000
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):
16.3%
14. TYPE OF REPORTING PERSON (See Instructions):
CO
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Item 1. Security and Issuer.
This statement relates to the Class A Common Share, $1.00 par value (the
"Class A Common Shares"), of Physicians Insurance Company of Ohio (the
"Issuer"). The address of the principal executive offices of the Issuer is
13515 Yarmouth Drive, NW, Pickerington, Ohio 43147.
Item 2. Identity and Background.
(a) The Ondaatje Corporation ("TOC")
(b) TOC's business address is 30A Hazelton Avenue, 4th Floor, Toronto,
Ontario M5R 2E2.
(c) TOC operates primarily as an international investment company and is
also involved in securities and commodities brokerage, investment
finance and agricultural services and food processing through its
subsidiaries.
(d) During the last five years, TOC has not been convicted in a criminal
proceeding
(e) During the last five years, TOC has not been a party to any civil
proceedings resulting in 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) Ontario, Canada
Item 3. Source and Amount of Funds or Other Consideration.
TOC purchased, and will purchase, the Class A Common Shares reported herein
with generally available funds from working capital. No part of these funds
was, or will be, borrowed.
Item 4. Purpose of Transaction.
TOC has acquired, and will acquire, the Class A Common Shares of the Issuer as
reported herein in order to obtain an equity position in the Issuer. TOC
believes the Class A Common Shares of the Issuer have the potential for
appreciation in price.
(a) As reported herein, TOC agreed to purchase, in two tranches, an
aggregate of 850,000 Class A Common Shares of the Issuer pursuant to
an Agreement for Purchase and Sale of Shares, effective as of May 9,
1996 (the "Purchase Agreement"), with Guinness Peat Group plc
("GPG"). The purchase of the first tranche of 665,000 Class A Common
Shares closed on May 13, 1996. The second tranche of 185,000 Class A
Common Shares to be acquired by TOC is subject to the filing and
waiting period requirements of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (the "HSR Act") and the purchase of those
Class A Common Shares is scheduled to close five days after the
expiration of the waiting period under the HSR Act has expired, which
is expected to occur in mid-June, 1996.
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(b)-(j) Not applicable.
Item 5. Interest in Securities of the Issuer.
(a) TOC has purchased 665,000 Class A Common Shares of the Issuer as of
the date hereof. This amounts to 12.8% of the Class A Common Shares
outstanding. As described in Items 4(a) and 5(c) of this
Schedule 13D, TOC will purchase an additional 185,000 Class A Common
Shares of the Issuer upon expiration of the applicable waiting period
under the HSR Act. When this latter purchase occurs, TOC will own an
aggregate of 850,000 Class A Common Shares of the Issuer, representing
16.3% of the outstanding Class A Common Shares.
(b) TOC has, and will have, the sole power to vote, or to direct the vote
of, and the sole power to dispose, or direct the disposition of, the
Class A Common Shares purchased by TOC.
(c) As described in Item 4(a) of this Schedule 13D, effective as of May 9,
1996, TOC entered into the Purchase Agreement with GPG to purchase an
aggregate of 850,000 Class A Common Shares of the Issuer owned by
GPG. The terms under which the Class A Common Shares were and are to
be purchased were arrived at through arms'-length negotiations between
the parties. The first tranche of 665,000 Class A Common Shares was
acquired by TOC on May 13, 1996 at a price of $20.75 per share. The
second tranche of 185,000 Class A Common Shares will be acquired by
TOC at a price of $8.1149 per share five days after the applicable
waiting period under the HSR Act has expired, which is expected to
occur in mid-June, 1996.
(d) As described in Items 4(a) and 5(c) of this Schedule 13D, until the
applicable waiting period under the HSR Act expires, GPG will own, and
have the right to receive dividends from and proceeds from the sale of,
the 185,000 Class A Common Shares to be purchased by TOC in the second
tranche acquisition contemplated by the Purchase Agreement.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings, or Relationships with
Respect to Securities of the Issuer.
See Items 4(a) and 5(c) of this Schedule 13D.
Item 7. Material to be Filed as Exhibits
The Agreement for Purchase and Sale of Shares, effective as of May 9, 1996,
among the Issuer, TOC and GPG is attached hereto as Exhibit 1 and incorporated
by reference.
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Signatures
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.
THE ONDAATJE CORPORATION
By /s/ James F. Mosier
--------------------------------
Date: May 17, 1996 James F. Mosier, its Secretary
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Exhibit 1
Agreement for Purchase and Sale of
Shares, effective as of May 9, 1996,
among Physicians Insurance Group of
Ohio, Guinness Peat Group Plc and
The Ondaatje Corporation
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<PAGE>
AGREEMENT FOR PURCHASE AND SALE OF SHARES
This Agreement is entered into effective as of May 9, 1996 among
Physicians Insurance Group of Ohio ("PICO"), Guinness Peat Group Plc ("GPG")
and The Ondaatje Corporation ("TOC").
RECITALS
A. PICO and GPG are parties to the Agreement for Purchase and Sale of
Stock dated November 23, 1993 as modified by an Assignment and Assumption
Agreement dated December 30, 1993 (collectively, the "Prior Agreement")
pursuant to which GPG acquired shares of PICO and PICO granted certain rights
to GPG.
B. GPG desires to sell 850,000 shares of PICO stock held by it to
TOC (the "Shares").
C. PICO has negotiated a definitive agreement (the "Merger Agreement")
in connection with the proposed merger of PICO with a wholly-owned subsidiary
of Citation Insurance Group ("Citation") which will result in the issuance of
shares of Citation Common Stock to the holders of PICO Class A Common Stock in
exchange for their PICO shares (the "Merger").
D. It is a condition to the Merger that GPG makes certain
representations and warranties to PICO pursuant to the Continuity of Interest
Certificate (the "Certificate") and that it agrees to certain of the terms
provided herein. Pursuant to the Certificate, GPG acknowledges that GPG has no
current plan or intention to sell any additional PICO shares. The consummation
of the transactions provided in this Agreement are a condition to GPG agreeing
to make such representations and warranties.
AGREEMENT
The parties agree as follows:
1. Purchase and Sale of Shares.
1.1 Share Transfer.
(a) GPG agrees to sell and transfer 665,000 of the Shares
(the "First Shares") to TOC at the First Closing (as defined below).
(b) Subject to the terms and conditions of this Agreement,
GPG agrees to sell and transfer 185,000 of the Shares (the "Conditional
Shares") to TOC at the Conditional Closing (as defined below).
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1.2 Purchase Price.
(a) TOC agrees to purchase the First Shares and to pay to
GPG in consideration therefor $20.75 per share which, in the aggregate, totals
$13,798,750.
(b) Subject to the terms and conditions of this Agreement,
TOC agrees to purchase the Conditional Shares and to pay to GPG in
consideration therefor $8.1149 per share which, in the aggregate, totals
$1,501,250.
1.3 Closings.
(a) The closing of the purchase and sale of the First Shares
(the "First Closing") shall be held at the offices of Gray Cary Ware &
Freidenrich located at 4365 Executive Drive, Suite 1600, San Diego, California
on May 9, 1996.
(b) The closing of the purchase and sale of the Conditional
Shares (the "Conditional Closing") shall be subject to and conditioned upon,
and shall be held at the location set forth in paragraph (a) above five (5)
days after the notice period with respect to the sale of the Conditional
Shares under the Hart-Scott Rodino Antitrust Improvements Act of 1976 (the
"HSR Act") shall have expired (the "Condition").
(c) Each of the other events, rights or obligations which by
the terms of this Agreement are to occur or arise upon the Conditional
Closing, shall be subject to and conditioned upon the completion of the
Condition and the Conditional Closing.
1.4 Delivery.
(a) At the First Closing, TOC shall deliver a check for the
purchase price of the First Shares to GPG and GPG shall deliver a stock
certificate representing the First Shares duly endorsed for transfer to TOC.
(b) At the First Closing, TOC shall deliver to Gray Cary
Ware & Freidenrich, as escrow agent (the "Escrow Agent"), a check payable to
GPG for the purchase price of the Conditional Shares (the "Second Check"), and
GPG shall deliver to the Escrow Agent a stock certificate representing the
Conditional Shares duly endorsed for transfer to TOC.
(c) Five (5) days after completion of the Condition, the
Escrow Agent shall deliver the Second Check to GPG and the stock certificate
representing the Conditional Shares duly endorsed for transfer to TOC.
(d) If both TOC and GPG agree that the Condition will not be
satisfied by reason of disapproval of the sale of the Conditional Shares by
the United States Federal Trade Commission or the Anti-Trust Division of the
United States Justice Department, upon notice from both such parties to that
effect the Escrow Agent shall return to TOC the Second Check and shall return
to GPG the stock certificate representing the Conditional Shares and any stock
power containing the endorsement.
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(e) Each of the parties hereto agrees that the Escrow Agent
shall not be liable for any act, error or omission in carrying out the duties
under this Agreement except for the Escrow Agent's gross negligence or willful
misconduct.
2. Representations and Warranties of TOC. In connection with the
purchase of the Shares, TOC represents to PICO the following:
2.1 TOC understands the Shares represent a speculative investment.
TOC is aware of PICO's business affairs and financial condition and have
acquired sufficient information about PICO to reach an informed and
knowledgeable decision to acquire the Shares. TOC is purchasing the Shares for
investment for its own account only and not with a view to, or for resale in
connection with, any "distribution" thereof within the meaning of the Shares
Act of 1933 ("Securities Act").
2.2 TOC understands that the Shares have not been registered under
the Securities Act by reason of a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of its
investment intent as expressed herein.
2.3 TOC further acknowledges and understands that the Shares must
be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. TOC
further acknowledges and understands that, except as provided in this
Agreement, PICO is under no obligation to register the Shares. TOC understands
that the instrument evidencing the Shares will be imprinted with a legend
which prohibits the transfer of the Shares unless they are registered or such
registration is not required in the opinion of counsel satisfactory to PICO.
2.4 TOC is aware of the adoption of Rule 144 by the Securities and
Exchange Commission, promulgated under the Securities Act, which permits
limited public resale of securities acquired in a non-public offering subject
to the satisfaction of certain conditions, including, among other things: the
availability of certain public information about PICO, the resale occurring
not less than two years after the Shares to be sold were originally issued and
paid for (and the giving of a promissory note does not, for this purpose,
constitute payment), the sale being through a broker in an unsolicited
"brokers transaction" and the amount of Securities being sold during any
three-month period not exceeding specified limitations (generally, 1% of the
total amount outstanding).
2.5 TOC further acknowledges and understands that if PICO (or its
successors) is not satisfying the current public information requirement of
Rule 144 at the time TOC wishes to sell the Shares, TOC would be precluded
from selling the Shares under Rule 144 even if the two-year minimum holding
period had been satisfied.
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2.6 TOC understands that stop transfer instructions will be in
effect with respect to the transfer of the Shares consistent with the above.
27. In addition, TOC represents and warrants that:
(a) TOC is capable of bearing the economic risk and burden
of the investment and the possibility of complete loss of all of the
investment, and the lack of a public market such that it may not be possible
to readily liquidate the investment whenever desired.
(b) That at no time was TOC presented with or solicited by
any leaflet, public promotional meeting, circular, newspaper or magazine
article, radio or television advertisement, or any other form of general
advertising.
(c) TOC has had substantial experience in business or
investments in securities, such as stocks and bonds, and therefore TOC is
familiar with business and financial dealings and problems, and TOC can "fend
for itself" in a venture of this nature.
(d) TOC understands that, in selling the Shares, GPG has
relied upon the exemption from registration under the Act contained in Section
4(1) and that, in an attempt to affect compliance with all the conditions
thereof, GPG and PICO are relying in good faith upon all of the foregoing
representations and warranties on the part of the undersigned.
3. Assignment of Rights and Obligations; Consent. PICO, GPG and TOC
agree that effective as of the First Closing or, as noted, the Conditional
Closing, certain ongoing rights and obligations of GPG pursuant to the Prior
Agreement shall be assigned and transferred to TOC as follows:
3.1 Registration Rights. PICO grants to TOC upon the First Closing
the rights as a "Purchaser" set forth in Sections 6.02 through 6.06 of the
Prior Agreement with respect to the First Shares and upon the Conditional
Closing the same such rights as a "Purchaser" with respect to the Conditional
Shares, and TOC agrees to be bound by the obligations of such Sections. This
Section 3.1 does not in any way limit GPG's rights or obligations under
Sections 6.02 through 6.07 of the Prior Agreement and GPG shall retain such
rights and obligations with respect to the shares of PICO stock it retains.
GPG's and TOC's rights under this section shall terminate in accordance with
Section 6.12 of the Prior Agreement. GPG and TOC agree not to exercise their
rights under this Section 3.1 and under Sections 6.02 through 6.06 of the
Prior Agreement for a period of six (6) months following the closing of the
Merger.
3.2 Right to Purchase Shares Issued by PICO. So long as TOC
continues to own the Shares, or any of them, TOC, upon the First Closing,
shall have the right to acquire shares of PICO with an aggregate purchase
price of $1,613,605, and upon the Conditional Closing TOC shall have the right
to acquire shares of PICO with the full aggregate purchase price of $5,000,000
pursuant to Section 7.02 of the Prior Agreement, subject to the limitations of
Section 7.04 of the Prior Agreement and shall be deemed to be the "Purchaser"
as defined in the Prior Agreement to the extent of such rights for purposes of
Section 7.02. GPG shall retain the right to acquire $3,386,395 in aggregate
amount of such shares unless and until the Conditional Closing occurs, in
which event all of GPG's rights under such Section 7.02 shall terminate. TOC
agrees not to exercise its rights under this Section 3.2 and under Section
7.02 of the Prior Agreement until six months after the Effective Time as
defined in the Merger Agreement.
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<PAGE>
3.3 PICO Right to Purchase PICO Shares Owned by TOC. PICO shall
have the first right to purchase PICO shares owned by TOC in accordance with
the terms of Sections 6.07, 6.08, and 6.09 of the Prior Agreement. The rights
provided in this Section 3.3 shall not alter or amend PICO's rights to acquire
GPG's shares pursuant to such Sections of the Prior Agreement, subject to the
limitations of Section 6.10 of the Prior Agreement.
3.4 TOC Option to Acquire PICO Shares. GPG hereby transfers to TOC
upon the Conditional Closing the right to acquire PICO shares valued at
$825,182.63 in accordance with the terms of Section 7.01 of the Prior
Agreement. Each of GPG and TOC shall retain its option under such Section 7.01
and this Section 3.4 so long as it owns not less than 7.5% of PICO.
3.5 Director Nominees
(a) So long as GPG holds 11% or more of the outstanding
shares of PICO or any successor corporation, it shall have the right to
nominate one director to the PICO board of Directors, subject to the terms of
Section 6.01 of the Prior Agreement.
(b) PICO will use its best efforts to elect such TOC and GPG
nominated directors to the PICO Board of Directors in accordance with and
subject to the limitations of Section 6.01 of the Prior Agreement.
4. GPG Consent. Pursuant to Section 6.13 of the Prior Agreement, GPG
hereby consents to the terms of the Merger in accordance with the Merger
Agreement in substantially the form thereof provided to GPG as of May 3, 1996;
provided, however, that (i) such consent shall remain effective only so long
as there are, as determined by GPG in its reasonable discretion, no material
changes to such agreement or the terms of the Merger which adversely affect
GPG's rights and obligations under or in connection with such agreement
including but not limited to the PICO Share Value (as defined in such
agreement ) not being greater than $33.50 per share and (ii) GPG's consent
shall terminate unless the First Closing shall have occurred on or before the
Merger occurs, as contemplated by the Merger Agreement. Upon consummation of
the Merger, the provisions of Section 6.13 and 6.14 of the Prior Agreement
shall terminate and be of no further force and effect.
5. Obligations of TOC.
5.1 Best Efforts. Promptly after the date of this Agreement, TOC
shall use its best efforts to obtain all approvals and consents necessary for
the consummation of the transactions contemplated under this Agreement.
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5.2 TOC Filing Obligations. TOC shall promptly after the date of
this agreement take all actions necessary to make all regulatory filings
required to be made by TOC with respect to the purchase and sale of the
Conditional Shares contemplated by this Agreement, including but not limited
to filings under the HSR Act. TOC shall cooperate with PICO and GPG in
providing information necessary for any regulatory filings required to be made
by them in order to consummate the transactions contemplated by this
Agreement.
6. GPG Covenant. If within two (2) years after the Merger an unforeseen
material change in the investment prospects for Citation cause GPG to
reconsider its plans with respect to its Citation shares, GPG will seek
confirmation from U.S. legal counsel that a sale of any such shares in such
circumstances would not affect the validity of the Certificate nor any tax
free status of the Merger before proceeding with any such sale. In such
two-year period, GPG shall promptly provide to PICO copies of all
correspondence or documents from such counsel.
7. Obligation of PICO. PICO shall maintain the registration of the Class
A common stock of PICO under Section 12(g) of the Exchange Act for a period of
not less than four years following the Merger, and shall continue to comply
with the reporting and other requirements of the Exchange Act for the same
four-year period.
8. General Terms.
8.1 Governing Law. This Agreement shall be interpreted,
construed, governed and enforced according to the laws of the State of Ohio.
8.2 Attorneys' Fees. In the event of any dispute or breach arising
with respect to this Agreement, the party prevailing in any negotiations or
proceedings for the resolution or enforcement thereof shall be entitled to
recover from the losing party reasonable expenses, attorneys' fees and costs
incurred therein.
8.3 Amendments. No amendment or modification of the terms or
conditions of this Agreement shall be valid unless in writing and signed by
both parties hereto. There shall be no implied-in-fact contracts modifying the
terms of this Agreement.
8.4 Entire Agreement. This Agreement and the Prior Agreement as
amended by this Agreement constitute the entire agreement between the parties
with respect to the transactions contemplated hereby and thereby. This
Agreement and the Prior Agreement as amended by this Agreement supersede all
prior agreements, understandings, negotiation and representation with respect
to such transactions.
8.5 Successors and Assigns. The rights and obligations of PICO
under this Agreement shall inure to the benefit of and shall be binding upon
the successors and assigns of PICO. Specifically, but not by way of
limitation, upon consummation of the Merger, PICO's rights and obligations
under this Agreement and the Prior Agreement as amended by this Agreement
shall be assigned to and assumed by Citation, pursuant to the Assignment and
Assumption Agreement in the form attached to this Agreement as Exhibit A, and
in accordance with Section 7.04 of the Prior Agreement. Neither GPG nor TOC
shall be entitled to assign any of their respective rights or obligations
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under this Agreement without the prior written consent of PICO.
Notwithstanding this Section 7.5, GPG shall be permitted to assign any or all
of its respective rights or obligations under this Agreement to a direct or
indirect wholly-owned subsidiary of GPG in accordance with Section 10.5 of the
Prior Agreement, without the prior written consent of PICO.
8.6 Waiver. Any party's failure to enforce any provision of this
Agreement shall not in any way be construed as a waiver of any such provision,
or prevent that party thereafter from enforcing each and every other provision
of this Agreement.
8.7 Severable Provisions. The provisions of this Agreement are
severable, and if any one or more provisions may be determined to be
judicially unenforceable, in whole or in part, the remaining provisions shall
nevertheless be binding and enforceable.
8.8 Counterparts. This Agreement may be executed in more than one
counterpart, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date set forth above.
PHYSICIANS INSURANCE COMPANY OF OHIO
By: /s/ John R. Hart
_______________________________________
Title: President
GUINNESS PEAT GROUP PLC
By: /s/ Blake Nixon
_______________________________________
Title: Executive Director
THE ONDAATJE CORPORATION
By: /s/ John R. Hart
_______________________________________
Title: President
