<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(RULE 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO 13d-2(a)
(AMENDMENT NO. 2)*
CHATCOM INC.
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(Name of Issuer)
Common Stock, no par value per share
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(Title of Class of Securities)
161723101
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(CUSIP Number)
Sandra L. Mallenbaum, Esq., c/o Anderson Kill & Olick, P.C.
1251 Avenue of the Americas, New York, New York 10020 (212) 278-1000
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
December 31, 1997
------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)(1)
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(e), 13d-1(f) or 13d-1(g), check the following
box [ ].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 16 Pages)
*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 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).
- --------
1. This filing incorporates all information relevant to events not reported
previously, effected by the Reporting Persons, who may be deemed a group for
purposes of Section 13(d), with respect to the referenced class of
securities, up to and including August 5, 1998.
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SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 2 OF 16 PAGES
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- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Ernest P. Werlin
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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*
Not Applicable
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
--
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL 5,103,658.1(1)
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING --
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
5,103,658.1(1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
--
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [X]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
--
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14 TYPE OF REPORTING PERSON*
IN
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- --------
1. Ernest P. Werlin disclaims beneficial ownership of all shares of Common
Stock, all shares of Restricted Common Stock, all 10% convertible preferred
stock (the "10% CPS"), all 9.5% convertible notes (the "9.5% Notes" or the
"Notes"), and all Warrants owned by other persons, as well as all shares of
Common Stock into which the 10% CPS and the 9.5% Notes could be converted, and
all shares of Common Stock and Restricted Common Stock which the Warrants could
be used to purchase.
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<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 3 OF 16 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Peter J. Powers
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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*
Not Applicable
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
--
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL 5,103,658.1(1)
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING --
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
5,103,658.1(1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
--
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [X]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
--
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
- --------
1. Peter J. Powers disclaims beneficial ownership of all shares of Common Stock,
all shares of Restricted Common Stock, all 10% CPS, all 9.5% Notes, and all
Warrants owned by other persons, as well as all shares of Common Stock into
which the 10% CPS and the 9.5% Notes could be converted and all shares of Common
Stock and Restricted Common Stock which the Warrants could be used to purchase.
<PAGE>
<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 4 OF 16 PAGES
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
The High View Fund, L.P.
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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*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
2,630,157.1
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL --
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 2,630,157.1
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,630,157.1
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.2
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14 TYPE OF REPORTING PERSON*
PN
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<PAGE>
<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 5 OF 16 PAGES
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- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
The High View Fund II, L.P.
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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*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
144,328.6
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL --
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 144,328.6
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
144,328.6
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.1
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14 TYPE OF REPORTING PERSON*
PN
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<PAGE>
<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 6 OF 16 PAGES
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- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
High View SSFI Fund, LDC
- --------------------------------------------------------------------------------
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*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
The Cayman Islands
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
97,271.4
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL --
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 97,271.4
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
97,271.4
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.8
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14 TYPE OF REPORTING PERSON*
OO
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<PAGE>
<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 7 OF 16 PAGES
- ----------------------- -------------------------
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
High View Capital Corporation
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
Not Applicable
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
--
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL 2,871,757.1(1)
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING --
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
2,871,757.1(1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
--
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [X]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
--
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
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- --------
1. High View Capital Corporation disclaims beneficial ownership of all shares of
Common Stock, all shares of Restricted Common Stock, all 10% CPS, all 9.5%
Notes, and all Warrants owned by other persons, as well as all shares of Common
Stock into which the 10% CPS and the 9.5% Notes could be converted, and all
shares of Common Stock and Restricted Common Stock which the Warrants could be
used to purchase.
<PAGE>
<PAGE>
SCHEDULE 13D
- ----------------------- -------------------------
CUSIP NO. 161723101 PAGE 8 OF 16 PAGES
- ----------------------- -------------------------
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
The High View Fund
- --------------------------------------------------------------------------------
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 PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
The Cayman Islands
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7 SOLE VOTING POWER
2,231,901
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL --
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 2,231,901
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
--
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,231,901
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
14.9
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14 TYPE OF REPORTING PERSON*
OO
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<PAGE>
<PAGE>
SCHEDULE 13D
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CUSIP NO. 161723101 PAGE 9 OF 16 PAGES
- ----------------------- -------------------------
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
High View Asset Management Corporation
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
Not Applicable
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
Not Applicable
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
--
NUMBER OF -------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALL 2,231,901(1)
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING --
PERSON -------------------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
2,231,901(1)
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
--
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [X]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
--
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- --------------------------------------------------------------------------------
- --------
1. High View Asset Management Corporation disclaims beneficial ownership of all
shares of Common Stock, all shares of Restricted Common Stock, all 10% CPS, all
9.5% Notes, and all Warrants owned by other persons, as well as all shares of
Common Stock into which the 10% CPS and the 9.5% Notes could be converted and
all shares of Common Stock and Restricted Common Stock which the Warrants could
be used to purchase.
<PAGE>
<PAGE>
Page 10 of 16 Pages
CHATCOM INC.
(CUSIP NO. 161723101)
This Amendment No. 2 on Schedule 13D ("Amendment No. 2) relates to the
Statement on Schedule 13D filed on December 30, 1997 and amended on January 30,
1998 (the "Original Amended 13D"). This Amendment No. 2 is being filed to
reflect, among other things, (i) the addition of two Reporting Persons; (ii) the
acquisition by certain Reporting Persons of 9.5% Notes and Warrants; (iii) the
receipt of dividends on the 10% CPS by certain Reporting Persons; (iv) the sale
of shares of Common Stock and (v) the sale of shares of Restricted Common Stock
by certain Reporting Persons. Any capitalized term used herein and not otherwise
defined shall be given the meaning ascribed to it in the Original Amended 13D.
ITEM 1. SECURITY AND ISSUER.
Item 1 of the Original Amended 13D is amended by adding, in sub-part (e), after
the words "Common Stock", the words "and Restricted Common Stock".
ITEM 2. IDENTITY AND BACKGROUND.
(a) - (f)
Item 2 of the Original Amended 13D is amended by replacing sub-parts (I) - (VII)
therein with the following sub-parts (I) - (VIII):
This statement is being filed on behalf of a group consisting
of the following eight reporting persons (each, a "Reporting Person" and,
collectively, the "Reporting Persons"):
(I) This statement is being filed on behalf of The High View Fund,
L.P., a Delaware limited partnership (the "Delaware Fund"). The Delaware Fund's
principal business is to make and hold investments. The business address for the
Delaware Fund is c/o High View Capital Corporation, 805 Third Avenue, Floor 17,
New York, New York 10022.
(II) This statement also is being filed on behalf of The High View Fund
II, L.P., a Delaware limited partnership ("Fund II"). Fund II's principal
business is to make and hold investments. The general partner of Fund II is High
View Capital Corporation. The business address for Fund II is c/o High View
Capital Corporation, 805 Third Avenue, Floor 17, New York, New York 10022.
(III) This statement also is being filed on behalf of High View SSFI
Fund, LDC, a Cayman Islands limited duration company ("SSFI"). SSFI's principal
business is to make and hold investments. The directors of SSFI are Dion R.
Friedland, Charles A. Stride and Peter J. Powers. SSFI's investment manager is
High View Capital Corporation. The business address for SSFI is c/o High View
Capital Corporation, 805 Third Avenue, Floor 17, New York, New York 10022.
(IV) This statement also is being filed on behalf of High View Capital
Corporation, a Delaware corporation ("HVCC"). HVCC's principal business is to
act as general partner to the Delaware Fund, to act as general partner to Fund
II, to act as investment manager to SSFI, and to provide investment advisory
services to other clients. The business address for HVCC is 805 Third Avenue,
Floor 17, New York, New York 10022.
The sole stockholder of voting stock of HVCC is Ernest P. Werlin. Mr.
Werlin is a director, President and Treasurer of HVCC. Peter J. Powers is a
director, Senior Vice President and Secretary of HVCC.
(V) This statement also is being filed on behalf of The High View Fund,
a Cayman Islands company (the "Cayman Fund"). The Cayman Fund is listed on the
Irish Stock Exchange and its principal business is to make and hold investments.
The Cayman Fund's directors are Rhonda D. McDeigan-Eldridge and Dorothea I.
Thompson. Ms. McDeigan-Eldridge and Ms. Thompson are citizens of the
Commonwealth of The Bahamas, their principal business is to act as investment
fund administrators, and their business address is c/o Mees Pierson Fund
Services (Bahamas) Limited, Windermere House, 404 East Bay Street, P.O. Box
SS-6238, Nassau, The Bahamas.
(VI) This statement also is being filed on behalf of High View Asset
Management Corporation, a Delaware corporation ("HVAM"). HVAM's principal
business is to act as investment manager to the Cayman Fund, and its business
address is 805 Third Avenue, Floor 17, New York, New York 10022.
The sole stockholder of voting stock and the sole director of HVAM
is Mr. Werlin. Mr. Werlin is President of HVAM. Peter J. Powers is Secretary,
Treasurer and Vice President of HVAM.
<PAGE>
<PAGE>
Page 11 of 16 Pages
(VII) This statement also is being filed on behalf of Ernest P. Werlin.
Mr. Werlin's present principal occupation is as a director, President and
Treasurer of HVCC and as the director and President of HVAM. Mr. Werlin is a
United States citizen whose business address is c/o HVCC, 805 Third Avenue,
Floor 17, New York, New York 10022.
(VIII) This statement also is being filed on behalf Peter J. Powers. Mr.
Powers's present principal occupation is as a director, Senior Vice President
and Secretary of HVCC, as Secretary, Treasurer and Vice President of HVAM, and
as a director of SSFI. Mr. Powers is a United States citizen whose business
address is c/o HVCC, 805 Third Avenue, Floor 17, New York, New York 10022.
Item 2 of the Original Amended 13D is amended further by replacing the paragraph
beginning "Each of the Delaware Fund and the Cayman Fund" with the following
paragraph:
Each of the Delaware Fund and the Cayman Fund is making this
filing because, in addition to the transactions in the Issuer's securities
reported previously on the Original Amended 13D, as reported in this Amendment
No. 2, each of them has acquired (a) 9.5% Notes which are convertible to shares
of Common Stock for which each has sole voting and dispositive power, (b)
Warrants that could be used to purchase shares of Restricted Common Stock for
which each has sole voting and dispositive power, and (c) shares of Restricted
Common Stock for which each has sole voting and dispositive power as dividends
of the 10% CPS, and each of the Delaware Fund and the Cayman Fund has disposed
of shares of Restricted Common Stock.
Item 2 of the Original Amended 13D is amended further by replacing the paragraph
beginning "Mr. Werlin is making this filing" with the following paragraph:
Mr. Powers is making this filing because, in addition to the
transactions in the Issuer's securities reported previously on the Original
Amended 13D, as reported in this Amendment No. 2, Mr. Powers has disposed of
shares of Common Stock for which he had sole voting and dispositive power. Mr.
Werlin is making this filing because, in addition to the transactions in the
Issuer's securities reported previously on the Original Amended 13D, as reported
in this Amendment No. 2, Mr. Werlin has disposed of shares of Common Stock for
which he had sole voting and dispositive power. In addition, each of Mr. Powers
and Mr. Werlin is making this filing because, due to the relationships described
above, each of Mr. Powers and Mr. Werlin could be deemed to have beneficial
ownership for purposes of Section 13(d) of the Securities Exchange Act of 1934
(the "Act") of any (a) shares of Common Stock, (b) shares of Restricted Common
Stock, (c) 10% CPS and the shares of Common Stock into which they could be
converted, (d) 9.5% Notes and the shares of Common Stock into which they could
be converted, and (e) Warrants and the shares of Common Stock and Restricted
Common Stock that they may be used to purchase which are held by each of the
Delaware Fund, Fund II, SSFI and the Cayman Fund. Each of Mr. Powers and Mr.
Werlin disclaims beneficial ownership of all shares of Common Stock held by
other persons, all shares of restricted Common Stock held by other persons, all
10% CPS held by other persons and the shares of Common Stock into which they
could be converted, all 9.5% Notes held by other persons and the shares of
Common Stock into which they could be converted, all Warrants held by other
persons and the shares of Common Stock and Restricted Common Stock that they may
be used to purchase.
Item 2 of the Original Amended 13D is amended further by deleting in its
entirety the paragraph which begins "Mr. Brown is making this filing" and adding
the following two paragraphs:
Fund II is making this filing because, as reported in this
Amendment No. 2, it has acquired (a) 9.5% Notes convertible to shares of Common
Stock and (b) Warrants that may be used to purchase shares of Restricted Common
Stock, for each of which it has sole voting and dispositive power.
SSFI is making this filing because, as reported in this
Amendment No. 2, it has acquired (a) 9.5% Notes convertible to shares of Common
Stock and (b) Warrants that may be used to purchase shares of Restricted Common
Stock, for each of which it has sole voting and dispositive power.
Item 2 of the Original Amended 13D is amended further by replacing the paragraph
beginning "HVCC is making this filing" with the following paragraph:
HVCC is making this filing because, due to the relationship
between HVCC and each of the Delaware Fund, Fund II and SSFI, as described
above, HVCC could be deemed to have beneficial ownership for purposes of Section
13(d) of the Act of any (a) shares of Common Stock, (b) shares of Restricted
Common Stock, (c) 10% CPS and the shares of Common Stock into which they could
be converted, (d) 9.5% Notes and the shares of Common Stock into which they
could be converted, and (e) Warrants and the shares of Restricted Common Stock
and Common Stock that they may be used to purchase which are held by each of the
Delaware Fund, Fund II and SSFI. HVCC disclaims beneficial ownership of all
shares of Common Stock held by other persons, all shares of Restricted Common
Stock held by other persons, all 10% CPS held by other persons and the shares of
Common Stock into which they could be converted, all 9.5% Notes held by other
persons and the shares of
<PAGE>
<PAGE>
Page 12 of 16 Pages
Common Stock into which they could be converted, all Warrants held by other
persons and the shares of Common Stock and Restricted Common Stock that they may
be used to purchase.
Item 2 of the Original Amended 13D is amended further by replacing the paragraph
beginning "HVAM is making this filing" with the following paragraph:
HVAM is making this filing because, due to its relationship to
the Cayman Fund, as described above, HVAM could be deemed to have beneficial
ownership for purposes of Section 13(d) of the Act of any (a) shares of Common
Stock, (b) shares of Restricted Common Stock, (c) 10% CPS and the shares of
Common Stock into which they could be converted, (d) 9.5% Notes and the shares
of Common Stock into which they could be converted, and (e) Warrants and the
shares of Common Stock and Restricted Common Stock that they may be used to
purchase which are held by the Cayman Fund. HVAM disclaims beneficial ownership
of all shares of Common Stock held by other persons, all shares of Restricted
Common Stock held by other persons, all 10% CPS held by other persons and the
shares of Common Stock into which they could be converted, all 9.5% Notes held
by other persons and the shares of Common Stock into which they could be
converted, all Warrants held by other persons and the shares of Common Stock and
Restricted Common Stock that they may be used to purchase.
Item 2 of the Original Amended 13D is amended further by replacing the paragraph
beginning "The Delaware Fund, HVCC, the Cayman Fund..." with the following
paragraph:
The Delaware Fund, Fund II, SSFI, HVCC, the Cayman Fund, HVAM,
Mr. Werlin, and Mr. Powers are making this group filing because such persons may
be deemed to constitute a "group" for purposes of Section 13(d)(3) of the Act
due to the relationships between and among the Reporting Persons as described in
this Item 2. Each of such persons disclaims beneficial ownership of all (a)
shares of Common Stock, (b) shares of Restricted Common Stock, (c) 10% CPS and
the shares of Common Stock into which they could be converted, (d) 9.5% Notes
and the shares of Common Stock into which they could be converted, and (e)
Warrants and the shares of Common Stock and Restricted Common Stock that they
may be used to purchase held by any other person for purposes of Section 13
or any other purpose, and disclaims membership in a group.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 3 of the Original Amended 13D is amended by replacing both the paragraph
beginning "In an open market transaction on September 9, 1996, Mr. Werlin
acquired" and the paragraph following that paragraph with the following
paragraphs:
In an open market transaction on September 9, 1996, Mr. Werlin
acquired 35,000 shares of Common Stock for $2.5625 per share. In an open market
transaction on September 10, 1996, Mr. Werlin acquired 15,000 shares of Common
Stock for $2.9375 per share. In an open market transaction on October 22, 1996,
Mr. Werlin acquired 10,000 shares of Common Stock for $2.7375 per share. In an
open market transaction on February 7, 1997, Mr. Werlin acquired 20,000 shares
of Common Stock for $3.48 per share. These 80,000 shares of Common Stock were
acquired for a total purchase price of $230,725, which amount was obtained from
Mr. Werlin's personal funds.
As discussed further in Item 5 below, in open market
transactions on August 25, August 26, and August 27, 1997, Mr. Werlin sold all
80,000 shares of Common Stock for a total price of $103,937.50.
Item 3 of the Original Amended 13D is amended further by adding the following
paragraphs at the end of that section:
In a private placement on December 31, 1997, the Delaware Fund
acquired 295 9.5% Notes convertible to up to 842,857.1 shares of Common Stock
and Warrants that may be used to purchase 81,900 shares of Restricted Common
Stock for a total purchase price of $295,000, which amount came from the working
capital of the Delaware Fund. On February 25, 1998, the Delaware Fund acquired
42,434 shares of Restricted Common Stock from the Issuer as a dividend on
certain 10% CPS. In a Rule 144 transaction on March 30, 1998, the Delaware Fund
disposed of 25,000 shares of Restricted Common Stock for a total price of
$16,406.25. On August 5, 1998, the Delaware Fund acquired 121,000 shares of
Restricted Common Stock from the Issuer as a dividend on certain 10% CPS.
In a private placement on December 31, 1997, the Cayman Fund
acquired 168 9.5% Notes convertible to up to 480,000 shares of Common Stock and
Warrants that may be used to purchase 46,500 shares of Restricted Common Stock
for a total purchase price of $168,000, which amount came from the working
capital of the Cayman Fund. On February 25, 1998, the Cayman Fund acquired
42,434 shares of Restricted Common Stock from the Issuer as a dividend on
certain 10% CPS. In a Rule 144 transaction on March 30, 1998, the Cayman Fund
disposed of 25,000 shares of Restricted Common Stock for a total price of
$16,406.25. On August 5, 1998, the Cayman Fund acquired 121,001 shares of
Restricted Common Stock from the Issuer as a dividend on certain 10% CPS.
<PAGE>
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Page 13 of 16 Pages
In a private placement on December 31, 1997, Fund II acquired
46 9.5% Notes convertible to up to 131,428.6 shares of Common Stock and Warrants
that may be used to purchase 12,900 shares of Restricted Common Stock for a
total purchase price of $46,000, which amount came from the working capital of
Fund II.
In a private placement on December 31, 1997, SSFI acquired 31
9.5% Notes convertible to up to 88,571.4 shares of Common Stock and Warrants
that may be used to purchase 8,700 shares of Restricted Common Stock for a total
purchase price of $31,000, which amount came from the working capital of SSFI.
In an open market transaction on November 7, 1997, Peter J.
Powers disposed of 3,000 shares of Common Stock for a total price of $4,031.25
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 of the Original Amended 13D is amended by replacing the paragraph therein
with the following paragraph:
Each of the Delaware Fund, Fund II, SSFI, and the Cayman Fund
holds, if any, its respective (a) shares of Common Stock, (b) shares of
Restricted Common Stock, (c) 10% CPS, (d) 9.5% Notes, and (e) Warrants
(collectively, the securities referred to in (a) - (e) herein are the
"Securities"), as applicable, to which this Amendment No. 2 relates for purposes
of investment. While at present, neither the Delaware Fund, Fund II, SSFI, nor
the Cayman Fund has any plans to purchase additional Securities or to transfer
any of the Securities, depending upon their respective evaluations of the
Issuer's business and prospects, future developments, market conditions and
other factors, each of the Delaware Fund, Fund II, SSFI, and the Cayman Fund
may, from time to time, purchase additional Securities or sell or cause to be
sold all or a portion of the Securities over which each exercises voting and
dispositive power. Except as disclosed in this Item 4, neither the Delaware
Fund, Fund II, SSFI, nor the Cayman Fund has current plans or proposals which
relate to or would result in any of the events described in Items (a) through
(j) of the instructions to Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Item 5 of the Original Amended 13D is amended by replacing parts (a) - (c)
therein with the following:
(a) and (b)
(I) The Delaware Fund beneficially holds 173,400 shares of Restricted
Common Stock, 10% CPS convertible to up to 832,000 shares of Common Stock, 9.5%
Notes convertible to up to 1,342,857.1 shares of Common Stock, Warrants that may
be used to purchase 200,000 shares of Common Stock and Warrants that may be used
to purchase 81,900 shares of Restricted Common Stock for an aggregate beneficial
ownership of up to 2,630,157.1 shares of Common Stock, which amount constitutes
17.2% of the outstanding shares of Common Stock.
(II) Fund II beneficially holds 9.5% Notes convertible to up to
131,428.6 shares of Common Stock and Warrants that may be used to purchase
12,900 shares of Restricted Common Stock for an aggregate beneficial ownership
of up to 144,328.6 shares of Common Stock, which amount constitutes 1.1% of the
outstanding shares of Common Stock.
(III) SSFI beneficially holds 9.5% Notes convertible to up to 88,571.4
shares of Common Stock and Warrants that may be used to purchase 8,700 shares of
Restricted Common Stock for an aggregate beneficial ownership of up to 97,271.4
shares of Common Stock, which amount constitutes 0.8% of the outstanding shares
of Common Stock.
(IV) For purposes of Rule 13(d) under the Act, because HVCC is the
general partner of each of the Delaware Fund and Fund II, because it is the
investment manager to SSFI, and because therefore it could be deemed to share
voting and dispositive power with each of the Delaware Fund, Fund II and SSFI
over the shares, if any, of Common Stock, Restricted Common Stock, the 10% CPS
and the shares of Common Stock into which they could be converted, the 9.5%
Notes and the shares of Common Stock into which they could be converted, and the
Warrants and the shares of Common Stock and Restricted Common Stock that they
may be used to purchase which are held by each of the Delaware Fund, Fund II,
and SSFI, HVCC may be deemed to be the beneficial owner of the 173,400 shares of
Restricted Common Stock held by the Delaware Fund and, if any, (i) the 10% CPS,
(ii) the 9.5% Notes, and (iii) the Warrants held by each of the Delaware Fund,
Fund II and SSFI, which could be converted into and/or used to purchase up to
2,698,357.1 shares of Common Stock. Therefore, HVCC may be deemed to be the
aggregate beneficial owner of up to 2,871,757.1 shares of Common Stock, which
amount constitutes 18.5% of the outstanding shares of Common Stock. HVCC
disclaims beneficial ownership of all shares of Common Stock, all shares of
Restricted Common Stock, all 10% CPS, all 9.5% Notes and all Warrants held by
other persons, as well as all shares of Common Stock into which the 10% CPS and
the 9.5% Notes could be converted and all shares of Common Stock and Restricted
Common Stock that the Warrants may be used to purchase held by other persons.
<PAGE>
<PAGE>
Page 14 of 16 Pages
(V) The Cayman Fund beneficially holds 173,401 shares of Restricted
Common Stock, 10% CPS convertible to up to 832,000 shares of Common Stock, 9.5%
Notes convertible to up to 980,000 shares of Common Stock, Warrants that may be
used to purchase 200,000 shares of Common Stock, and Warrants that may be used
to purchase 46,500 shares of Restricted Common Stock for an aggregate beneficial
ownership of up to 2,231,901 shares of Common Stock, which amount constitutes
14.9% of the outstanding shares of Common Stock.
(VI) For purposes of Rule 13(d) under the Act, because HVAM is
investment manager to the Cayman Fund, and because it could be deemed to share
voting and dispositive power with the Cayman Fund over the shares of Restricted
Common Stock, the 10% CPS and the shares of Common Stock into which they could
be converted, the 9.5% Notes and the shares of Common Stock into which they
could be converted, and the Warrants and the shares of Common Stock and
Restricted Common Stock that they may be used to purchase held by the Cayman
Fund, HVAM may be deemed to be the beneficial owner of the 173,401 shares of
Restricted Common Stock held by the Cayman Fund and the (i) 10% CPS, (ii) 9.5%
Notes and (iii) Warrants held by the Cayman Fund, which could be converted into
and/or used to purchase up to 2,058,500 shares of Common Stock. Therefore, HVAM
may be deemed to be the aggregate beneficial owner of up to 2,231,901 shares of
Common Stock, which amount constitutes 14.9% of the outstanding shares of Common
Stock. HVAM disclaims beneficial ownership of all shares of Common Stock, all
shares of Restricted Common Stock, all 10% CPS, all 9.5% Notes and all Warrants
held by other persons, as well as all shares of Common Stock into which the 10%
CPS and the 9.5% Notes could be converted and all shares of Common Stock and
Restricted Common Stock that the Warrants may be used to purchase held by other
persons.
(VII) Peter J. Powers is a director, Senior Vice President and
Secretary of HVCC and a director of SSFI. Mr. Powers is also an officer of HVAM.
Because of the positions Mr. Powers holds at HVCC, the investment manager of
SSFI and the general partner of each of the Delaware Fund and Fund II, because
he could be deemed to share with HVCC and the other director and officer of HVCC
voting and dispositive power over, if any, the shares of Common Stock, the
shares of Restricted Common Stock, the 10% CPS and the shares of Common Stock
into which they could be converted, the 9.5% Notes and the shares of Common
Stock into which they could be converted, and the Warrants and the shares of
Common Stock and Restricted Common Stock that they may be used to purchase held
by each of the Delaware Fund, Fund II and SSFI, and because, in addition, he
could be deemed to share with the other two directors of SSFI voting and
dispositive power over, if any, the shares of Common Stock, the shares of
Restricted Common Stock, the 10% CPS and the shares of Common Stock into which
they could be converted, the 9.5% Notes and the shares of Common Stock into
which they could be converted and the Warrants and the shares of Common Stock
and Restricted Common Stock that they may be used to purchase owned by SSFI, for
purposes of Rule 13(d) under the Act, Mr. Powers may be deemed to be the
beneficial owner of the 173,400 shares of Restricted Common Stock held by the
Delaware Fund, and, if any, (i) the 10% CPS (ii) the 9.5% Notes and (iii) the
Warrants held by each of the Delaware Fund, Fund II and SSFI, which could be
converted into and/or used to purchase up to 2,698,357.1 shares of Common Stock.
Further, because of the position Mr. Powers holds at HVAM, the investment
manager to the Cayman Fund, and because he could be deemed to share with HVAM
and with the director and other officer of HVAM voting and dispositive power
over, if any, the shares of Common Stock, the shares of Restricted Common Stock,
the 10% CPS and the shares of Common Stock into which they could be converted,
the 9.5% Notes and the shares of Common Stock into which they could be
converted, and the Warrants and the shares of Common Stock and Restricted
Common Stock that they may be used to purchase held by the Cayman Fund, for
purposes of Rule 13(d) under the Act, Mr. Powers may be deemed to be the
beneficial owner of the 173,401 shares of Restricted Common Stock held by the
Cayman Fund and (i) the 10% CPS, (ii) the 9.5% Notes and (iii) the Warrants
held by the Cayman Fund, which could be converted into and/or used to purchase
up to 2,058,500 shares of Common Stock. Therefore, Mr. Powers may be deemed to
be the aggregate beneficial owner of up to 5,103,658.1 shares of Common Stock,
which amount constitutes 28.9% of the outstanding shares of Common Stock.
Mr. Powers disclaims beneficial ownership of all shares of Common Stock, all
shares of Restricted Common Stock, all 10% CPS and the shares of Common Stock
into which they could be converted, all 9.5% Notes and the shares of Common
Stock into which they could be converted, and all Warrants and the shares of
Common Stock and Restricted Common Stock that they may be used to purchase
held by other persons.
(VIII) Ernest P. Werlin is the sole stockholder, a director, and the
President and Treasurer of HVCC. Mr. Werlin is also the sole director, sole
stockholder, and the President of HVAM. Because of the positions Mr. Werlin
holds at HVCC, the investment manager of SSFI and the general partner of each of
the Delaware Fund and Fund II, because he could be deemed to share with HVCC and
the other director and officer of HVCC voting and dispositive power over, if
any, the shares of Common Stock, the shares of Restricted Common Stock, the 10%
CPS and the shares of Common Stock into which they could be converted, the 9.5%
Notes and the shares of Common Stock into which they could be converted, and the
Warrants and the shares of Common Stock and Restricted Common Stock that they
may be used to purchase held by each of the Delaware Fund, Fund II and SSFI, for
purposes of Rule 13(d) under the Act, Mr. Werlin may be deemed to be the
beneficial owner of the 173,400 shares of Restricted Common Stock held by the
Delaware Fund and, if any, (i) the 10% CPS, (ii) the 9.5% Notes and (iii) the
Warrants held by each of the Delaware Fund, Fund II and SSFI, which could be
converted into and/or used to purchase up to 2,698,357.1 shares of Common Stock.
Further, because of the positions Mr. Werlin holds at HVAM, the investment
manager to the Cayman Fund, and because he could be deemed to share with HVAM
and with the other officer of HVAM voting and dispositive power over, if any,
the shares of Common Stock, the shares of Restricted Common Stock, the 10% CPS
<PAGE>
<PAGE>
Page 15 of 16 Pages
and the shares of Common Stock into which they could be converted, the 9.5%
Notes and the shares of Common Stock into which they could be converted, and the
Warrants and the shares of Common Stock and Restricted Common Stock that they
may be used to purchase held by the Cayman Fund, for purposes of Rule 13(d)
under the Act, Mr. Werlin may be deemed to be the beneficial owner of the
173,401 shares of Restricted Common Stock held by the Cayman Fund and (i) the
10% CPS, (ii) the 9.5% Notes and (iii) the Warrants held by the Cayman Fund,
which could be converted into and/or used to purchase up to 2,058,500 shares of
Common Stock. Therefore, Mr. Werlin may be deemed to be the aggregate beneficial
owner of up to 5,103,658.1 shares of Common Stock, which amount constitutes
28.9% of the outstanding shares of Common Stock. Mr. Werlin disclaims beneficial
ownership of all shares of Common Stock, all shares of Restricted Common Stock,
all 10% CPS and the shares of Common Stock into which they could be converted,
all 9.5% Notes and the shares of Common Stock into which they could be
converted, and all Warrants and the shares of Common Stock and Restricted Common
Stock that they may be used to purchase held by other persons.
By reason of the relationships described in Item 2 and this
Item 5 above, the Delaware Fund, Fund II, SSFI, HVCC, the Cayman Fund, HVAM, Mr.
Werlin and Mr. Powers may be deemed to constitute a "group" within the meaning
of Rule 13d-5 under the Act. Pursuant to Rule 13d-4 under the Act, neither the
filing of this statement nor any of its contents shall be construed as an
admission that any person named herein is, for purposes of Section 13(d) or
13(g) of the Act (or pursuant to Rule 16a-1(a)(1) thereunder), the beneficial
owner of any shares of Common Stock, any shares of Restricted Common Stock, any
10% CPS, any 9.5% Notes, any Warrants, any shares of Common Stock into which the
10% CPS and the 9.5% Notes could be converted, or any shares of Common Stock or
Restricted Common Stock that the Warrants may be used to purchase held by other
members of any such group. Additionally, each of the Reporting Persons disclaims
membership in a group for purposes of Section 13 or for any other purpose.
(c)
In an open market transaction on November 7, 1997, Peter J.
Powers disposed of 3,000 shares of Common Stock for $1.34375 per share.
In a private placement on December 31, 1997, the Delaware Fund
acquired 295 9.5% Notes convertible to up to 842,857.1 shares of Common Stock
with Warrants that may be used to purchase 81,900 shares of Restricted Common
Stock for $1,000 per Note. On February 25, 1998, the Delaware Fund received a
dividend on previously reported 10% CPS of 42,434 shares of Restricted Common
Stock. In a Rule 144 transaction on March 30, 1998, the Delaware Fund disposed
of 25,000 shares of Restricted Common Stock for $.65625 per share. On August 5,
1998, the Delaware Fund received a dividend on previously reported 10% CPS of
121,000 shares of Restricted Common Stock.
In a private placement on December 31, 1997, the Cayman Fund
acquired 168 9.5% Notes convertible to up to 480,000 shares of Common Stock with
Warrants that may be used to purchase 46,500 shares of Restricted Common Stock
for $1,000 per Note. On February 25, 1998, the Cayman Fund received a dividend
on previously reported 10% CPS of 42,434 shares of Restricted Common Stock. In a
Rule 144 transaction on March 30, 1998, the Cayman Fund disposed of 25,000
shares of Restricted Common Stock for $.65625 per share. On August 5, 1998, the
Cayman Fund received a dividend on previously reported 10% CPS of 121,001 shares
of Restricted Common Stock.
In a private placement on December 31, 1997, Fund II acquired
46 9.5% Notes convertible to up to 131,428.6 shares of Common Stock with
Warrants that may be used to purchase 12,900 shares of Restricted Common Stock
for $1,000 per Note.
In a private placement on December 31, 1997, SSFI acquired 31
9.5% Notes convertible to up to 88,571.4 shares of Common Stock with Warrants
that may be used to purchase 8,700 shares of Restricted Common Stock for $1,000
per Note.
In an open market transaction inadvertently omitted from
Original Amended 13D, on October 22, 1996, Ernest P. Werlin acquired 10,000
shares of Common Stock for $2.7375 per share. On August 26, 1997, in a
previously reported open market transaction for which an incorrect per share
price ($1.1376) was reported, Mr. Werlin disposed of 25,000 shares of Common
Stock for $1.2875 per share. In an open market transaction on August 27, 1997,
Mr. Werlin disposed of 35,000 shares of Common Stock for $1.30 per share.
Except as discussed in this paragraph (c), no other
transactions in shares of Common Stock or Restricted Common Stock or 10% CPS or
9.5% Notes or Warrants were effected in the past 60 days by any of the Reporting
Persons.
Item 5 of the Original Amended 13D is amended further by replacing part (e)
therein with the following:
Not applicable.
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Page 16 of 16 Pages
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.
Dated: September 28, 1998 /s/ ERNEST P. WERLIN
---------------------------------
Ernest P. Werlin
/s/ PETER J. POWERS
---------------------------------
Peter J. Powers
THE HIGH VIEW FUND, L.P.
By: High View Capital Corporation,
its general partner
By: /s/ ERNEST P. WERLIN
---------------------------------
Ernest P. Werlin
President
THE HIGH VIEW FUND II, L.P.
By: High View Capital Corporation,
its general partner
By: /s/ ERNEST P. WERLIN
---------------------------------
Ernest P. Werlin
President
HIGH VIEW SSFI FUND, LDC
By: /s/ PETER J. POWERS
---------------------------------
Peter J. Powers
Director
HIGH VIEW CAPITAL CORPORATION
By: /s/ ERNEST P. WERLIN
---------------------------------
Ernest P. Werlin
President
THE HIGH VIEW FUND
By: /s/ RHONDA D. MCDEIGAN-ELDRIDGE
---------------------------------
Rhonda D. McDeigan-Eldridge
Director
HIGH VIEW ASSET MANAGEMENT CORPORATION
By: /s/ ERNEST P. WERLIN
---------------------------------
Ernest P. Werlin
President
<PAGE>
