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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
CHOICE DRUG SYSTEMS, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
170379-10-1
(CUSIP Number)
ALLAN C. SILBER
COUNSEL CORPORATION
EXCHANGE TOWER, SUITE 1300, 2 FIRST CANADIAN PLACE
TORONTO, ONTARIO, CANADA MSX 1E3
(416) 866-3000
(Name, Address and Telephone Number of
Person Authorized to Receive
Notice and Communications)
MAY 22, 1995
(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 this statement [ ].
(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 ("Exchange 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 12 Pages
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<TABLE>
<CAPTION>
CUSIP NO. 170379-10-1 13D
<S> <C> <C>
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
COUNSEL CORPORATION
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [ ]
(3) SEC USE ONLY
(4) SOURCE OF FUNDS *
PF (SEE ITEM 3)
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT
TO ITEMS 2(d) or (e) [ ]
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
ONTARIO, CANADA
NUMBER OF SHARES (7) SOLE VOTING POWER
4,933,088 (SEE ITEM 5)
BENEFICIALLY (8) SHARED VOTING POWER
0
OWNED BY EACH (9) SOLE DISPOSITIVE POWER
4,933,088 (SEE ITEM 5)
REPORTING PERSON (10) SHARED DISPOSITIVE POWER
0
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,933,088 (SHARES OF COMMON STOCK (SEE ITEM 5))
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
COUNSEL CORPORATION DISCLAIMS BENEFICIAL OWNERSHIP OF MR. SILBER'S HOLDINGS, AS DISCUSSED IN ITEM 5.
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.9% (SEE ITEM 5)
(14) TYPE OF REPORTING PERSON *
CO
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 2 of 12 Pages
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<TABLE>
<CAPTION>
CUSIP NO. 170379-10-1 13D
<S> <C> <C>
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ALLAN C. SILBER
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [ ]
(3) SEC USE ONLY
(4) SOURCE OF FUNDS *
PF (SEE ITEM 3)
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT
TO ITEMS 2(d) or (e) [ ]
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
TORONTO, ONTARIO, CANADA
NUMBER OF SHARES (7) SOLE VOTING POWER
95,000 (SEE ITEM 5)
BENEFICIALLY (8) SHARED VOTING POWER
0 (SEE ITEM 5)
OWNED BY EACH (9) SOLE DISPOSITIVE POWER
95,000 (SEE ITEM 5)
REPORTING PERSON (10) SHARED DISPOSITIVE POWER
0 (SEE ITEM 5)
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
95,000 (SEE ITEM 5)
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ X ]
MR. SILBER DISCLAIMS BENEFICIAL OWNERSHIP OF COUNSEL CORPORATION'S HOLDINGS,
AS DISCUSSED IN ITEM 5
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
LESS THAN 1% (SEE ITEM 5)
(14) TYPE OF REPORTING PERSON *
IN
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
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AMENDED AND RESTATED SCHEDULE 13D
Introduction
This statement (the "Amendment") is amendment number 1 to an initial
statement on Schedule 13D (the Amendment and the initial statement being herein
referred to as the "Schedule 13D"), with respect to the common stock of Choice
Drug Systems, Inc. (the "Issuer"). The reporting persons named below are
hereby jointly filing this statement on Schedule 13D, pursuant to Rule
13d-1(f)(1) promulgated by the Securities and Exchange Commission pursuant to
the Exchange Act. Pursuant to Item 101(a)(2)(ii) of Regulation S-T, this
Amendment is restating the initial statement.
Item 1. Security and Issuer.
This statement relates to the common stock of Choice Drug Systems,
Inc., a New York corporation, whose principal executive offices are
located at: 2930 Washington Blvd., Baltimore, Maryland, 21230.
Item 2. Identity and Background.
(a) The reporting persons are Counsel Corporation, an Ontario,
Canada corporation, and Allan C. Silber. The directors and
executive officers of Counsel Corporation as of the date
hereof are set forth on Schedule A attached hereto and
incorporated herein by reference.
(b) The principal business address of both Counsel Corporation and
Mr. Silber is: Exchange Tower, Suite 1300, 2 First
Canadian Place, Toronto, Ontario, Canada M5X 1E3. The
principal business address of each of the directors and
executive officers of Counsel Corporation is set forth on
Schedule A attached hereto and incorporated herein by
reference.
(c) Counsel Corporation's principal business is the management of
health care and real estate assets. Mr. Silber is the
Chairman and Chief Executive Officer of Counsel Corporation
and Chairman of the Issuer's Board of Directors. The
principal occupation of each director and executive officer of
Counsel Corporation, including the principal business and
address of any organization in which such employment is
conducted, is set forth on Schedule A attached hereto and
incorporated herein by reference.
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(d) During the last five (5) years, neither Counsel Corporation
nor Mr. Silber has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
(e) During the last five (5) years, neither Counsel Corporation
nor Mr. Silber has been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and
as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal
or state securities laws or finding any violation with respect
to such laws.
(f) Mr. Silber is a citizen of Canada.
Item 3. Source and Amount of Funds or Other Consideration.
Counsel Corporation used corporate funds to purchase 596,362 shares of
the Issuer's common stock and warrants for an additional 536,726 shares of the
Issuer's common stock. Mr. Silber borrowed $182,500 from Issuer to purchase
50,000 shares of the Issuer's common stock and warrants for an additional
45,000 shares of the Issuer's common stock. Such borrowing is evidenced by an
interest bearing five (5) year note in favor of the Issuer that is secured by
the shares acquired.
Item 4. Purpose of Transactions.
The Issuer's common stock that is presently beneficially owned by
Counsel Corporation and Mr. Silber was acquired and is currently being held for
investment purposes. Counsel Corporation and Mr. Silber may acquire additional
shares in the open market, in privately negotiated transactions or otherwise.
Subject to certain transfer restrictions set forth under federal and state
securities laws, Counsel Corporation and Mr. Silber may attempt to dispose of
the shares owned by them in the open market, in privately negotiated
transactions or otherwise.
Except as set forth above, neither Counsel Corporation nor Mr. Silber
have any present plans or intentions that would result in or relate to any of
the transactions described in subparagraphs (a) through (j) of Item 4 of
Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) As of the close of business on June 5, 1995, (i) Counsel
Corporation beneficially owns in the aggregate 4,933,088
shares of the Issuer's common stock and disclaims beneficial
ownership of all shares held by Mr. Silber, and (ii) Mr.
Silber beneficially owns in the aggregate 95,000 shares of the
Issuer's common stock and
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disclaims beneficial ownership of all shares held by Counsel
Corporation. Counsel Corporation's and Mr. Silber's
ownership constitute 40.9% and less than 1%, respectively, of
the outstanding shares of the Issuer's common stock, based
upon 9,735,810 shares outstanding as of May 22, 1995
(represented as the number of shares of the Issuer's common
stock outstanding as of such date in the Issuer's Annual
Report on Form 10-K) plus, with respect to each party, the
number of shares subject to warrants held by such party.
Counsel Corporation has direct beneficial ownership of
2,596,362 shares of the Issuer's common stock and warrants to
acquire an additional 2,336,726 shares.
Mr. Silber has direct beneficial ownership of 50,000 shares of
the Issuer's common stock and warrants to acquire an
additional 45,000 shares.
Mr. Silber is a director of Counsel Corporation and a
shareholder who beneficially owns or controls approximately
24.9% of the common shares of Counsel Corporation. Each
of Counsel Corporation and Mr. Silber disclaims beneficial
ownership of the shares of the Issuer beneficially owned by
the other.
(b) Each of Counsel Corporation and Mr. Silber has the sole power
to direct the vote and disposition of the shares of which it
possesses beneficial ownership. The responses of Counsel
Corporation and Mr. Silber to Items (7) through (11) of the
portions of the cover page of this Schedule 13D that relate to
beneficial ownership are incorporated herein by reference.
(c) On May 22, 1995, the Issuer completed a private offering of
units consisting of Common Stock and two three-year warrants,
one of which granted the right to acquire additional shares of
Common Stock at $4.50 per share, and the other of which
granted the right to acquire additional shares at $5.50 per
share. Counsel Corporation acquired 596,362 shares of Common
Stock and warrants for an additional 536,726 shares for an
aggregate consideration of $2,177,000. Mr. Silber acquired
50,000 shares of Common Stock and warrants for an additional
45,000 shares for an aggregate consideration of $182,500.
(d) Not Applicable
(e) Not Applicable
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Item 6. Contracts, Arrangements, Understanding or Relationships with
Respect to Securities of the Issuer.
None
Item 7. Materials to be Filed as Exhibits.
Agreement to File Jointly *
Stock Purchase Agreement by and between Choice Drug
Systems, Inc. and Counsel Corporation *
Form of Promissory Note of Allan Silber Exhibit A
____________________________________
*Previously filed
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SIGNATURES
After reasonable inquiry and to the best knowledge and belief of each
of the undersigned, the undersigned certify that the information set forth in
this statement is true, complete and correct.
Date: June 5, 1995
COUNSEL CORPORATION
By: /s/ Allan C. Silber
-------------------------------------------
Allan C. Silber
Chairman of the Board and
Chief Executive Officer
/s/ Allan C. Silber
-----------------------------------------------
Allan C. Silber, Individually
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SCHEDULE A
TO SCHEDULE 13D
Board of Directors of Counsel Corporation:
<TABLE>
<CAPTION>
Name Address
- ---------------------------------- ---------------------------
<S> <C>
Paul Godfrey 333 King Street East
President & C.E.O. Toronto, ON M5A 3X5
Toronto Sun Publishing Corp.
Norman Hill 250 Sheppard Avenue East
President Suite 300
Norman Hill Realty Inc. Toronto, ON M2N 3A9
Ajit Hutheesing 300 First Stamford Place
Chairman & Managing Partner Stamford, CT 06902
International Capital Partners Inc.
Morris Perlis Exchange Tower
President Suite 1300, P. O. Box 435
Counsel Corporation 2 First Canadian Place
Toronto, ON M5X 1E3
Philip Reichmann P. O. Box 20, 28th Floor
President 2 First Canadian Place
Olympia & York Properties Inc. Toronto, ON M5Y 1B5
Allan C. Silber Exchange Tower
Chairman & C.E.O. Suite 1300, P. O. Box 435
Counsel Corporation 2 First Canadian Place
Toronto, ON M5X 1E3
Edward Sonshine, Q.C. Exchange Tower
Vice-Chairman Suite 1300, P. O. Box 435
Counsel Corporation 2 First Canadian Place
Toronto, ON M5X 1E3
Gerald Turner Administration
President Emeritus 600 University Avenue
Mt. Sinai Hospital Suite 338
Toronto, ON M5G 1X5
</TABLE>
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Executive Officers of Counsel Corporation:
<TABLE>
<CAPTION>
Name Address
- ------------------------------- ---------------------------
<S> <C>
Allan C. Silber Exchange Tower
Chairman of the Board and Chief Suite 1300, P. O. Box 435
Executive Officer 2 First Canadian Place
Toronto, ON M5X 1E3
Edward Sonshine, Q.C. Exchange Tower
Vice-Chairman Suite 1300, P. O. Box 435
2 First Canadian Place
Toronto, ON M5X 1E3
Morris Perlis Exchange Tower
President Suite 1300, P. O. Box 435
2 First Canadian Place
Toronto, ON M5X 1E3
Stephen Weintraub Exchange Tower
Senior Vice President and Suite 1300, P. O. Box 435
Secretary 2 First Canadian Place
Toronto, ON M5X 1E3
Alan Winer Exchange Tower
Vice President Suite 1300, P. O. Box 435
2 First Canadian Place
Toronto, ON M5X 1E3
Howard Wortzman Exchange Tower
Vice President, Suite 1300, P. O. Box 435
Financial Reporting 2 First Canadian Place
Toronto, ON M5X 1E3
</TABLE>
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EXHIBIT A
FORM OF RECOURSE PROMISSORY NOTE
$182,500.00 May 19, 1995
Nashville, Tennessee
FOR VALUE RECEIVED, ALLAN C. SILBER, ("Maker") promises to pay to the
order of CHOICE DRUG SYSTEMS, INC., a New York corporation ("Lender"), its
successors and assigns, the principal sum of ONE HUNDRED EIGHTY-TWO THOUSAND,
FIVE HUNDRED AND NO/100 DOLLARS ($182,500.00).
Principal and interest on this obligation shall be payable in a single
payment by May 31, 2000, with interest accruing at a rate no greater than that
which will be imputed to Choice Drug Systems, Inc. for tax purposes. This Note
may be prepaid, in whole or in part, at any time without premium or penalty,
provided all payments shall be applied first to accrued interest and then to
principal.
Both principal and interest shall be payable in lawful money of the
United Sates of America, which shall be legal tender in payment of all debts
and dues, public and private, at the time of payment. Payments shall be made
at the office of Lender, 2930 Washington Boulevard, Baltimore, Maryland 21230,
or at such other places the holder hereof may designate in writing to Maker at
the address shown below.
This Note, including any and all extensions, renewals, modifications
and amendments thereof, is secured by that certain Stock Pledge Agreement of
even date herewith.
It is the intention of the parties to comply strictly with all
applicable usury laws; and, accordingly, in no event and upon no contingency
shall the Lender ever be entitled to receive, collect or apply as interest any
interest, fees, charges or other payments equivalent to interest, in excess of
the maximum rate which Lender may lawfully charge under applicable laws from
time to time in effect. Any provisions hereof, or of any other agreement
between Maker and Lender, that operates to bind, obligate or compel Maker to
pay interest in excess of such maximum lawful rate shall be construed to
require the payment of the maximum lawful rate only. The provisions of this
paragraph shall be given precedence over any other provisions contained herein
or in any other agreement between the Lender and the Maker that is in conflict
with the provisions of this paragraph.
This Note shall be deemed in default upon the occurrence of any one of
the following events: (i) the Maker fails to pay principal and/or interest
within ten (10) days of
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the date when due; or (ii) the insolvency of Maker (as insolvency is defined in
the Uniform Commercial Code in effect at that time in Tennessee), or the filing
of a petition in bankruptcy by or against the Maker, or if a receiver be
appointed for any part if the property or assets of Maker, or any assignment
for creditors is made by Maker. Upon default of this Note, the entire unpaid
principal balance then owed upon this Note, together with all interest then
accrued, shall, at the option of the holder of this Note, at once become due
and payable. Failure of the holder to cause such acceleration upon the
occurrence of a default shall not constitute a waiver of such holder's right to
do so any time during the term of this Note.
The security rights of holder and its assigns hereunder shall not be
impaired by any renewal, extension or modification which holder may grant with
respect to the indebtedness evidenced hereby, or by any surrender, compromise,
release, renewal, extension, exchange or substitution which holder may grant
with respect to the collateral.
The Maker waives protest, demand, presentment and notice of dishonor
and agrees that this Note may be extended, in whole or in part, without limit
as to the number of such extensions, or the period or periods thereof, and
without notice to him and without affecting his liability hereon.
Notwithstanding anything to the contrary contained herein, neither
Maker nor Lender may assign or delegate any of its rights or obligations under
this Note or the Stock Pledge Agreement without the prior written consent of
the other party. Any assignment or delegation effected without such consent
shall be null and void.
This Note shall be governed and construed according to the statutes
and laws of the State of Tennessee from time to time in effect.
MAKER:
-----------------------------
ALLAN C. SILBER
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