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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
FORSTMANN & COMPANY, INC.
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(Name of Issuer)
Common Stock, par value $0.01
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(Title of Class of Securities)
34659D10
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(CUSIP Number)
Michael C. Murr, Managing Director
DAYSTAR L.L.C.
411 Theodore Fremd Avenue
Rye, New York 10580
(914) 967-1155
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(Name, Address and Telephone Number
of Person Authorized to Receive
Notices and Communications)
January 29, 1998
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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 [ ].
Page 1 of 6 Pages
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CUSIP NO. 34659D10
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1) Names of Reporting Persons DAYSTAR L.L.C.
I.R.S. Identification Nos. of
Above Persons (Entities Only) 13-3859222
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2) Check the Appropriate Box (a) /_/
if a Member of a Group (b) /X/
(See Instructions)
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3) SEC Use Only
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4) Source of Funds WC, PF
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5) Check Box if Disclosure of Legal
Proceedings is Required Pur-
suant to Item 2(d) or 2(e) /_/
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6) Citizenship or Place of New York
Organization
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(7) Sole Voting Power 1,370,312 shares
Number of ------------------------------------------------------------
Shares Bene- (8) Shared Voting
ficially Power 0 shares
Owned by ------------------------------------------------------------
Each Report- (9) Sole Dispositive
ing Person Power 1,370,312 shares
With ------------------------------------------------------------
(10) Shared Dispositive
Power 0 shares
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11) Aggregate Amount Beneficially
Owned by Each Reporting Person 1,370,312 shares
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12) Check Box if the Aggregate
Amount in Row (11) Excludes
Certain Shares /_/
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13) Percent of Class Represented
by Amount in Row (11) 31.3%
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14) Type of Reporting Person IA
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Page 2 of 6 Pages
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INTRODUCTORY STATEMENT
Item 1. Security and Issuer.
This statement on Schedule 13D (the "Statement") relates to
the shares of Common Stock, par value $0.01 per share ("Common Stock"), of
Forstmann & Company, Inc., a Georgia corporation (the "Company"), with its
principal executive offices located at 1155 Avenue of the Americas, New York,
New York 10036.
Item 2. Identity and Background.
(a) This Statement is being filed by Daystar L.L.C., a New
York limited liability company ("Daystar"). Daystar serves as General Partner of
Daystar Special Situations Fund, L.P. (the "Fund"), a Delaware limited
partnership, which owns 784,936 shares of Common Stock, and as such has full
discretionary authority to vote and dispose of such shares. Daystar also acts,
with full discretionary authority, as investment advisor to clients who own in
the aggregate 585,376 shares of Common Stock. The managing directors of Daystar
who are jointly responsible for managing the Fund and such client advisory
accounts are Bruce W. Gregory, Warren J. Malone, Michael C. Murr and John C.
Sites, Jr. (together, the "Managing Directors").
(b) The business address of Daystar, the Fund and each of the
Managing Directors is 411 Theodore Fremd Avenue, Rye, New York 10580.
(c) Daystar acts as General Partner of the Fund and also
manages a limited number of investment accounts for other entities as an
investment advisor. The principal occupation of each of the Members is as
Managing Director of Daystar.
(d) During the last five years, neither Daystar, the Fund nor
any of the Managing Directors has been convicted in any criminal proceeding
(excluding traffic violations and similar misdemeanors).
(e) During the last five years, neither Daystar, the Fund, nor
any of the Managing Directors was a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction which, as a result of such
proceeding, made it or him 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
thereto.
(f) Daystar is a New York limited liability company and the
Fund is a Delaware limited partnership. Each of the Managing Directors is a
citizen of the United States of America.
Page 3 of 6 Pages
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Item 3. Source and Amount of Funds or Other Consideration.
(a) The 784,936 shares of Common Stock owned by the Fund were
issued to the Fund by the Company in connection with its Chapter 11 bankruptcy
proceeding in exchange for debt securities of the Company held by the Fund. The
source of the funds used to purchase such debt securities was the Fund's working
capital, which was contributed to the Fund by its partners.
(b) The aggregate of 585,376 shares of Common Stock owned by
Daystar's investment advisory clients were issued to such clients by the Company
in connection with its Chapter 11 bankruptcy proceedings in exchange for debt
securities of the Company held in such clients' investment advisory accounts
with Daystar. The source of the funds used to purchase such debt securities was
the personal funds of each such client.
Item 4. Purpose of Transaction.
Daystar acquired the shares of Common Stock described in Item
3 (together, the "Shares") for the Fund and its clients solely for investment
purposes. Bruce W. Gregory, one of the Managing Directors, serves as a director
of the Company. None of Daystar or the Managing Directors currently has any plan
or proposal which relates to or would result in any of the matters listed in
Item 4 of Schedule 13D, except that Daystar may, from time to time or at any
time, dispose of Shares or acquire additional shares of Common Stock for the
Fund or Daystar client accounts depending on price and market conditions and
other factors.
Item 5. Interest in Securities of the Issuer.
(a) As of the date of this Statement, Daystar owns
beneficially (for purposes of Rule 13d-3 under the Securities Exchange Act of
1934) an aggregate of 1,370,312 (31.3% of the outstanding) shares of Common
Stock, including 784,936 (17.9% of the outstanding) shares held by the Fund and
an aggregate of 585,376 (13.4% of the outstanding) shares held by Daystar's
client accounts. The Company is in the process of granting options to Bruce W.
Gregory to purchase shares of Common Stock in connection with his service to the
Company as a director. He will hold such options for the benefit of Daystar,
which will be deemed to be the beneficial owner of such options. This statement
will be promptly amended to reflect such option grant.
(b) Daystar, as General Partner of the Fund and investment
advisor to its advisory clients, has sole voting power and dispositive power
over all 1,370,312 Shares. Such power is exercised jointly by the Managing
Directors.
(c) During the past 60 days, Daystar has not purchased any
shares of Common Stock for its account or the accounts of the Fund or its
advisory clients, nor have any of the Managing Directors done so.
(d) Not applicable.
(e) Not applicable.
Page 4 of 6 Pages
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Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Pursuant to the Fund's Agreement of Limited Partnership and
Daystar's investment management agreements with its clients, Daystar may
participate in any profits realized by the Fund and such clients from their
investments in the Shares.
Daystar is a party to a Registration Rights Agreement among
the Company and certain holders of Common Stock, dated as of July 23, 1997, with
respect to the registration of the shares of Common Stock held by them. Under
the terms of such agreement, among other things, the Company must (i) file not
later than March 31, 1998, a registration statement to resell such shares of
Common Stock on a delayed and continuous basis from time to time in the open
market or otherwise and (ii) use its reasonable best efforts to have the
registration statement declared effective as soon as practicable after the
filing.
Item 7. Material to Be Filed as Exhibits.
None.
Page 5 of 6 Pages
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SIGNATURE
After reasonable inquiry and to the best of the undersigned's
knowledge and belief, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
Dated: February 13, 1998
DAYSTAR L.L.C.
By /s/ Michael C. Murr
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Michael C. Murr
Managing Director
Page 6 of 6 Pages
