SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D**
Under the Securities Exchange Act of 1934
(Amendment No. 3)*
Integrated Orthopaedics, Inc.
(Name of Issuer)
Common Stock, Par Value $.001 Par Value
(Title of Class of Securities)
45812K108
(Cusip Number)
J. Taylor Crandall
201 Main Street
Fort Worth, Texas 76102
(817) 390-8500
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 18, 1999
(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(e), 13d-1(f) or 13d-1(g), check
the following box [ ].
*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).
**The total number of shares reported herein is 9,802,482 shares, which
constitutes approximately 60.9% of the 16,084,272 shares of Stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i) under the Act. Unless
otherwise stated, all ownership percentages set forth herein assume that
there are 6,496,540 shares outstanding.
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<PAGE>
1. Name of Reporting Person:
FW Integrated Orthopaedics Investors, L.P.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: 00-Contributions from Partners
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 94,875
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 94,875
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,882,741 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.3% (2)
14. Type of Reporting Person: PN
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(1) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible Non-
Redeemable Preferred Stock and 2,500,000 shares of the Stock that may
be acquired upon exercise of warrants that become exercisable on July
1, 2000.
(2) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,284,406
shares of the Stock outstanding.
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<PAGE>
1. Name of Reporting Person:
Group 31, Inc.
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):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 94,875 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 94,875 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,882,741(1)(2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.3% (3)
14. Type of Reporting Person: CO
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(1) Solely in its capacity as the sole general partner of FW Integrated
Orthopaedics Investors, L.P.
(2) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible Non-
Redeemable Preferred Stock and 2,500,000 shares of the Stock that may
be acquired upon exercise of warrants that become exercisable on July
1, 2000. FW Integrated Orthopaedics Investor, L.P. is the direct
owner of such securities.
(3) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,284,406
shares of the Stock outstanding.<PAGE>
<PAGE>
1. Name of Reporting Person:
J. Taylor Crandall
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):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: 119,875 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 119,875 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,919,741 (1)(2)(3)(4)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.6% (5)
14. Type of Reporting Person: IN
- ------------
(1) Solely in his capacity as President and sole shareholder of Group
Special Investments, Inc. with respect to 25,000 shares of the Stock,
and solely in his capacity as President and sole shareholder of Group
31 Inc., in its capacity as the sole general partner of FW Integrated
Orthopaedics Investors, L.P., with respect to 94,875 shares of the
Stock.
(2) Solely in his capacity as President and sole shareholder of Group
31 Inc., in its capacity as the sole general partner of FW Integrated
Orthopaedics Investors, L.P. with respect to 4,882,741 shares.
(3) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible Non-
Redeemable Preferred Stock and 2,500,000 shares of the Stock that may
be acquired upon exercise of warrants that become exercisable on July
1, 2000. FW Integrated Orthopaedics Investors, L.P. is the direct
owner of such securities.
(4) Includes 12,000 shares issuable upon exercise of options granted to
Mr. Crandall pursuant to a stock option plan.
(5) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,296,406
shares of the Stock outstanding.
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<PAGE>
1. Name of Reporting Person:
FW Integrated Orthopaedics Investors II, L.P.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: 00-Contributions from Partners
5. Check box if Disclosure of Legal Proceedings is Required Pursuant
to Items 2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 94,875
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 94,875
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,882,741 (1)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.3% (2)
14. Type of Reporting Person: PN
- ------------
(1) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible
Non-Redeemable Preferred Stock and 2,500,000 shares of the Stock
that may be acquired upon exercise of warrants that become
exercisable on July 1, 2000.
(2) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,284,406
shares of the Stock outstanding.<PAGE>
<PAGE>
1. Name of Reporting Person:
FW Group Genpar, Inc.
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):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 94,875 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 94,875 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,882,741 (1)(2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.3% (3)
14. Type of Reporting Person: CO
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(1) Solely in its capacity as the sole general partner of FW Integrated
Orthopaedics Investors II, L.P.
(2) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible
Non-Redeemable Preferred Stock and 2,500,000 shares of the Stock that
may be acquired upon exercise of warrants that become exercisable on
July 1, 2000. FW Integrated Orthopaedics Investors, II, L.P. is the
direct owner of such securities.
(3) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,284,406
shares of the Stock outstanding.
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<PAGE>
1. Name of Reporting Person:
David G. Brown
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):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: 94,875 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 94,875 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
4,882,741 (1)(2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 43.1% (3)
14. Type of Reporting Person: IN
- ------------
(1) Solely in his capacity as President and sole shareholder of FW Group
Genpar, Inc. in its capacity as the sole general partner of FW
Integrated Orthopaedics Investors II, L.P.
(2) Includes 2,287,866 shares of Stock that may be acquired upon the
conversion of 137,272 shares of the Issuer's Series B Convertible Non-
Redeemable Preferred Stock and 2,500,000 shares of the Stock that may
be acquired upon exercise of warrants that become exercisable on July
1, 2000. FW Integrated Investors II, L.P. is the direct beneficial
owner of such securities.
(3) Assumes, pursuant to Rule 13d-3(d)(1)(i), that there are 11,284,406
shares of the Stock outstanding.
<PAGE>
<PAGE>
1. Name of Reporting Person:
Group Special Investments, Inc.
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):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 25,000 (1)
Number of
Units
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 25,000 (1)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
25,000
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain
Units:
/ /
13. Percent of Class Represented by Amount in Row (11): 0.4%
14. Type of Reporting Person: CO
- ------------
(1) Power is exercised through its President and sole shareholder, J.
Taylor Crandall.
<PAGE>
<PAGE>
Pursuant to Rule 13d-2(a) of Regulation 13D-G of the General Rules
and Regulations under the Securities Exchange Act of 1934, as amended (the
"Act"), the undersigned hereby amend their Schedule 13D Statement dated
December 12, 1997, as amended by Amendment No. 1 dated March 31, 1998 and
Amendment No. 2 dated October 26, 1998 (the "Schedule 13D"), relating to
the Common Stock, $.001 par value (the "Stock"), of Integrated
Orthopaedics, Inc. (the "Issuer"). Unless otherwise indicated, all defined
terms used herein shall have the same meanings respectively ascribed to
them in the Schedule 13D.
Item 4. Purpose of Transaction
Item 4 is hereby amended by adding at the end thereof the
following:
On February 18, 1999, J. Taylor Crandall resigned from the Issuer's
Board of Directors and was replaced by Steven B. Gruber, who will serve as
one of the Reporting Persons' three representatives on the Board.
Except as set forth in this Item 4, the Reporting Persons have no
present plans or proposals that relate to or would result in any of the
actions specified in clauses (a) through (j) of Item 4 of Schedule 13D of
the Act.
Item 5. Interest in Securities of the Issuer.
Item 5 is hereby amended and restated in its entirety as follows:
(a)
FW Investors
The aggregate number of shares of the Stock that FW Investors owns
beneficially, pursuant to Rule 13d-3 of the Act, is 4,882,741 which
constitutes approximately 43.3% of the 11,284,406 shares of the Stock
deemed outstanding pursuant to Rule 13d-3(d)(1)(i).
Group
Because of its position as the sole general partner of FW
Investors, Group may, pursuant to Rule 13d-3 of the Act, be deemed to be
the beneficial owner of 4,882,741 shares of the Stock, which constitutes
approximately 43.3% of the 11,284,406 shares of the Stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i).
Crandall
Because of his position as the President and sole shareholder of
Group, which is the sole general partner of FW Investors, and because of
his position as President and sole shareholder of Group Investments,
Crandall may, pursuant to Rule 13d-3 of the Act, be deemed to be the
beneficial owner of 4,919,741 shares of the Stock, which constitutes
approximately 43.6% of the 11,296,406 shares of the Stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i).
FW Investors II
The aggregate number of shares of the Stock that FW Investors II
owns beneficially, pursuant to Rule 13d-3 of the Act, is 4,882,741, which
constitutes approximately 43.3% of the 11,284,406 shares of the Stock
deemed outstanding pursuant to Rule 13d-3(d)(1)(i).
FW Genpar
Because of its position as the sole general partner of FW Investors
II, FW Genpar may, pursuant to Rule 13d-3 of the Act, be deemed to be the
beneficial owner of 4,882,741 shares of the Stock, which constitutes
approximately 43.3% of the 11,284,406 shares of the Stock deemed
outstanding pursuant to Rule 13d-3(d)(1)(i).
Brown
Because of his position as the President and sole shareholder of FW
Genpar, which is the sole general partner of FW Investors II, Brown may,
pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial owner of
4,882,741 shares of the Stock, which constitutes approximately 43.3% of the
11,284,406 shares of the Stock deemed outstanding pursuant to Rule 13d-
3(d)(1)(i).
Group Investments
The aggregate number of shares of the Stock that Group Investments
owns beneficially, pursuant to Rule 13d-3 of the Act, is 25,000, which
constitutes approximately 0.4% of the outstanding shares of the Stock.
(b)
FW Investors
FW Investors has the sole power to vote or to direct the vote and
to dispose or to direct the disposition of 94,875 shares of the Stock.
Group
In its capacity as the sole general partner of FW Investors, Group
has the sole power to vote or to direct the vote and to dispose or to
direct the disposition of 94,875 shares of the Stock.
Crandall
Because of his position as the President and sole shareholder of
Group Investments, and because of his position as the President and sole
shareholder of Group, which is the sole general partner of FW Investors,
Crandall has the sole power to vote or to direct the vote and to dispose or
to direct the disposition of 119,875 shares of the Stock.
FW Investors II
FW Investors II has the sole power to vote or to direct the vote
and to dispose or to direct the disposition of 94,875 shares of the Stock.
FW Genpar
In its capacity as the sole general partner of FW Investors II, FW
Genpar has the sole power to vote or to direct the vote and to dispose or
to direct the disposition of 94,875 shares of the Stock.
Brown
In his capacity as the President and sole shareholder of FW Genpar,
which is the sole general partner of FW Investors II, Brown has the sole
power to vote or to direct the vote and to dispose or to direct the
disposition of 94,875 shares of the Stock.
Group Investments
Group Investments has the sole power to vote or to direct the vote
and to dispose or to direct the disposition of 25,000 shares of the Stock.
(c) On December 31, 1998, FW Investors and FW Investors II each
received 3,044 shares of the Series B Stock in the form of a paid-in-kind
dividend on shares of the Series B Stock owned by them. Each share of the
Series B Stock is convertible into 16.66666181 shares of the Stock.
Except as described above, none of the Reporting Persons have
effected any transactions in shares of the Stock during the past 60 days.
(d) Each of the Reporting Persons affirms that no person other
than such Reporting Person has the right to receive or the power to direct
the receipt of dividends from, or the proceeds from the sale of, the shares
of the Stock owned by such Reporting Person.
(e) Not Applicable.
Item 7. Material to be Filed as Exhibits.
Exhibit 99.1 -- Agreement and Power of Attorney pursuant to Rule 13d-
1(k)(1)(iii), previously filed.
Exhibit 99.2 -- Securities Purchase Agreement dated as of December 12, 1997
between Integrated Orthopaedics, Inc. and FW Integrated Orthopaedics
Investors, L.P. and Integrated Orthopaedics, Inc. and FW Integrated
Orthopaedics Investors II, L.P. and other parties named herein, previously
filed.
Exhibit 99.3 -- Limited Partnership Agreement of FW Integrated Investors,
L.P., previously filed.
Exhibit 99.4 -- Limited Partnership Agreement of FW Integrated Investors
II, L.P., previously filed.
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<PAGE>
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.
DATED: March 2, 1999
FW INTEGRATED ORTHOPAEDICS
INVESTORS, L.P.
By: Group 31, Inc., general partner
By: /s/ J. Taylor Crandall
J. Taylor Crandall
President
GROUP 31, INC.
By: /s/ J. Taylor Crandall
J. Taylor Crandall
President
/s/ J. Taylor Crandall
J. Taylor Crandall
FW INTEGRATED ORTHOPAEDICS
INVESTORS II, L.P.
By: FW Group Genpar, Inc.,
general partner
By: /s/ David G. Brown
David G. Brown
President
FW GROUP GENPAR, INC.
By: /s/ David G. Brown
David G. Brown
President
/s/ David G. Brown
David G. Brown
GROUP SPECIAL INVESTMENTS, INC.
By: /s/ J. Taylor Crandall
J. Taylor Crandall
President
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
99.1 Agreement and Power of Attorney pursuant to Rule 13d-1(k)(1)(iii),
previously filed
99.2 Securities Purchase Agreement dated as of December 12, 1997 between
Integrated Orthopaedics, Inc. and FW Integrated Orthopaedics
Investors, L.P. and Integrated Orthopaedics, Inc. and FW Integrated
Orthopaedics Investors II, L.P. and other parties named herein,
previously filed.
99.3 Limited Partnership Agreement of FW Integrated Investors, L.P.,
previously filed.
99.4 Limited Partnership Agreement of FW Integrated Investors II, L.P.,
previously filed.
