<PAGE> 1
UNITED STATES
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. )(1)
Jay Jacobs, Inc.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $.01 Par Value
- --------------------------------------------------------------------------------
(Title of Class of Securities)
469 816 102
- --------------------------------------------------------------------------------
(CUSIP Number)
Victor I. Chang, Law Clerk (617) 248-7000
c/o Testa, Hurwitz & Thibeault, LLP, High Street Tower, 125 High Street,
Boston, Ma 02110
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 5, 1997
- --------------------------------------------------------------------------------
(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 [ ].
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.
- ----------
(1) 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).
<PAGE> 2
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Edward L. Cahill
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
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
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 3
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
David L. Warnock
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
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
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 4
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Cahill, Warnock Strategic Partners, L.P.
IRSN: 52-1970604
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware Limited Partnership
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
PN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 5
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Cahill, Warnock Strategic Partners Fund, L.P.
IRSN: 52-1970619
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
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
Delaware Limited Partnership
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
PN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 6
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Cahill, Warnock & Company, LLC
IRSN: 52-1931617
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS*
AF
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Maryland Limited Liability Company
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
OO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 7
SCHEDULE 13D
- ---------------------------
CUSIP No. 469 816 102
- ---------------------------
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Strategic Associates, L.P.
IRSN: 52-1991689
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
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
Delaware Limited Partnership
- --------------------------------------------------------------------------------
7. SOLE VOTING POWER
-0-
NUMBER OF -------------------------------------------------------
SHARES 8. SHARED VOTING POWER
BENEFICIALLY
OWNED BY 35,897,145
EACH -------------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON
WITH: -0-
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
35,897,145
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,897,145
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[X]
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
85.2%
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
PN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 8
ITEM 1. SECURITY AND ISSUER:
This statement relates to the Common Stock, $.01 par value per share, of
Jay Jacobs, Inc., a Washington corporation (the "Issuer"). The address of the
Issuer's principal executive offices is 1530 Fifth Avenue, Seattle, WA 98101.
ITEM 2. IDENTITY AND BACKGROUND:
This statement is being filed by (i) Cahill, Warnock Strategic Partners
Fund, L.P. ("Strategic Partners Fund"), (ii) Cahill Warnock Strategic Partners,
L.P. ("Strategic Partners"), the sole general partner of Strategic Partners
Fund, (iii) Strategic Associates, L.P. ("Strategic Associates"), (iv) Cahill,
Warnock & Company, LLC ("Cahill, Warnock & Co."), the sole general partner of
Strategic Associates, (v) Edward L. Cahill ("Cahill"), a general partner of
Strategic Partners and a member of Cahill, Warnock & Co., and (vi) David L.
Warnock ("Warnock"), a general partner of Strategic Partners and a member of
Cahill, Warnock & Co. Strategic Partners Fund, Strategic Partners, Strategic
Associates, Cahill, Warnock & Co., Cahill, and Warnock are sometimes referred to
collectively herein as the "Reporting Persons."
The address of the principal business and principal office of Strategic
Partners Fund, Strategic Partners, Strategic Associates and Cahill, Warnock &
Co. is 1 South Street, Suite 2150, Baltimore, MD 21202. The business address of
Cahill and Warnock is 1 South Street, Suite 2150, Baltimore, MD 21202.
The state of organization for Strategic Partners Fund, Strategic Partners
and Strategic Associates is Delaware. The state of organization for Cahill,
Warnock & Co. is Maryland. Both Cahill and Warnock are citizens of the United
States of America.
The principal business of Strategic Partners Fund and Strategic Associates
is to make private equity investments in micro-cap public companies seeking
capital for expansion or undergoing a restructuring of ownership. The principal
business of Strategic Partners is to act as the sole general partner of
Strategic Partners Fund. The principal business of Cahill, Warnock & Co. is to
act as the sole general partner of Strategic Associates and Camden Partners,
L.P. ("Camden Partners") and to manage the activities of Strategic Partners
Fund, Strategic Associates, and Camden Partners. The principal occupations of
Cahill and Warnock are their activities on behalf of Strategic Partners Fund,
Strategic Partners, Strategic Associates, Cahill, Warnock & Co. and Camden
Partners.
The principal business of Camden Partners is to make passive investments in
public companies. The principal office of Camden Partners is 1 South Street,
Suite 2150, Baltimore, MD 21202.
During the five years prior to the date hereof, none of the Reporting
Persons has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or has been a party to a civil proceeding
ending in a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws, or finding a violation with respect to such laws.
<PAGE> 9
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION:
On December 5, 1997 Strategic Partners Fund acquired 15,014 shares of
Series B Preferred Stock of the Issuer for a total purchase price of $1,501,400.
The Series B Preferred Stock acquired by Strategic Partners Fund is currently
convertible into 34,014,499 shares of the Issuer's Common Stock. The working
capital of Strategic Partners Fund was the source of funds for this purchase. No
part of the purchase price was or will be represented by funds or other
consideration borrowed or otherwise obtained for the purpose of acquiring,
holding, trading or voting the Series B Preferred Stock.
On December 5, 1997 Strategic Associates acquired 831 shares of Series B
Preferred Stock of the Issuer for a total purchase price of $83,100. The Series
B Preferred Stock acquired by Strategic Associates is currently convertible into
1,882,646 shares of the Issuer's Common Stock. The working capital of Strategic
Associates was the source of funds for this purchase. No part of the purchase
price was or will be represented by funds or other consideration borrowed or
otherwise obtained for the purpose of acquiring, holding, trading or voting the
Series B Preferred Stock.
ITEM 4. PURPOSE OF TRANSACTION:
Strategic Partners Fund and Strategic Associates acquired the Issuer's
securities for investment purposes. Depending on market conditions, their
continuing evaluation of the business and prospects of the Issuer and other
factors, Strategic Partners Fund and Strategic Associates may dispose of or
acquire additional securities of the Issuer. Except as otherwise described
herein or as expressly stated below, none of the Reporting Persons has any
present plans which relate to or would result in:
(a) The acquisition by any person of additional securities of the Issuer,
or the disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its
subsidiaries;
(c) A sale or transfer of a material amount of assets of the Issuer or of
any of its subsidiaries;
(d) Any change in the present board of directors or management of the
Issuer, including any plans or proposals to change the number or term
of directors or to fill any existing vacancies on the board;
(e) Any material change in the present capitalization or dividend policy
of the Issuer;
(f) Any other material change in the Issuer's business or corporate
structure;
(g) Changes in the Issuer's charter, bylaws or instruments corresponding
thereto or other actions which may impede the acquisition of control
of the Issuer by any person;
(h) Causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national
securities association;
<PAGE> 10
(i) A class of equity securities of the Issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934; or
(j) Any action similar to any of those enumerated above.
EXCEPTION. Pursuant to the terms of a certain Voting Agreement dated as of
December 5, 1997 (the "Voting Agreement," attached hereto as EXHIBIT 4) by and
among the Strategic Partners Fund, Strategic Associates, T. Rowe Price Recovery
Fund II, L.P. ("T. Rowe Price"), Michael D. Sullivan ("Sullivan"), Rex Loren
Steffey ("Steffey"), and William L. Lawrence, Jr. ("Lawrence"), the parties
thereto agreed to fix the size of the Board of Directors at seven (7) and vote
all of their shares of stock of the Issuer to elect certain persons to the Board
of Directors of the Issuer. At present, Strategic Partners Fund, Strategic
Associates, T. Rowe Price, and Sullivan collectively have the authority to
designate five members of the Board of Directors.
ITEM 5. INTEREST IN THE SECURITIES OF THE ISSUER:
(a) Strategic Partners Fund is the record owner of 15,014 shares of Series
B Preferred Stock of the Issuer (the "Fund B Preferred"). The Fund B Preferred
is currently convertible into 34,014,499 shares of the Issuer's Common Stock
(the "Fund Conversion Shares").
Strategic Associates is the record owner of 831 shares of Series B
Preferred Stock of the Issuer (the "Associates B Preferred"). The Associates B
Preferred is currently convertible into 1,882,646 shares of the Issuer's Common
Stock (the "Associates Conversion Shares").
The Fund Conversion Shares and the Associates Conversion Shares are
sometimes referred to herein collectively as the "Jay Jacobs Shares."
Because of their relationship as affiliated entities, both Strategic
Partners Fund and Strategic Associates may be deemed to own beneficially the Jay
Jacobs Shares. As general partners of Strategic Partners Fund and Strategic
Associates, respectively, Strategic Partners and Cahill, Warnock & Co. may be
deemed to own beneficially the Jay Jacobs Shares. As the individual general
partners of Strategic Partners and as the members of Cahill, Warnock & Co., both
Cahill and Warnock may be deemed to own beneficially the Jay Jacobs Shares.
By virtue of the Voting Agreement (attached hereto as EXHIBIT 4), each of
the Reporting Persons may be deemed to share voting power with respect to each
share of the Issuer's stock subject to the agreement. Consequently, the
Reporting Persons may be deemed to beneficially own, in addition to the Jay
Jacobs Shares, an additional 23,221,663 shares of the Issuer (the "Agreement
Shares").
Strategic Partners Fund disclaims beneficial ownership of the Associates
Conversion Shares and the Agreement Shares. Strategic Associates disclaims
beneficial ownership of the Fund Conversion Shares and Agreement Shares.
Strategic Partners, Cahill, Warnock & Co., Cahill, and Warnock each disclaim
beneficial ownership of the Jay Jacobs Shares and the Agreement Shares, except
with respect to their pecuniary interest therein, if any.
Each of the Reporting Persons may be deemed to own beneficially 85.2% of
the Issuer's Common Stock, which percentage is calculated based upon 6,213,837
shares of the Issuer's Common Stock reported as outstanding by the Issuer in the
Stock Purchase Agreement and 35,897,145 shares of the Issuer's Common
<PAGE> 11
Stock issuable upon conversion of the Fund B Preferred and Associates B
Preferred. The calculation of beneficial ownership percentage does not reflect
potential deemed beneficial ownership of the Agreement Shares.
In Amendment No. 1 to the Limited Partnership Agreement of Strategic
Partners Fund, dated July 26, 1996 (attached hereto as EXHIBIT 2), Strategic
Partners and the limited partners of Strategic Partners Fund agreed that any
securities of a particular issuer that are acquired by both Strategic Partners
Fund and Strategic Associates shall be sold or otherwise disposed of at
substantially the same time, on substantially the same terms and in amounts
proportionate to the size of each of their investments. As a consequence,
Strategic Associates and Strategic Partners Fund may be deemed to be members of
a group pursuant to Rule 13d-5(b)(1) of the Securities Exchange Act of 1934.
Strategic Partners, Cahill, Warnock & Co., Cahill and Warnock each disclaim
membership in the aforementioned group.
(b) Number of shares of the Issuer's Common Stock as to which each
such person has
(i) Sole power to vote or direct the vote:
0 shares for each Reporting Person;
(ii) Shared power to vote or direct the vote:
35,897,145* shares for each Reporting Person;
(iii) Sole power to dispose or to direct the disposition:
0 shares for each Reporting Person;
(iv) Shared power to dispose or to direct the disposition:
35,897,145* shares for each Reporting Person.
* Does not reflect potential deemed beneficial ownership of the
Agreement Shares.
(c) Except as set forth above, none of the Reporting Persons has
effected any transaction in shares of the Issuer's Common Stock during the last
60 days.
(d) No other person is known to have the right to receive or the
power to direct the receipt of dividends from, or any proceeds from the sale of,
the shares beneficially owned by any of the Reporting Persons.
(e) Not applicable.
<PAGE> 12
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
OF THE ISSUER:
In Amendment No. 1 to the Limited Partnership Agreement of Strategic
Partners Fund, dated July 26, 1996, Strategic Partners and the limited partners
of Strategic Partners Fund agreed that any securities of a particular issuer
that are acquired by both Strategic Partners Fund and Strategic Associates shall
be sold or otherwise disposed of at substantially the same time, on
substantially the same terms and in amounts proportionate to the size of each of
their investments.
Pursuant to the terms of a certain Preferred Stock Purchase Agreement
dated December 5, 1997 by and among the Issuer, Strategic Partners Fund,
Strategic Associates, T. Rowe Price, and Sullivan (the "Stock Purchase
Agreement," attached hereto as EXHIBIT 3), Strategic Partners Fund acquired
27,624 shares of Series A Preferred Stock (non-voting, non-convertible) and
15,014 shares of Series B Preferred Stock. Pursuant to the Stock Purchase
Agreement, Strategic Associates acquired 1,531 shares of Series A Preferred
Stock (non-voting, non-convertible) and 831 shares of Series B Preferred Stock.
Under the terms of the Stock Purchase Agreement, the Issuer is obligated to
prepare and file with the Securities and Exchange Commission, within 180 days of
December 5, 1997, a registration statement for an offering to be made on a
delayed or continuous basis pursuant to Rule 415 of the Securities Act (the
"Shelf Registration") registering the resale from time to time by Strategic
Partners Fund, Strategic Associates, T. Rowe Price, and Sullivan, and their
transferees and distributees of all of the securities owned by such persons that
are registrable under the Shelf Registration.
Pursuant to the terms of the Voting Agreement (attached hereto as
EXHIBIT 4), by and among Strategic Partners Fund, Strategic Associates, T. Rowe
Price, Sullivan, Steffey, and Lawrence, (the parties to the agreement are
referred to herein collectively as the "Stockholders"), the Stockholders agreed
to fix the size of the Board of Directors at seven (7) and to vote all of the
Stockholders' shares of stock of the Issuer to elect certain persons to the
Board of Directors of the Issuer. At present, Strategic Partners Fund, Strategic
Associates, T. Rowe Price, and Sullivan collectively have the authority to
designate five members of the Board of Directors.
Pursuant to a certain Registration Rights Agreement (attached hereto as
EXHIBIT 5) dated December 5, 1997 by and among the Issuer, Strategic Partners
Fund, Strategic Associates, T. Rowe Price, and Sullivan (attached hereto as
EXHIBIT 5), Strategic Partners Fund, Strategic Associates, T. Rowe Price, and
Sullivan are granted, subject to certain restrictions and limitations, certain
demand and "piggyback" registration rights with respect to the Series B
Preferred Stock.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS:
Exhibit 1 - Agreement regarding filing of joint Schedule 13D.
Exhibit 2 - Amendment No. 1 to the Limited Partnership Agreement of
Strategic Partners Fund.
Exhibit 3 - Preferred Stock Purchase Agreement dated December 5, 1997,
by and among the Issuer, Strategic Partners Fund, Strategic
Associates, T. Rowe Price, and Sullivan (filed as EXHIBIT
2.1 to the Issuer's Current Report on 8-K filed
December 15, 1997 and incorporated by reference to this
filing).
<PAGE> 13
Exhibit 4 - Voting Agreement dated December 5, 1997, by and among
Strategic Partners Fund, Strategic Associates, T. Rowe
Price, Sullivan, Steffey, and Lawrence (filed as EXHIBIT 4.2
to the Issuer's Current Report on 8-K filed December 15,
1997 and incorporated by reference to this filing).
Exhibit 5 - Registration Rights Agreement dated December 5, 1997, by and
among the Issuer, Strategic Partners Fund, Strategic
Associates, T. Rowe Price, and Sullivan (filed as EXHIBIT
4.4 to the Issuer's Current Report on 8-K filed
December 15, 1997 and incorporated by reference to this
filing).
Exhibit 6 - Amendment to Articles of Incorporation of Jay Jacobs, Inc.
as filed with the Secretary of the State of Washington on
December 3, 1997 (filed as EXHIBIT 3.1 to the Issuer's
Current Report on 8-K filed December 15, 1997 and
incorporated by reference to this filing).
<PAGE> 14
SCHEDULE 13D
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: December 15, 1997.
/s/ Edward L. Cahill
---------------------------------------------
Edward L. Cahill
/s/ David L. Warnock
---------------------------------------------
David L. Warnock
CAHILL, WARNOCK STRATEGIC PARTNERS
FUND, L.P.
By: Cahill, Warnock Strategic Partners,
L.P., its Sole General Partner
By: /s/ Edward L. Cahill
------------------------------------
Edward L. Cahill, General Partner
By: /s/ David L. Warnock
------------------------------------
David L. Warnock, General Partner
CAHILL, WARNOCK STRATEGIC PARTNERS, L.P.
By: /s/ Edward L. Cahill
-----------------------------------------
Edward L. Cahill, General Partner
By: /s/ David L. Warnock
-----------------------------------------
David L. Warnock, General Partner
<PAGE> 15
STRATEGIC ASSOCIATES, L.P.
By: Cahill, Warnock & Co., LLC, its sole
General Partner
By: /s/ Edward L. Cahill
------------------------------------
Edward L. Cahill, Member
By: /s/ David L. Warnock
------------------------------------
David L. Warnock, Member
CAHILL, WARNOCK & CO., LLC
By: /s/ Edward L. Cahill
----------------------------------------
Edward L. Cahill, Member
By: /s/ David L. Warnock
----------------------------------------
David L. Warnock, Member
<PAGE> 1
EXHIBIT 1
AGREEMENT
Pursuant to Rule 13d-1(f)(1) under the Securities Exchange Act of 1934,
the undersigned hereby agree that only one statement containing the information
required by Schedule 13D need be filed with respect to the ownership by each of
the undersigned of shares of stock of Jay Jacobs, Inc.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
Executed this December 15, 1997.
/s/ Edward L. Cahill
-----------------------------------
Edward L. Cahill
/s/ David L. Warnock
-----------------------------------
David L. Warnock
<PAGE> 2
CAHILL, WARNOCK STRATEGIC PARTNERS FUND, L.P.
By: Cahill, Warnock Strategic Partners,
L.P., its Sole General Partner
By: /s/ Edward L. Cahill
-----------------------------------
Edward L. Cahill, General Partner
By: /s/ David L. Warnock
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David L. Warnock, General Partner
CAHILL, WARNOCK STRATEGIC PARTNERS, L.P.
By: /s/ Edward L. Cahill
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Edward L. Cahill, General Partner
By: /s/ David L. Warnock
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David L. Warnock, General Partner
STRATEGIC ASSOCIATES, L.P.
By: Cahill, Warnock & Co., LLC, its sole
General Partner
By: /s/ Edward L. Cahill
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Edward L. Cahill, Member
By: /s/ David L. Warnock
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David L. Warnock, Member
CAHILL, WARNOCK & CO., LLC
By: /s/ Edward L. Cahill
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Edward L. Cahill, Member
By: /s/ David L. Warnock
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David L. Warnock, Member
<PAGE> 1
Exhibit 2
AMENDMENT NO. 1 TO
LIMITED PARTNERSHIP AGREEMENT
OF
CAHILL, WARNOCK STRATEGIC PARTNERS FUND, L.P.
AMENDMENT NO. 1 dated as of the 26th day of July, 1996, by and among
Cahill, Warnock Strategic Partners, L.P., a Delaware limited partnership, as
general partner (the "General Partner") of Cahill, Warnock Strategic Partners
Fund, L.P., a Delaware limited partnership (the "Partnership"), and the Limited
Partners of the Partnership listed on Schedule A to the Limited Partnership
Agreement of the Partnership, dated as of April 11, 1996 (the "Partnership
Agreement"), at least 66 2/3% in interest of whom have executed a counterpart
signature page to this Amendment No. 1:
WHEREAS, immediately prior to the admission on the date hereof of
additional Limited Partners to the Partnership pursuant to Section 8(c) of the
Partnership Agreement, the parties hereto desire to amend the Partnership
Agreement and approve Amendment No. 1 to the Management Agreement, the form of
which Management Agreement is attached to the Partnership Agreement as Schedule
B.
NOW, THEREFORE, the parties hereto, in consideration of the premises and
the agreements herein contained and intending to be legally bound hereby, agree
as follows:
1. Section 4(k)(2) of the Partnership Agreement is amended by deleting
the second sentence thereof in its entirety and substituting the
following:
"Notwithstanding Section 4(e)(1) to the contrary, the Principals
may organize, after the date of this Agreement, other investment
funds and client investment vehicles for the benefit of
employees, associates and advisors of the General Partner and the
Principals and for investors who may be strategically important
to the Partnership, specifically for the purpose of co-investing
with the Partnership; provided that the aggregate amount of
capital committed to such other investment funds and client
investment vehicles does not exceed $7 million; and provided,
further, that any such investment funds or client investment
vehicles which are managed by the General Partner or the
Principals shall sell or otherwise dispose of each such
co-investment at substantially the same time and on substantially
the same terms as the Partnership in amounts proportionate to the
relative size of the investments made by such investment funds
and client investment vehicles and the Partnership."
<PAGE> 2
2. Section 7(a) of the Partnership Agreement is amended by deleting the
first sentence thereof in its entirety and substituting the following:
"The Partnership shall have a Valuation Committee which shall
consist of at least three (3) but not more than five (5) members,
none of whom shall be an officer, director, member or employee of
the General Partner, the Management Company or any affiliate
thereof, and none of whom shall be related to any Principal."
3. Section 8(a) of the Partnership Agreement is amended by adding the
following text at the end thereof:
"Each notice for an Additional Capital Contribution from the
General Partner shall include a general description of the
purposes and uses for which the Additional Capital Contribution
is being called including, for example, the payment of
Partnership expenses (including the Management Fee) and the
purchase of Portfolio Company Securities; provided that the
General Partner shall not be required to identify the purposes
and uses of 100% of any Additional Capital Contribution or be
required to identify the name of any particular Portfolio Company
or proposed Portfolio Company. After the fourth anniversary of
the last admittance of any additional Limited Partners pursuant
to Section 8(c) hereof, the General Partner shall not make any
further calls for Additional Capital Contributions for the
purpose of investing in the Securities of any entity that was not
a Portfolio Company (including as a Portfolio Company for such
purpose, any predecessor of such entity) on such anniversary
date, except with the approval of the Valuation Committee. After
the fifth anniversary of the last admittance of any additional
Limited Partners pursuant to Section 8(c) hereof, the General
Partner shall not make any further calls for Additional Capital
Contributions for the purpose of investing in the Securities of
any entity that was a Portfolio Company (including as a Portfolio
Company for such purpose, any predecessor of such entity) on such
anniversary date, except with the approval of the Valuation
Committee."
4. Section 11(b) of the Partnership Agreement is amended by adding the
following subsection (8) at the end thereof:
"(8) An amount equal to 50% of all distributions made to the
General Partner, other than (A) Tax Distributions plus (B)
distributions the General Partner would have received if it had
made its Capital Contributions as a Limited Partner and did not
hold an interest as a General Partner (excluding any Tax
Distributions on account thereof which are included in (A)),
shall be used by the General Partner immediately upon
distribution thereof to prepay any promissory notes contributed
by the General Partner to the Partnership."
5. Section 16 of the Partnership Agreement is amended by adding the
following text at the end thereof:
"No Principal will voluntarily assign, pledge, mortgage,
hypothecate, sell or otherwise dispose of or encumber (a
"Disposition") all or any part of his interest in the allocations
<PAGE> 3
made to the General Partner of "20% of such additional Net
Realized Gain" pursuant to Section 10(b)(1)(A)(iv) (the "20%
carried interest"), except for (a) Dispositions to members of his
immediate family or trusts for the benefit of such general
partner or members of his immediate family (and, in the case of
any Dispositions to such family members or such trusts, the
transferee shall thereafter be subject, as to further transfers,
to the same restrictions on transfer as were applicable to the
transferor), (b) Dispositions to other persons who are associated
with or employed by the General Partner, the Principals or the
Management Company, and (c) Dispositions to another Principal;
provided, that, the Dispositions of all Principals pursuant to
clauses (a) and (b) shall not exceed in the aggregate 45% of
their aggregate interests in the 20% carried interest."
6. Section 19(c) of the Partnership Agreement is amended by adding the
following text at the end thereof:
"The General Partner shall transmit to each Partner within sixty
(60) days after the close of each fiscal year, a report
describing any fees and other remuneration which, pursuant to
Section 4(b) of the Management Agreement, reduced the Management
Fee payable in such fiscal year. Such description will be
organized by the type of such fees and other remuneration (e.g.,
director's fees and consulting fees) and the dollar amount
attributable to each such category."
7. Pursuant to Section 7 of the Management Agreement, the Limited
Partners hereby consent to Amendment No. 1 to the Management Agreement
dated the date hereof, which amends Section 4(b) of the Management
Agreement by adding the following text at the end thereof:
"If in any year such reductions exceed the Management Fee
otherwise payable, the excess amount of such reductions shall be
carried forward on a year-by-year basis."
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 1 as
of the day and year first above written.
GENERAL PARTNER
CAHILL, WARNOCK STRATEGIC PARTNERS, L.P.
By: /s/ Edward L. Cahill
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Edward L. Cahill, General Partner
By: /s/ David L. Warnock
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David L. Warnock, General Partner
<PAGE> 4
AMENDMENT NO. 1 TO
LIMITED PARTNERSHIP AGREEMENT
OF
CAHILL, WARNOCK STRATEGIC PARTNERS FUND, L.P.
LIMITED PARTNER SIGNATURE PAGE
The undersigned Limited Partner hereby executes Amendment No. 1 to Limited
Partnership Agreement of Cahill, Warnock Strategic Partners Fund, L.P. and
hereby authorizes this signature page to be attached to a counterpart of such
document executed by the General Partner of Cahill, Warnock Strategic Partners
Fund, L.P.
Please type or print exact
name of Limited Partner *
____________________________________
Please sign here By__________________________________
Please type or print exact
name of signer ____________________________________
Please type or print
title of signer Title_______________________________
* Signature pages of the limited partners will be provided upon request.
