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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
Banyan Mortgage Investment Fund
(Name of Issuer)
Common Stock, $.01 par value
(Title of Class of Securities)
066 82 P 106
(CUSIP Number)
Lawrence G. Goodman, Esq.
Shereff, Friedman, Hoffman & Goodman, LLP
919 Third Avenue
New York, New York 10022
(212) 758-9500
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 14, 1996
(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 the 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 ("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).
SEC 1746 (12-91)
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SCHEDULE 13D
CUSIP No. 066 82 P 106 Page 2 of 11 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
GABRIEL CAPITAL, L.P.
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
7 SOLE VOTING POWER
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,118,961
EACH
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
10 SHARED DISPOSITIVE POWER
1,118,961
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,118,961
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.8%
14 TYPE OF REPORTING PERSON*
PN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE
ATTESTATION.
SEC 1746 (12-91)
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SCHEDULE 13D
CUSIP No. 066 82 P 106 Page 3 of 11 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ARIEL FUND LIMITED
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
CAYMAN ISLANDS
7 SOLE VOTING POWER
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,650,393
EACH
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
10 SHARED DISPOSITIVE POWER
1,650,393
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,650,393
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.1%
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE
ATTESTATION.
SEC 1746 (12-91)
<PAGE>
SCHEDULE 13D
CUSIP No. 066 82 P 106 Page 4 of 11 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ARIEL MANAGEMENT CORP.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
00
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
7 SOLE VOTING POWER
183,046
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,650,393
EACH
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
183,046
10 SHARED DISPOSITIVE POWER
1,650,393
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,833,439
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.6%
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE
ATTESTATION.
SEC 1746 (12-91)
<PAGE>
SCHEDULE 13D
CUSIP No. 066 82 P 106 Page 5 of 11 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
J. EZRA MERKIN
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) /X/
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
00
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
7 SOLE VOTING POWER
183,046
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 2,769,354
EACH
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
183,046
10 SHARED DISPOSITIVE POWER
2,769,354
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,952,400
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.4%
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE
ATTESTATION.
SEC 1746 (12-91)
<PAGE> SCHEDULE 13D
This Amendment No. 2 amends and supplements the following Items of the
Reporting Persons' Statement on Schedule 13D (the "Schedule"), as previously
amended by Amendment No. 1 to Schedule 13D.
Item 3. Source and Amount of Funds
The information contained in Item 3 to the Schedule is hereby amended and
supplemented as follows:
From December 5, 1995 through December 12, 1995: (i) Gabriel purchased an
aggregate of 37,900 shares of Common Stock at an aggregate cost of $15,396.87
using its own funds; (ii) Ariel Fund purchased an aggregate of 55,901 shares of
Common Stock at an aggregate cost of $22,709.78 using its own funds, and in
addition, (iii) Ariel caused one of its private discretionary investment
accounts to purchase 6,199 shares of Common Stock at an aggregate cost of
$2,518.34 using the funds of such account.
Item 4. Purpose of the Transaction
The information contained in Item 4 to the Schedule is hereby amended and
supplemented as follows:
With respect to the actions or events described in paragraphs (a) through
(j) of Item 4 of Schedule 13D, see Exhibit A hereto. The aforesaid private
discretionary account managed by Ariel has no interest, and there is no current
intention for it to have an interest, in the course of action referred to in
Exhibit A.
Except for the foregoing, no Reporting Person has any present plans or
proposals which relate to or would result in any of the actions or events
described in paragraphs (a) through (j) of Item 4 of Schedule 13D. However, the
Reporting Persons retain their respective rights to modify their plans with
respect to the transactions described in this Item 4, to acquire or dispose of
securities of the Issuer and to formulate plans and proposals which could result
in the occurrence of any such events, subject to applicable laws and
regulations.
All of the shares of Common Stock reported herein were acquired for
investment purposes. Each of the Reporting Persons may acquire or dispose of
securities of the Issuer, including shares of Common Stock, directly or
indirectly, in open-market or privately negotiated transactions, depending upon
the evaluation of the performance and prospects of the Issuer by the Reporting
Persons, and upon other developments and circumstances, including, but not
limited to, general economic and business conditions and stock market
conditions.
6
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Item 5. Interest in Securities of the Issuer
The information contained in Item 5 to the Schedule is hereby amended and
supplemented as follows:
(a) and (b) Gabriel is the beneficial owner of 1,118,961 shares of Common
Stock, for a total beneficial ownership of 2.8% of the outstanding shares of
Common Stock.
Ariel Fund is the beneficial owner of 1,650,393 shares of Common Stock, for
a total beneficial ownership of 4.1% of the outstanding shares of Common Stock.
Ariel, as Investment Advisor to Ariel Fund, has the power to vote and to
direct the voting of and the power to dispose and direct the disposition of the
1,650,393 shares of Common Stock owned by Ariel Fund. In addition, Ariel has
sole dispositive and voting power with respect to 183,046 shares of Common Stock
purchased by a private discretionary investment account. Accordingly, Ariel may
be deemed to be the beneficial owner of 1,833,439 shares of Common Stock, or
4.6% of the outstanding shares of Common Stock.
As the General Partner of Gabriel, Merkin has the power to vote and to
direct the voting of and the power to dispose and direct the disposition of the
1,118,961 shares of Common Stock owned by Gabriel. In addition, as the sole
shareholder and president of Ariel, Merkin may be deemed to have power to vote
and to direct the voting of and the power to dispose and direct the disposition
of the 1,650,393 shares of Common Stock owned by Ariel Fund and the 183,046
shares of Common Stock owned by Ariel's private account. Accordingly, Merkin
may be deemed to be the beneficial owner of 2,952,400 shares of Common Stock, or
7.4% of the outstanding shares of Common Stock.
The number of shares beneficially owned by each of the Reporting Persons
and the percentage of outstanding shares represented thereby, have been computed
in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as
amended. The ownership of the Reporting Persons is based on 39,822,304
outstanding shares of Common Stock of the Issuer as of April 8, 1996, as
reported in the Issuer's Quarterly Report on Form 10-K for the fiscal period
ended December 31, 1995.
(c) There were no transactions effected by the Reporting Persons during the
past 60 days.
Item 7. Material to Be Filed as Exhibits
Exhibit A. Letter to the Issuer dated May 14, 1996
7
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Signatures
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.
GABRIEL CAPITAL, L.P.
By: /s/ J. Ezra Merkin
------------------
Name: J. Ezra Merkin
Title: General Partner
ARIEL FUND LIMITED
By: MEESPIERSON MANAGEMENT
(CAYMAN) LIMITED
By: /s/ C. Anthony Mellin, Darryll LeGeyt
-------------------------------------
Name: C. Anthony Mellin, Darryll LeGeyt
Title: Director, Assistant Secretary
ARIEL MANAGEMENT CORP.
By: /s/ J. Ezra Merkin
--------------------------------------
Name: J. Ezra Merkin
Title: President
/s/ J. Ezra Merkin
-------------------
J. EZRA MERKIN
Dated: May 17, 1996
8
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Exhibit A
May 14, 1995
Leonard G. Levine, President and Director
Banyan Mortgage Investment Fund
150 S. Wacker Drive, Suite 2900
Chicago, Illinois 60606
Dear Mr. Levine:
As you know, Gabriel Capital L.P., ("Gabriel") and Ariel Fund Ltd.
are, collectively, the largest shareholder of Banyan Mortgage Investment Fund
("Banyan") - owning approximately 7% of Banyan's outstanding common shares. We
write to demand that Banyan not proceed with the Private Placement or the Merger
described in the Agreement and Plan of Merger (the "Merger Agreement"), dated as
of April 12, 1996, by and among RGI U.S. Holdings, Inc., RGI Holdings Inc.
(collectively, "RGI") and Banyan.
Based on the information available to us, we believe that the
transactions contemplated by the Merger Agreement severely compromise the
interests of Banyan and its shareholders and are inconsistent with the fiduciary
duties of Banyan's directors and officers (the "D&Os"). In particular (and
without limitation), we strenuously object to the excessive termination fees
contained in the Merger Agreement (including Section 10.03 thereof) -- fees that
are payable even if Banyan's Board of Directors chooses to support an
alternative transaction or cannot obtain a Fairness Opinion. There is no reason
why Banyan is required to act immediately to close the Private Placement and
become obligated for these fees and it is unreasonable for Banyan to do so.
This is especially true in light of Gabriel's willingness to invest millions of
dollars into Banyan as discussed below.
Accordingly, if you choose to proceed with the Private Placement or
the Merger, we intend to take appropriate steps to protect Banyan and its
shareholders. These steps include, without limitation, the filing of
appropriate lawsuits to invalidate all or portions of the Merger
- --------------------
1 Each capitalized term in this letter that is not otherwise defined has
the meaning ascribed to such term in the Merger Agreement.
<PAGE>
Leonard G. Levine, President and Director
May 14, 1996
Page 2
Agreement and to hold each D&O liable for breaching his or her duties to Banyan
and its shareholders. It would be unfortunate if Gabriel is forced to resort to
litigation. As your largest shareholder, out interests and those of Banyan
should be completely aligned. We, therefore, ask that, prior to consummating
any portion of the Private Placement or the Merger, Banyan meet with us to
discuss alternatives.
To provide Banyan with liquidity and other benefits without the
termination fee and other coercive terms of the Merger Agreement, Gabriel and/or
its designee(s) is willing to purchase the Initial Shares for $3.5 million,
subject to (i) the terms and conditions of Section 1.01(e) of the Merger
Agreement (replacing Gabriel and/or its designee(s) and advisors for RGI and its
advisors, as applicable) that do not specifically relate to the Merger, Sogen or
Morgens, (ii) the appointment of a Gabriel designee to Banyan's Board of
Directors in substitution for an existing Board member (identity to be
discussed) and (iii) Banyan's agreement for a reasonable period of time to be
agreed upon to repurchase at Gabriel's request the Initial Shares at Gabriel's
original purchase price plus costs, expenses and a 10% return (calculated on an
annual basis) contemporaneously with Banyan's agreement to sell, issue, transfer
or exchange, in any transaction or series of transactions, ten percent or more
of any class of Banyan equity securities or equivalents (broadly defined to
include, among other things, warrants, convertible debt and other interests in
the profits or revenues of Banyan).
We look forward to discussing these issues with you promptly. Please
be advised that our offer to purchase the Initial Shares contained herein
terminates on the earlier of (i) the closing of the Private Placement and (ii)
5:00 p.m. on May 16, 1996. In addition, we understand that Banyan desires
liquidity in excess of the $3.5 million discussed herein and, therefore, expects
that, as part of the purchase of the Initial Shares, we and Banyan will discuss
in good faith all of Banyan's financing issues. In particular, please be
advised that Gabriel and/or its designee(s) is willing to invest an additional
$7 million to $12 million into Banyan, subject to due diligence and
documentation.
We strongly believe that, working together, Banyan and Gabriel can
provide better solutions for Banyan than those contained in the Merger Agreement
and look forward to a constructive dialogue. Although our offer necessarily
will have to be finalized in a formal agreement, our proposal to make millions
of dollars available to Banyan on favorable terms is, we believe, sufficiently
attractive so as to warrant serious reconsideration.
<PAGE>
Leonard G. Levin, President and Director
May 14, 1996
Page 3
Please provide copies of this letter to the other Banyan directors.
Gabriel and its advisors are available at your reasonable convenience to discuss
these matters.
Very truly yours,
GABRIEL CAPITAL L.P.
/s/ Jack Mayer
Jack Mayer, Authorized Agent
