<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. ________)*
Citadel Holding Corporation
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $.01 par value per share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
172862104
-------------------
(CUSIP Number)
James A. Wunderle
Chief Operating Officer
Reading Company
30 South 15th Street, Suite 1300
Philadelphia, PA 19102
(215) 569-3344
________________________________________________________________________________
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
March 28, 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. [X] (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).
<PAGE>
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CUSIP NO. 172862104 13D PAGE 2 OF 14 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Craig Corporation
95-1620188
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
WC
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(E) [_]
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF 1,329,114 Shares 3% Cumulative Voting Convertible
Preferred Stock
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 1,329,114 Shares 3% Cumulative Voting Convertible
Preferred Stock
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
4,424,371
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12 [_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
13
49.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP NO. 172862104 13D PAGE 4 OF 14 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Reading Company 23-6000773
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
WC
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(E) [_]
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Pennsylvania
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF 1,564,473
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 1,564,473
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,564,473
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12 [_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
13
26.1%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
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CUSIP NO. 172862104 13D PAGE 5 OF 14 PAGES
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- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Reading Holdings, Inc. 51-0353118
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
WC
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(E) [_]
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF 1,564,473
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 1,564,473
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,564,473
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12 [_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
13
26.1%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Page 6 of 14 Pages
This joint filing made by Reading Company, a Pennsylvania corporation
("Reading"), Craig Corporation, a Delaware corporation ("Craig") and Reading
Holdings, Inc., a Delaware corporation ("Holdings" and collectively with Craig
and Reading the "Filers") relates to the Common Stock, $0.01 par value of
Citadel Holding Corporation, a Delaware corporation ("Citadel" or the "Issuer").
With respect to Craig, this filing is Amendment No. 24, which amends and
supplements the Schedule 13D, dated June 5, 1987, and Amendments thereto
(collectively, the "Craig Schedule 13D") filed by Craig, relating to beneficial
holdings of shares of Common Stock of Citadel. All capitalized terms used herein
and not otherwise defined shall have the respective meanings assigned to such
terms in the Craig Schedule 13D. The information provided below under Items 1
through 7 with respect to Craig is intended to amend the Schedule 13D
information previously provided by Craig.
With respect to Reading and Holdings, this is the initial filing on
Schedule 13D.
ITEM 1. SECURITY AND ISSUER.
-------------------
This Schedule 13D relates to the Common Stock, $.01 par value per share
(the "Common Stock"), of Citadel, whose principal executive offices are located
at 550 South Hope Street, Suite 1825, Los Angeles, California 90071.
ITEM 2. IDENTITY AND BACKGROUND.
-----------------------
The persons filing this Amendment No. 24 and this Initial Filing on
Schedule 13D are respectively Craig Corporation, a Delaware corporation, whose
principal business and office address is 550 S. Hope Street, Suite 1825, Los
Angeles, California 90071, Reading Company, a Pennsylvania corporation, whose
principal business and office address is 30 South 15th Street, Suite 1300,
Philadelphia, Pennsylvania 19102 and Reading Holdings, Inc., a Delaware
corporation whose principal business and office address is 103 Springer Building
3411 Silverside Road, Wilmington, Delaware 19810.
Craig has historically been in the retail grocery business through its
interest in Stater Bros. Holdings, Inc. ("Stater"), in the real estate business
through its interest in Citadel and in the beyond-the-home entertainment and
real estate business through its interest in Reading and, more recently, through
its interest in Reading International Cinemas, LLC (a limited liability company
owned in equal parts by Craig and Reading, and formed to pursue cinema
exhibition opportunities in Australia). On March 8, 1996, Stater exercised its
right to convert Craig's common stock interest in that Company into preferred
stock. In light of this action by Stater, Craig has determined to focus its
activities going forward on the land-based entertainment industry --
<PAGE>
Page 7 of 14 Pages
particularly on the development, ownership and operation of cinemas.
Reading's and Holdings' business focuses on the beyond-the-home segment of
the entertainment industry at present, consists primarily of motion picture
theater development and operations. Reading also engages in real estate
activities through ownership, sale or development of certain real estate in
Pennsylvania and participation in two real estate joint ventures. Holdings is a
wholly-owned subsidiary of Reading.
Provided below is a list of officers and directors for Craig, Reading and
Holdings. Also provided are the business addresses and the principal business
occupation of each parties listed below.
The executive officers and directors of Craig Corporation are:
Directors Officers
--------- --------
James J. Cotter James J. Cotter, Chairman
S. Craig Tompkins S. Craig Tompkins, President
William D. Gould Robin W. Skophammer
Edward L. Kane Chief Financial Officer
Gerard P. Laheney
Ralph B. Perry III
The executive officers and directors of Reading Company are:
Directors Officers
--------- --------
James J. Cotter James J. Cotter, Chairman
S. Craig Tompkins S. Craig Tompkins, President
Edward L. Kane James A. Wunderle
Gerard P. Laheney Executive Vice President
Ralph B. Perry III Chief Operating Officer
John W. Sullivan Chief Financial Officer
Albert J. Tahmoush & Treasurer
The executive officers and directors of Reading Holdings are:
Directors Officers
--------- --------
S. Craig Tompkins S. Craig Tompkins, President
James A. Wunderle James A. Wunderle
Charles S. Groshon Vice President & Treasurer
Charles S. Groshon
Vice President & Secretary
<PAGE>
Page 8 of 14 Pages
Business Address and Principal Business Occupation
--------------------------------------------------
James J. Cotter S. Craig Tompkins
Pacific Theatres Craig Corporation
120 North Robertson Boulevard 550 South Hope Street
Los Angeles, CA 90048 Suite 1825
Tel: (310) 855-8331 Los Angeles, CA 90071
Fax: (310) 855-0114 Tel: (213) 239-0555
Principal Business Occupation: Fax: (213) 239-0548
Chairman of Craig, Reading and Principal Business Occupation:
Citadel, Executive Vice Director and President of Craig and
President of Decurion (Pacific Reading, Vice Chairman and Principal
Theatres) Accounting Officer of Citadel
William D. Gould, Esq. Edward L. Kane
Troy & Gould 7816 Ivanhoe Street
1801 Century Park East Suite 12
16/th/ Floor La Jolla, CA 92039
Los Angeles, CA 90067 Tel: (619) 495-2950
Tel: (310) 553-4441 Fax: (619) 459-2952
Fax: (310) 201-4746 Principal Business Occupation:
Principal Business Occupation: Attorney and Business
Attorney Consultant
Gerard P. Laheney Ralph B. Perry III
Investment Resource Intl. Graven Perry Block
1101 Brickell Avenue Brody & Qualls
Suite 1401 Pacific Mutual Building
Miami, FL 33131 523 West Sixth Street
Tel: (305) 372-0299 Suite 1130
Fax: (305) 372-0499 Los Angeles, CA 900l4
Principal Business Occupation: Tel: (213) 680-9770
Investment Advisor Fax: (213) 489-1332
Principal Business Occupation:
Attorney
John W. Sullivan Albert J. Tahmoush
Loblolly Pines 7231 Tory Lane
7407 S.E. Hill Terrace Bay Colony Shores
Hobe Sound, FL 33455 Naples, FL 33963
Tel: (407) 546-8700 Tel: (813) 597-8085
Fax: (407) 546-1062 Principal Business Occupation:
Principal Business Occupation: Private Investor; Director and
Private Investor and Real Deputy Chairman of UBAF Arab
Estate Developer American Bank.
<PAGE>
Page 9 of 14 Pages
James A. Wunderle Robin W. Skophammer
Reading Company Craig Corporation
One Penn Square West 550 South Hope Street
30 South Fifteenth Street, Suite 1825
Suite 1300 Los Angeles, CA 90071
Philadelphia, PA 19102-4813 Tel: (213) 239-0555
Tel: (215) 569-3344 Fax: (213) 239-0548
Fax: (215) 569-2862 Principal Business Occupation:
Principal Business Occupation: Chief Financial Officer of
Executive Vice President, Chief Craig
Operating Officer, Chief
Financial Officer and Treasurer
of Reading
Charles S. Groshon
Reading Company
One Penn Square West
30 South Fifteenth Street
suite 1300
Philadelphia, PA 19102-4813
Tel: (215) 569-3344
Fax: (215) 569-2862
Principal Business Occupation:
Vice President and Assistant
Secretary of Reading
None of the filers or any of the above referenced persons has been involved in
any proceeding of the type described in (d) of Item 2 to the Schedule 13D.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
-------------------------------------------------
The source of funds for Craig's purchase of 53,000 shares of Issuer's
Common Stock is working capital. The total net consideration amounted to
approximately $119,478.
Through Holdings, Reading acquired 1,564,473 shares of Citadel Common Stock
from Craig pursuant to a Stock Purchase and Sale Agreement dated March 29, 1996
between Holdings and Craig (the "Agreement"), a copy of which is attached hereto
as Exhibit 1. The purchase price for such shares was $3,324,505, which was paid
by Holdings delivering its promissory note, bearing interest payable quarterly
in arrears at a fluctuating rate equal to 30 day LIBOR plus 225 basis points,
with principal of the note due on March 29, 2001 (the "Common Stock Purchase
Note"). Holdings intends to satisfy its note obligations from working capital,
which may include capital contributed by Reading. See Item 4 for a further
description of the Agreement.
<PAGE>
Page 10 of 14 Pages
ITEM 4. PURPOSE OF TRANSACTION.
----------------------
The Board of Directors of Reading and Craig on March 28, 1996 authorized
and approved the purchase and sale, pursuant to the Agreement, of all of the
shares of Citadel Common Stock owned by Craig, being 1,564,473 shares (the
"Shares"), to Holdings, a wholly owned subsidiary of Reading, for $3,324,505,
approximately $2.125 per share, such amount to be paid in the form of the Common
Stock Purchase Note. That transaction closed on March 29, 1996.
In addition, as a part of the same transaction, Craig granted Holdings an
option (the "Preferred Stock Option") exercisable for a period of 12 months
commencing on the later of (i) the tenth business day following the next annual
meeting of stockholders of Citadel and (b) July 1, 1996, to purchase all of the
shares of Citadel's 3% Cumulative Voting Convertible Preferred Stock (the
"Preferred Stock"), stated value $3.95 per share, owned by Craig, being
1,329,114 shares. The exercise price is the fair market value of the Preferred
Stock as determined by an investment banking firm to be mutually agreed upon and
is payable in the form of a promissory note having the same terms (including the
due date) and form as the Common Stock Purchase Note. If Holdings determines to
acquire (the "Acquisition Transaction") enough additional shares of Citadel
Common Stock to permit the consolidation of Holdings and Citadel for Federal
income tax purposes, then the purchase price will be the price paid by Holdings
to Citadel Common Stock stockholders and the form of the consideration will be
the same form paid to such Citadel stockholders. An option fee of $50,000 was
paid by Holdings. The option fee will be credited against the exercise price if
Holdings elects to exercise the Preferred Stock Option. The Preferred Stock
Option can be extended for an additional 12 months by increasing the option fee
to $100,000 through the payment of an additional $50,000.
Craig has also granted Holdings, as a part of the same transaction, an
option (the "Warrant Option") exercisable in the event that Holdings determines
to enter into an Acquisition Transaction to acquire Craig's warrant (the
"Warrant") to purchase 666,000 shares of Citadel Common Stock at $3.00 per
share. The Warrant expires on April 11, 1997. The exercise price is a price per
share equal to the price paid to Citadel stockholders in the Acquisition
Transaction, less $3.00. If Craig exercises the Warrant, the Warrant Option will
apply to the underlying shares of Citadel Common Stock and the exercise price
will be the same price per share and will be paid in the same manner as the
consideration paid to Citadel stockholders in the Acquisition Transaction.
In the event that Holdings determines to effectuate an Acquisition
Transaction, Craig can put the Preferred Stock and the Warrant (or the Common
Stock underlying the Warrant) to Holdings on the same terms as if Holdings had
exercised the Preferred Stock Option and the Warrant Option.
<PAGE>
Page 11 of 14 Pages
Craig owns 49% of the issued and outstanding Class A Common Stock of
Reading and five of the seven members of the Board of Directors of Reading are
also members of the Board of Directors of Craig. James J. Cotter and S. Craig
Tompkins are respectively the Chairman of the Board and President of both Craig
and Reading. Together, Craig and Reading own securities representing
approximately 40% of the currently outstanding voting power of Citadel. Assuming
exercise in full of the conversion feature of the Citadel Preferred Stock and
the Warrant, Craig and Reading would control approximately 49.9% of such voting
power.
Three of the five directors of Citadel are also directors of Craig, and of
these three directors, two are also directors of Reading. The Chairman of the
Board of Citadel is also the Chairman of the Board of each of Craig and Reading
and the Vice Chairman of the Board and Principal Accounting Officer of Citadel
is also a director and the President of each of Craig and Reading.
Reading determined to purchase the Shares as it believes that the price and
terms on which such shares were offered presented an attractive opportunity for
Reading and that Citadel's real estate business and expertise complements and
reflects Reading's involvement in and commitment to the land-based entertainment
business. The Preferred Stock Option and the Warrant Option were acquired in
order to provide to Reading the ability, should it so elect, to acquire a
controlling interest in Citadel. However, no determination has been made at
this time to in fact increase Reading's interest to such levels, and no
assurances can be given that Reading will ultimately determine to acquire a
controlling or greater interest in Citadel.
Either Craig and/or Reading may, from time to time, determine to purchase
additional Citadel securities or to sell their interests in some or all of such
securities depending upon a variety of factors, including, without limitation,
the price at which such securities are available, the other demands upon the
working capital of Craig and/or Reading, and the business prospects and
opportunities available for Craig, Reading and/or Citadel.
As a consequence of the sale to Reading, Craig will recognize for its tax
year ended June 30, 1996, a capital loss of approximately $18 million, which may
be carried forward for up to 5 years. For financial reporting purposes, the
amount of loss or gain to Craig resulting from the sale of Citadel Common Stock
will be de minimus.
Reading and Craig have determined to file as a "group" not because of any
common plan, agreement or understanding between the two companies as to the
voting, acquisition or disposition of the shares, but rather to reflect the fact
that Craig currently owns over 49% of the Common Stock of Reading and the
overlapping
<PAGE>
Page 12 of 14 Pages
composition of the boards of directors and senior management of the
two companies.
The officers and directors of Craig and/or Reading who also serve as
officers or directors of Citadel (the "Common Management") may from time to time
have information with respect to and be involved in decision making with respect
to possible transactions of the sort described in paragraphs (a) through (j) of
Item 4 of Schedule 13D ("Covered Transactions"). To the extent that any Covered
Transaction is developed or proposed by or on behalf of the Issuer, or jointly,
rather than by Craig, Reading and/or Holdings, the Filers do not intend to make
preemptive disclosure of such matters in filings on Schedule 13D based upon the
knowledge or involvement of the Common Management. Given the dual capacities of
the Common Management and the resulting importance of independent Craig, Reading
and/or Holdings Board approval of any Covered Transaction involving the Issuer,
the Filers do not believe that any plan or proposal for a Covered Transaction
involving Craig, Reading and/or Holdings and the Issuer may be properly
characterized as a plan or proposal of any one or more of the Filer(s) absent
appropriate action of the Board of Directors of such Filer(s). Accordingly, the
absence of any disclosure of possible Covered Transactions by the Filers should
not be interpreted as an indication that no Covered Transaction is being
considered or acted upon by the Issuer or being considered by members of Common
Management at any given point in time.
The Stock Purchase and Sale Agreement was reviewed, negotiated and approved
by a special committee of the Reading Board of Directors composed of independent
directors unaffiliated with Craig or Citadel.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
------------------------------------
(a) Craig's responses in Items 7, 9, 11 and 13 of the Cover Page of
this Amendment No. 24 include (1) 1,564,473 outstanding shares of Common Stock
owned beneficially by Craig, (2) 666,000 shares of Common Stock issuable upon
exercise of a warrant (the "Warrant Shares") granted by the Issuer to Craig
pursuant to a Conversion Deferral, Warrant and Reimbursement Agreement (the
"Warrant Agreement") as described in Amendment 15 dated April 3, 1995 and (3)
2,193,898 shares of Common Stock (the "Conversion Shares") issuable upon
conversion of 1,329,114 shares of 3% Cumulative Voting Convertible Preferred
Stock (the "Preferred Stock"), stated value $3.95 per share, of the Issuer,
which are convertible under certain circumstances into shares of Common Stock as
described in Amendments 14, 15 (dated December 7, 1994) and 15 (dated April 3,
1995) to Schedule 13D beginning February 4, 1996.
The 2,193,898 Conversion Shares would be issuable assuming Craig's optional
conversion in full of the Preferred Stock at a conversion price equal to the
"Market Price" per share as defined
<PAGE>
Page 13 of 14 Pages
in the Certificate of Designation of the Preferred Stock (the "Certificate of
Designation"), a copy of which was included as part of Exhibit A to Amendment
No. 14 to this Schedule 13D. Assuming a conversion on March 27, 1996, such
Market Price would have been $2.393. The actual number of Conversion Shares that
may be acquired by Craig by reason of the Preferred Shares may vary depending
upon, assuming other things, the Market Price and the number of Shares
outstanding at the time of any optional conversion and is subject to other
adjustments and limitations pursuant to the terms of the Certificate of
Designation.
Pending any conversion of the Preferred Stock pursuant to the conversion
features of the Preferred Stock, the holders of the Preferred Stock will be
entitled to one vote per share of Preferred Stock on all matters submitted to
the Issuer's stockholders and will vote together with the holders of the
Issuer's Common Stock as a single class with respect to such matters. The
Common Stock beneficially owned by Craig, as reported above, together with the
Warrant Shares and Preferred Stock, represents approximately 49.9% of the
aggregate combined voting power of the outstanding shares of the Issuer assuming
issuance of 2,193,898 Conversion Shares and assuming the exercise in full of the
Warrant.
Reading's and Holdings' responses in Items 7, 9, 11 and 13 of the Cover
Page of this Schedule 13D reflect its beneficial ownership of 1,564,473 shares
of Common Stock.
(b) See Items 7, 8, 9 and 10 of the Cover Pages and the information
in Item 1 concerning the calculation of the combined voting power represented by
the securities of the Issuer beneficially owned by Craig, Reading and Holdings.
(c) Craig has engaged in the following transactions in Common Stock
of the Issuer since the filing of Amendment No. 23 to this Schedule 13D, all of
which were effectuated on the American Stock Exchange.
<TABLE>
<CAPTION>
Shares Price
Date Purchased Per Share
---- --------- ---------
<S> <C> <C>
12/18/95 5,500 $2.25
12/29/95 47,500 $2.25
</TABLE>
Reading and Holdings have engaged in the transactions described above under
Items 3 and 4 above.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
-------------------------------------------------------------
RESPECT TO SECURITIES OF THE ISSUER.
-----------------------------------
See Item 4 above for a description of the Stock Purchase and
<PAGE>
Page 14 of 14 Pages
Sale Agreement between Craig and Holdings pursuant to which Craig sold its
shares of the Issuer's Common Stock to Holdings and granted Holdings an option
to purchase Craig's shares of the Issuer's Preferred Stock and Craig's Warrant
to purchase 666,000 shares of Issuer's Common Stock.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
--------------------------------
Exhibit 1 - Stock Purchase and Sale Agreement dated as of March 29, 1996
by and between Craig Corporation and Reading Holdings, Inc.
SIGNATURES
----------
After reasonable inquiry and to the best of my knowledge and belief, the
undersigned certifies that the information set forth in this Statement is true,
complete and correct.
Dated: April 5, 1996 CRAIG CORPORATION,
a Delaware corporation
By:/s/ Craig Tompkins
------------------
S. Craig Tompkins
President
Dated: April 5, 1996 READING COMPANY,
a Pennsylvania corporation
By:/s/ Craig Tompkins
------------------
S. Craig Tompkins
President
Dated: April 5, 1996 READING HOLDINGS, INC.
a Pennsylvania corporation
By:/s/ S. Craig Tompkins
---------------------
S. Craig Tompkins
<PAGE>
EXHIBIT 1
STOCK PURCHASE AND SALE AGREEMENT
This STOCK PURCHASE AND SALE AGREEMENT is entered into as of this 29th day
of March, 1996 by and between Craig Corporation, a Delaware corporation
("Seller") and Reading Holdings, Inc., a Delaware corporation ("Purchaser"), at
Purchaser's corporate headquarters located in Wilmington, Delaware and with
reference to the following facts:
WHEREAS, Seller is the owner of the following securities, issued by Citadel
Holding Corporation, a Delaware corporation ("Citadel"):
A. One Million Five Hundred Sixty Four Thousand Four Hundred Seventy
Three (1,564,473) shares (the "Common Shares") of common stock, par value $.01
per share (the "Common Stock");
B. One Million Three Hundred Twenty Nine Thousand One Hundred Fourteen
(1,329,114) shares (the "Preferred Shares") of 3% Cumulative Convertible
Preferred Stock, stated value $3.95 per share (the "Preferred Stock"); and
C. Warrants to purchase Six Hundred Sixty Six Thousand (666,000) shares
of Common Stock at an exercise price of $3.00 per share, expiring April 11, 1997
(the "Warrants"); and
WHEREAS, the closing price for Shares of Common Stock on the American Stock
Exchange as of the date immediately preceding the date hereof was $2.250; and
WHEREAS, Purchaser desires to purchase and Seller desires to sell the
Common Shares;
WHEREAS, Purchaser desires to acquire and Seller desires to grant options
to acquire the Preferred Shares and the Warrants on the terms set forth
hereinbelow:
THE PARTIES HERETO in consideration of the above stated premises, the terms
and conditions hereinbelow set forth, and other good and valid consideration,
the receipt and sufficiency of which is hereby acknowledged, do hereby agree as
follows:
1. The Common Stock.
----------------
1.1 Purchase Price. The purchase price of the Common Shares will be
--------------
Three Million Three Hundred Twenty Four Thousand Five Hundred Five Dollars
($3,324,505), representing a purchase price of slightly less than $2.125 per
share.
<PAGE>
1.2 Form of Payment. The Purchase Price will be paid at the Closing
---------------
(as defined in Section 5) in the form of Purchaser's promissory note in the
amount of the purchase price (the "Note"). The Note will have a term of five
(5) years, bear interest at that fluctuating rate equal from time to time to
thirty (30) day LIBOR plus two hundred twenty-five (225) basis points payable
quarterly in arrears, and otherwise be on the terms set forth in Exhibit 1,
hereto.
2. The Preferred Stock.
-------------------
2.1 Preferred Purchase Option. Effective at the Closing, Seller
-------------------------
hereby grants to the purchaser an option (the "Preferred Purchase Option")
exercisable for a period of twelve (12) months, commencing upon the later of (a)
the tenth (10th) business day following the next annual meeting of the
stockholders of Citadel and (b) July 1, 1996 to purchase all, but not less than
all, of the Preferred Shares or such securities into which such Preferred Shares
may have been converted (the "Preferred Securities"). Seller will use
commercially reasonable efforts to have the conversion feature of the Preferred
Stock considered by the shareholders of Citadel at the next meeting of such
Shareholders.
2.2 Exercise Price. The exercise price will be equal to the fair
--------------
market value on the Preferred Securities on the date of exercise, as determined
by an investment banking firm mutually and reasonably agreeable to Purchaser and
Seller; provided, however, that in the event that (i) Purchaser has determined
to enter into an Acquisition Transaction (as such term is defined in Section
3.1, below) and (ii) Seller has, prior to the closing of any transfer following
exercise of the Preferred Purchase Option, exercised its right to convert the
Preferred Shares into Common Stock, then the exercise price with respect to such
Common Stock shall be the same price and the form of payment will be in the same
form as paid to third party shareholders of Citadel Common Stock (the
"Independent Shareholders") in such Acquisition Transaction.
The cost and expense of any such investment banker will be shared
equally between the Purchaser and the Seller.
2.3 Form of Payment. The Exercise Price will be paid upon the
---------------
closing of the sale of such Preferred Shares in the form of a further note (the
"2nd Note") issued by Purchaser in the amount of the Exercise Price (less the
amount of any fees paid under Section 2.5, below), which 2nd Note will be in the
same form as the Note, carry interest at the same rate as specified in the Note,
and have a term co-terminus with the Note.
2.4 Notice and Closing. Purchaser shall give to
------------------
<PAGE>
Seller not less than forty-five (45) days notice of its determination to
exercise the Preferred Purchase Option. Purchaser and Seller shall thereafter
work in good faith to designate a mutually acceptable investment banker, so as
to permit a timely closing of the sale.
2.5 Option Fee. Purchaser will pay to the Seller at the Closing an
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Option Fee of Fifty Thousand Dollars ($50,000) which amount will be credited
against the Exercise Price in the event of the exercise by Purchaser of the
Preferred Purchase Option. In the event that Purchaser wishes to extend the
Preferred Purchase Option so that the total option term is two years rather than
one year, Purchaser may do so at any time prior to the expiration of the
Preferred Purchase Option by increasing the Option Fee paid to Seller to One
Hundred Thousand Dollars ($100,000) by delivery to Seller on or before the
expiration of the Preferred Purchase Option the sum of an additional Fifty
Thousand Dollars ($50,000).
2.6 Assignment. This Preferred Purchase Option is personal to the
----------
Purchaser and may not be transferred to any other Person or entity without the
approval of Seller, which may be withheld or granted in the sole discretion of
the Seller; provided, however, that the Preferred Purchase Option may be
assigned to any wholly owned subsidiary of the Purchaser without any such
approval, provided that (a) the Common Shares and the Warrant Purchase Option
(as defined below) are simultaneously transferred to and retained by such
affiliate and (b) such affiliate executes and delivers to Seller its written
agreement to be bound by the terms of this Agreement (an "Approved Transfer").
The Preferred Purchase Option will immediately terminate upon any transfer of
the Common Shares by the Purchaser, other than an Approved Transfer.
3. The Warrants.
3.1 The Warrant Purchase Option. Effective at the Closing, Seller
---------------------------
hereby grants to Purchaser an option (the "Warrant Purchase Option") exercisable
in the event that the Purchaser determines, by a resolution duly adopted by its
Board of Directors, to proceed with an acquisition (through merger, asset
purchase, tender offer or otherwise) of an equity interest in Citadel sufficient
to permit the consolidation of Citadel and the Purchaser for Federal Income Tax
purposes (an "Acquisition Transaction"), to acquire the Warrants simultaneously
with the consummation of such transaction. It is understood that Seller will
have no obligation to exercise the Warrants or to acquire the underlying Common
Stock.
3.2 Exercise Price. The exercise price for the Warrant Purchase
--------------
Option will be that amount equal to the
<PAGE>
difference between $3.00 per share and the price per share being paid to
Independent Shareholders in the Acquisition Transaction. Seller may elect to
receive such consideration either in cash or, if Independent Shareholders are
being paid in whole or in part in securities in the form of such securities. In
the event that, as of the time of the closing of the Acquisition Transaction,
Seller has exercised the Warrants, in whole or in part, and paid the purchase
price for the underlying Common Stock, then to such extent such underlying
Common Stock, and not the Warrants, will be the subject of this Warrant Purchase
Option, and the exercise price with respect to such shares of Common Stock will
be the same consideration as paid to Independent Shareholders.
3.3 Exercise and Closing. The Warrant Purchase Option may be
--------------------
exercised at any time on not less than twenty (20) days written notice from the
Purchaser to the Seller. The closing will be simultaneous with the closing of
the Acquisition Transaction, and the closing of the Acquisition Transaction will
be a condition precedent to the obligation of the Seller to sell and of the
Purchaser to purchase.
3.4 Term. The term of the Warrant Purchase Option is the same as the
----
Preferred Purchase Option as modified by Section 3.3.
3.5 Assignment. The Warrant Purchase Option is subject to the
----------
provisions of Section 2.6.
4. Seller's Put Option. In the event that Purchaser determines, by a
-------------------
resolution duly adopted by its Board of Directors, to proceed with an
Acquisition Transaction, then Seller will have the right to put to Purchaser the
Preferred Securities, the Warrants and/or the Common Stock underlying such
Warrants, as the case may be, to the Purchaser on the same terms as if the
Purchaser had exercised the Preferred Purchase Option and/or the Warrant
Purchase Option.
5. The Closing. The Closing will be held at 1:00 p.m., Wilmington local
-----------
time, on March 29, 1996, at the offices of the Purchaser in Wilmington,
Delaware, or at such other location as the parties hereto may determine.
6. Representations and Warranties.
------------------------------
6.1 Due Authority. Each party hereby represents, subject to the
-------------
receipt of appropriate Board approvals, that it has all necessary corporate
power and authority and that it has taken all necessary corporate action
required to perform its obligations under this Agreement.
6.2 Good Title. Seller hereby represents that it has
----------
<PAGE>
good and marketable title to the Common Stock, the Preferred Stock and the
Warrants, and that it is permitted to and will transfer such securities free and
clear of all liens, claims or other encumbrances.
6.3 Unregistered Securities. Purchaser acknowledges that Seller is
-----------------------
an affiliate of Citadel, and that the Preferred Stock and the Warrants have not
been registered with any state or federal authority and that the Preferred Stock
and Warrants are not traded on any securities exchange. Accordingly, Purchaser
represents that it is acquiring the Common Stock, the Preferred Purchase Option
and the Warrant Purchase Option in a privately negotiated transaction, with an
intention to hold such securities for the indefinite future, and without any
intention to engage in a public distribution of such securities.
7. Board Approval. The obligations of the Purchaser and the Seller are
--------------
subject to the approval of this agreement on or before 1:00 p.m., Wilmington
local time, on March 29, 1996.
8. Miscellaneous Provisions.
------------------------
8.1 Integrated Agreement. This Agreement sets forth all of the
--------------------
agreements of the parties with respect to the subject matter hereof.
8.2 Choice of Law. This Agreement will be interpreted in accordance
-------------
with the laws of the State of Delaware, as such laws govern contracts to be made
and performed within such State. Any dispute between the parties with respect
to this agreement will be adjudicated solely in the state or federal courts
sitting in Wilmington, Delaware, and both parties consent to the jurisdiction of
such court.
8.3 Notices. Any notice required or permitted by this Agreement
-------
shall be deemed delivered when personally delivered or on the fourth (4th)
business day after deposit in the U.S. Mail, postage paid, registered or
certified mail and addressed to the recipient at its corporate headquarters
address.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
entered into as of the date first set forth above.
CRAIG CORPORATION READING HOLDINGS, INC.
By: By:
--------------------------------- ---------------------------------
Its: Its:
-------------------------------- --------------------------------
<PAGE>
EXHIBIT 1
FORM OF PROMISSORY NOTE
$3,324,505 March 29, 1996
FOR VALUE RECEIVED, READING HOLDINGS, INC., a Delaware corporation
(the "Maker") hereby promises to pay to the order of CRAIG CORPORATION, a
Delaware corporation (the "Payee") the principal sum of Three Million, Three
Hundred Twenty-Four Thousand, Five Hundred Five Dollars ($3,324,505) according
to the terms hereof.
1. Defined Terms. All terms capitalized herein but not defined shall
-------------
have the meanings ascribed to them in that certain Stock Purchase and Sale
Agreement dated the date hereof between Payee and Maker.
2. Payment of Principal and Interest. Interest shall accrue on the
---------------------------------
outstanding principal amount hereunder at an annual rate of LIBOR plus 2.25%,
and shall be paid to Payee quarterly in arrears commencing July 1, 1996 and on
each October 1, January 1, April 1 and July 1 thereafter, with a final payment
of all accrued and unpaid interest being made on the date on which all
outstanding principal hereof is paid in full. For purposes of this Promissory
Note ("Note") "LIBOR" shall mean the London Interbank Offered Rate for thirty-
day deposits as published in The Wall Street Journal three business days prior
to the first day of each month. The principal amount due hereunder shall be due
and payable on March 29, 2001. This Note may be prepaid in whole or in part at
any time without penalty or prepayment charge.
3. Place of Payment. All amounts payable by the Maker to the Payee
----------------
hereunder shall be paid directly to the Payee at its address as set forth in
paragraph 11 hereof, or at such other address of which the Payee shall give
written notice to the Maker.
4. Representations and Warranties of Maker. The Maker represents and
---------------------------------------
warrants that as of the date hereof:
(a) Maker is a corporation duly incorporated and organized in
accordance with the laws of the State of Delaware with all necessary powers to
own its properties and operate its business as now owned and operated by it;
(b) Maker has full power and authority to enter into this Note and
Maker has taken or caused to be taken all actions required to authorize the
approval, execution and consummation of the transactions contemplated by this
Note. This Note is a valid and binding obligation of Maker, enforceable against
Maker in
<PAGE>
accordance with its terms, except (i) as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors, rights and (ii) that the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefore may be brought; and
(c) Neither the execution and delivery of this Note, nor the
consummation of the transactions contemplated hereby, will (i) violate any
provision of the Certificate of Incorporation or Bylaws of Maker, (ii) violate,
or be in conflict with, or constitute a default under, or permit the termination
of, or cause the acceleration of the maturity of any debt or obligation of
Maker, (iii) require the consent of any other party, or result in the creation
or imposition of any security interest, lien or other encumbrance upon any
property or assets of Maker under any agreement or commitment to which Maker is
a party or by which Maker is bound, or (iv) violate any statute or law or any
judgment, decree, order, regulation or rule of any court or governmental
authority to which Maker is subject.
5. Events of Default; Remedies. If any of the following events of
---------------------------
default ("Events of Default") shall occur and be continuing for any reason
whatsoever (and whether it shall be voluntary or involuntary or occur or be
affected by operation of law or otherwise):
(a) the Maker fails to make any payment when due of any principal or
interest or other sum payable under this Note, which failure remains uncured for
a period of five days after written notice thereof from Payee;
(b) the Maker shall (i) file, or consent by answer or otherwise to the
filing against it of, a petition for relief or reorganization or arrangement or
any other petition in bankruptcy, for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, (ii) make an assignment for
the benefit of its creditors, (iii) consent to the appointment of a custodian,
receiver, trustee or other officer with similar powers with respect to it or
with respect to any substantial part of its property, (iv) be adjudicated
insolvent or be liquidated, or (v) take appropriate action for the purpose of
any of the foregoing; or
(c) a court or governmental authority of competent jurisdiction shall
enter an order appointing, without consent by the maker, a custodian, receiver,
trustee or other officer with similar powers with respect to it or with respect
to any substantial part of its property, or if an order for relief shall be
entered in any case or proceeding for liquidation or
<PAGE>
reorganization or otherwise to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding-up or liquidation
of the Maker, or if any petition for any such relief shall be filed against the
Maker, and such order or petition shall not be dismissed within sixty (60) days;
then, automatically upon the occurrence of an Event of Default described in
subparagraph (b) or (c), or in the sole discretion of the Payee upon the
occurrence of an Event of Default described in subparagraph (a), the unpaid
principal amount of, and the unpaid interest on, this Note shall become
immediately due and payable, without presentment, demand, protest or other
requirements of any kind, all of which are hereby expressly waived by the Maker.
6. Additional Remedies. If any Event of Default shall have occurred
-------------------
and be continuing, the Payee may proceed to protect and enforce its rights under
this Note by exercising such remedies as are available to the Payee in respect
thereof under applicable law, either by suit in equity or by action at law, or
both, whether for specific performance of any agreement contained in this Note
or in aid of the exercise of any power granted in this Note. No remedy is
intended to be exclusive and each such remedy shall be cumulative.
7. No Waiver. Neither the failure of the Payee nor any delay on the
---------
part of the Payee in the exercise of any right, power or privilege under this
Note shall operate as a waiver thereof, nor shall any single or partial exercise
by the Payee of any right, power, or privilege preclude any other or further
exercise of that or any other right, power or privilege.
8. Expenses. The Maker shall reimburse the Payee promptly for all
--------
reasonable counsel fees, costs and other expenses incurred by the Payee in
connection with the enforcement and collection of this Note.
9. Payment Due on Holidays. If the principal of or interest on this
-----------------------
Note or any fee due hereunder falls due on a Saturday, Sunday or legal holiday
at the place of payment, such payment shall be made on the next succeeding
business day and such extended time shall be included in computing interest.
10. Applicable Law. The construction, interpretation and enforcement
--------------
of this Note shall be governed by the laws of the State of Delaware.
11. Notices. Every notice and communication under this Note shall be
-------
in writing and shall be given by either (i) hand delivery, (ii) first class mail
(postage prepaid), (iii) reliable overnight commercial courier (charges
prepaid), or (iv) telecopy or other means of electronic transmission, if
confirmed promptly by any of the methods specified in clauses (i), (ii) and
(iii) of
<PAGE>
this sentence, to the following addresses:
If to the Maker:
Reading Holdings, Inc.
103 Springer Building
3411 Silverside Road
Wilmington, DE 19810
If to the Payee:
Craig Corporation
550 South Hope Street
Suite 1825
Los Angeles, CA 90071
Notice given by telecopy or other means of electronic transmission shall be
deemed to have been given and received when sent. Notice by overnight courier
shall be deemed to have been given and received on the date scheduled for
delivery. Notice by mail shall be deemed to have been given and received three
(3) calendar days after the date first deposited in the United States Mail.
Notice by hand delivery shall be deemed to have been given and received upon
delivery.
A party may change its address by giving written notice to the other party
as specified herein.
12. Severability. If any provision in this Note shall be held invalid
------------
under any applicable law, such invalidity shall not effect any other provision
of this Note that can be given effect without the invalid provision and, to this
end, the provisions hereof are severable.
13. Successors and Assigns. This Note shall be binding upon the Maker and
----------------------
its successors and assigns, and shall inure to the benefit of the Payee and its
successors and assigns, provided that Maker may not assign any of its rights or
obligations hereunder or any interest herein without the written consent of
Payee. Payee may assign this Note or any interest herein without restriction,
and upon written notice being given to Maker of such assignment, the assignee
shall be deemed to be the Payee for all purposes hereunder.
14. Waiver of Demand, Presentment, etc. The Maker waives the requirements
-----------------------------------
of demand, presentment, protest, notice of protest and dishonor and all other
demands or notices of any kind in connection with the delivery, acceptance,
performance, default, dishonor or enforcement of this Note.
<PAGE>
IN WITNESS WHEREOF, and intending to be legally bound hereby, Reading
Holdings, Inc. has caused this Note to be executed and delivered by its proper
and duly authorized officer as of the date first above written.
READING HOLDINGS, INC.
By:
----------------------------------
