UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)
HOMEOWNERS GROUP, INC.
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(Name of Issuer)
Common Stock, $0.01 Par Value
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(Title of Class of Securities)
43739N107
---------------------------------------------
(CUSIP Number)
Mr. Howard L. Wolk, President
NAPAQ Corporation
4040 Mystic Valley Parkway
Boston, MA 02155
-with copies to-
Robert M. Rosen, Esq.
Lane Altman & Owens LLP
101 Federal Street
Boston, Massachusetts 02110
(617) 345-9800
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(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
May 1, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
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 13-d(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).
SCHEDULE 13D
CUSIP No. 43739N107 Page 2 of 15 Pages
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1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person NAPAQ Corporation
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2 Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [X]
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3 SEC Use Only
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4 Source of Funds* WC
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5 Check Box if Disclosure of Legal Proceeding is Required Pursuant to
Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization Nevada
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Number of 7 Sole Voting Power 126,000
Shares ___________________________________________________________
Beneficially 8 Shared Voting Power 0
Owned by ___________________________________________________________
Each 9 Sole Dispositive Power 126,000
Reporting ___________________________________________________________
Person With 10 Shared Dispositive Power 0
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11 Aggregate Amount Beneficially Owned by Each Reporting Person 126,000
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12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ]
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13 Percent of Class Represented by Amount in Row (11) 2.266%
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14 Type of Reporting Person* CO
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*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.
SCHEDULE 13D
CUSIP No. 43739N107 Page 3 of 15 Pages
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1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person Cross Country
Motor Club, Inc.
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2 Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [X]
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3 SEC Use Only
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4 Source of Funds* WC
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5 Check Box if Disclosure of Legal Proceeding is Required Pursuant to
Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization Massachusetts
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Number of 7 Sole Voting Power 362,500
Shares ___________________________________________________________
Beneficially 8 Shared Voting Power 0
Owned by ___________________________________________________________
Each 9 Sole Dispositive Power 362,500
Reporting ___________________________________________________________
Person With 10 Shared Dispositive Power 0
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11 Aggregate Amount Beneficially Owned by Each Reporting Person 362,500
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12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ]
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13 Percent of Class Represented by Amount in Row (11) 6.522%
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14 Type of Reporting Person* CO
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*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.
SCHEDULE 13D
CUSIP No. 43739N107 Page 4 of 15 Pages
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1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person Jeffrey C. Wolk
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2 Check the Appropriate Box if a Member of a Group* (a) [ ]
(b) [X]
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3 SEC Use Only
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4 Source of Funds* CA
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5 Check Box if Disclosure of Legal Proceeding is Required Pursuant to
Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization USA
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Number of 7 Sole Voting Power 3,000
Shares ___________________________________________________________
Beneficially 8 Shared Voting Power 0
Owned by ___________________________________________________________
Each 9 Sole Dispositive Power 3,000
Reporting ___________________________________________________________
Person With 10 Shared Dispositive Power 0
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11 Aggregate Amount Beneficially Owned by Each Reporting Person 3,000
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12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ]
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13 Percent of Class Represented by Amount in Row (11) .054%
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14 Type of Reporting Person* IN
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*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.
CUSIP No. 43739N107 Page 5 of 15 Pages
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This Amendment No. 2 relates to the Schedule 13D filed on behalf of the
Reporting Persons on April 4, 1996. The text of Items 3,4 and 7 of said Schedule
13D is hereby amended by the following:
Item 3. Source and Amount of Funds
The source of the funds used by CCMC to purchase securities of the
Issuer was working capital. The approximate aggregate amount of funds used by
CCMC to purchase such securities were $543,917 (exclusive of commissions and
other expenses).
The source of funds used by NAPAQ to purchase securities of the Issuer
was working capital. The approximate aggregate amount of funds used by NAPAQ to
purchase such securities were $154,299 (exclusive of commissions and other
expenses).
The source of funds used by Jeffrey C. Wolk to purchase securities of
the Issuer was cash assets. The approximate aggregate amount of funds used by
Mr. Wolk to purchase such securities were $10,500 (exclusive of commissions and
other expenses).
Item 4. Purpose of the Transaction
The Reporting Persons have acquired the shares of Common Stock in order
to obtain a substantial equity position in the Issuer.
In a letter dated April 12, 1996, the Issuer had agreed to engage in
discussions with CCG based upon public information. From such time, through the
date hereof, the Issuer has declined to meet for the purpose of having such
discussions. On April 29, 1996, the Reporting Persons received information
indicating that the Issuer may consummate a sale transaction with another
bidder, without holding sale negotiations with CCG. As a result, in letters
dated April 30, 1996 and May 1, 1996 (attached hereto as Exhibits D and E,
respectively), CCG advised the Issuer that it would consider such action to be a
breach of the Directors' duty to shareholders and, at the same time, increased
its offer. Based upon conversations with a representative of the Issuer, CCG
believes its revised offer warrants participation in negotiations for the sale
of the Issuer.
In a subsequent letter dated May 1, 1996 (attached hereto as Exhibit
F), CCG reiterated its desire to participate in open bidding for the purchase of
the Issuer and executed and forwarded to the Issuer a Confidentiality and
Standstill Agreement. As of the date hereof, the Issuer has not signed and
returned the Confidentiality and Standstill Agreement or agreed to meet to
negotiate with CCG and CCG continues to seek to be included in sale
negotiations.
CCG continues to consider, but has not decided whether or not to
pursue, other courses of action with respect to the Issuer, including: (i) the
possibility of a merger, purchase of all or substantially all of the Issuer's
assets, a business combination or other similar transaction between the Issuer
and CCG or any affiliate or subsidiary of CCG or a tender offer; (ii) the taking
of such actions as it deems appropriate to manage the business and affairs of
Issuer, including seeking control of the Issuer through designation of some or
all of the Issuer's Board of Directors or otherwise; and (iii) seeking judicial
remedies for actions by the Company and its directors which CCG considers to be
unlawful.
From time to time, the Reporting Persons will evaluate their positions
and may determine to acquire additional shares of the Issuer's Common Stock in
the open market, in privately negotiated transactions, by making a tender offer
or otherwise.
CUSIP No. 43739N107 Page 6 of 15 Pages
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CCG may continue to contact the Company and its representatives and may
contact other persons interested in the Issuer, or other interested persons, for
purposes of discussing the Issuer.
Whether CCG or the Reporting Persons decide to pursue any of the
courses of action above, including the purchase of additional shares of the
Issuer's Common Stock, and the amount and timing of any such purchases, will
depend on its continuing assessment of pertinent factors, including without
limitation the following: the availability of shares of the Issuer's Common
Stock for purchase at particular price levels; the Issuer's and CCG's business
and prospects; other business and investment opportunities available to CCG and
the Reporting Persons; economic conditions; stock market and money market
conditions; the attitude and actions of the management and Board of Directors of
the Issuer; the availability and nature of opportunities to dispose of the
Reporting Person's interest; and other plans and requirements of CCG.
Depending upon its assessment of these factors from time to time, the
Reporting Persons may change their present intentions as stated above or dispose
of some or all of the shares of Issuer's Common Stock held by them in the open
market, in privately negotiated transactions, to third parties or otherwise, and
may sell such shares to one or more purchasers. Although the foregoing
represents the range of activities presently contemplated by the Reporting
Persons with respect to the Issuer's Common Stock, the possible activities of
the Reporting Persons are subject to change at any time.
Except as set forth in this Item 4 and elsewhere in this Statement,
none of the Reporting Persons has any plans or proposals which relate to or
would result in any of the actions specified in clauses (a) through (j) of Item
4 of Schedule 13D, and each of the foregoing persons reserves the right to
change its intentions with respect to any of the foregoing at any time without
notice.
Item 5. Interest in Securities of the Issuer
(a) The beneficial ownership by each of the Reporting Persons of Common
Stock of the Issuer as of the date hereof is as follows:
<TABLE>
<CAPTION>
No. of Shares Deemed Nature of Ownership Percentage of Class
to be Beneficially Owned:
<S> <C> <C>
126,000 The record ownership and economic 2.266%
interest in such shares is held
by NAPAQ.
362,500 The record ownership and economic 6.522%
interest in such shares is held
by CCMC.
3,000 The record ownership and economic .054%
interest in such shares is held
by Jeffrey C. Wolk.
============== ===============
491,500 8.842%
</TABLE>
Collectively, the Reporting Persons may be deemed directly or
indirectly to beneficially own 8.842% of the Common Stock of the Issuer.
CUSIP No. 43739N107 Page 7 of 15 Pages
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The number of shares beneficially owned and the percentage of
outstanding shares represented thereby, for each of the Reporting Persons, have
been computed in accordance with Rule 13d-3 under the Securities Exchange Act of
1934, as amended. The percentages of ownership described above are based on the
5,558,350 outstanding shares of Common Stock of the Issuer reported in the
Issuer's Form 10-K filed on April 1, 1996.
(b) NAPAQ has the sole power to vote and dispose of the Common Stock of
the Issuer beneficially owned by it. CCMC has the sole power to vote and dispose
of the Common Stock of the Issuer beneficially owned by it. Jeffrey C. Wolk has
the sole power to vote and dispose of the Common Stock of the Issuer
beneficially owned by him.
(c) Transactions in the securities of the Issuer reported on herein
which have been effected in the past sixty days by the Reporting Persons are as
follows:
Purchase Transactions by CCMC
<TABLE>
<CAPTION>
Date No. of Shares Price per Share Total
---- ------------- --------------- -----
<S> <C> <C> <C> <C>
2/22/96 20,000 1.000 20,000
2/26/96 10,000 1.000 10,000
2/27/96 10,000 1.181 11,810
2/28/96 12,000 1.181 14,172
3/11/96 10,000 1.116 11,160
4/09/96 25,500 1.810 46,155
4/10/96 10,000 1.810 18,100
4/11/96 14,500 1.810 26,245
4/15/96 19,000 1.750 34,390
4/15/96 1,000 1.810 1,810
4/15/96 16,000 1.935 30,960
4/15/96 3,100 1.810 5,611
4/17/96 5,000 1.810 9,050
4/18/96 2,400 1.750 4,344
4/23/96 26,000 1.960 50,960
4/24/96 2,000 1.960 3,920
4/25/96 5,000 1.960 9,800
4/26/96 8,000 1.960 15,680
4/30/96 7,000 2.060 14,420
5/1/96 16,000 2.000 32,960
Purchase Transactions by NAPAQ
3/15/96 60,000 1.0883 65,298
3/21/96 6,000 1.1875 7,125
3/27/96 30,000 1.2500 37,500
3/27/96 10,000 1.2813 12,813
4/04/96 10,000 1.5000 15,000
4/08/96 10,000 1.6563 16,563
</TABLE>
(d) Not Applicable.
(e) Not Applicable.
CUSIP No. 43739N107 Page 8 of 15 Pages
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Item 7. Material to be Filed as Exhibits
Exhibit A. Agreement of Joint Filing
Exhibit D. Letter dated April 30, 1996
Exhibit E. Letter dated May 1, 1996.
Exhibit F. Letter dated May 1, 1996.
CUSIP No. 43739N107 Page 9 of 15 Pages
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After reasonable inquiry and to the best of our knowledge and belief, we each
certify that the information set forth in this statement is true, complete and
correct. This statement may be executed in multiple counterparts, each of which
shall be deemed an original and all of which shall constitute one (1)
instrument.
Cross Country Motor Club, Inc.
by: /s/ Sidney D. Wolk
-------------------------
Sidney D. Wolk, President
NAPAQ Corporation
by: /s/ Sidney D. Wolk
-------------------------
Sidney D. Wolk, Secretary
/s/ Jeffrey C. Wolk
-------------------------
Jeffrey C. Wolk
Date: May 2, 1996
CUSIP No. 43739N107 Page 10 of 15 Pages
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EXHIBIT A
AGREEMENT OF JOINT FILING
HOMEOWNERS GROUP, INC.
COMMON STOCK, $0.01 PAR VALUE
In accordance with Rule 13D-1(f) under the Securities Exchange Act of
1934, as amended, the undersigned hereby confirm the agreement by and among them
to the joint filing on behalf of each of them of a Statement on Schedule 13D,
and any and all amendments thereto, with respect to the above-referenced
securities and that this Agreement be included as an Exhibit to such filing.
This Agreement may be executed in any number of counterparts each of
which shall be deemed to be an original and all of which together shall be
deemed to constitute one and the same Agreement.
WITNESS WHEREOF, the undersigned hereby execute this Agreement on this
2nd day of May, 1996.
NAPAQ Corporation
by: /s/ Sidney D. Wolk
-------------------------
Sidney D. Wolk, Secretary
Cross Country Motor Club, Inc.
by: /s/ Sidney D. Wolk
-------------------------
Sidney D. Wolk, President
/s/ Jeffrey C. Wolk
-------------------------
Jeffrey C. Wolk
EXHIBIT D PAGE 11 OF 15
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THE
CROSS COUNTRY GROUP
VIA FAX (813) 573-8058
April 30, 1996
Special Committee of the Board of Directors
Homeowners Group, Inc.
c/o Jeffrey Trocin
Raymond James & Associates
880 Carillon Parkway
St. Petersburg, FL 33716
Gentlemen:
As you know, we have tried in good faith over the past three (3) months
to reach a mutually acceptable arrangement to acquire Homeowners Group in an all
cash transaction. In our most recent letter dated April 23, we provided a
revised cash offer of $1.95 per share, with a deadline of April 26. We have also
learned that Homeowners officers have informed franchisees that the sale of the
Company is apparently imminent and that such sale would not be for cash. Given
that the Company has neither responded to our cash offer, nor met with us to
negotiate a higher offer, we can only conclude that the sale of the Company is
not being conducted in a manner to maximize value to shareholders. We sincerely
hope that the sale negotiations will proceed fairly to include all bidders and
obtain the highest price available.
In conversations this week, Raymond James & Associates have confirmed
to us (i) that our audited financial statements and our banker confirm our
ability to readily consummate an all cash deal; and (ii) that our opening cash
offer of $1.95 was close to fair value attainable for shareholders.
Notwithstanding these facts, the Company has been unwilling to meet with us to
discuss our offer, while intensively pursuing a transaction for a non-cash deal
with another party.
Today we have again confirmed to Raymond James that (i) we are prepared
to increase our cash offer, (ii) we are prepared to enter into a Confidentiality
and Standstill Agreement so long as it does not prohibit our competing with
other bidders by making an all cash offer directly to all stockholders; and
(iii) we are prepared to take all appropriate steps to ensure that we and all
other stockholders receive the benefit of a fair sale of the Company. In this
regard, we caution the Board against approving any device or payment which would
give any one bidder an economic, procedural, or other advantage over any other
bidder at this time.
Our preferred goal remains a negotiated transaction. To that end, we
make the following, enhanced, proposal:
1. We hereby offer to acquire all shares of outstanding common stock of
Homeowners Group, Inc. at a price of $2.10 per share, net to the sellers, in
cash. Such price assumes that the Accelerated judgment is not settled prior to
closing.
EXHIBIT D PAGE 12 OF 15
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Special Committee of the Board of Directors
Homeowners Group, Inc.
c/o Jeffrey Trocin
April 30, 1996
Page Two
2. To complete negotiations, we remain willing to immediately execute a
Confidentiality and Standstill Agreement, provided that we retain the right to
conduct an all cash, all stock tender offer and the attendant proxy solicitation
if the Board does not accept our offer. We have resubmitted to Raymond James our
revisions to the Company's form of agreement, which we proposed last month. We
have also forwarded forms of standard standstill provisions recently used by
other public companies engaged in the sale process. We are happy to discuss
either form as a basis for going forward.
3. We will meet with representatives of the Special Committee to
negotiate the terms of a purchase within three (3) days of receiving all
confidential information. We believe our willingness to work this quickly in the
due diligence process underscores the seriousness of our bid.
Raymond James has also informed us that time is now critical.
Accordingly, we must ask for a definitive response by 12:00 noon on Wednesday,
May 1, 1996. In the absence of such response we will be forced to conclude that
you are committed to negotiating with only one bidder. In that case, we will
take the actions which we determine are in our interest as a bidder and as a
stockholder of the Company.
Sincerely,
Sidney D. Wolk
President
SDW/bk
pc: Carl Buccellato
President, Chief Executive Officer
Homeowners Group, Inc.
Members of the Board of Directors
EXHIBIT E PAGE 13 OF 15
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May 1, 1996
Via Telecopier (813) 573-8058
Special Committee of the Board of Directors
Homeowners Group, Inc.
c/o Jeffrey Trocin
Raymond James & Associates
880 Carillon Parkway
St. Petersburg, FL 33716
Dear Jeffrey:
By way of confirmation and clarification, our offer of $2.10 per share
assumed no settlement of the Accelerated Judgment. We are prepared to discuss
with the Company a formula to increase the amount paid to shareholders, if there
is a settlement reached before closing. We look forward to receiving more
details regarding the Judgment so that we can determine the appropriate
adjustment.
We hope and expect that the Board will be specific in its response as
to our offer and specify to us the price and terms it seeks for a sale. This
will allow all of us to proceed rapidly to determine the highest price we can
offer to shareholders.
Very truly yours,
Sidney D. Wolk
SDW/bk
EXHIBIT F PAGE 14 OF 15
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The Cross Country Group, Inc.
4040 Mystic Valley Parkway
Medford, MA 02155
May 1, 1996
Via Telecopier (813) 573-8058
and Federal Express
Special Committee of the Board of Directors
Homeowners Group, Inc.
c/o Jeffrey Trocin
Raymond James & Associates
880 Carillon Parkway
St. Petersburg, FL 33716
Dear Jeffrey:
I have received your letter of 1:15 p.m. today and I assume that it
represents the Board's response to our offer of yesterday. Unfortunately, we are
disappointed and, frankly, confused as to the source of some of your comments
and the meaning of the Board's response that our offer does not put us in a
"favored position", and that our offer has not "dissuaded the Board from
favoring other bidders".
We believe the Board is required to "favor" only the bidder with the
highest price to shareholders, with the ability to close the transaction. Though
you characterize our increased offer as "inching", it exceeds the value which,
just yesterday, you stated would be sufficient for further, serious discussion.
You now say that you have been trying to "guide" us to a competitive bid, but we
have yet to have the opportunity to meet with you or the Company to discuss
pricing.
If this is a legitimate sale process, then there is no reason for you
to "guide" us to a price. Instead, the Board should state to us its asking price
and accept the fair bid which is the highest, whether from Cross Country or any
other bidder. We consider any other process to be an egregious violation of the
Directors' fiduciary duty to all stockholders. If it proves that such breach of
duty is accompanied by self-enrichment of Directors and officers, then, as a
stockholder, we expect to seek remedies for such conduct.
PAGE 15 OF 15
------ ----
Jeffrey Trocin
May 1, 1996
Page Two
For the record:
1. Our offer does not impose any restriction on Homeowner's settlement
of the Accelerated Adjustment. Instead, we have made a firm offer which assumes
payment in full of the judgment and have offered to discuss increased payments
to shareholders if a favorable settlement is reached.
2. We have repeatedly offered to accept a reasonable standstill
agreement. Given the Board's favoring of other bidders, however, we must
preserve the right to go directly to stockholders with an all-cash, all-stock
offer in the event our offer is not accepted. To resolve this unnecessary
impasse, we are executing and forwarding to you the Standstill Agreement
substantially as requested by the Company, but preserving only this limited
right.
3. No information contained in your letter or otherwise communicated to
us is material, non-public information which impedes our further acquisition of
shares. We have repeatedly stated that we wanted no such information until a
Confidentiality Agreement was in place. Accordingly, neither any information we
have received, nor the manner in which we have received it, imposes any
restriction on our transactions in Company stock.
We continue to seek, and expect, a fair auction of the Company.
Very truly yours,
Sidney D. Wolk
SDW/lcn
Enclosure
