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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 1)*
FINLAY ENTERPRISES, INC.
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(Name of Issuer)
Common Stock, par value $.01 per share
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(Title of Class of Securities)
317884203
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(CUSIP Number)
Christopher Hilbert, Esq.
Morgan, Lewis & Bockius LLP
101 Park Avenue
New York, New York 10178
(212) 309-6000
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 22, 1997
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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 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 (the "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).
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
ROHIT MOJILAL DESAI ###-##-####
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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*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 704,412 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
704,412 shares of Common Stock
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
704,412 shares of Common Stock
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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)
7.3%(1)
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14 TYPE OF REPORTING PERSON*
IN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
DESAI CAPITAL MANAGEMENT INCORPORATED 13-3229933
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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*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 704,412 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
704,412 shares of Common Stock
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
704,412 shares of Common Stock
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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)
7.3%(1)
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14 TYPE OF REPORTING PERSON*
IA, CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
ROHIT M. DESAI ASSOCIATES-II 13-3426754
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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*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 704,412 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
704,412 shares of Common Stock
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
704,412 shares of Common Stock
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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)
7.3%(1)
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14 TYPE OF REPORTING PERSON*
PN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
ROHIT M. DESAI ASSOCIATES 13-3240237
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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*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 0 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0 shares of Common Stock
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 shares of Common Stock
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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)
0%
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14 TYPE OF REPORTING PERSON*
PN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
EQUITY LINKED INVESTORS-II 13-3427026
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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 PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 704,412 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
704,412 shares of Common Stock
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
704,412 shares of Common Stock
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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)
7.3%(1)
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14 TYPE OF REPORTING PERSON*
IV, PN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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CUSIP No. 317884203 13D
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
EQUITY LINKED INVESTORS, L.P. 13-3240235
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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 PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
NUMBER OF 0 shares of Common Stock
SHARES ------------------------------------------------------------
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 0 shares of Common Stock
PERSON WITH ------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0 shares of Common Stock
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 shares of Common Stock
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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)
0%
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14 TYPE OF REPORTING PERSON*
IV, PN
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
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(1) Assumes 9,616,449 shares of Common Stock outstanding, as reported by Finlay
Enterprises, Inc. in its Registration Statement on Form S-1 as filed with the
Securities and Exchange Commission on September 23, 1997.
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CUSIP NO. 317884203
The statement on Schedule 13D, dated April 13, 1995, filed with the
Securities and Exchange Commission by Equity-Linked Investors, L.P. ("ELI-I"),
Rohit M. Desai Associates ("RMDA-I"), Equity-Linked Investors-II ("ELI-II"),
Rohit M. Desai Associates-II ("RMDA-II"), Desai Capital Management Incorporated
("DCMI") and Rohit M. Desai, is hereby amended and restated in its entirety as
follows:
Item 1. Security and Issuer.
This statement relates to the Common Stock, $.01 par value, of
Finlay Enterprises, Inc. (the "Company"). The address of the Company's principal
executive offices is 521 Fifth Avenue, New York, New York 10175.
Item 2. Identity and Background.
This Statement is filed by ELI-II, RMDA-II, DCMI and Rohit M. Desai,
each of whom may be deemed to be the beneficial owners of securities owned
directly by ELI-II, and by ELI-I and RMDA-I.
ELI-I and ELI-II are each a New York limited partnership whose
principal business is investing in a portfolio of convertible debt securities,
convertible preferred stock and other debt securities with equity features.
RMDA-I is a New York general partnership and is the general partner
of ELI-I. RMDA-II is a New York general partnership and is the general partner
of ELI-II. RMDA-I has no business activities other than acting as ELI-I's
general partner. RMDA-II has no business activities other than acting as
ELI-II's general partner. The partners of RMDA-I and RMDA-II are Rohit M. Desai,
Katharine B. Desai and the Rohit M. Desai Family Trust (of which Katharine B.
Desai and Joseph F. McDonald are the trustees under a trust Agreement dated July
1, 1987).
DCMI is a New York corporation whose principal business is that of
an investment adviser. DCMI acts as investment adviser to ELI-I and ELI-II. The
sole stockholder of DCMI is Rohit M. Desai. The directors of DCMI are Rohit M.
Desai and Katharine B. Desai. Rohit M. Desai, Katharine B. Desai, Damon H. Ball,
Thomas P. Larsen, Timothy R. Kelleher, Tom W. Perlmutter, Frank J. Pados, Jr.
and Andre McSherry are officers of DCMI (each a "Reporting Person" and
collectively the, "Reporting Persons").
The address of the principal business and principal office of DCMI
is 540 Madison Avenue, 36th Floor, New York, New York 10022.
The present principal occupation and employment of Rohit M. Desai,
who is a citizen of the United States, is as the president, treasurer and
chairman of the board of directors of DCMI and as the managing general partner
of RMDA-I, the general partner of ELI-I, and as the managing general partner of
RMDA-II, the general partner of ELI-II. The present principal occupation and
employment of Katharine B. Desai, who is a United States citizen, is as the
secretary and director of DCMI. The present principal occupation and employment
of Joseph F. McDonald, who is a United States citizen, is as a member of the law
firm of Morgan, Lewis & Bockius LLP. The present principal occupation and
employment of Damon H. Ball, who is a United States citizen, is as senior vice
president of DCMI. The present principal occupation and employment of Frank J.
Pados, Jr., who is a United States
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citizen, is as senior vice president of DCMI. The present principal occupation
and employment of Thomas P. Larsen, who is a United States citizen, is as senior
vice president of DCMI. The present principal occupation and employment of
Timothy R. Kelleher, who is a United States citizen, is as vice president of
DCMI. The present principal occupation and employment of Tom W. Perlmutter, who
is a United States citizen, is as vice president of DCMI. The present principal
occupation and employment of Andre McSherry, who is a United States citizen, is
as vice president of DCMI. The business address of each of these individuals,
except Joseph F. McDonald, is the same as that of DCMI. The business address of
Joseph F. McDonald is c/o Morgan, Lewis & Bockius LLP, 101 Park Avenue, New
York, New York 10178.
During the last five years neither ELI-I, ELI-II, RMDA-I, RMDA-II,
DCMI, the Rohit M. Desai Family Trust, Joseph F. McDonald, nor any Reporting
Person has been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors). During the last five years, neither ELI-I, ELI-II,
RMDA-I, RMDA-II, DCMI, the Rohit M. Desai Family Trust, Joseph F. McDonald, nor
any Reporting Person has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction resulting in a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or a finding of any
violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On May 26, 1993, ELI-I purchased 477,569 shares of the Company's
Common Stock, $.01 par value (the "Common Stock"), and 69,000 shares of the
Company's 10% Series C Cumulative Redeemable Preferred Stock, $.01 par value
(the "Preferred Stock") and ELI-II purchased 352,986 shares of Common Stock and
51,000 shares of Preferred Stock. These purchases were made pursuant to the
Stock Purchase Agreement dated as of May 26, 1993 among the Company, Finlay Fine
Jewelry Corporation and the Purchasers listed therein (the "Purchase
Agreement"), a copy of which is incorporated herein by reference as Exhibit 6.
(The Company effected a two-for-three reverse stock split and ELI-I and ELI-II's
holdings were appropriately adjusted to 318,379 and 235,324, respectively.)
On April 6, 1995, ELI-I agreed to purchase 40,837 shares of Common
Stock at a price of $14.00 per share and ELI-II agreed to purchase 30,184 shares
of Common Stock at a price of $14.00 per share. These purchases were made in the
Company's registered public offering of Common Stock (the "Offering").
Effective April 13, 1995, ELI-I received 593,813 shares of Common
Stock in exchange for 69,000 shares of Preferred Stock, and ELI-II received
438,905 shares of Common Stock in exchange for 51,000 shares of Preferred Stock.
This exchange occurred in connection with the Offering and pursuant to a Share
Exchange Agreement dated as of March 6, 1995 by and among the Company and
Stockholders listed therein (the "Share Exchange Agreement"), a copy of which is
incorporated herein by reference as Exhibit 8.
In making the purchases described above, ELI-I used working capital
from its operating account, which is funded by capital contributions from
ELI-I's limited partners and gains and proceeds from ELI-I's investment
portfolio. ELI-II used working capital from its operating account, which is
funded by capital contributions from ELI-II's limited partners and gains and
proceeds from ELI-II's investment portfolio.
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On October 22, 1997, ELI-I sold all of its shares of Common Stock
(953,029 shares) in a registered offering by the Company, receiving $17.955 per
share (the "ELI-I Disposition").
Item 4. Purpose of Transaction.
Each of ELI-I and ELI-II have acquired securities of the Company in
the ordinary course of their respective businesses solely for investment
purposes.
Neither ELI-I, ELI-II, RMDA-I, RMDA-II, DCMI, the Rohit M. Desai
Family Trust, Joseph F. McDonald, nor any Reporting Person has any plans or
proposals which relate to or would result in:
(a) the acquisition by any person of additional securities of the
issuer or the disposition of securities of the Company, except that ELI-II may
from time to time and in furtherance of its investment programs, acquire (for
investment) or dispose of the Common Stock or any other securities of the
issuer;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the issuer or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of the issuer
or any of its subsidiaries;
(d) any change in the present board of directors or management of
the issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board;
(e) any material change in the present capitalization or dividend
policy of the issuer;
(f) any other material change in the issuer's business or corporate
structure;
(g) any change in the issuer's charter or by-laws;
(h) causing a class of securities of the issuer to be delisted from
a national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
(i) a class of equity securities of the issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934; or
(j) any action similar to those enumerated above.
Item 5. Interest in Securities of the Issuer.
ELI-II directly owns 704,412 shares of Common Stock, which would
constitute beneficial ownership of approximately 7.3% of the outstanding shares
of the Company's Common Stock. As of such date, each of DCMI and Rohit M. Desai
could be deemed to be the beneficial owner, for purposes of this Schedule 13D,
of 704,412 shares of the Company's Common Stock held by ELI-II.
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The power to vote, to convert, to dispose of, or to direct the
voting, conversion or disposal of, any Common Stock held by ELI-II is vested in
RMDA-II as general partner of ELI-II, but such decisions (and similar decisions
with respect to the rest of ELI-II's investment portfolio) may also be made by
DCMI under an investment and advisory Agreement between ELI-II and DCMI. Rohit
M. Desai is the managing general partner of RMDA-I and RMDA-II and the sole
stockholder, chairman of the board of directors, president and treasurer of
DCMI. Katharine B. Desai is the secretary and a director of DCMI, a general
partner of RMDA-I and RMDA-II and a trustee of the Rohit M. Desai Family Trust.
The Rohit M. Desai Family Trust is a general partner of RMDA-I and RMDA-II.
Joseph F. McDonald is a trustee of the Rohit M. Desai Family Trust. Damon H.
Ball, Thomas P. Larsen and Frank J. Pados, Jr. are senior vice presidents of
DCMI. Timothy R. Kelleher, Tom W. Perlmutter and Andre McSherry are vice
presidents of DCMI.
Accordingly for purposes of Schedule 13D, ELI-II, RMDA-II, DCMI and
Rohit M. Desai may each be deemed to share the power to vote or to direct the
vote and may be deemed to share the power to dispose or to direct the
disposition with respect to the securities held by ELI-II.
ELI-II is a party to the Amended and Restated Stockholders'
Agreement dated as of March 6, 1995 (the "Amended and Restated Stockholders'
Agreement"), by and among the Company, ELI-I, ELI-II and certain other
stockholders of the Company (the "Other Stockholders"), a copy of which is
incorporated herein by reference as Exhibit 7, which sets forth certain rights
and obligations of the parties with respect to the Common Stock and corporate
governance of the Company.
ELI-II is also a party to the Registration Rights Agreement dated as
of May 26, 1993 by and among the Company, ELI-I, ELI-II and the certain other
stockholders listed on the signature pages thereto (the "Registration Rights
Agreement"), a copy of which is incorporated herein by reference as Exhibit 9.
Under the Registration Rights Agreement, ELI-II was granted certain registration
rights with respect to the shares of Common Stock owned.
On October 22, 1997, each of the Amended and Restated Stockholders'
Agreement and the Registration Rights Agreement was amended by an Omnibus
Amendment to Registration Rights and Stockholders' Agreement (the "Omnibus
Amendment") a copy of which is incorporated herein by reference as Exhibit 10.
The Omnibus Amendment reflected, among other things, (i) the removal of ELI-I as
a party to the Amended and Restated Stockholders' Agreement and (ii) certain
changes in the right to nominate directors.
Additionally, on October 22, 1997, ELI-II entered into a letter
agreement with the Lee Holders (the "Letter Agreement"), a copy of which is
attached hereto as Exhibit 11. Pursuant to the Letter Agreement, ELI-II and the
Lee Holders agreed, among other things, to restrict their sale of Common Stock
for a limited period of time.
The Amended and Restated Stockholders' Agreement, as amended by the
Omnibus Amendment, provides that the parties thereto must vote their shares to
fix the number of members of the Board of Directors of the Company at eight and
to vote in favor of six directors who will be nominated as follows: two will be
nominated by the Thomas H. Lee Company and certain of its officers, employees,
consultants and affiliates (the "Lee Investors"), one will be nominated by
ELI-II, two will be nominated by David B. Cornstein and one will be nominated by
Arthur E. Reiner, Vice Chairman of the Company and Chairman and Chief Executive
Officer of Finlay Fine Jewelry Corporation. Notwithstanding the foregoing, the
rights of various parties to designate directors will be reduced or eliminated
at such time as such party owns less than certain specified percentages of the
shares of Common Stock then outstanding or in certain cases are no longer an
employee of the
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Company. The Amended and Restated Stockholders' Agreement also provides that the
executive committee will consist of five directors, including one independent
director selected by the Board of Directors, one member designated by Thomas H.
Lee (so long as the Lee Investors have the right to designate a nominee for
director), one member designated by ELI-II (so long as ELI-II has the right to
designate a nominee for director) and two members designated by Mr. Cornstein
(which number will be reduced to one if Mr. Cornstein is only entitled to
designate one nominee for director and none if Mr. Cornstein ceases to have the
right to designate a nominee for director). When a stockholder or group of
stockholders loses the right to designate a director, such director is to be
designated instead by a majority of the directors of the Company.
In addition, the Amended and Restated Stockholders' Agreement
provides that the parties thereto have (i) certain "come along" rights allowing
them to participate in private sales of Common Stock by parties selling at least
a majority of the outstanding shares of Common Stock and (ii) certain "take
along" rights allowing parties who are selling at least a majority of the
outstanding shares of Common Stock to require the other parties to sell all or a
portion of their shares of Common Stock to the same purchaser in the same
transaction on the same terms.
Pursuant to Rule 13d-4 under the Securities Exchange Act of 1934,
DCMI, RMDA-II, the Rohit M. Desai Family Trust, Joseph F. McDonald and each
Reporting Person hereby declare that the filing of this Statement shall not be
construed as an admission that any person other than ELI-II (including, without
limitation, the Other Stockholders) is the beneficial owner of any securities
covered by this Statement.
Within the meaning of Rule 13(d)(5) under the Securities Exchange
Act of 1934, as amended (the "Act"), the terms of the Amended and Restated
Stockholders' Agreement, as amended by the Omnibus Amendment, could be deemed to
provide for an agreement amongst the stockholders who are party therein to act
together for the purpose of voting equity securities of the Company.
Accordingly, each of such stockholders could be deemed to be members of a
"group" and could be deemed to be beneficial owners of all of the shares held by
such group. Each of such stockholders denies the existence of such a group and
each disclaims beneficial ownership of the securities held by another such
stockholder.
No other person is known to have the right to receive or the power
to direct the receipt of dividends from, or the proceeds from the sale of, the
securities covered by this Statement.
During the sixty days preceding the filing of this Schedule, no
transactions in the class of securities reported were effected by any persons
reporting on this Statement, other than the transactions related to the ELI-I
Disposition.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
Neither ELI-II, RMDA-II, DCMI, the Rohit M. Desai Family Trust,
Joseph F. McDonald, nor any Reporting Person is party to any other contract,
arrangement, understanding or relationship specifically relating to any
securities of the Company other than (i) the Purchase Agreement, (ii) the Share
Exchange Agreement, (iii) the Amended and Restated Stockholders' Agreement, (iv)
the Registration Rights Agreement, (v) the Omnibus Amendment and (vi) the Letter
Agreement.
<PAGE>
<PAGE>
ELI-II has contracted with DCMI for DCMI to provide investment
advisory and other services to ELI-II. Pursuant to its investment and advisory
contracts, DCMI may exercise investment power and voting power with respect to
the investment portfolio of ELI-II. For its services under this investment and
advisory agreement DCMI receives a management fee from ELI-II generally based on
the value of its portfolio.
Item 7. Material to be Filed as Exhibits.
1. Joint Filing Agreement regarding the filing of this Statement.*
2. Power of Attorney authorizing Gilbert W. Sanborn to sign on
behalf Rohit M. Desai.*
3. Power of Attorney.*
4. Investment and Advisory Agreement between ELI-I and DCMI, as
amended.*
5. Investment and Advisory Agreement between ELI-II and DCMI, as
amended.*
6. Stock Purchase Agreement, dated May 26,1993 among the Company,
Finlay Fine Jewelry Corporation and the Purchasers listed therein, as amended,
filed with the Securities and Exchange Commission as Exhibit 4.5 to the
Company's Current Report on Form 8-K filed by the Company on June 10, 1993, is
incorporated herein by reference.**
7. Form of Amended and Restated Stockholders' Agreement, dated March
6, 1995, among the Company and the Stockholders listed therein, as amended,
filed with the Securities and Exchange Commission as Exhibit 4.9 to the
Company's Registration Statement on Form S-1 filed by the Company on April 6,
1994, is incorporated herein by reference.**
8. Share Exchange Agreement, dated March 6, 1995, among the Company
and the Stockholders listed therein, as amended, filed with the Securities and
Exchange Commission as Exhibit 10.27 to the Company's Registration Statement on
Form S-1 filed by the Company on April 6, 1995, is incorporated herein by
reference.**
9. Registration Rights Agreement, dated as of May 26, 1993, by and
among the Company and certain stockholders listed therein, filed with the
Securities and Exchange Commission as Exhibit 4.7 to the Company's Current
Report on Form 8-K filed by the Company on June 10, 1993, is incorporated herein
by reference.**
10. Omnibus Amendment to Registration Rights and Stockholders'
Agreement, dated as of October 22, 1997, filed with the Securities and Exchange
Commission as Exhibit 4.9(b) to the Company's Registration Statement on Form S-1
filed by the Company on September 23, 1997, is incorporated herein by
reference.**
11. Letter Agreement, dated October 22, 1997, between ELI-II and the
Lee Holders, as defined in the Amended and Restated Stockholders Agreement.***
<PAGE>
<PAGE>
- ----------------------
* Previously filed.
** Incorporated herein by reference.
*** Filed herewith.
<PAGE>
<PAGE>
After reasonable inquiry and to the best of their knowledge and
belief, each of the undersigned certifies that the information set forth in this
Statement, is true, complete and correct.
Date: November 18, 1997 EQUITY-LINKED INVESTORS, L.P.
By Rohit M. Desai Associates,
General Partner
By /s/ ROHIT M. DESAI
____________________________
Rohit M. Desai as
General Partner
EQUITY-LINKED INVESTORS-II
By Rohit M. Desai Associates-II
General Partner
By /s/ ROHIT M. DESAI
________________________________
Rohit M. Desai as
General Partner
ROHIT M. DESAI ASSOCIATES
By /s/ ROHIT M. DESAI
________________________________
Rohit M. Desai as
Managing General Partner
ROHIT M. DESAI ASSOCIATES-II
By /s/ ROHIT M. DESAI
________________________________
Rohit M. Desai as
Managing General Partner
DESAI CAPITAL MANAGEMENT
INCORPORATED
By /s/ ROHIT M. DESAI
________________________________
Rohit M. Desai
President
/s/ ROHIT M. DESAI
__________________________________
Rohit M. Desai
<PAGE>
<PAGE>
Exhibit 11
Thomas H. Lee Capital, LLC
Thomas H. Lee Equity Partners, L.P.
590 Madison Avenue
New York, NY 10022
October 22, 1997
Equity-Linked Investors-II
c/o Desai Capital Management, Inc.
540 Madison Avenue
New York, NY 10022
Re: Finlay Enterprises, Inc. (the "Company")
Ladies and Gentlemen:
This letter agreement is entered into in connection with the
Company's registration statement on form S-1 dated September 23, 1997,
registration number 333-34949 (the "Registration Statement"). Terms used herein
as defined terms shall have the meanings assigned to them in the Registration
Rights Agreement among the Company and certain stockholders thereof dated as of
May 26, 1993, as amended to date (the "Registration Rights Agreement").
For good and valuable consideration, the receipt and sufficiency
which are hereby acknowledged, the undersigned hereby agree as follows:
1. Until the earlier of October 23, 1999 or the Catch-Up Point (the
"Restricted Period"), neither the ELI Holders nor the Lee Holders, respectively,
will sell in any one calendar quarter Registrable Securities constituting more
than 10% of the shares of common stock of the Company traded on NASDAQ in the
immediately preceding quarter, provided that the foregoing limitation shall not
apply to Registrable Securities sold in any Block Sale (as defined below).
Notwithstanding the foregoing, nothing contained in this letter agreement shall
prevent or restrict the ELI Holders or the Lee Holders from exercising any of
their respective registration rights under and as provided in the Registration
Rights Agreement.
<PAGE>
<PAGE>
Equity-Linked Investors-II
October 22, 1997
Page
2. During the Restricted Period, the ELI Holders and the Lee
Holders, respectively, each hereby agree to give the other no less than two
business days advance written notice at the above address of any sale of
Registrable Securities in any calendar quarter, which notice shall specify the
number of Registrable Securities to be sold. In addition, each of the ELI
Holders and the Lee Holders, respectively, will provide a written statement to
the other within 10 business days after the end of each calendar quarter listing
the number of Registrable Securities sold by such party during the previous
calendar quarter.
3. For the purposes of this letter agreement, the term "Block Sale"
shall mean either (a) a sale through a broker/dealer to a purchaser who has
already been identified or (b) a sale of Registrable Securities directly to a
purchaser, or (c) a private transfer of Registrable Securities to affiliates or
partners of the ELI Holders and Lee Holders, in each case where such purchaser
is not a market maker.
4. The ELI Holders and the Lee Holders hereby agree that, for a
period of 180 days after the date of the final prospectus relating to the
Registration Statement, (a) neither the ELI Holders nor the Lee Holders shall
exercise any registration rights which have been waived pursuant to the letter
agreements executed by the ELI Holders and the Lee Holders, respectively, in
favor of Goldman, Sachs & Co., Donaldson, Lufkin & Jenrette Securities
Corporation and SBC Warburg Dillon Read Inc. (the "Underwriters") unless the
Underwriters have agreed in writing to permit the ELI Holders and the Lee
Holders to exercise such rights on the same terms, and (b) both the ELI Holders
and the Lee Holders shall remain subject to the restrictions on the sale, offer
or other disposition of Registrable Securities set forth in the letter
agreements executed by the ELI Holders and the Lee Holders, respectively, in
favor of the Underwriters unless the Underwriters have agreed in writing to
release both the ELI Holders and the Lee Holders from such restrictions, which
release shall be on the same terms.
[The Rest of This Page Intentionally Left Blank]
<PAGE>
<PAGE>
Equity-Linked Investors-II
October 22, 1997
Page
Please indicate your agreement with the foregoing by signing and
returning to us a copy of this letter.
Very truly yours,
Thomas H. Lee Equity Partners, L.P.
By: THL Equity Advisers Limited Partnership
By: THL Equity Trust
By: /s/ Warren C. Smith, Jr.
Thomas H. Lee Company
By: /s/ Warren C. Smith, Jr.
AGREED TO AND ACCEPTED BY:
By: Equity-Linked Investors-II
By: Rohit M. Desai Associates-II
General Partner
By: /s/ Damon H. Ball
Attorney-in-fact for
Rohit M. Desai
Managing General Partner
<PAGE>
