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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
Solo Serve Corporation
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(Name of Issuer)
Common Stock, Par Value $.01
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(Title of Class of Securities)
834263204
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(CUSIP Number)
Hamlet T. Newsom Jr.
Cox & Smith Incorporated
112 E. Pecan Street, Suite 1800, San Antonio, Texas 78205
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
March 17, 1998
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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 ("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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SCHEDULE 13D
CUSIP NO. 834263204 PAGE 2 OF 7 PAGES
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NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1
Charles M. Siegel
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)[ ]
(b)[ ]
2
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SEC USE ONLY
3
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SOURCE OF FUNDS*
4 PF
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
5
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CITIZENSHIP OR PLACE OF ORGANIZATION
6 United States
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NUMBER OF SOLE VOTING POWER
SHARES 7 1,115,000
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BENEFICIALLY SHARED VOTING POWER
OWNED BY 8 0
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EACH SOLE DISPOSITIVE POWER
REPORTING 9 1,115,000
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PERSON SHARED DISPOSITIVE POWER
WITH 10 0
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
11 1,115,000
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13 30.42%
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TYPE OF REPORTING PERSON*
14 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.
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CUSIP NO. 834263204 PAGE 3 OF 7 PAGES
SCHEDULE 13D
OF CHARLES M. SIEGEL COVERING COMMON STOCK OF
SOLO SERVE CORPORATION
ITEM 1. Security and Issuer
This schedule relates to the shares of Common Stock, par value $.01
per share ("Common Stock"), of Solo Serve Corporation, a Delaware corporation
(the "Company"). The number of shares of the Company's Common Stock, par value
$.01 per share, and Preferred Stock, par value $.01 per share ("Preferred
Stock"), outstanding as of the date of this schedule, were 3,565,812 and 679,203
shares, respectively. The shares of Preferred Stock of the Company votes with
the shares of Common Stock on an as-converted basis.
The principal executive offices of the Company are located at 1610
Cornerway Blvd., San Antonio, Texas 78219.
ITEM 2. Identity and Background
(a) This statement is being filed by Charles M. Siegel.
(b) Mr. Siegel's business address is 1610 Cornerway Blvd., San
Antonio, Texas 78219.
(c) Mr. Siegel's present principal occupation is President and
Chief Executive Officer of the Company.
(d) During the last five years, Mr. Siegel has not been convicted
in a criminal proceeding.
(e) During the last five years, Mr. Siegel was not a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any
violation with respect to such laws.
(f) Mr. Siegel is a United States citizen.
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CUSIP NO. 834263204 PAGE 4 OF 7 PAGES
ITEM 3. Source and Amount of Funds or Other Consideration
Mr. Siegel purchased 1,255,000 shares of Common Stock of the Company
from General Atlantic Corporation ("GAC") on October 2, 1997. On March 17,
1998, Mr. Siegel transferred 80,000 shares of Common Stock of the Company to
each of Ross E. Bacon, Executive Vice President, Chief Operating Officer and
Chief Financial Officer of the Company, Terry Lalosh, Senior Vice President and
General Merchandise Manager of the Company and Mark J. Blankenship, Senior Vice
President of Planning and Allocation of the Company (each a "Transferee" and
together, the "Transferees"). The stock transferred by Mr. Siegel to the
Transferees was transferred for no stated consideration.
The Company had previously granted Mr. Siegel options to purchase up
to 100,000 shares of Common Stock, all of which options are vested and
exercisable as of the date of this schedule.
ITEM 4. Purpose of Transaction
The purpose of the gift of the shares of Common Stock was to afford the
Transferees additional stock ownership in connection with a transaction whereby
on March 17, 1998 each Transferee (i) purchased 236,562 shares of Common Stock
from GAC and (ii) provided a $100,000 certificate of deposit for the benefit of
GAC to collateralize in part two letters of credit provided by GAC in favor of
Sanwa Business Credit Corporation, the Company's primary lender ("Sanwa"), in
the amounts of $600,000 and $750,000. The $600,000 letter of credit was
provided by GAC as part of the series of related transactions contemporaneous
with the gift of the shares to the Transferees. The $600,000 letter of credit
will enable the Company to access additional borrowings for use in its
operations. The letters of credit will enable the Company to access greater
amounts of credit for use in its operations.
Mr. Siegel does not have any plans which relate to or would result in:
(a) The acquisition by any person of additional securities of the
issuer, or the disposition of securities of the issuer;
(b) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the issuer or any of its subsidiaries;
(c) A sale or transfer of a material amount of assets of the
issuer or 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;
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CUSIP NO. 834263204 PAGE 5 OF 7 PAGES
(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, including but not limited to, if the issuer is a
registered closed-end investment company, any plans or proposals to make any
changes in its investment policy for which a vote is required by Section 13 of
the Investment Company Act of 1940;
(g) Changes in the issuer's charter, bylaws, or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the issuer by any person;
(h) Causing a class of securities of the issuer to be delisted
from a national securities exchange or to cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national securities
association;
(i) A class of equity securities of the issuer becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the Act; or
(j) Any action similar to any of those enumerated above.
However, Mr. Siegel may propose any of the foregoing transactions
described in (a)-(j) which he hereafter considers desirable in light of his
examination of the Company and its assets, operations and future prospects, and
of the circumstances prevailing at the time.
ITEM 5. Interest in Securities of the Issuer
(a) Mr. Siegel beneficially owns an aggregate of 1,115,000 shares
of Common Stock, which represent 30.42% of the outstanding Common Stock of the
Company. The shares of Common Stock held by Mr. Siegel (including the shares
issuable upon exercise of options held by Mr. Siegel) represent 26.27% of the
voting stock of the Company. The calculation of the percentage of voting stock
of the Company held by Mr. Siegel includes the number of shares beneficially
owned by him, all shares of Common Stock and all shares of Preferred Stock of
the Company.
(b) Mr. Siegel has the sole power to vote or direct the vote and
the sole power to dispose or direct the disposition of the shares he holds.
(c) During the past sixty days, Mr. Siegel transferred by gift an
aggregate of 240,000 shares of Common Stock in a private transaction without
consideration as described in Item 3 above.
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CUSIP NO. 834263204 PAGE 6 OF 7 PAGES
(d) No other person is known to have the right to receive or the
power to direct receipt of dividends from, or the proceeds from the sale of,
the shares of Common Stock owned by Mr. Siegel.
(e) Not applicable.
ITEM 6. Contracts, Arrangements, Understanding or Relationships with
Respect to Securities of the Issuer
In connection with the acquisition of shares of capital stock of the
Company by the Transferees, GAC, Mr. Siegel and the Transferees entered into a
Stockholders Agreement (the "Stockholders Agreement"). The Stockholders
Agreement provides that no party thereto will sell, exchange, transfer or
otherwise dispose of shares of the Company's Common Stock or Preferred Stock
owned by such stockholder without the prior written consent of the other
parties thereto and no party will exercise incentive stock options or other
rights to acquire capital stock or will otherwise acquire capital stock of the
Company without the prior written consent of the others. The Stockholders
Agreement provides that the certificates representing shares of capital stock
of the Company currently held by the parties, as well as any additional shares
issued to the parties, shall each bear a legend evidencing the existence of the
Stockholders Agreement and the restrictions upon transfer contained therein.
The Stockholders Agreement terminates on March 17, 2001 unless terminated
earlier or extended by agreement of all parties. The description of the
Stockholders Agreement contained in this schedule is qualified in its entirety
by reference to the full text of the Stockholders Agreement by and between GAC,
Mr. Siegel and the Transferees, a copy of which has been attached to this
schedule as Exhibit A and incorporated herein by reference.
ITEM 7. Material to be filed as Exhibits
Exhibit A--Stockholders Agreement dated March 17, 1998 by and among
General Atlantic Corporation, a Delaware corporation, Charles M. Siegel, Ross
E. Bacon, Terry Lalosh and Mark J. Blankenship.
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CUSIP NO. 834263204 PAGE 7 OF 7 PAGES
SIGNATURE
After reasonably inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: April 2, 1998
/s/ Charles M. Siegel
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CHARLES M. SIEGEL
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description
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<S> <C>
99.A Exhibit A--Stockholders Agreement dated March 17, 1998 by and among General Atlantic Corporation, a
Delaware corporation, Charles M. Siegel, Ross E. Bacon, Terry Lalosh and Mark J. Blankenship.
</TABLE>
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STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT ("Agreement) made and entered into as of
March 17, 1998 by and among General Atlantic Corporation, a Delaware
corporation, Charles M. Siegel, Ross E. Bacon, Terry Lalosh and Mark J.
Blankenship (together, the "Principal Stockholders"), each a principal
stockholder of Solo Serve Corporation (the "Company").
W I T N E S S E T H:
WHEREAS, each of the Principal Stockholders owns and holds shares of
the common stock, par value $.01 per share (the "Common Stock") or the
preferred stock, par value $.01 per share (the "Preferred Stock"), of the
Company;
WHEREAS, the Principal Stockholders desire to limit their ability to
transfer shares of Common Stock and Preferred Stock of the Company as set forth
herein;
NOW, THEREFORE, for and in consideration of the premises and the
mutual covenants and agreements hereinafter contained and for other good and
valuable consideration, the receipt and sufficiency of all of which are hereby
acknowledged, the parties hereto agree as follows:
1. A copy of this Agreement and of every amendment or supplement
hereto shall be filed in the principal office of the Company in San Antonio,
Texas, and shall be open to inspection by any holder of capital stock of the
Company (as hereinafter defined), in person or by agent or attorney, daily
during business hours, to the same extent as such holder would be entitled to
examine the books and records of the Company, under the provisions of the
Delaware General Corporation Law or other applicable law.
2. For the purposes of this Agreement, the term "capital stock"
shall mean the Company's common stock and the preferred stock, if any, of the
Company of every class and series. The term "Shares" shall mean all shares of
capital stock of the Company owned and/or held by the Principal Stockholders,
including those issued in connection with any stock split, stock dividend or
other recapitalization of the Company or in connection with the exercise of
stock options, as well as any additional shares of the capital stock of the
Company hereafter acquired by the Principal Stockholders.
3. During the term of this Agreement, (i) no Principal
Stockholder shall sell, exchange, transfer or otherwise dispose of shares of
Common Stock or Preferred Stock owned by any such shareholder, whether for cash
or other consideration or by gift, without the prior written consent of all
other Principal Stockholders; and (ii) no Principal Stockholder who has or
hereafter is granted incentive stock options or other rights to acquire capital
stock of the Company shall exercise any such options or otherwise
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acquire any shares of capital stock without the prior written consent of all
other Principal Stockholders.
4. Pursuant to Section 202 of the Delaware General Corporation
Law, the restrictions on transfer set forth herein shall be noted conspicuously
on the certificates representing shares of capital stock owned by the Principal
Stockholders, with each of such certificates to bear the following restrictive
legend:
The shares represented by this certificate may not be sold, exchanged,
transferred or disposed of, whether for cash or other consideration or
by gift, without the prior written consent of all other Principal
Stockholders, as defined in that certain Stockholder Agreement dated
March __, 1998, between and among General Atlantic Corporation, a
Delaware corporation, Charles M. Siegel, Ross E. Bacon, Terry Lalosh
and Mark J. Blankenship. A copy of the referenced Stockholder
Agreement is on file at the principal office of Solo Serve Corporation
(the "Company") in San Antonio, Texas and is available for inspection
by any holder of capital stock of the Company to the same extent as
any such holder would be entitled to examine the books and records of
the Company under the provisions of the Delaware General Corporation
Law.
If and to the extent additional shares of capital stock are issued to
any of the Principal Stockholders during the term of this Agreement, the
certificates evidencing such shares shall be legended as set forth above.
5. The term of this Agreement shall commence as of the date
hereof and shall terminate on March 15, 2001, unless terminated earlier or
extended by agreement of all parties. Upon termination of this Agreement, the
restrictions set forth in paragraph 3 hereof shall lapse and be of no further
force and effect, and the restrictive legend set forth in paragraph 4 hereof
may be removed from certificates representing capital stock owned by the
Principal Stockholders.
6. In the event that a notice or other document is required to be
sent hereunder, such notice or other document shall be sent by registered or
certified mail, return receipt requested, to the party entitled to receive such
notice or other document at the address reflected below or at such other
address as such party shall request in a written notice sent to the other
party:
If to the Company: Chief Executive Officer
Solo Serve Corporation
1610 Cornerway Blvd.
San Antonio, TX 78219
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With a copy to: Cox & Smith Incorporated
112 E. Pecan, Suite 1800
San Antonio, TX 78205
Attention: James B. Smith, Jr.
Charles M. Siegel
1403 Fortune Hill
San Antonio, Texas 78258
If to a Principal Ross E. Bacon
Stockholder: 2279 Encino Loop
San Antonio, Texas 78259
Terry Lalosh
105 Ponca Bend
San Antonio, Texas 78231
Mark J. Blankenship
733 Patterson Ave.
San Antonio, Texas 78209
with a copy to: Oppenheimer, Blend, Harrison & Tate, Inc.
711 Navarro, Suite 600
San Antonio, Texas 78205
Attn: J. David Oppenheimer
General Atlantic Corporation
950 Third Avenue, 26th Floor
New York, New York 10022
Attention: Julie S. Lefkowitz
Any party may change the address as to which a notice or other
document is sent to such party by giving all other parties hereto notice
thereof in accordance with this Section 5.
7. This Agreement shall be binding upon and inure to the benefit
of the respective heirs, executors, administrators, legal representatives,
successors, assigns and affiliates of each of the parties hereto. This
Agreement and the rights and obligations evidenced hereby may not be
transferred, assigned, pledged or hypothecated by any party hereto.
8. This Agreement shall be construed and enforced in accordance
with the laws of the State of Texas. The parties hereto acknowledge that any
breach or threatened breach of any provision of this Agreement will cause
irreparable injury for which there is no adequate remedy at law, and each party
agrees that each of the other
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parties hereto shall be entitled to specific performance and injunctive and
other equitable relief in case of any such breach or attempted breach.
9. This Agreement may be executed in one or more counterparts,
all of which taken together shall constitute one and the same instrument.
10. This Agreement embodies the entire agreement and understanding
among the parties hereto with respect to the subject matter hereof, and except
as expressly set forth herein, the rights of the Principal Stockholders
incident to ownership of capital stock of the Company shall not be restricted
hereby. This Agreement may be altered, modified or amended, in whole or in
part, at any time only by an instrument in writing signed by each of the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement and duly delivered the same or caused the same to be duly delivered
on their behalf as of the date first above written.
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Charles M. Siegel
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Ross E. Bacon
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Terry Lalosh
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Mark J. Blankenship
GENERAL ATLANTIC CORPORATION
By:
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Julie S. Lefkowitz
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