UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
RECONDITIONED SYSTEMS, INC.
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(Name of Issuer)
Common Stock, No Par Value
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(Title of Class of Securities)
756240305
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(CUSIP Number)
Stephen M. Vine, Esq.
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
399 Park Avenue
New York, New York 10022
(212) 872-1000
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 12, 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 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 disclosure
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).
Continued on following page(s)
Page 1 of 10 Pages
Exhibit Index: Page 9
<PAGE>
SCHEDULE 13D
CUSIP No. 756240305 Page 2 of 10 Pages
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
George Soros (in his capacity as the sole proprietor of Soros
Fund Management)
2 Check the Appropriate Box If a Member of a Group*
a. [_]
b. [_]
3 SEC Use Only
4 Source of Funds*
Not applicable
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [_]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
Number of 489,548
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 489,548
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
489,548
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares*
[_]
13 Percent of Class Represented By Amount in Row (11)
33.22%
14 Type of Reporting Person*
IA
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Page 3 of 10 Pages
This Amendment No. 1 to Schedule 13D relates to the common stock, no
par value (the "Common Shares") of Reconditioned Systems, Inc. (the "Issuer").
This Amendment No. 1 amends the initial statement on Schedule 13D dated February
9, 1995 (the "Initial Statement") filed by the Reporting Person (as defined
herein). This Amendment No. 1 is being filed by the Reporting Person to report
that, pursuant to a recapitalization plan effected by the Issuer (as more fully
described herein): (i) shares of Series A Convertible Preferred Stock (the
"Preferred Shares"), of which the Reporting Person may have been deemed the
beneficial owner, were converted into Common Shares, and thereafter (ii) the
Issuer consummated a one-for-six reverse stock split of its outstanding Common
Shares (including the Common Shares issued to the holders of the Preferred
Shares). As a result of the Issuer's recapitalization plan, there has been a
material change in the facts set forth in the Initial Statement. This Amendment
No. 1 amends, restates, and replaces the Initial Statement as it is the first
Schedule 13D to be filed on EDGAR.
Item 1. Security and Issuer.
This Amendment No. 1 to Schedule 13D relates to the Common Shares of
the Issuer. The address of the principal executive office of the Issuer is 444
West Fairmont, Tempe, Arizona 85282.
Item 2. Identity and Background.
This statement is being filed on behalf of Mr. George Soros (the
"Reporting Person") in his capacity as the sole proprietor of an investment
advisory firm conducting business under the name Soros Fund Management ("SFM").
This statement on Schedule 13D relates to Common Shares held for the account of
Quota Fund N.V., a Cayman Islands exempted limited duration company ("Quota"),
which has granted investment discretion to SFM pursuant to an investment
advisory contract.
SFM is a sole proprietorship of which the Reporting Person is the sole
proprietor. SFM has its principal office at 888 Seventh Avenue, 33rd Floor, New
York, New York 10106. Its sole business is to serve, pursuant to contract, as
the principal investment manager to several foreign investment companies (the
"SFM Clients"), including Quota. Quota has its principal office at Kaya
Flamboyan 9, Willemstad, Curacao, Netherlands Antilles. SFM's contracts with SFM
Clients generally provide that SFM is responsible for designing and implementing
the SFM Clients' overall investment strategy; for conducting direct portfolio
management strategies to the extent that SFM determines that it is appropriate
to utilize its own portfolio management capabilities; for selecting, evaluating
and monitoring other investment advisors who manage separate portfolios on
behalf of the SFM Clients; and for allocating and reallocating the SFM Clients'
assets among the outside managers and itself.
The principal occupation of the Reporting Person, a United States
citizen, is his direction of the activities of SFM, which is carried out in his
capacity as the sole proprietor of SFM at SFM's principal office. Information
concerning the identity and background of the Managing Directors of SFM is set
forth in Annex A hereto and incorporated by reference in response to this Item
2.
Pursuant to regulations promulgated under Section 13(d) of the Act,
the Reporting Person (as the sole proprietor and the person ultimately in
control of SFM) may be deemed a beneficial owner of securities, including the
Common Shares, held for the account of Quota as a result of the contractual
authority of SFM to exercise voting and dispositive power with respect to such
securities.
<PAGE>
Page 4 of 10 Pages
During the past five years, none of the Reporting Person, Quota and,
to the best of the Reporting Person's knowledge, any other person identified in
response to this Item 2 has been (a) convicted in a criminal proceeding, or (b)
a party to any civil proceeding as a result of which he has been 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.
Item 3. Source and Amount of Funds or Other Consideration.
As described below, Quota expended an aggregate of approximately
$1,212,292 of its working capital to purchase the 48,400 Common Shares and the
222,222 Preferred Shares, which were previously reported as being held for its
account. On January 14, 1994, Quota agreed to purchase 136,522 Preferred Shares
at a purchase price of $4.50 per Preferred Share pursuant to the terms of a
Series A Convertible Preferred Stock Purchase Agreement between the Issuer and
Quota dated as of January 14, 1994. The total cost of the January 14, 1994
transaction was approximately $614,349. On February 9, 1994, Quota purchased
30,000 Common Shares on the Nasdaq Small-Cap Securities over-the-counter market
at a purchase price of $4.687 per Common Share, for a total cost of
approximately $140,625. On December 1, 1994, Quota purchased 18,400 Common
Shares on the Nasdaq Small-Cap Securities over-the-counter market at a purchase
price of $3.895 per Common Share, for a total cost of approximately $71,668. On
December 14, 1994, Quota purchased an additional 85,700 Preferred Shares at a
purchase price of $4.50 per Preferred Share in a private transaction, for a
total cost of approximately $385,650.
Immediately prior to the Plan (as defined herein), the Preferred
Shares were convertible into an equal number of Common Shares at any time at the
option of the holder. The Preferred Shares were entitled to a cumulative,
preferred $0.405 annual dividend and were entitled to a liquidation preference
of $4.50 per Preferred Share, plus all accrued but unpaid dividends. Each of the
holders of the Preferred Shares was entitled to the number of votes equal to the
number of Common Shares into which the Preferred Shares held by such holder
could be converted at the time of such vote. In addition, in the event that the
Issuer failed to pay a specified amount of dividends on the Preferred Shares,
the Board of Directors of the Issuer was to be automatically increased by one
director (the "Default Director") and such Default Director was to be designated
by a majority of the holders of the Preferred Shares. As of the date of the
Plan, the Issuer had not paid any of the dividends on the Preferred Shares since
February 1995.
On August 12, 1996, pursuant to a recapitalization plan unanimously
approved and recommended by the Board of Directors of the Issuer and approved by
the requisite vote of the shareholders of the Issuer (the "Plan"), (i) each of
the Issuer's outstanding Preferred Shares was automatically converted into 13
Common Shares, and thereafter (ii) the Issuer effected a one-for-six reverse
stock split of its outstanding Common Shares (including the Common Shares issued
to the holders of the Preferred Shares).
The Plan resulted in 2,888,886 Common Shares being received for the
account of Quota in exchange for the 222,222 Preferred Shares previously held
for its account. These Common Shares, when added to the 48,400 Common Shares
previously held for the account of Quota, resulted in an aggregate of 2,937,286
Common Shares being held for the account of Quota prior to the reverse stock
split. After the one-for-six reverse stock split, a total of 489,548 Common
Shares are held for the account of Quota.
<PAGE>
Page 5 of 10 Pages
The Common Shares held for the account of Quota may be held through
margin accounts maintained with brokers, which extend margin credit to Quota as
and when required to open or carry positions in its margin accounts, subject to
applicable federal margin regulations, stock exchange rules and such firms'
credit policies. The positions which may be held in margin accounts, including
the Common Shares, are pledged as collateral security for the repayment of debit
balances in the respective accounts.
Item 4. Purpose of Transaction.
All of the Common Shares reported herein as having been acquired for
the account of Quota were acquired for investment purposes. Neither the
Reporting Person, nor, to the best of his knowledge, any of the other
individuals identified in response to Item 2, has any plans or proposals which
relate to or would result in any of the transactions described in subparagraphs
(a) through (j) of Item 4 of Schedule 13D. The Reporting Person reserves the
right to acquire additional securities of the Issuer, to dispose of such
securities at any time or to formulate other purposes, plans or proposals
regarding the Issuer or any of its securities, to the extent deemed advisable in
light of general investment and trading policies of SFM Clients, market
conditions or other factors.
Item 5. Interest in Securities of the Issuer.
(a) The aggregate number of Common Shares of which the Reporting
Person may be deemed a beneficial owner is 489,548 (approximately 33.22% of the
total number of Common Shares outstanding).
(b) Pursuant to the terms of the contract between Quota and SFM, the
Reporting Person may be deemed to have sole power to direct the voting and
disposition of securities held for the account of Quota, including the 489,548
Shares held for the account of Quota.
(c) Except for the transactions described in Item 3 above relating to
the Plan, there have been no transactions with respect to the Common Shares
since June 23, 1996 (60 days prior to the date hereof) by Quota or the Reporting
Person.
(d) The shareholders of Quota have the right to participate in the
receipt of dividends from, or proceeds from the sale of, securities, including
the Common Shares, held by Quota in accordance with their ownership interests in
Quota.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings in Relationship with Respect
to Securities of the Issuer.
From time to time, the Reporting Person and/or Quota may lend
portfolio securities to brokers, banks or other financial institutions. These
loans typically obligate the borrower to return the securities, or an equal
amount of securities of the same class, to the lender and typically provide that
the borrower is entitled to exercise voting rights and to retain dividends
<PAGE>
Page 6 of 10 Pages
during the term of the loan. From time to time, Quota or other SFM Clients may
borrow securities, including the Common Shares, for the purpose of effecting,
and may effect, short sale transactions, and may purchase securities for the
purpose of closing out short positions in such securities.
Except as disclosed above, the Reporting Person does not have any
contracts, arrangements, understandings or relationships with respect to any
securities of the Issuer.
Item 7. Material to be Filed as Exhibits.
(a) Power of Attorney dated April 16, 1996 granted by Mr. George Soros
in favor of Mr. Sean C. Warren.
<PAGE>
Page 7 of 10 Pages
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.
Date: August 22, 1996 GEORGE SOROS
By: /S/ SEAN C. WARREN
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Sean C. Warren
Attorney-in-Fact
<PAGE>
Page 8 of 10 Pages
ANNEX A
The following is a list of all of the persons who serve as Managing
Directors of Soros Fund Management ("SFM"):
Scott K. H. Bessent
Walter Burlock
Stanley Druckenmiller
Jeffrey L. Feinberg
Arminio Fraga
Gary Gladstein
Robert K. Jermain
David N. Kowitz
Elizabeth Larson
Alexander C. McAree
Paul McNulty
Gabriel S. Nechamkin
Steven Okin
Dale Precoda
Lief D. Rosenblatt
Mark D. Sonnino
Filiberto H. Verticelli
Sean C. Warren
Each of the above-listed persons is a United States citizen whose principal
occupation is serving as Managing Director of SFM, and each has a business
address c/o Soros Fund Management, 888 Seventh Avenue, New York, New York 10106.
During the past five years, none of the above-listed persons has been (i)
convicted in a criminal proceeding, or (ii) a party to any civil proceeding as a
result of which any such persons has been 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 violations with
respect to such laws.
<PAGE>
Page 9 of 10 Pages
INDEX OF EXHIBITS
EXHIBIT PAGE
A Power of Attorney dated April 16, 1996 granted by
Mr. George Soros in favor of Mr. Sean Warren. 10
Page 10 of 10 Pages
EXHIBIT A
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENT, that I, GEORGE SOROS, hereby make, constitute and
appoint SEAN C. WARREN as my agent and attorney in fact for the purpose of
executing in my name, in my personal capacity or in my capacity as sole
proprietor of Soros Fund Management, all documents, certificates, instruments,
statements, filings and agreements ("documents") to be filed with or delivered
to any foreign or domestic governmental or regulatory body or required or
requested by any other person or entity pursuant to any legal or regulatory
requirement relating to the acquisition, ownership, management or disposition of
securities or other investments, and any other documents relating or ancillary
thereto, including but not limited to, all documents relating to filings with
the United States Securities and Exchange Commission (the "SEC") pursuant to the
Securities Act of 1933 or the Securities Exchange Act of 1934 (the "Act") and
the rules and regulations promulgated thereunder, including: (1) all documents
relating to the beneficial ownership of securities required to be filed with the
SEC pursuant to Section 13(d) or Section 16(a) of the Act including, without
limitation: (a) any acquisition statements on Schedule 13D or Schedule 13G and
any amendments thereto, (b) any joint filing agreements pursuant to Rule
13d-1(f) and (c) any initial statements of, or statements of changes in,
beneficial ownership of securities on Form 3, Form 4 or Form 5 and (2) any
information statements on Form 13F required to be filed with the SEC pursuant to
Section 13(f) of the Act.
All past acts of the attorney-in-fact in furtherance of the foregoing are hereby
ratified and confirmed.
This power of attorney shall be valid from the date hereof until revoked by me.
IN WITNESS WHEREOF, I have executed this instrument this 16th of April, 1996.
/s/ George Soros
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GEORGE SOROS
