<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
FOUR MEDIA COMPANY
- --------------------------------------------------------------------------------
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
- --------------------------------------------------------------------------------
(Title of Class of Securities)
(CUSIP Number) 350872107
- --------------------------------------------------------------------------------
Larry A. Kimmel
Robert Fleming, Inc.
320 Park Avenue, 11th Floor
New York, NY 10022
(212) 508-3610
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
January 18, 1999
- --------------------------------------------------------------------------------
(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 that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
[X].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
(Page 1 of 15 Pages)
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(Page 2 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
FLEMING US DISCOVERY FUND III, L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A) [X]
(B) [_]
- - ------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
- - ------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [_]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 1,939,200 shares of Common Stock
BENEFICIALLY --------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 310,800 shares of Common Stock
PERSON --------------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
1,939,200 shares of Common Stock
--------------------------------------------------------
10 SHARED DISPOSITIVE POWER
310,800 shares of Common Stock
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,250,000 shares of Common Stock
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.8%
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN
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<PAGE>
(Page 3 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
FLEMING US DISCOVERY OFFSHORE FUND III, L.P.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A) [X]
(B) [_]
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [_]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
BERMUDA
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7 SOLE VOTING POWER
NUMBER OF
SHARES 310,800 shares of Common Stock
BENEFICIALLY -----------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 1,939,200 shares of Common Stock
PERSON -----------------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
310,800 shares of Common Stock
-----------------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,939,200 shares of Common Stock
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,250,000 Shares of Common Stock
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.8%
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN
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<PAGE>
(Page 4 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
FLEMING US DISCOVERY PARTNERS, L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A) [X]
(B) [_]
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [_]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 0 shares of Common Stock
BENEFICIALLY ------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 2,417,900 shares of Common Stock
PERSON ------------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
0 shares of Common Stock
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN
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<PAGE>
(Page 5 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
FLEMING US DISCOVERY, LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A) [_]
(B) [_]
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 2,417,900 shares of Common Stock
BENEFICIALLY ----------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 2,417,900 shares of Common Stock
PERSON ----------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
2,417,900 shares of Common Stock
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OO
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<PAGE>
(Page 6 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
ROBERT FLEMING, INC.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A)[_]
(B)[_]
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [_]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 0 shares of Common Stock
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
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IA, CO
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<PAGE>
(Page 7 of 15 Pages)
SCHEDULE 13D
CUSIP NO. 350872107
1 NAME OF REPORTING PERSON
ROBERT FLEMING HOLDINGS, LTD.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)(A) [_]
(B) [_]
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or (e) [_]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED KINGDOM
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 0 shares of Common Stock
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
2,417,900 shares of Common Stock
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS) [_]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.2%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
HC, CO
- --------------------------------------------------------------------------------
<PAGE>
Item 1. Security and Issuer.
This statement relates to Common Stock, $0.01 par value per share
("Common Stock"), of Four Media Company, a Delaware corporation
("Issuer"). The address of the Issuer's principal executive offices is
2813 West Alameda Avenue, Burbank, CA 91505.
Item 2. Identity and Background.
This statement is being filed pursuant to a Joint Filing Agreement
(attached as Exhibit 1 and incorporated herein by reference) by (i)
Fleming US Discovery Fund III, L.P. ("US Fund"), (ii) Fleming US
Discovery Offshore Fund III, L.P. ("Offshore Fund"), (iii) Fleming US
Discovery Partners, L.P., ("Fleming Partners"), the general partner of
the US Fund and a general partner of the Offshore Fund, (iv) Fleming
US Discovery, LLC ("Discovery"), the general partner of Fleming
Partners, (v) Robert Fleming, Inc. ("RFI"), investment adviser to the
US Fund and Offshore Fund (collectively, the "Funds"), and (vi) Robert
Fleming Holdings, Ltd. ("RFH"), the indirect parent of RFI (sometimes
collectively referred to as the "Reporting Persons").
The information required by this Item for each of the Reporting
Persons is set forth in Appendix 1 hereto. The information required by
this Item for each officer, director, and partner and each controlling
person, if any, of certain Reporting Persons is set forth in Appendix
2 hereto.
The Offshore Fund has two general partners, Fleming Partners and
Fleming (Bermuda) Discovery III Limited ("Fleming Bermuda"). Fleming
Bermuda is a company organized in Bermuda. Its principal business and
office address is c/o Bank of Bermuda, Ltd., 6 Front St., Hamilton HM
11, Bermuda. Its principal business is to serve as a general partner
of the Offshore Fund.
During the last five years prior to the date of this filing, none of
the Reporting Persons or persons identified in Appendix 1 or Appendix
2 has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or has been a party to a civil
proceeding of a judicial or administrative body of competent
jurisdiction ending in a judgment, decree or final order enjoining
future violations or prohibiting or mandating the activities subject
to, federal or state securities laws or finding a violation with
respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On February 5, 1998, the US Fund entered into the Preferred Stock
Purchase Agreement, dated as of February 5, 1998, between the Issuer
and the US Fund (attached hereto as Exhibit 4 and incorporated herein
by reference), to purchase 129,280 shares of Series A Convertible
Preferred Stock, $0.01 par value per share ("Preferred Stock"), of the
Issuer for a total purchase price of $12,928,000. The Preferred Stock,
which was acquired by the US Fund at the closing on February 27, 1998,
was convertible into 1,292,800 shares of Common Stock. The US Fund
purchased the Preferred Stock with its working capital. On January
18, 1999, the US Fund agreed to convert all of its shares of Preferred
8 of 15
<PAGE>
Stock into 1,939,200 shares of Common Stock, subject to certain
closing conditions beyond the control of the Reporting Persons,
pursuant to a Preferred Stock Conversion and Stockholders Agreement,
dated as of January 18, 1999, among the Issuer, the Funds and the
Purchasers (as defined in Item 4 of this Schedule) (the "Conversion
Agreement") (attached hereto as Exhibit 9 and incorporated herein by
reference). No part of the purchase price was or will be represented
by funds or other consideration borrowed or otherwise obtained for the
purpose of acquiring, holding, trading or voting the Common Stock.
On February 5, 1998, the Offshore Fund entered into the Preferred
Stock Purchase Agreement, dated as of February 5, 1998, between the
Issuer and the Offshore Fund, to purchase 20,720 shares of Preferred
Stock for a total purchase price of $2,072,000. The Preferred Stock,
which was acquired by the Offshore Fund at closing on February 27,
1998, was convertible into 207,200 shares of Common Stock. The
Offshore Fund purchased the Preferred Stock with its working capital.
On January 18, 1999, the Offshore Fund agreed to convert all of its
shares of Preferred Stock into 310,800 shares of Common Stock, subject
to certain closing conditions beyond the control of the Reporting
Persons, pursuant to the Conversion Agreement. No part of the
purchase price was or will be represented by funds or other
consideration borrowed or otherwise obtained for the purpose of
acquiring, holding, trading or voting the Common Stock.
Item 4. Purpose of Transaction.
(a) The Funds acquired the Preferred Stock, and will acquire the
Common Stock upon closing of the proposed Transaction (as defined
below), for investment purposes. The Funds may dispose of or acquire
securities of the Issuer, including Common Stock, depending upon the
position of the market, the Issuer and other factors.
Upon the closing of a transaction (the "Transaction") proposed
pursuant to a Securities Purchase Agreement, dated as of January 18,
1999 (the "Securities Purchase Agreement"), among the Issuer and
Warburg, Pincus Equity Partners, L.P., a Delaware limited partnership
("WPEP"), Warburg, Pincus Netherlands Equity Partners I, C.V.,
Warburg, Pincus Netherlands Equity Partners II, C.V. and Warburg,
Pincus Netherlands Equity Partners III, C.V. (WPEP together with these
"Netherlands Entities", collectively, the "Purchasers"), the Funds,
the holders of all outstanding shares of the Issuer's Preferred Stock
(the "Preferred Stockholders"), will convert all of their preferred
shares into 2,250,000 shares of Common Stock pursuant to the
Conversion Agreement. In addition, upon the closing, the Issuer will
grant the Preferred Stockholders customary demand and piggyback
registration rights with respect to the shares of Common Stock of
which they acquired beneficial ownership in the Transaction.
Upon the closing of the Transaction, all rights of the Funds under the
Preferred Stock Purchase Agreements described in Item 3 and all
agreements executed in connection therewith, including the
Stockholders' Agreement described in Item 6, will terminate.
The Preferred Stockholders have also entered into a voting agreement
with the Purchasers, dated as of January 18, 1999 (the "Preferred
Voting Agreement"). Under the terms of the Preferred Voting
Agreement,
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<PAGE>
the Preferred Stockholders have agreed to support the Transaction and
to vote against any competing transactions that may arise prior to
termination of the Securities Purchase Agreement.
The foregoing descriptions are qualified in their entirety by
reference to the Conversion Agreement (and the exhibits thereto), the
Preferred Voting Agreement and the Securities Purchase Agreement (and
the exhibits thereto), which were filed as exhibits to the Issuer's
Form 8-K, filed with the Securities and Exchange Commission (the
"Commission") on January 20, 1999.
Except as set forth above, none of the Reporting Entities nor, to the
best of their knowledge, any person listed in Appendix I hereto, has
any plans or proposals which relate to or would result in any other
acquisition by any person of additional securities of the Issuer, or
the disposition of securities of the Issuer.
(b) Except as set forth above, none of the Reporting Entities
nor, to the best of their knowledge, any person listed in Appendix I
hereto, has any plans or proposals which relate to or would result in
an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its
subsidiaries.
(c) Except as set forth above, none of the Reporting Entities
nor, to the best of their knowledge, any person listed in Appendix I
hereto, has any plans or proposals which relate to or would result in
a sale or transfer of a material amount of assets of the Issuer or any
of its subsidiaries.
(d) Pursuant to the Securities Purchase Agreement, upon
consummation of the Transaction, the Purchasers will have the right,
so long as they beneficially own at least 35% of the then outstanding
shares of the Common Stock, to cause the Issuer to nominate and use
its best efforts to elect individuals designated by the Purchasers to
comprise a majority of the members of the Issuer's Board of Directors.
Furthermore, for so long as the Purchasers beneficially own at least
10% and less than 35% of the then outstanding shares of the Common
Stock, the Issuer will continue to be obligated to nominate and use
its best efforts to elect individuals designated by the Purchasers as
members of the Issuer's Board of Directors, on a decreasing basis in
proportion to such ownership. Pursuant to the Issuer's Certificate of
Designations, the Preferred Stockholders have the right, so long as
they beneficially own at least 75,000 shares of Preferred Stock, to
elect one director to the Issuer's Board of Directors. Upon
consummation of the Transaction and pursuant to the Conversion
Agreement, the Funds have the right, so long as they beneficially own
at least 1,125,000 shares of Common Stock, to nominate one individual
reasonably acceptable to the Issuer to stand for election to the
Issuer's Board of Directors. The Issuer has agreed to use its
reasonable best efforts to secure the election of such nominees to the
Board of Directors. In addition, pursuant to the Preferred Voting
Agreement, the Purchasers and the Funds have agreed to vote their
respective shares of Common Stock for their respective nominees.
Except as set forth above, none of the Reporting Entities nor, to
the best of their knowledge, any person listed in Appendix I hereto,
has any plans or proposals which relate to or would result in any
other
10 of 15
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changes in the board of directors or management of the Issuer, or
which relate to or would result in: (e) any material change in the
present capitalization or divided policy of the Issuer; (f) any other
material change in the Issuer's business or corporate structure; (g)
changes in the Issuer's charter, By-Laws 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 Exchange Act; or (j)
any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) On February 27, 1998, the US Fund purchased 129,280 shares of
Preferred Stock ("US Fund Preferred Stock"). The US Fund Preferred
Stock is convertible into 1,292,800 shares of Common Stock. Pursuant
to the Conversion Agreement and upon consummation of the Transaction,
the US Fund Preferred Stock will be converted into 1,939,200 shares of
Common Stock ("US Fund Conversion Shares").
On February 27, 1998, the Offshore Fund purchased 20,720 shares of
Preferred Stock ("Offshore Fund Preferred Stock"). The Offshore Fund
Preferred Stock is convertible into 207,200 shares of Common Stock.
Pursuant to the Conversion Agreement and upon consummation of the
Transaction, the Offshore Fund Preferred Stock will be converted into
310,800 shares of Common Stock ("Offshore Fund Conversion Shares").
Because of their relationship as affiliated entities, both Funds may
be deemed to beneficially own the US Fund Conversion Shares and the
Offshore Fund Conversion Shares. As the general partner of both
Funds, Fleming Partners may be deemed to beneficially own the US Fund
Conversion Shares and the Offshore Fund Conversion Shares. As the
general partner of Fleming Partners, Discovery may be deemed to
beneficially own the US Fund and Offshore Fund Conversion Shares. As
investment adviser to the Funds, controlling member of Discovery and
the sole limited partner of Fleming Partners, RFI may be deemed to
beneficially own the US Fund and Offshore Fund Conversion Shares. RFH
is the indirect 80% owner of RFI. Thus, as the indirect parent of RFI,
RFH may be deemed to beneficially own the US Fund and Offshore Fund
Conversion Shares.
In addition, Fleming Partners, Discovery, RFI and RFH may be deemed to
beneficially own 45,500 shares of Common Stock owned by Fleming US
Discovery Investment Trust and 122,400 shares of Common Stock owned by
Fleming US Discovery Fund, all of which shares were purchased on the
open market.
Pursuant to the Offshore Fund's Limited Partnership Agreement
(attached hereto as Exhibit 2 and incorporated herein by reference),
Fleming Bermuda, one of the Offshore Fund's general partners, is
responsible for the Offshore Fund's administrative, secretarial and
related management activities. Fleming Bermuda has no authority over
or responsibility for the investment management of the Offshore Fund.
11 of 15
<PAGE>
As of January 18, 1999, each of the Funds may be deemed to have owned
beneficially 17.8% of Common Stock, on an aggregated basis, which
percentage is calculated based upon (i) 10,363,256 shares of Common
Stock reported outstanding by the Issuer in their Quarterly Report on
Form 10-Q for the quarterly period ended November 1, 1998, and (ii)
the number of shares of Common Stock (2,250,000) issuable upon
conversion of the US Fund Preferred Stock and Offshore Fund Preferred
Stock.
The percentage is calculated by dividing 2,250,000 by 12,613,256,
which is the sum of 2,250,000 and 10,363,256.
As of January 18, 1999, each of Fleming Partners, Discovery, RFI and
RFH may be deemed to have beneficially owned 19.2% of Common Stock, on
an aggregated basis, which percentage is calculated by dividing
2,417,900 by 12,613,256.
(b) The information required by this paragraph is reflected on
Lines 7-10 of each Reporting Person's cover page, incorporated herein
by reference. The information required by Items 2 of this Schedule
for Fleming US Discovery Investment Trust and Fleming US Discovery
Fund is set forth in Appendix 1 and Appendix 2 hereto.
(c) None of the Reporting Persons has effected any transactions
in the Common Stock during the last 60 days.
(d) No other person is known to have the right to receive or the
power to direct the receipt of dividends from, or any proceeds from
the sale of, the shares of Common Stock beneficially owned by any of
the Reporting Persons.
(e) Not Applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
The Funds acquired their respective shares of Preferred Stock pursuant
to the Preferred Stock Purchase Agreements, dated as of February 5,
1998, and executed by the Funds and the Issuer.
A Stockholders' Agreement, dated as of February 27, 1998 (attached
hereto as Exhibit 6 and incorporated herein by reference), was entered
into by the Issuer, Robert T. Walston, John H. Donlon, Gavin W.
Schutz, Robert Bailey and each of the Funds. The Stockholders'
Agreement provides that in the event Robert T. Walston ("Walston")
proposes to transfer Walston shares ("Transferor Shares") to any
Person ("Buyer"), as a condition to such Transfer, Walston shall cause
the Buyer to offer to purchase from each Fund up to that number of
Investor Shares representing the same percentage of all Investor
Shares owned by it as the Transferor Shares are of all Walston shares,
subject to certain exceptions. These "Tag-Along" rights are more
fully set forth in Section 1 of the Stockholders' Agreement. In
addition, under the Stockholders' Agreement, the Preferred
Stockholders have the option of participating, on a pro rata basis,
subject to certain exceptions, in future issuances by the Issuer of
privately placed preferred and/or Common Stock. Upon the closing of
the Transaction, all rights of the Funds under this Stockholders'
Agreement will terminate. Pursuant to the Conversion Agreement, so
long as the Funds own at least 1,125,000
12 of 15
<PAGE>
shares of Common Stock, the Funds have "tag-along" rights with respect
to Walston shares and shares held by the Purchasers similar to the
"tag-along" rights provided by the Stockholders' Agreement. These
rights are more fully set forth in the Conversion Agreement.
Pursuant to the Certificate of Designations, the Preferred
Stockholders currently are entitled to one vote per share of Common
Stock into which each share of Preferred Stock is convertible. The
Preferred Stockholders are entitled to receive dividends in an amount
equal to the equivalent per share dividend declared on the Common
Stock, when and as declared by the Board of Directors.
Pursuant to the Preferred Voting Agreement and the Conversion
Agreement, the Funds agreed to transfer restrictions on the shares of
Preferred Stock.
In the Limited Partnership Agreements of the US Fund and the Offshore
Fund, each dated as of September 27, 1996 (attached hereto as
Exhibits 3 and 2, and incorporated herein by reference), the Funds
and their respective limited partners agreed that (i) all investment
opportunities would be apportioned between the Funds in proportion to
the relative amounts of capital committed to each Fund and (ii) the
Funds would sell or otherwise dispose of their investments at
substantially the same time, on substantially the same terms, in
amounts proportionate to the relative size of their investments.
The foregoing descriptions are qualified in their entirety by
reference to the Preferred Stock Purchase Agreement, the Stockholders'
Agreement, the Conversion Agreement, the Certificate of Designations
and the Preferred Voting Agreement.
Except as set forth in this Item 6 and Items 3,4 and 5 of this
statement, there are no contracts, arrangements, understandings or
relationships among the persons named in Item 2 or between such
persons and any other person with respect to any securities of the
Issuer.
13 of 15
<PAGE>
Item 7. Material to be Filed as Exhibits:
Exhibit 1 - Joint Filing Agreement.
Exhibit 2 - Limited Partnership Agreement of Fleming Discovery
Offshore Fund III, L.P. (incorporated by reference to
Exhibit 3 to the Schedule 13D of Robert Fleming, Inc. with
respect to the securities of Anicom, Inc. filed on July
29, 1997).
Exhibit 3 - Limited Partnership Agreement of Fleming US Discovery Fund
III, L.P. (incorporated by reference to Exhibit 6 to the
Schedule 13D of Robert Fleming, Inc. with respect to the
securities of Anicom, Inc. filed on July 29, 1997).
Exhibit 4 - Preferred Stock Purchase Agreement, dated as of February
5, 1998 between Four Media Company and Fleming US
Discovery Fund III, L.P.(incorporated by reference to
Exhibit 4.2 to Issuer's Quarterly Report on Form 10-Q for
the quarterly period ended February 1, 1998).
Exhibit 5 - Certificate of Designations of Series A Convertible
Preferred Stock Four Media Company filed with the
Secretary of State of Delaware on February 26, 1998
(incorporated by reference to Exhibit 3 to Issuer's
Quarterly Report on Form 10-Q for the quarterly period
ended February 1, 1998).
Exhibit 6 - Stockholders' Agreement, dated as of February 27, 1998
(incorporated by reference to Exhibit 4.3 to Issuer's
Quarterly Report on Form 10-Q for the quarterly period
ended February 1, 1998).
Exhibit 7 - Registration Rights Agreement, dated as of February 27,
1998 (incorporated by reference to Exhibit 4.4 to Issuer's
Quarterly Report on Form 10-Q for the quarterly period
ended February 1, 1998).
Exhibit 8 - Securities Purchase Agreement, dated as of January 18,
1999 (incorporated by reference to the same document
included as Exhibit 99.2 to Form 8-K filed by the Issuer
on January 20, 1999, under SEC File No. 0-21943 (the
"Company Form 8-K").
Exhibit 9 - Preferred Stock Conversion Agreement and Stockholders
Agreement, dated as of January 18, 1999 (incorporated by
reference to the same document included as Exhibit 99.5 to
the Company Form 8-K).
Exhibit 10 - Voting Agreement, dated as of January 18, 1999
(incorporated by reference to the same document included
as Exhibit 99.6 to the Company Form 8-K).
Exhibit 11 - Press Release issued by the Issuer on January 19, 1999
(incorporated by reference to the same document included
as Exhibit 99.1 to the Company Form 8-K).
14 of 15
<PAGE>
Appendix 1 - Address, Organization and Principal Business of Each
Reporting Person Required by Item 2
Appendix 2 - Information About Each Reporting Person Required by Item 2
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
15 of 15
<PAGE>
SIGNATURE
After reasonable 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.*
January 27, 1999 Fleming US Discovery Fund III, L.P.
By: Fleming US Discovery Partners, L.P.,
its general partner
By: Fleming US Discovery, LLC, its
general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery Offshore Fund III, L.P.
By: Fleming US Discovery Partners, L.P., its
general partner
By: Fleming US Discovery, LLC, its
general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery Partners, L.P.
By: Fleming US Discovery, LLC, its
general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery, LLC
By: /s/ Christopher M.V. Jones
----------------------------
Christopher M.V. Jones, member
Robert Fleming, Inc.
By: /s/ Christopher M.V. Jones
------------------------------
Christopher M.V. Jones, Director
Robert Fleming Holdings, Ltd.
By: /s/ Arthur A. Levy
-----------------------------
Arthur A. Levy, Director
<PAGE>
Appendix 1
ADDRESS, ORGANIZATION AND PRINCIPAL BUSINESS OF EACH
REPORTING PERSON REQUIRED BY ITEM 2 AND OTHER PERSONS REQUIRED BY ITEM 5
<TABLE>
<CAPTION>
REPORTING PERSON PRINCIPAL BUSINESS
AND OFFICE ADDRESS PLACE OF ORGANIZATION PRINCIPAL BUSINESS
<S> <C> <C> <C>
Fleming US Discovery Fund III, L.P. 320 Park Avenue, 11th Floor Delaware limited partnership to invest in securities with a
("US Fund") New York, NY 10022 view to long-term capital
appreciation
Fleming US Discovery Offshore c/o Bank of Bermuda, Ltd,. Bermuda limited partnership to invest in securities with a
Fund III, L.P. 6 Front St view to long-term capital
("Offshore Fund," with US Fund, Hamilton HM 11 Bermuda appreciation
the "Funds")
Fleming US Discovery Partners, L.P. 320 Park Avenue, 11th Floor Delaware limited partnership to act as the general partner
("Fleming Partners") New York, NY 10022 of the Funds
Fleming US Discovery, LLC 320 Park Avenue, 11th Floor Delaware limited liability to act as the sole general
New York, NY 10022 company partner of Fleming Partners
Robert Fleming, Inc. 320 Park Avenue, 11th Floor Delaware corporation a registered investment
New York, NY 10022 adviser and broker-dealer
Robert Fleming Holdings, Ltd. 25 Copthall Avenue United Kingdom company to provide international
London EC2B 7PQ, England investment banking, asset
management and securities
brokerage services to its
clients
</TABLE>
OTHER
- -----
Fleming US Discovery 25 Copthall Avenue
Investment Trust London EC2B 7PQ, England
Fleming US Discovery 320 Park Avenue, 11th Floor
Fund New York, NY 10022
A - 1
<PAGE>
Appendix 2
INFORMATION ABOUT REPORTING PERSONS
REQUIRED BY ITEM 2
MANAGERS AND COMMITTEES OF FLEMING US DISCOVERY, LLC
MANAGERS
Robert Fleming, Inc.
Robert L. Burr
Christopher M.V. Jones
Eytan M. Shapiro*
Timothy R.V. Parton*
EXECUTIVE COMMITTEE
Arthur A. Levy
Iain O.S. Saunders
Jonathan K.L. Simon
Robert L. Burr
Christopher M.V. Jones
INVESTMENT COMMITTEE
Robert L. Burr
Christopher M.V. Jones
Eytan M. Shapiro
Timothy R.V. Parton
* Eytan M. Shapiro, Christopher M.V. Jones and Timothy R.V. Parton are United
Kingdom citizens. Robert L. Burr is a United States citizen. Their business
address is 320 Park Avenue, 11th Floor, New York, New York 10022. The
citizenship and business address, for each of the remaining persons listed above
is contained in "Executive Officers and Directors of Robert Fleming, Inc."
A - 2
<PAGE>
EXECUTIVE OFFICERS AND DIRECTORS OF ROBERT FLEMING, INC.
Name: Lord Robin Renwick
Citizenship: United Kingdom
Business Address: Robert Fleming & Co.
25 Copthall Avenue
London EC2R-7DR, England
Title: Chairman of the Board
Name: Arthur A. Levy
Citizenship: United States
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: President, Vice Chairman and Director
Name: Christopher M.V. Jones
Citizenship: United Kingdom
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Director
Name: Larry A. Kimmel
Citizenship: United States
Business Address: Robert Fleming,Inc.
320 Park Avenue
New York, NY 10022
Title: Vice President and Director of Compliance
Name: Iain O.S. Saunders
Citizenship: United Kingdom
Business Address: Robert Fleming & Co.
25 Copthall Avenue
London EC2R-7DR, England
Title: Director
A - 3
<PAGE>
Name: Jonathan K.L. Simon
Citizenship: United Kingdom
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Director
Name: Andrea M. Whitmore
Citizenship: United Kingdom
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Chief Financial Officer and Vice President
Name: Mark Mattheys
Nationality: United States
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Director and Chief Operating
Officer
Name: Charlie Bridge
Nationality: United States
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Director
Name: Eduardo Canet
Nationality: United States
Business Address: Robert Fleming, Inc.
320 Park Avenue
New York, NY 10022
Title: Director
A - 4
<PAGE>
OFFICERS AND DIRECTORS OF ROBERT FLEMING HOLDINGS, LTD.
BOARD OF DIRECTORS* CITIZENSHIP
- ------------------- -----------
John Manser CBE United Kingdom
Chairman
William Garrett United Kingdom
Group Chief Executive
Phillip Wichelow United Kingdom
Iain O.S. Saunders United Kingdom
John Emly United Kingdom
Paul Bateman United Kingdom
Tom Hughes-Hallett United Kingdom
Michael Baines United Kingdom
David Boardman United Kingdom
Robin Fleming United Kingdom
Ken Inglis United Kingdom
Arthur A. Levy United States
Bernard Taylor United Kingdom
Sir Robin Renwick KCMG United Kingdom
John Archibald United Kingdom
Peter Barton United Kingdom
Ian Hannam United Kingdom
*With the exception of Arthur A. Levy, the business address for each of the
above persons is 25 Copthall Avenue, London EC2R- 7DR, England. The titles below
the first four names refer to officer titles.
A - 5
<PAGE>
Exhibit 1
JOINT FILING AGREEMENT
Pursuant to and in accordance with Rule 13d-1(k)(1) under the Securities
Exchange Act of 1934, the undersigned hereby agree to jointly file the Schedule
13D dated January 18, 1999 and any amendments thereto with respect to the
beneficial ownership by each of the undersigned of shares of common stock of
Four Media Company. Such joint filings may be executed by one or more of us on
behalf of each of the undersigned.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
Executed this day of January 27, 1999.
Fleming US Discovery Fund III, L.P.
By: Fleming US Discovery Partners, L.P.,
its general partner
By: Fleming US Discovery, LLC,
its general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery Offshore Fund III, L.P.
By: Fleming US Discovery Partners, L.P.,
its general partner
By: Fleming US Discovery, LLC,
its general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery Partners, L.P.
By: Fleming US Discovery, LLC,
its general partner
By: /s/ Christopher M.V. Jones
--------------------------
Christopher M.V. Jones, member
Fleming US Discovery, LLC
By: /s/ Christopher M.V. Jones
---------------------------
Christopher M.V. Jones, member
Robert Fleming, Inc.
By: /s/ Christopher M.V. Jones
------------------------------
Christopher M.V. Jones, Director
Robert Fleming Holdings, Ltd.
<PAGE>
By: /s/ Arthur A. Levy
---------------------------
Arthur A. Levy, Director
