UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. #__)
Digital Generation Systems, Inc.
(Name of Issuer)
Common
(Title of Class of Securities)
253921100
(CUSIP Number)
Dawson-Samberg Capital Management, Inc., 354 Pequot Ave.
Southport CT 06490 Attn: Amiel M. Peretz 203/254-0091
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
July 25, 1997
(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 o.
Check the following box if a fee is being paid with this 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 the
disclosures provided in a prior cover page.
The information required in 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).
1 Name of Reporting Person DAWSON-SAMBERG CAPITAL MANAGEMENT, INC.
IRS Identification No. of Above Person 06-1033494
2 Check the Appropriate Box if a Member of a Group (a) o
(b) o
3 SEC USE ONLY
4 Source of Funds 00
5 Check Box if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(d) or 2(e)
6 Citizenship or Place of Organization CONNECTICUT
7 Sole Voting Power 1,026,311
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
8 Shared Voting Power 0
9 Sole Dispositive Power 1,026,311
10 Shared Dispositive Power 0
11 Aggregate Amount Beneficially Owned by Each Reporting Person 1,026,311
12 Check Box if the Aggregate Amount in Row 11 Excludes Certain Shares
13 Percent of Class Represented by Amount in Row 11 7.8%
14 Type of Reporting Person IA
1 Name of Reporting Person PEQUOT PRIVATE EQUITY PARTNERS, LLC
IRS Identification No. of Above Person 06-1469967
2 Check the Appropriate Box if a Member of a Group (a) o
(b) o
3 SEC USE ONLY
4 Source of Funds AF
5 Check Box if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(d) or 2(e)
6 Citizenship or Place of Organization DELAWARE
7 Sole Voting Power 0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
8 Shared Voting Power 0
9 Sole Dispositive Power 0
10 Shared Dispositive Power 0
11 Aggregate Amount Beneficially Owned by Each Reporting Person 681,333
12 Check Box if the Aggregate Amount in Row 11 Excludes Certain Shares
13 Percent of Class Represented by Amount in Row 11 5.3%
14 Type of Reporting Person OO
<PAGE>
ITEM 1. SECURITY AND ISSUER
This Statement relates to the Common Stock, no par value, of Digital
Generation Systems, Inc. ("DGIT") a California Corporation. DGIT's principal
executive office is located at 875 Battery Street, San Francisco, CA 94111.
ITEM 2. IDENTITY AND BACKGROUND
This statement is being filed on behalf of Dawson-Samberg Capital
Management, Inc. ("Dawson-Samberg"), a Connecticut corporation, and Pequot
Private Equity Partners, LLC ("Equity Partners"), a limited liability company
formed under the laws of Delaware (collectively, the "Reporting Persons"). The
principal business of Dawson-Samberg, an investment adviser registered under
the Investment Advisers Act of 1940, is to act as investment adviser to
certain managed accounts. The principal shareholders of Dawson-Samberg are
Messrs. Jonathan T. Dawson and Arthur J. Samberg. The principal business of
Equity Partners is to serve as the general partner of Pequot Private Equity
Fund, L.P. ("Private Equity"), a limited partnership formed under the laws of
Delaware to invest and trade primarily in securities and financial
instruments, and to serve as investment manager of Pequot Offshore Private
Equity Fund, Inc. ("Offshore Private Equity"), a corporation formed under the
laws of the British Virgin Islands to invest and trade primarily in securities
and financial instruments. Messrs. Dawson and Samberg are both members of
Equity Partners. The business address of the Reporting Persons is 354 Pequot
Avenue, Southport, CT 06490.
None of the Reporting Persons, their respective members, officers,
directors or controlling persons have, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
None of the Reporting Persons, their respective members, officers,
directors or controlling persons have, during the last five years, been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction which resulted in 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 of the date hereof, under rule 13d-3(d) (1) (i) under the Securities
Exchange Act of 1934, Dawson-Samberg is deemed to be the beneficial owner of
1,026,311 shares of the Company's Common Stock by virtue of the Series A
Convertible Preferred Stock (the "Shares") held by accounts for which it (or
its principals) exercises investment discretion, as follows; 172,489 Shares
are owned by Pequot Partners Fund, L.P. ("Pequot") , a Delaware limited
partnership, 172,489 Shares are owned by Pequot International Fund, Inc.
("International"), a corporation formed under the laws of the British Virgin
Islands, 604,763 Shares are owned by Private Equity and 76,570 Shares are
owned by Offshore Private Equity. As of the date hereof, Equity Partners
beneficially owns in the aggregate 681,333 shares of the Company's Common
Stock by virtue of the 604,763 Shares owned by Private Equity and the 76,570
Shares owned by Offshore Private Equity. The 1,026,311 Shares were purchased
in a Private Placement directly from the Company @ $3.535 per Share for a
total of $3,628,012.50. The funds for the purchase of Shares held by all of
the entities were obtained from the contributions of their various
partners/shareholders. Such funds, in the case of Pequot and International,
may also include the proceeds of margin loans entered into in the ordinary
course of business with Morgan Stanley & Company, Inc.
<PAGE>
ITEM 4. PURPOSE OF TRANSACTION
The Shares held by the above-mentioned entities were acquired for, and
are being held for, investment purposes. The acquisitions of the Shares
described herein were made in the ordinary course of the Reporting Person's
business or investment activities, as the case may be. The Reporting Persons,
on behalf of the above-mentioned entities, reserves the right to purchase
additional Shares or shares of the Company's Common Stock or to dispose of the
Shares or the shares of the Company's Common Stock in the open market or in
privately negotiated transactions or in any other lawful manner in the future,
including engaging in short sales of the Shares or the shares of the Company's
Common Stock, and to take whatever action with respect to each of such
entities' holdings of the Shares or the shares of the Company's Common Stock
it deems to be in the best interests of such entities.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
As of the date hereof, Dawson-Samberg and Equity Partners beneficially
own in the aggregate 1,026,311 and 681,333 shares, respectively. These shares,
if converted, would represent approximately 7.8% and 5.3%, respectively, of
the 13,126,136 and 12,781,158 shares, respectively, of DGIT's Common Stock
which would be outstanding if the Series A Convertible Preferred Stock owned
by such Reporting Person was converted into Common Stock. Dawson-Samberg (or
its principals) has the sole power to vote, direct the vote, dispose and
direct the disposition of all of the 1,026,311 Shares beneficially owned by
Dawson-Samberg. Equity Partners does not currently have the power to vote,
direct the vote, dispose and direct the disposition of the 681,333 Shares
beneficially owned by Equity Partners but may acquire such powers by
terminating its investment management agreement with Dawson-Samberg. The only
transaction of the Reporting Persons in the past 60 days was the entering into
a purchase agreement with the Company to purchase a total of 2,524,752 Shares
of Series A Convertible Preferred Stock @ $3.535 per share in a private
placement. The first closing of 1,026,311 Shares pursuant to this purchase
agreement was on 7/25/97 and is the subject of this filing.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
None
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
A copy of a written agreement relating to the filing of a joint statement
as required by Rule 13d-1(f) under the Securities Exchange Act of 1934 is
attached hereto as Exhibit A.
<PAGE>
After a reasonable inquiry and to the best of my knowledge and belief,
the undersigned certify that the information set forth in this statement is
true, complete and correct.
August 5, 1997
Dawson-Samberg Capital Management, Inc.
By: /s/ Amiel M. Peretz
Amiel M. Peretz, Chief Financial Officer
Pequot Private Equity Partners, LLC
By: /s/ Amiel M. Peretz
Amiel M. Peretz, Member
<PAGE>
EXHIBIT A
AGREEMENT
The undersigned agree that this Schedule 13D dated August 5, 1997
relating to the Shares of DGIT shall be filed on behalf of the undersigned.
Dawson-Samberg Capital Management, Inc.
By: /s/ Amiel M. Peretz
Amiel M. Peretz, Chief Financial Officer
Pequot Private Equity Partners, LLC
By: /s/ Amiel M. Peretz
Amiel M. Peretz, Member
