<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
AMENDMENT NO. 12
Under the Securities Exchange Act of 1934
MALIBU ENTERTAINMENT WORLDWIDE, INC.
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
(Title of Class of Securities)
561182106
(CUSIP Number)
RICHARD M. FITZPATRICK
MEI HOLDINGS, L.P.
2200 ROSS AVENUE
SUITE 4200
DALLAS, TEXAS 75201
(214) 220-4900
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
With a copy to:
ROBERT A. PROFUSEK, ESQ.
JONES, DAY, REAVIS & POGUE
599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022
(212) 326-3939
JULY 6, 1998
(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 this statement [ ].
<PAGE> 2
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 2
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MEI Holdings, L.P
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 3
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 3
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MEI GenPar, L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 4
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 4
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
HH GenPar Partners
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 5
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 5
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hampstead Associates, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 6
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 6
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RAW GenPar, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 7
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 7
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
InMed, Inc. d/b/a Incap, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 8
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 8
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Donald J. McNamara
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 9
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 9
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert A. Whitman
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 10
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 10
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Daniel A. Decker
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* [ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person
may be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 11
This Amendment No. 12 amends and supplements the Statement on
Schedule 13D first filed on June 17, 1996, as amended by Amendments No. 1
through 11 (the "Schedule 13D"), by MEI Holdings, L.P., a Delaware limited
partnership ("Holdings"), and certain other persons.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 is hereby amended to add the following at the end thereof:
On July 6, 1998, MEI Holdings delivered to the Company's Board of
Directors the letter which is attached hereto as Exhibit 99 and is incorporated
herein by this reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Item 7 is hereby amended to add the following at the end thereof:
Exhibit 99 Letter from MEI Holdings, L.P. to Board of Directors of Malibu
Entertainment Worldwide, Inc., dated July 6, 1998.
<PAGE> 12
SIGNATURES
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement may
be filed collectively on behalf of it and each of the other signatories hereto.
Dated: July 6, 1998
MEI HOLDINGS, L.P.
By: MEI GenPar, L.P.
Its General Partner
By: HH GenPar Partners
Its General Partner
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ Daniel A. Decker
------------------------------------
Daniel A. Decker
Executive Vice President
MEI GENPAR, L.P.
By: HH GenPar Partners
Its General Partner
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ Daniel A. Decker
------------------------------------
Daniel A. Decker
Executive Vice President
HH GENPAR PARTNERS
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ Daniel A. Decker
------------------------------------
Daniel A. Decker
Executive Vice President
HAMPSTEAD ASSOCIATES, INC.
By: /s/ Daniel A. Decker
------------------------------------
Daniel A. Decker
Executive Vice President
<PAGE> 13
RAW GENPAR, INC.
By: /s/ Robert A. Whitman
--------------------------------
Robert A. Whitman
President
INMED, INC.
By: /s/ Daniel A. Decker
--------------------------------
Daniel A. Decker
President
/s/ Donald J. McNamara
------------------------------------
Donald J. McNamara
/s/ Robert A. Whitman
------------------------------------
Robert A. Whitman
/s/ Daniel A. Decker
------------------------------------
Daniel A. Decker
<PAGE> 14
INDEX TO EXHIBITS
Exhibit Description
- ------- -----------
99 Letter from MEI Holdings, L.P. to Board of Directors of Malibu
Entertainment Worldwide, Inc., dated July 6, 1998
<PAGE> 1
EXHIBIT 99
[HR INTERESTS, L.L.C. LETTERHEAD]
July 6, 1998
Special Committee of the
Board of Directors
Malibu Entertainment Worldwide, Inc.
717 North Harwood
Suite 1650
Dallas, Texas 75201
Gentlemen:
HR Interests, L.L.C. is an entity sponsored by the Hampstead Group,
L.L.C. to acquire the Houlihan's restaurant group of companies. The acquisition
of Houlihan's was completed on June 29, 1998. The purchase price was
approximately $127 million (including approximately $7 million in transaction
costs), which was funded with $35 million of equity from HR Interests ($34.125
million for preferred stock and $900,000 for common stock), $1 million in equity
from Houlihan's management and $91 million in a combination of senior and
subordinated debt.
This letter has been prepared at your request to set forth the key
terms of a proposed combination of Houlihan's and Malibu for your
consideration. The key terms are:
1. Immediately before the combination, Malibu would become a wholly
owned subsidiary or a newly formed holding company pursuant to a holding
company reorganization in which each Malibu common share would be
converted into a common share of the new holding company. The new holding
company would be the public company.
2. At the closing of the Houlihan's-Malibu combination, all of
Houlihan's equity securities (other than the minority interest owned by
management) would be transferred to the new holding company in exchange
for new holding company common shares. The number of new holding company
common shares would be determined by dividing the $32,025,000 equity
investment in Houlihan's, plus a 12% "meter" on the Houlihan's preferred
stock from the June 29th closing date for the Houlihan's acquisition to
the closing date for the combination, by $1.8810, which is 85% of the
volume weighted average sales price for Malibu common shares for the 20
trading days ended July 2, 1998 of $2.2129. As such, any changes in the
market price of Malibu shares following the date of public disclosure of
this proposal in Hampstead's Schedule 13D filing with the SEC should not
be taken into account.
3. To ensure that Malibu's public shareholders will have an equal
opportunity to participate in the transaction and retain the same
proportionate ownership interest in the new holding company that they have
in Malibu, the public shareholders would receive transferrable 60-day
rights to purchase new holding common shares priced at the same per share
price as the shares issuable to HR Interests.
The enclosed diagrams depict the foregoing transactions in somewhat greater
detail.
It may be desirable to effect a reverse stock split as a part of
or immediately after the transaction in order to increase the per share trading
price of the new holding company common shares. In that event the per share
numbers set forth herein would be appropriately adjusted.
There are, of course, a number of issues that would have to be
addressed in the definitive documents providing for the transaction. We are
prepared to begin the documentation process immediately. As we trust you will
appreciate, this letter is submitted based on the understanding that, until
definitive agreements are executed, no party will have any legally binding
obligations.
We look forward to your reply.
Very truly yours,
HR INTERESTS, L.L.C.
By: /s/ RICHARD FITZPATRICK
-------------------------------
Duly Authorized
<PAGE> 2
PROJECT HERCULES
STEP 1: M REORGANIZATION
Public
MEI Holdings L.P. shareholders
81.4% 18.6%
All M shares
converted
into Sub 1
(Newco)
shares on a
1:1 basis
M
Existing Sub 1
shares cancelled
Existing Subs
Sub 1
(Newco after
the merger)
Merger
(Sub 2 into M)
Sub 2 shares
converted into M shares
on 1:1 basis
Sub 2
Page 1
<PAGE> 3
PROJECT HERCULES
STEP 2: ACQUISITION OF H BY M
<TABLE>
<S> <C> <C> <C> <C>
HR Funding,
L.P.
ISSUANCE OF
Mgmt. HR PARENT SHARES:
Interest, DETERMINE NUMBER
L.L.C. BY DIVIDING $35
MILLION, PLUS
12% RETURN FROM 6/29
TO CLOSING OF
COMBINATION, BY
$1.8810
2 1/2% preferred 97 1/2% preferred MEI Holdings, Public
10% common 90% common L.P. shareholders
CONTRIBUTION TO 81.4% 18.6%
NEWCO:
97 1/2% PREFERRED
AND 90%
COMMON STOCK
OF HR GROUP
HOLDINGS, INC.
HR GROUP
HOLDINGS,
INC. NEWCO
100%
Investors $20 million H Rest. Newly Formed
subordinated notes Group Inc. intermediate
subsidiary
100%
Banks $71 H Rest. M
million Inc.
loan
100%
Existing Existing
Subs Subs
</TABLE>
Page 2
<PAGE> 4
PROJECT HERCULES
STEP 3: RIGHTS OFFERING TO PUBLIC
SHAREHOLDERS OF COMBINED COMPANY
<TABLE>
<CAPTION>
<S> <C> <C>
HR Funding L.P.
HR Interests MEI Holdings L.P. Public
L.L.C. Shareholders
__% __% __%
If the rights offering is fully RIGHTS OFFERING
subscribed by public
shareholders the aggregate % NEWCO Issuance of additional shares
held by HR Interests L.L.C. and in rights offering at $1.90366
MEI Holdings, L.P. would be the per share. If fully subscribed,
same as MEI Holdings' Interest public shareholders interest
prior to the H acquisition (81.4%) (18.6%) would not be diluted
MGMT. 2 1/2% preferred
10% common
97 1/2% preferred 100%
90% common
HR Group Newly formed
Holdings, Inc. intermediate
subsidiary
100% 100%
INVESTORS $20 million
subdebt H Rest. M
Group, Inc.
100%
BANKS $71 million H Rest.
loan Inc.
100% Existing
Subs
Existing
Subs
</TABLE>
Page 3
