UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)
HMN FINANCIAL, INC.
(Name of Issuer)
Common Stock, $.01 par value
(Title of Class of Securities)
40424G108
(CUSIP Number)
Charles R. Haywood
Foley & Lardner
One IBM Plaza
330 North Wabash Avenue
Suite 3300
Chicago, Illinois 60611
(312) 755-1900
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 20, 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 [ ].
<PAGE>
1 Name of Reporting Person
S.S. or I.R.S. Identification Number of Above Person (optional)
LaSalle Financial Partners, Limited Partnership
2 Check The Appropriate Box If a Member of a Group (a)[X]
(b)[ ]
3 SEC Use Only
4 Source of Funds: WC, OO
5 Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [X]
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
0 shares
Number of
Shares 8 Shared Voting Power
Beneficially 388,600 shares
Owned By
Each Reporting 9 Sole Dispositive Power
Person With 0 shares
10 Shared Dispositive Power
388,600 shares
11 Aggregate Amount Beneficially Owned by Each Reporting Person
388,600 shares
12 Check Box If The Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
13 Percent of Class Represented By Amount in Row (11)
9.2%
14 Type of Reporting Person
PN
<PAGE>
1 Name of Reporting Person
S.S. or I.R.S. Identification Number of Above Person (optional)
Richard J. Nelson
2 Check The Appropriate Box If a Member of a Group (a)[X]
(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) [X]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
0 shares
Number of
Shares 8 Shared Voting Power
Beneficially 388,600 shares
Owned By
Each Reporting 9 Sole Dispositive Power
Person With 0 shares
10 Shared Dispositive Power
388,600 shares
11 Aggregate Amount Beneficially Owned by Each Reporting Person
388,600 shares
12 Check Box If The Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
13 Percent of Class Represented By Amount in Row (11)
9.2%
14 Type of Reporting Person
IN
<PAGE>
1 Name of Reporting Person
S.S. or I.R.S. Identification Number of Above Person (optional)
Peter T. Kross
2 Check The Appropriate Box If a Member of a Group (a)[X]
(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) [X]
6 Citizenship or Place of Organization
United States
7 Sole Voting Power
0 shares
Number of
Shares 8 Shared Voting Power
Beneficially 388,600 shares
Owned By
Each Reporting 9 Sole Dispositive Power
Person With 0 shares
10 Shared Dispositive Power
388,600 shares
11 Aggregate Amount Beneficially Owned by Each Reporting Person
388,600 shares
12 Check Box If The Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
13 Percent of Class Represented By Amount in Row (11)
9.2%
14 Type of Reporting Person
IN
<PAGE>
1 Name of Reporting Person
S.S. or I.R.S. Identification Number of Above Person (optional)
Florence Nelson
2 Check The Appropriate Box If a Member of a Group (a)[X]
(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
0 shares
Number of
Shares 8 Shared Voting Power
Beneficially 0 shares
Owned By
Each Reporting 9 Sole Dispositive Power
Person With 0 shares
10 Shared Dispositive Power
0 shares
11 Aggregate Amount Beneficially Owned by Each Reporting Person
0 shares
12 Check Box If The Aggregate Amount in Row (11) Excludes
Certain Shares [X]
13 Percent of Class Represented By Amount in Row (11)
0%
14 Type of Reporting Person
IN
<PAGE>
This is Amendment No. 3 to the Schedule 13D filed jointly by LaSalle
Financial Partners, Limited Partnership (the "Partnership"), Richard J.
Nelson and Peter T. Kross (including Florence Nelson as of this Amendment
No. 3, the "Group") on July 11, 1997 (as amended, the "Original 13D"), and
relates to the common stock, $.01 par value (the "Common Stock"), of HMN
Financial, Inc. (the "Issuer"). The following items in the Original 13D
are amended to read in their entirety as follows:
Item 2. Identity and Background
(d)-(e) During the past five years, none of the Partnership, the
General Partners, Mr. Nelson, Mrs. Nelson or Mr. Kross has been convicted
in a criminal proceeding (excluding traffic violations).
On December 9, 1996, Standard Financial, Inc. filed a civil lawsuit
(case No. 96-C-8037) in the United States District Court for the Northern
District of Illinois (the "Court") naming as defendants the Partnership,
the General Partners, Mr. Kross and Mr. Nelson. The lawsuit requested
injunctive and other relief relating to a Schedule 13D filing with respect
to beneficial ownership of Standard Financial, Inc.'s common stock. While
the Court entered certain preliminary orders in February and March, 1997,
those orders were subsequently vacated on October 9, 1997.
During the past five years, Mrs. Nelson has not been a party to a
civil proceeding of a judicial or administrative body of competent
jurisdiction resulting in her being 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 4. Purpose of Transaction
The Group's goal is to profit from appreciation in the market price
of the Common Stock. The Group expects to actively assert shareholder
rights, in the manner described below, with the purpose to influence the
policies of the Issuer.
The Partnership's stated purpose is to emphasize investments in the
stocks of selected thrifts, banks and savings banks which the General
Partners believe to be undervalued or that they believe to represent
"special situation" investment opportunities. The Partnership has further
described its purpose, in its private placement memorandum, as follows:
Considering the current opportunity to purchase shares of
selected thrifts and savings banks at substantial discounts to
intrinsic value as determined by the General Partners, with
significant appreciation potential available due to merger and
acquisition activity in the banking industry, the Partnership
currently intends to concentrate its investments in thrifts,
banks and savings banks which, in the opinion of the General
Partners, possess certain buyout characteristics. Concentrated
investments may be made in companies to allow the Partnership to
influence or to effect control over management's decisions in
order to achieve Partnership objectives.
The Partnership believes that its acquisition of the Common Stock is in
accordance with these stated purposes.
The Group intends to work with the Issuer to attempt to influence the
Board of Directors to consider all possible strategic alternatives
available to the Issuer in order to increase the market price of the
Common Stock. One way of achieving this goal is to seek out another
financial institution and attempt to implement a business combination.
The Group is interested in influencing the Issuer's Board of Directors to
explore seriously, in consultation with independent financial advisors,
this and other possible means of improving the market price of the Common
Stock, to the extent such options may not have already been fully
explored. To the extent such influence may be deemed to constitute a
"control purpose" with respect to the Securities Exchange Act of 1934, as
amended, and the regulations thereunder, the Group has such a purpose.
On October 21, 1997, Messrs. Nelson and Kross met with management of
the Issuer. Topics of discussion included the past performance of the
Issuer and methods to maximize shareholder value in the future. At that
meeting, Messrs. Nelson and Kross, on behalf of the Group, requested that
the Board of Directors of the Issuer nominate Mr. Nelson for election to
the Board at the 1998 Meeting of Stockholders and noted that if the Board
of Directors does not nominate Mr. Nelson for election as a Board nominee,
the Group most likely would nominate Mr. Nelson and directly solicit
shareholder votes for Mr. Nelson's election to the Board. In addition,
Messrs. Nelson and Kross informed management of the Issuer that the Group
was generally reviewing its options with respect to the Issuer, and that
the Group may submit for shareholder vote at the 1998 Meeting of
Stockholders a proposal regarding corporate governance, maximizing
shareholder value or other matters. Messrs. Nelson and Kross also
informed the Issuer that the Partnership will shortly submit a request for
a shareholder list and associated materials. On November 20, 1997, the
Partnership sent to the Issuer a request for a shareholder list and
associated materials. A copy of that letter is attached as Exhibit 3.
The above-stated purpose to control is unrelated to the Office of
Thrift Supervision ("OTS") regulations. Specifically, the Group is aware
that regulations promulgated by the OTS contain separate standards with
regard to acquisition of "control" of a federally chartered savings
institution, such as the Issuer's subsidiary bank. Those regulations
require OTS approval for acquisition of control under certain conditions.
Some of the provisions are based in part on numerical criteria. One of
the provisions creates a rebuttable presumption of control where a person
acquires more than 10 percent of the voting stock of a savings association
and other conditions are met. Another provision creates a rebuttable
presumption of control where a person acquires proxies to elect one-third
or more of the savings association's board of directors and other
conditions are met. The Group has no present plans to cross these
numerical thresholds.
The Group intends to continue to evaluate the Issuer and its business
prospects and intends to consult with management of the Issuer, other
shareholders of the Common Stock or other persons to further its
objectives. The Group may seek representation on the Issuer's Board of
Directors. The Group may make further purchases of shares of the Common
Stock or may dispose of any or all of its shares of the Common Stock at
any time. At present, and except as disclosed herein, the Group has no
specific plans or proposals that relate to, or could result in, any of the
matters referred to in paragraphs (a) through (j), inclusive, of Item 4 of
Schedule 13D. The Group intends to continue to explore the options
available to it. The Group may, at any time or from time to time, review
or reconsider its position with respect to the Issuer and may formulate
plans with respect to matters referred to in Item 4 of Schedule 13D.
Item 7. Material to be Filed as Exhibits
No. Description
1 Joint Filing Agreement*
2 Professional Account Agreement, dated March 6, 1996,
between the Partnership and each of the subsidiaries of The
Bear Stearns Companies Inc.*
3 Letter from Richard J. Nelson to the Issuer, dated November
20, 1997.
*Filed previously with the Securities and Exchange Commission as part of
the Original 13D.
<PAGE>
SIGNATURES
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.
Date: November 24, 1997
LaSALLE FINANCIAL PARTNERS, LIMITED PARTNERSHIP
By: LaSALLE CAPITAL MANAGEMENT, INC.
a General Partner
By: /s/ Richard J. Nelson
Richard J. Nelson, President
/s/ Richard J. Nelson
Richard J. Nelson
/s/ Peter T. Kross
Peter T. Kross
/s/ Florence Nelson
Florence Nelson
EXHIBIT 3
LASALLE FINANCIAL PARTNERS, L.P.
Suite 500
350 E. Michigan Avenue
Kalamazoo, Michigan 49007
______________________
Telephone (616) 344-4993
Facsimile (616) 382-2382
November 20, 1997
Via Federal Express
HMN Financial, Inc.
101 North Broadway
P.O. Box 231
Spring Valley, MN 55975
Via Federal Express
HMN Financial, Inc.
c/o The Corporation Trust Company
1209 Orange Street
Wilmington, DE 19899
Re: Stockholder Demand For Inspection of Stocklist Materials
Ladies and Gentlemen:
The undersigned, LaSalle Financial Partners, L.P., is the record
owner of common stock of HMN Financial, Inc., a Delaware corporation ("HMN
Financial" or "the Company"). Pursuant to Section 220 of the Delaware
General Corporation Law, the undersigned hereby demands the right (in
person or by its attorney or other agent), during the usual business
hours, to inspect the following records and documents of the Company (the
"Stocklist Materials") and to make copies or extracts therefrom:
a. A complete record or list of the Company's stockholders,
certified by its transfer agent(s) and/or registrar(s), showing the
name and address of each stockholder and the number of shares
registered in the name of each such stockholder as of the most recent
date available;
b. A magnetic computer tape or disk containing a list of the
Company's stockholders showing the names and addresses of each
stockholder and number of shares registered in the name of each such
stockholder as of the most recent date available, together with such
computer processing data and directions as are necessary to make use
of such magnetic computer tape or disk, and a printout of such
magnetic computer tape or disk for verification purposes;
c. A list of all stockholders arranged in descending order by
number of shares, showing the name and address of each stockholder; a
complete record or list of any participants in any employee stock
purchase, ESOP plan, or other plan for the purchase of shares,
showing the name and address of each participant and the number of
shares credited to the participant's account; a magnetic tape(s) or
disk containing this information with same computer processing data
and directions as requested in (b) above; a correct and complete copy
of the plan(s) documents, including any amendments of such plan(s);
d. All daily transfer sheets showing changes in the list of
the Company's stockholders referred to in paragraph (a) above which
are in or come into the possession of the Company or its transfer
agent from the date of such list to the date of the Company's annual
meeting or any meeting held as a result of any postponement or
adjournment thereof;
e. All information in or which comes into the Company's
possession or control or which can reasonably be obtained from
brokers, dealers, banks, clearing agencies or voting trustees or
nominees of any central certificate depository system concerning the
number and identity of the actual beneficial owners of the Company's
stock, including a breakdown of any holders in the name of Cede &
Co., Kray & Co., Philadep, and other similar nominees;
f. All information in or which comes into the Company's
possession or control or which can reasonably be obtained from
brokers, dealers, banks, clearing agencies or voting trustees
relating to the names of the non-objecting beneficial owners of the
Company's stock ("NOBO's") in the format of a printout in descending
order balance and on a magnetic computer tape or disk (such
information with respect to brokers and dealers is readily available
to the Company under Rule 14b-1 of the Securities Exchange Act of
1934, as amended, from Independent Election Corporation of America
and ADP Proxy Services);
g. A stop list or stop lists relating to any Common Stock as
of the date of the list referred to in paragraph (a) above;
h. A true and correct copy of the Company's by-laws and
articles of incorporation, including any amendments thereto, in
effect on the date hereof; and
i. The information and records specified in paragraphs (a),
(b), (c), (e) and (f) above as of any record date for stockholder
action set by the Board of Directors, by operation of law or
otherwise; the information and records specified in paragraph (e) on
a weekly basis up until any shareholders' meeting.
The purpose of this demand to inspect the Stocklist Materials is
to enable the undersigned to communicate with stockholders regarding their
investment as stockholders including, without limitation, to communicate
with stockholders regarding a possible proxy solicitation.
Please advise Jon E. Abramczyk of Morris, Nichols, Arsht &
Tunnell, 1201 North Market Street, Wilmington, Delaware 19801 (302) 658-
9200, where and when the Stocklist Materials will be available. The
undersigned hereby authorizes Jon E. Abramczyk of Morris, Nichols, Arsht &
Tunnell, and his respective partners, associates, employees, and any other
persons to be designated by them, acting together, singly or in
combination, to conduct the inspection and copying herein demanded.
Very truly yours,
LaSalle Financial Partners, L.P.
By: /s/ Richard J. Nelson
General Partner
LaSalle Capital Management, Inc.
