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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)*
JERRY'S FAMOUS DELI, INC.
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(Name of Issuer)
Common Stock, no par value
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(Title of Class of Securities)
476 523 105
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(CUSIP Number)
Kenneth J. Abdalla
Waterton Management, LLC
10000 Santa Monica Boulevard
Los Angeles, California 90067
(310) 789-7200
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 4, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is subject of this Schedule 13D, and is filing this
statement because of Rule 13d-1(b)(3) or (4), check the following box:
[ ]
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
disclosures provided in a prior cover page.
(Continued on following pages)
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).
(Page 1 of 12 Pages)
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SCHEDULE 13D
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CUSIP NO. 476 523 105 PAGE 2 OF 12
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1 NAME OF REPORTING PERSON
JERRY'S INVESTORS, LLC
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC
- -------------------------------------------------------------------------------
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
- -------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 0
PERSON WITH ------------------------------------------------------
8 SHARED VOTING POWER
1,000,000 SHARES (2,000,000 MAXIMUM)
------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,000,000 SHARES (2,000,000 MAXIMUM)
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,000,000 SHARES (2,000,000 MAXIMUM)
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.8% (16.1% MAXIMUM)
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14 TYPE OF REPORTING PERSON
OO
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<PAGE> 3
SCHEDULE 13D
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CUSIP NO. 476 523 105 PAGE 3 OF 12
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1 NAME OF REPORTING PERSON
YUCAIPA WATERTON DELI INVESTORS, LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
- -------------------------------------------------------------------------------
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
- -------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 0
PERSON WITH ------------------------------------------------------
8 SHARED VOTING POWER
1,065,000 SHARES (2,065,000 MAXIMUM)
------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,065,000 SHARES (2,065,000 MAXIMUM)
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,065,000 SHARES (2,065,000 MAXIMUM)
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3% (16.6% MAXIMUM)
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14 TYPE OF REPORTING PERSON
OO
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SCHEDULE 13D
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CUSIP NO. 476 523 105 PAGE 4 OF 12
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1 NAME OF REPORTING PERSON
WATERTON MANAGEMENT, LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- -------------------------------------------------------------------------------
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
- -------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 0
PERSON WITH ------------------------------------------------------
8 SHARED VOTING POWER
3,372,449.70 SHARES (6,539,166.30 MAXIMUM)
------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
3,372,449.70 SHARES (6,539,166.30 MAXIMUM)
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,372,449.70 SHARES (6,539,166.30 MAXIMUM)
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.5% (38.6% MAXIMUM)
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14 TYPE OF REPORTING PERSON
OO
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<PAGE> 5
SCHEDULE 13D
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CUSIP NO. 476 523 105 PAGE 5 OF 12
----------------------------- ---------------------
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1 NAME OF REPORTING PERSON
KENNETH J. ABDALLA
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
CALIFORNIA
- -------------------------------------------------------------------------------
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED
BY EACH REPORTING 0
PERSON WITH ------------------------------------------------------
8 SHARED VOTING POWER
4,437,499.70 SHARES (8,604,166.30 SHARES MAXIMUM)
------------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
------------------------------------------------------
10 SHARED DISPOSITIVE POWER
4,437,499.70 SHARES (8,604,166.30 SHARES MAXIMUM)
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,437,499.70 SHARES (8,604,166.30 SHARES MAXIMUM)
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.9% (45.3% MAXIMUM)
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- -------------------------------------------------------------------------------
<PAGE> 6
ITEM 1 SECURITY AND ISSUER.
This Amendment No. 1 (this "Amendment") to the Schedule 13D (the
"Prior Filing") is being filed to reflect, among other things, the addition of
a new Reporting Person to the group previously formed by Yucaipa Waterton Deli
Investors, LLC, a Delaware limited liability company ("Deli Investors"),
Waterton Management, LLC, a Delaware limited liability company ("Waterton") and
Kenneth J. Abdalla, an individual (collectively, the "Initial Group"), with
respect to the ownership of shares of Common Stock, no par value ("Common
Stock"), of Jerry's Famous Deli, Inc., a California corporation (the
"Company"), which has its principal executive offices at 12711 Ventura Blvd.,
Suite 4000, Studio City, California 91604. The new Reporting Person and the
Initial Group are collectively referred to herein as the Reporting Persons.
This Amendment also reflects that certain of the Reporting Persons have
acquired additional shares of the Company's Series A Preferred Stock, Options
and Warrants as set forth below.
ITEM 2 IDENTITY AND BACKGROUND.
(a) This Amendment is being filed jointly by the Initial Group and
Jerry's Investors, LLC, a Delaware limited liability corporation ("Jerry's
Investors"). The Initial Group and Jerry's Investors are now collectively the
"Reporting Persons." Waterton is the managing member of Jerry's Investors.
(b) The address of the principal business and principal office of
Jerry's Investors is 10000 Santa Monica Boulevard, Fifth Floor, Los Angeles,
California 90067.
(c) The principal business of Jerry's Investors is to invest in
the Company.
(d) None of the Reporting Persons has, during the last five years,
been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) None of the Reporting Persons has, during the last five years,
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to
a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
ITEM 3 SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On August 30, 1996, the Company completed the sale (the "Initial
Issuance") to Deli Investors of 6,000 shares of its Series A Preferred Stock
(the "Preferred Stock") and warrants (the "Warrants") to purchase 65,000 shares
of the Company's common stock, no par value (the "Common Stock") for an
aggregate purchase price of $6,000,100. The Company also granted options (the
"Options") to Waterton to purchase an additional $ 13,000,000 of Preferred
Stock and Warrants to acquire a total of 140,833 shares of Common Stock, upon
the same terms and conditions as those received by Deli investors in connection
with the Initial Issuance.
On November 4, 1996, the Company granted additional Options to
Waterton to purchase an additional $6,000,000 of Preferred Stock and Warrants
to acquire 65,000 shares of Common Stock, upon
(Page 6 of 12)
<PAGE> 7
the same terms and conditions as those received by Deli Investors in connection
with the Initial Issuance. (See Item 6 below.)
On November 8, 1996, a portion of the Options was exercised for an
aggregate purchase price of $6,000,100. In connection with such exercise,
Jerry's Investors (which Waterton had designated to exercise certain of its
rights under the Options) purchased 6,000 shares of Preferred Stock, and
Waterton purchased Warrants to acquire 65,000 shares of Common Stock.
The funds used by Waterton to acquire the Warrants and the funds used
by Jerry's Investors to acquire the Preferred Stock were obtained from the
capital contributions of their respective members. The source of funds to be
used by Waterton or its designees in connection with any future exercise of the
Options has not been determined as of the date hereof, but may include
additional capital contributions or future borrowings.
ITEM 4 PURPOSE OF TRANSACTION.
There has been no change in the information set forth under Item 4 in
the Prior Filing.
ITEM 5 INTEREST IN SECURITIES OF THE ISSUER.
(a) Jerry's Investors owns 6,000 shares of Preferred Stock.
Commencing on November 30, 1996, the Preferred Stock will be convertible into
shares of the Company's Common Stock. The Preferred Stock will automatically
convert to Common Stock on August 30, 1999. Each share of Preferred Stock will
convert into a number of shares of Common Stock to be determined by dividing
its Designated Value (equal to $1,000 per share plus accrued and unpaid
dividends) by the product of (i) the average closing bid price for the Common
Stock on the preceding five trading days (the "Closing Price") and (ii) .83;
provided however, that in no event shall the product of such two items be less
that $3.00 or greater that $6.00 for purposes of any conversion. Pursuant to
the Preferred Shares' conversion provisions, Jerry's Investors may be deemed to
beneficially own a minimum of 1,000,000 shares (8.8%) of the Company's Common
Stock and, if the product of the Closing Price and .83 is $3.00 or less at the
time of conversion, a maximum of 2,000,000 shares (16.1%) of the Company's
Common Stock.
Waterton owns Warrants to acquire 65,000 shares of Common Stock.
Pursuant to the letter agreements, dated August 22, 1996 and November 4, 1996
(the "Option Letters"), Waterton has been granted options to acquire (i) an
additional 7,000 shares of Preferred Stock and Warrants to acquire an
additional 75,833 shares of Common Stock for an aggregate consideration of
$7,000,100 on or before November 30, 1996 and (ii) an additional 6,000 shares
of Preferred Stock and Warrants to acquire an additional 65,000 shares of
Common Stock for an aggregate consideration of $6,000,100 on or before December
30, 1996. The Warrants are exercisable at the price of $1.00 per share
(subject to customary anti-dilution adjustments). As described in Item 6 of
the Prior Filing, the periods in which such Options are exercisable may be
extended if certain waivers or approvals have not been obtained. As a result
of Waterton's status as the manager of Jerry's Investors, Waterton has the
ability to vote and dispose its holdings, and consequently may be deemed to
beneficially own all of the Common Stock issuable upon exercise of the
Preferred Stock beneficially owned by Jerry's Investors. Pursuant to the
conversion and exercise provisions (as described above) of the Preferred Stock
and Warrants, Waterton may be deemed to beneficially own a minimum of
3,372,499.70 shares (24.5%) of the Company's Common Stock, and,
(Page 7 of 12)
<PAGE> 8
if the product of the Closing Price and .83 is $3.00 or less at the time of
conversion, a maximum of 6,539,166.30 shares (38.6%) of the Company's Common
Stock.
As a result of Mr. Abdalla's status as the manager of Deli Investors
and Waterton, and Waterton's status as the manager of Jerry's Investors, Mr.
Abdalla has the ability to vote and dispose the holdings of all three entities,
and consequently may be deemed to beneficially own all of the Common Stock
issuable upon exercise of the Preferred Stock and Warrants beneficially owned
by Deli Investors, Waterton and Jerry's Investors. This would represent
beneficial ownership of a minimum of 4,437,499.70 shares (29.9%) of the
Company's Common Stock and, if the product of the Closing Price and .83 is
$3.00 or less at the time of conversion, a maximum of 8,604,166.30 shares
(45.3%) of the Company's Common Stock.
(b) As a result of Waterton's status as the manager of Jerry's
Investors, Waterton may be deemed to have shared dispositive and voting power
with respect to the minimum of 1,000,000 shares (8.8%) and the maximum of
2,000,000 shares (16.1%) of the Company's Common Stock which may be deemed to
be beneficially owned by Jerry's Investors. As a result of Mr. Abdalla's
status as the manager of Deli Investors and Waterton, and Waterton's status as
the manager of Jerry's Investors, Mr. Abdalla may be deemed to have shared
dispositive and voting power with respect to the minimum of 1,065,000 shares
(9.3%) and the maximum of 2,065,000 shares (16.6%) of the Company's Common
Stock which may be deemed to be beneficially owned by Deli Investors, the
minimum of 1,000,000 shares (8.8%) and the maximum of 2,000,000 shares (16.1%)
of the Company's Common Stock which may be deemed to be beneficially owned by
Jerry's Investors, and the minimum of 3,372,499.70 shares (24.5%) and the
maximum of 6,539,166.30 shares (38.6%) of the Company's Common Stock which may
be deemed to be beneficially owned by Waterton.
(c) Except as described in Item 3 above, there have not been any
transactions in the Common Stock effected by or for the account of the
Reporting Persons during the past 60 days.
(d) Except as stated in this Item 5, to the best knowledge of the
Reporting Persons, no other person has the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the sale of, the
shares of Common Stock owned by the Reporting Persons.
(e) Not applicable.
ITEM 6 CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
On November 8, 1996, Jerry's Investors acquired 6,000 shares of
Preferred Stock and Waterton acquired Warrants to acquire 65,000 shares of
Common Stock for an aggregate purchase price of $6,000,100. Jerry's Investors
and Waterton made these investments pursuant to a Private Securities Purchase
Agreement dated as of November 8, 1996, on the same terms and conditions as
those contained in the Private Securities Purchase Agreement governing the
Initial Issuance, included as Exhibit 3 to the Prior Filing. In addition, the
Company and Jerry's Investors entered into a Registration Rights Agreement,
containing the same terms and conditions as those contained in the Registration
Rights Agreement included as Exhibit 3 to the Prior Filing. The rights,
preferences and privileges of the Preferred Stock were set forth in the Second
Amended and Restated Certificate of Determination of Rights and Preferences of
Series A Preferred Shares (the "Preferred Stock Certificate"), which was
(Page 8 of 12)
<PAGE> 9
included as Exhibit 2 to the Prior Filing. The terms of the Warrants are the
same as those set forth in the Common Stock Purchase Warrant Certificate which
was included as Exhibit 4 to the Prior Filing.
Pursuant to the Option Letter dated November 4, 1996, the Company has
granted options to Waterton to purchase, on or before December 30, 1996, an
additional $6,000,000 of Preferred Stock and Warrants to acquire an additional
65,000 shares of Common Stock, upon the same terms and conditions as those
governing the Initial Issuance. The exercise of the options is subject to the
receipt of any required Hart-Scott-Rodino approval. Such time periods will be
extended if the required approvals have not been obtained within a specific
period prior to the designated dates.
The terms of the Initial Issuance, including the Private Securities
Purchase Agreement, the Registration Rights Agreement, the Preferred Stock
Certificate, the Common Stock Purchase Warrant Certificate and the original
Option Letter, are described in detail in the Prior Filing, and reference is
made to the Prior Filing for further information applicable to the transactions
discussed in this Amendment.
Pursuant to the Option Letter dated August 22, 1996, Mr. Abdalla has
the right to be nominated to the Company's Board of Directors. Mr. Abdalla has
informed the Company that he intends to exercise such right in the near future.
Except as set forth herein, none of the Reporting Persons have any
contracts, arrangements, understandings or relationships (legal or otherwise)
with any person with respect to any securities of the Company, including but
not limited to any contracts, arrangements, understandings or relationships
concerning the transfer or voting of such securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of profits,
division of profits or losses, or the giving or withholding of proxies.
ITEM 7 MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1. Joint Filing Agreement dated as of November 21,
1996.
Exhibit 2. Letter Agreement dated as of November 4, 1996 between
the Company and Waterton Management, LLC
(incorporated by reference to Exhibit 10.2 of the
Company's Quarterly Report on Form 10-Q filed
November 13, 1996).
Exhibit 3. Letter Agreement dated as of October 31, 1996 between
the Company and Waterton Management, LLC
(incorporated by reference to Exhibit 10.1 of the
Company's Quarterly Report on Form 10-Q filed
November 13, 1996).
(Page 9 of 12)
<PAGE> 10
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.
Dated: November 21, 1996 Yucaipa Waterton Deli Investors, LLC
Waterton Management, LLC
By: /s/ KENNETH J. ABDALLA
----------------------------------
Name: Kenneth J. Abdalla
Title: Manager
Dated: November 21, 1996 Jerry's Investors, LLC
By: Waterton Management, LLC
Title: Manager
By: /s/ KENNETH J. ABDALLA
----------------------------------
Name: Kenneth J. Abdalla
Title: Manager
Dated: November 21, 1996 Kenneth J. Abdalla
By: /s/ KENNETH J. ABDALLA
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(Page 10 of 12)
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EXHIBIT INDEX
Exhibit 1. Joint Filing Agreement dated as of November 21, 1996.
Exhibit 2. Letter Agreement dated as of November 4, 1996 between
the Company and Waterton Management, LLC
(incorporated by reference to Exhibit 10.2 of the
Company's Quarterly Report on Form 10-Q filed
November 13, 1996).
Exhibit 3. Letter Agreement dated as of October 31, 1996 between
the Company and Waterton Management, LLC
(incorporated by reference to Exhibit 10.1 of the
Company's Quarterly Report on Form 10-Q filed
November 13, 1996).
(Page 11 of 12)
<PAGE> 1
EXHIBIT 1
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) promulgated under the
Securities Exchange Act of 1934, as amended, the undersigned hereby agree to
the joint filing with all other Reporting Persons (as such term is defined in
the Amendment No. 1 to Schedule 13D referred to below) on behalf of each of
them of a statement on Amendment No. 1 to Schedule 13D with respect to the
common stock, no par value (the "Common Stock"), of Jerry's Famous Deli, Inc.,
a California corporation, and that this Agreement may be included as an Exhibit
to such joint filing.
IN WITNESS WHEREOF, the undersigned hereby execute this
Agreement as of November 19, 1996.
Dated: November 21, 1996 Yucaipa Waterton Deli Investors, LLC
Waterton Management, LLC
By: /s/ KENNETH J. ABDALLA
----------------------------------
Name: Kenneth J. Abdalla
Title: Manager
Dated: November 21, 1996 Jerry's Investors, LLC
By: Waterton Management, LLC
Title: Manager
By: /s/ KENNETH J. ABDALLA
----------------------------------
Name: Kenneth J. Abdalla
Title: Manager
Dated: November 21, 1996 Kenneth J. Abdalla
By: /s/ KENNETH J. ABDALLA
----------------------------------
(Page 12 of 12)
