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M E M O R A N D U M
June 9, 1997
FROM: ARV Assisted Living, Inc.
TO: Holders of ARV Assisted Living, Inc. 6 3/4% Convertible Subordinated
Notes due 2006 (the "Convertible Notes")
SUBJECT: Supplement No. 1 to Prospectus dated January 14, 1997
Enclosed are two copies of Supplement No. 1 dated June 9, 1997
("Supplement No. 1"), to the Prospectus, dated January 14, 1997 (the
"Prospectus"), of ARV Assisted Living, Inc., a California corporation (the
"Company").
In any resale of the Convertible Notes or the shares of Common Stock
issued upon conversion of the Convertible Notes (the "Conversion Shares") as
described in the Prospectus, the holder must deliver a copy of Supplement No. 1
along with a copy of the Prospectus. If you are a holder of Convertible Notes or
Conversion Shares and your name or the name of the broker holding your
Convertible Notes or Conversion Shares does not appear in the table under the
caption "Selling Securityholders" in the Prospectus (as supplemented from time
to time), you must obtain a Selling Securityholder Questionnaire from the
Company and complete and return it to the Company before you may use the
Prospectus.
Should you have any questions or require additional copies of
Supplement No. 1 or the Prospectus, please contact Sheila Muldoon, General
Counsel, at (714) 751-7400.
Thank you.
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PROSPECTUS SUPPLEMENT NO. 1 Filed Pursuant to Rules 424(b)(3) and 424(c)
(To Prospectus dated January 14, 1997) Registration Statement No. 333-16269
ARV ASSISTED LIVING, INC.
6 3/4% CONVERTIBLE SUBORDINATED NOTES DUE 2006
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The following information supplements, and must be read in connection with,
the information contained in the Prospectus, dated January 14, 1997 (the
"Prospectus"), of ARV Assisted Living, Inc., a California corporation (the
"Company"). This Supplement must be delivered along with a copy of the
Prospectus. All capitalized terms not otherwise defined herein shall have the
meanings given them in the Prospectus.
The information below replaces in its entirety the information provided in
the Prospectus under the caption "Selling Securityholders":
SELLING SECURITYHOLDERS
The Convertible Notes were originally issued by the Company in a private
placement and were resold by the initial purchaser thereof to qualified
institutional buyers (within the meaning of Rule 144A under the Securities Act)
or other institutional accredited investors (as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act) in transactions exempt from registration
under the Securities Act. The Convertible Notes and the Conversion Shares that
may be offered pursuant to this Prospectus will be offered by the Selling
Securityholders. The following table sets forth certain information as of March
31, 1997 concerning the principal amount of Convertible Notes held of record by
certain Selling Securityholders. To the Company's knowledge, other than as a
result of the ownership indicated below, none of the Selling Securityholders has
had any position, office or other material relationship with the Company or any
of its affiliates within the past three years.
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF PERCENTAGE OF NUMBER OF
CONVERTIBLE CONVERTIBLE CONVERSION PERCENTAGE OF
NOTES THAT NOTES SHARES THAT COMMON STOCK
NAME MAY BE SOLD OUTSTANDING(1) MAY BE SOLD(2) OUTSTANDING(3)
---- ----------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
AIM Balanced Fund..................................... $ 500,000 0.9 26,925 0.3
Allstate Insurance Company............................ 2,060,000 3.6 110,931 1.1
Dean Witter Convertible Securities Trust.............. 2,500,000 4.3 134,625 1.4
Dean Witter Income Builder Fund....................... 1,500,000 2.6 80,775 0.8
Declaration of Trust for the Defined Benefit
Plans of Leneca Holdings, Inc..................... 355,000 0.6 19,116 0.2
Declaration of Trust for the Defined Benefit
Plans of ICI American Holdings Inc................ 500,000 0.9 26,925 0.3
Delaware Group Dividend and Income
Fund, Inc........................................... 1,281,000 2.2 68,982 0.7
Delaware Group Global Dividend and Income
Fund, Inc........................................... 491,250 0.9 26,453 0.3
Delaware State Employees Retirement Fund.............. 1,665,000 2.9 89,660 0.9
Fidelity Advisor Strategic Opportunities Fund......... 5,000,000 8.7 269,251 2.7
General Motors Employees Domestic Group
Trust............................................. 5,400,000 9.4 290,791 2.9
Guardian Master Pension Trust Fund.................... 400,000 0.7 21,540 0.2
Guardian Life Insurance Co. of America................ 5,150,000 9.0 277,329 2.8
Hillside Capital Incorporated Corporate
Account........................................... 150,000 0.3 8,077 0.1
Laterman & Co......................................... 350,000 0.6 18,847 0.2
Laterman Strategies: 90's LLC......................... 1,110,000 1.9 59,773 0.6
</TABLE>
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<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF PERCENTAGE OF NUMBER OF
CONVERTIBLE CONVERTIBLE CONVERSION PERCENTAGE OF
NOTES THAT NOTES SHARES THAT COMMON STOCK
NAME MAY BE SOLD OUTSTANDING(1) MAY BE SOLD(2) OUTSTANDING(3)
---- ----------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Lincoln National Convertible Securities Fund.......... 1,450,000 2.5 78,082 0.8
Lincoln National Life Insurance....................... 3,595,000 6.3 193,591 2.0
McMahan Securities Co. L.P............................ 100,000 0.2 5,385 0.1
Offshore Strategies Ltd............................... 1,340,000 2.3 72,159 0.7
Oppenheimer Bond Fund for Growth...................... 2,000,000 3.5 107,700 1.1
The TCW Group, Inc.................................... 3,520,000 6.1 189,553 1.9
Thermo Electron Balanced Investment Fund.............. 450,000 0.8 24,232 0.3
United National Life Insurance........................ 100,000 0.2 5,385 0.1
Vanguard Explorer Fund, Inc........................... 4,300,000 7.5 231,556 2.3
Walker Art Center..................................... 300,000 0.5 16,155 0.2
Weirton Trust......................................... 405,000 0.7 21,809 0.2
</TABLE>
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The date of this Supplement is June 9, 1997
(1) Does not total to 100% because not all of the Selling Securityholders have
completed Selling Securityholder Questionnaires required for inclusion in
this Prospectus.
(2) Assumes conversion of the full amount of Convertible Notes held by such
holder at the initial conversion price of $18.57 per share; such conversion
price is subject to adjustment as described under "Description of
Convertible Notes--Conversion." Accordingly, the number of shares of Common
Stock issuable upon conversion of the Convertible Notes may increase or
decrease from time to time. Under the terms of the Indenture, fractional
shares will not be issued upon conversion of the Convertible Notes; cash
will be paid in lieu of fraction shares, if any.
(3) Computed in accordance with Rule 13d-3(d)(i) promulgated under the Exchange
Act and based upon 9,654,843 shares of Common Stock outstanding as of March
31, 1997, treating as outstanding the number of Conversion Shares shown as
being issuable upon the assumed conversion by the named holder of the full
amount of such holder's Convertible Notes but not assuming the conversion
of the Convertible Notes of any other holder.
The preceding table has been prepared based upon information furnished to
the Company by the Trustee, The Depository Trust Company and the Selling
Securityholders.
Because the Selling Securityholders may offer all or some of the
Convertible Notes that they hold and/or Conversion Shares pursuant to the
offering contemplated by this Prospectus, no estimate can be given as to the
amount of the Convertible Notes or Conversion Shares that will be held by the
Selling Securityholders upon the termination of this offering. See "Plan of
Distribution" in the Prospectus.
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