-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MKPlge0QANQ2TsIQjJ6Xhi9WIOEfhOPllXVgoKoiQTrWmVL5+Xg7PXhumO7lH/zv tur7LGfU+f20teDn0H3twQ== 0000950147-98-000769.txt : 19980929 0000950147-98-000769.hdr.sgml : 19980929 ACCESSION NUMBER: 0000950147-98-000769 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19980928 SROS: NASD SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AVESIS INC CENTRAL INDEX KEY: 0000795574 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 860349350 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-39650 FILM NUMBER: 98715821 BUSINESS ADDRESS: STREET 1: 3724 NORTH THIRD ST STREET 2: STE 300 CITY: PHOENIX STATE: AZ ZIP: 85012 BUSINESS PHONE: 6029567287 MAIL ADDRESS: STREET 1: 1001 W CLARENDON STREET 2: NO 2300 CITY: PHOENIX STATE: AZ ZIP: 85013 FORMER COMPANY: FORMER CONFORMED NAME: NBS NATIONAL BENEFIT SERVICES INC DATE OF NAME CHANGE: 19910114 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL VISION SERVICES INC DATE OF NAME CHANGE: 19900117 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: BLUM KENNETH L JR CENTRAL INDEX KEY: 0000939614 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: RENT A WRECK OF AMERICA INC STREET 2: 11460 CRONRIDGE RD STE 120 CITY: OWINGS MILLS STATE: MD ZIP: 21117 BUSINESS PHONE: 4105818700 MAIL ADDRESS: STREET 1: RENT A WRECK OF AMERICA INC STREET 2: 11460 CRONRIDGE RD STE 118 CITY: OWINGS MILLS STATE: MD ZIP: 21117 SC 13D/A 1 FORM SC13D/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Schedule 13D Under the Securities Exchange Act of 1934 (Amendment No. 4) AVESIS INCORPORATED ------------------- (Name of issuer) COMMON STOCK ------------ (Title of Class of Securities) 053650107 --------- (CUSIP Number) Kenneth L. Blum, Jr. 11460 Cronridge Drive, Suite 120, Owings Mills, MD 21117 (410) 265-6074 with copies to: Joel H. Alperstein, Treasurer, Avesis Incorporated 3724 N. Third St., Suite 300, Phoenix, AZ 85012 (602) 241-3400 -------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notes and Communications) AUGUST 11, 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-l(b)(3) or (4), check the following box [ ]. (Continued on following page(s)) Page 1 of 6 Pages CUSIP No. 053650107 Page 2 of 6 Pages --------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSONS SS. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON KENNETH L. BLUM, JR. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) (a) [X] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS (See Instructions) 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 UNITED STATES - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER Number of 1,764,750 Shares ------------------------------------------------------------ Beneficially 8 SHARED VOTING POWER Owned by 50,000 Each ------------------------------------------------------------ Reporting 9 SOLE DISPOSITIVE POWER Person 1,764,750 With ------------------------------------------------------------ 10 SHARED DISPOSITIVE POWER 50,000 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,814,750 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 24.5% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- ITEM 1. SECURITY AND ISSUER. This Statement relates to Common Stock of Avesis Incorporated (the "Issuer"). The principal executive offices of the Issuer are located at 3724 North Third Street, Suite 300, Phoenix, Arizona 85012. ITEM 2. IDENTITY AND BACKGROUND. (a) This statement is being filed by Kenneth L. Blum, Jr. (b) The address for Mr. Blum is 11460 Cronridge Drive, Suite 120, Owings Mills, Maryland 21117. (c) Mr. Blum has served on the Board of Directors of the Issuer since August 1998. Mr. Blum is the president and sole owner of National Health Enterprises, a healthcare management company; president of Rent-A-Wreck of America, Inc., a used vehicle rental system franchisor; president of American Business Information Systems, Inc., a high-volume laser printing company and National Computer Services, Inc., a computer service bureau and division of American Business Information Systems, Inc.; and a consultant to United Healthcare, Inc. (d) During the last five years, the filing person has not been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) During the last five years, the filing person has not been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and is not 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. (f) Mr. Blum is a citizen of the United States. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. On August 11, 1998, Mr. Blum exercised stock purchase options for 1,064,750 and 700,000 shares of the Issuer's Common Stock, at exercise prices of $0.31 and $0.26 per option, respectively. The total funds expended, $512,072.50, were loaned from Kenneth L. Blum, Sr., a member of the Issuer's Board of Directors and the filing person's father. The loan bears interest at a rate of 5% and is payable over a fifteen (15) year period. Payments are $49,334.24 per year and commence on August 11, 1999. Page 3 of 6 ITEM 4. PURPOSE OF TRANSACTION. The Options discussed in Item 5 were acquired for investment. The Options were originally issued by the Issuer to National Health Enterprises, Inc. ("NHE") in connection with the retention by the Issuer of NHE to perform management services for the Issuer pursuant to a management contract (the "Management Agreement"). To that extent, the acquisition of the options relates to a change in the management of the Issuer. NHE transferred all Issuer options to Issuer's management as incentive. All of the Issuer's shares held by Mr. Blum were acquired and are held for investment purposes only. Except as described above, Mr. Blum has no present plan or proposal that relates to or would result in any of the actions described in clauses (a) through (j) of Item 4 of Schedule 13D, although he may from time to time in the future acquire additional shares of Common Stock or securities convertible into Common Stock. At present, Mr. Blum contemplates that such additional shares, if any, would also be purchased for investment purposes only. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) The aggregate number and percentage of Issuer Common Stock beneficially owned by Mr. Blum is 1,814,750 and 24.5%, respectively. (b) See Items 7 through 10 on the Cover Pages of this Schedule 13D. (c) Mr. Blum effected the following transaction since 60 days prior to the date of the event which requires filing of this statement: (i) On August 11, 1998, Mr. Blum exercised stock purchase options for 1,064,750 and 700,000 shares of the Issuer's Common Stock, at exercise prices of $0.31 and $0.26 per option, respectively. Previously, Mr. Blum owned 50,000 shares of the Issuer's Common Stock. (d) Not applicable. (e) Not applicable. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Except as set forth above or set forth in the exhibits, there are no contracts, arrangements, understandings, or relationships between Mr. Blum and any other person with respect to any securities of the Company Page 4 of 6 ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. 1. Management Agreement dated March 18, 1993 between the Issuer and NHE.* 2. Stock Option Grant to NHE dated March 18, 1993 relating to options for the purchase of 4,400,000 shares of the Issuer's Common Stock.* 3. Subordinated Promissory Note dated March 18, 1993 in the amount of $80,000 payable by Issuer to Mr. and Mrs. Blum. * 4. Registration Rights Agreement dated March 18, 1993 among NHE, Mr. Blum, and Alan S. Cohn.* 5. Marketing Agreement dated March 18, 1993 between the Issuer and NHE. * 6. Option Transfer Document dated March 31, 1993** 7. Loan Agreement, filed as Exhibit 1 hereto. * Incorporated by reference from Schedule 13D dated March 18, 1993 filed by NHE and Mr. and Mrs. Kenneth L. Blum, Jr. ** Incorporated by reference from Amendment No. 2 to Schedule 13D dated December 5, 1994 filed by Mr. Frank C. Cappadora. Page 5 of 6 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. SEPTEMBER 23, 1998 ------------------ /s/ KENNETH L. BLUM, JR. ------------------------- KENNETH L. BLUM, JR. Page 6 of 6 EX-1 2 LOAN AGREEEMENT EXHIBIT 1 --------- LOAN AGREEMENT This loan agreement is made this 11th day of August, 1998 whereby Kenneth L. Blum, Sr. agrees to lend Kenneth L. Blum, Jr. Five Hundred Twelve Thousand Seventy Two Dollars and Fifty Cents ($512,072.50) to exercise 1,764,750 options of Avesis Incorporated common stock. The terms of this agreement shall be 5% interest over a fifteen (15) year period and the payments shall be $49,334.24 per year. The payments shall begin one year from today on August 11, 1999. The stock will be held in escrow until the loan is fully repaid. AGREED AND ACCEPTED /s/ KENNETH L. BLUM, Sr. 8/11/98 - ------------------------ ---------------- Kenneth L. Blum, Sr. Date /s/ KENNETH L. BLUM, Jr. 8/11/98 - ------------------------ ---------------- Kenneth L. Blum, Jr. Date State of Maryland County of Carroll On this 11TH day of AUGUST, 1998, before me, the undersigned, personally appeared KENNETH L. BLUM, SR., who acknowledged himself as the lender, and personally appeared KENNETH L. BLUM, JR., who acknowledged himself as the borrower, in the foregoing instrument for the purposes contained therein by signing his name. In witness whereof I hereunto set my hand and official seal. /s/ DEE WALLACE ------------------ Notary Public 12/27/98 - ------------------ My commission expires -----END PRIVACY-ENHANCED MESSAGE-----