UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 39463 / December 18, 1997 ADMINISTRATIVE PROCEEDING File No. 3-9511 : : ORDER INSTITUTING CEASE- In the Matter of : AND-DESIST PROCEEDINGS : PURSUANT TO SECTION 21C OF Alan R. Mishkin, : THE SECURITIES EXCHANGE ACT : OF 1934 AND FINDINGS AND Respondent. : ORDER OF THE COMMISSION : I. The Commission deems it appropriate and in the public interest that public administrative proceedings be, and they hereby are, instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") to determine whether Alan R. Mishkin ("Mishkin") has failed to comply with Sections 13(d) and 16(a) of the Exchange Act, and Rules 13d-1, 13d-2, 16a-2, 16a-3 and former Rule 16a-1 thereunder. II. In anticipation of the institution of these administrative proceedings, Mishkin ("the Respondent") has submitted an Offer of Settlement which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, the Respondent, without admitting or denying the matters set forth herein, consents to the issuance of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934 and Findings and Order of the Commission ("the Order"), and to the entry of the findings, and imposition of the remedial sanctions set forth below. III. On the basis of this Order and the Respondent's Offer of Settlement, the Commission finds the following: A. FACTS 1. Respondent Alan Mishkin, age 55, was a Director of ILX, Inc. ("ILX") from April 1991 through December 1993. At times relevant to this proceeding, Mishkin beneficially owned more than ten percent of the equity securities of ILX and Stratford American Corporation ("Stratford American"). 2. Issuers a. ILX, INC. ILX, Inc. (formerly International Leisure Enterprises, Inc.), an Arizona corporation with its principal offices in Phoenix, is engaged in the development and operation of resort properties. According to ILX's Annual Report on Form 10-K for the year ended December 31, 1996, ILX had total assets of over $41.2 million and shareholders' equity of over $15.1 million. As of January 31, 1997, ILX had 12,994,290 shares of common stock issued and outstanding. ILX reported a net income of over $1 million, or $.08 per share for its 1996 fiscal year. ILX's common stock has been registered with the Commission pursuant to Section 12 of the Exchange Act since July 11, 1988, and is traded on the NASDAQ Small Cap Market. b. Stratford American Corporation Stratford American Corporation, an Arizona corporation with its principal offices in Phoenix, through its subsidiaries, is engaged primarily in the business of leisure and commercial car rental and, explores for and develops natural resources and acquires, invests in and develops real estate. According to Stratford American's Annual Report on Form 10-KSB for the year ended December 31, 1996, Stratford American had total assets of over $10.4 million and a deficit shareholders' equity of $683,000. As of February 28, 1997, Stratford American had 84,076,806 shares of common stock outstanding. Stratford American reported a net loss of $268,000 for its 1996 fiscal year. Stratford American's common stock has been registered with the Commission pursuant to Section 12 of the Exchange Act since December 14, 1988, and is traded on the OTC Bulletin Board. B. APPLICABLE LAW Section 13(d) of the Exchange Act and Rule 13d-1 thereunder, in relevant part, provide that any person who, after acquiring directly or ======END OF PAGE 2====== indirectly the beneficial ownership of any equity security of a company registered pursuant to Section 12 of the Exchange Act, is directly or indirectly the beneficial owner of more than 5 percent of such security, shall, within 10 days after such acquisition, file a Schedule 13D with the Commission and the appropriate Exchange. Rule 13d-2(a) requires that amendments to Schedule 13D be promtly filed if any material change to the facts set forth in the Schedule 13D occurs. A change of one percent or more in the reporting person's beneficial ownership of the specified securities is deemed material for the purposes of Rule 13d-2(a). Section 16(a) of the Exchange Act <(1)> requires that beneficial owners of more than ten percent of any class of any equity security registered pursuant to Section 12 of the Exchange Act and the officers and directors of the issuer of any such security (hereinafter "insider") file a statement with the Commission by the effective date of a registration statement filed pursuant to Section 12 of the Exchange Act, or within ten days of becoming such officer, director or beneficial owner, reporting the amount of all equity securities of such issuer of which they are a beneficial owner. Section 16(a) also requires an insider to file with the Commission within ten days after the close of each calendar month, if there has been a change in the insider's ownership of the issuer's equity securities during such month, a statement indicating such changes. The rules enacted pursuant to Section 16(a) provide that an initial statement by an insider is to be made on a Form 3 and subsequent statements of changes in beneficial ownership are to be made on a Form 4 or a Form 5. C. MISHKIN'S VIOLATIONS OF SECTIONS 13(d) AND 16(a) OF THE EXCHANGE ACT AND THE RULES THEREUNDER Mishkin did not timely file for one month, and five years and ten months, respectively two Schedules 13D and did not timely file for periods ranging from one week to more than five years and five months twelve amendments to his Schedule 13D reporting changes in the information with <(1)> Until May 1, 1991, the statutory filing requirements under Section 16 of the Exchange Act were implemented by Rule 16a-1. On January 10, 1991, the Commission adopted a comprehensive revision of the rules under Section 16 which became effective on May 1, 1991. See Rel. 34-28869, 56 Fed. Reg. 7242 (Feb. 21, 1991). Among other things, these amendments place the implementation of the former Rule 16a-1 filing requirements in new Rules 16a-2 and 16a-3. Accordingly, this Order, at paragraph VI, orders that Mishkin cease-and-desist from violating Rules 16a-2 and 16a-3. ======END OF PAGE 3====== respect to his beneficial ownership of the common stock of ILX and Stratford American. Mishkin failed for three months to file a Form 3 with the Commission reporting his holdings of ILX, and failed for periods ranging from one week to more than one year and eight months to file thirteen Forms 4 reporting changes in his beneficial ownership of ILX's securities, and failed for periods ranging from three months to five years and five months to file three Forms 5 reporting changes in his beneficial ownership of ILX common stock. Mishkin failed for more than two months to file a Form 3 with the Commission reporting his holdings of Stratford American, and failed for three weeks to file a Form 4 reporting changes in his beneficial ownership of Stratford American's securities. The combined value of Mishkin's stock transactions in late Form 4 filings for ILX is approximately $2,302,270. Mishkin's history of delinquency, compiled from the ownership reports he has filed with the Commission for ILX and Stratford American, is set forth below: ======END OF PAGE 4====== ALAN R. MISHKIN Forms 3, 4 and 5 For Holdings and Transactions in the Equity Securities of ILX Inc. (formerly International Leisure Enterprises, Inc.) April 3, 1991 through August 8, 1997 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late Form 3 04-91 C/S 2,200 04-15-91 3m 07-11-91 Forms 4, 5 06-91 Buy 2,200 N/R N/R 07-10-91 1y8m1w 03-16-93 09-91 Buy 3,500,000 .50 1,750,000 10-10-91 1y5m1w 03-16-93 FY-91 Form 5 02-14-92 5y5m3w Not rec'd** 02-92 Other 1,166,655 N/A N/A 03-10-92 1y1w Disp 03-16-93 (Return of capital to Corp.) 05-92 Buy 40,000 .40 16,000 06-10-92 9m1w 03-16-93 FY-92 Form 5 02-16-93 4y5m3w Not rec'd 02-93 Buy 28,000 .66 18,480 03-10-93 1w 03-16-93 07-93 Buy 102,000 1.00 102,000 08-10-93 1m1w 09-20-93 ======END OF PAGE 5====== Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 02-94 Other 61,500 1.00 61,500 03-10-94 3m1w Acq. 06-21-94 10-94 Sale 10,000 1.63 16,300 11-10-94 6m 05-12-95 FY-94 Form 5 02-14-95 3m 05-12-95 01-95 Sale 5,000 1.50 7,500 02-10-95 6m 08-10-95 04-95 Sale 5,000 1.25 6,250 05-10-95 3m 5,000 1.25 6,250 08-10-95 12,500 05-95 Sale 17,000 1.19 20,230 06-12-95 2m 8,000 1.22 9,760 08-10-95 5,000 1.25 6,250 10,000 1.31 13,100 20,000 1.38 27,600 20,000 1.50 30,000 106,940 06-95 Sale 15,000 1.44 21,600 07-10-95 1m 15,000 1.50 22,500 08-10-95 35,000 1.50 52,500 55,000 1.50 82,500 179,100 07-95 Sale 25,000 1.88 47,000 08-10-95 T 40,000 1.94 77,600 08-10-95 08-95 Sale 20,000 2.00 40,000 09-10-95 T 15,000 2.00 30,000 09-11-95 09-95 Sale 25,000 2.13 53,250 10-10-95 T 10,000 2.25 22,500 10-10-95 15,000 2.19 32,850 20,000 2.31 46,200 150,000 2.38 357,000 10-95 Sale 15,000 2.13 31,950 11-13-95 1m 12-11-95 ======END OF PAGE 6====== Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 02-97 Sale 20,000 1.25 25,000 03-10-97 T 10,000 1.28 12,800 03-07-97 20,000 1.28 25,600 10,000 1.31 13,100 10,000 1.31 13,100 15,000 1.25 18,750 15,000 1.22 18,300 10,000 1.22 12,200 20,000 1.19 23,800 Total value late reported transactions: $ 2,302,270 * = Price per share rounded off ** = Lateness calculated through August 8, 1997 C/S = Common Stock T = Timely ======END OF PAGE 7====== Schedule 13D and Amendments ILX INC. (formerly International Leisure Enterprises Inc.) September 19, 1991 through August 8, 1997 Date Date Event Due/ Apprx. of No. of Triggering Date Yrs/Mos/ Trans. Type Shares Amendment Rec'd Wks.Late 09-09-91 13D 3,504,400 09-19-91 5y10m3w Not rec'd** 02-20-92 13D Amendment Change in 02-20-92 5y5m2w Information Not rec'd 05-19-92 13D Amendment " 05-19-92 5y2m2w Not rec'd 04-17-95 13D Amendment " 04-17-95 2y3m2w Not rec'd 06-05-95 13D Amendment " 06-05-95 2y2m Not rec'd 08-03-95 13D Amendment " 08-03-95 2y Not rec'd 09-22-95 13D Amendment " 09-22-95 1y10m1w Not rec'd 02-11-97 13D Amendment " 02-11-97 5m3w Not rec'd * = For the purpose of this table, the due date for amendments reflects the date the obligation to file the amendment arose. ** = Lateness calculated through August 8, 1997. ======END OF PAGE 8====== Forms 3 and 4 For Holdings and Transactions in the Equity Securities of Stratford American Corporation December 10, 1990 through January 10, 1992 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* Value Rec'd Wks.Late Form 3 11-90 C/S 3,991,000 12-10-90 2m2w Pfd. 2,000,000 02-28-91 Forms 4 03-91 Disp 2,000,000 N/A N/A 04-10-91 3w by exch. 04-30-91 or conv. 03-91 Acq 2,000,000 N/A N/A 04-10-91 3w by exch. 04-30-91 or conv. 12-91 Other 500,000 N/A N/A 01-10-92 T Acq 01-10-92 (issued in connection with consulting services performed) Total value late reported transactions: $ 0 * = Price per share rounded off C/S = Common Stock Pfd = Preferred T = Timely exch. = exchange conv. = conversion ======END OF PAGE 9====== Schedules 13D and Amendments Stratford American Corporation March 12, 1990 through August 8, 1996 Date Date Event Due/ Apprx. of No. of Triggering Date Yrs/Mos/ Trans. Type Shares Amendment Rec'd Wks.Late 03-05-90 13D 4,000,000 03-15-90 T 03-12-90 03-05-90 13D Amendment Change 03-05-90* 1w Items 1-7** 03-15-90 05-14-90 13D Amendment Change 05-14-90 T Items 1-7 05-23-90 06-05-90 13D Amendment Change 06-05-90 T Items 1-7 06-11-90 10-29-90 13D Amendment Change 10-29-90 1w Items 1-7 11-09-90 11-28-90 13D Amendment Change 11-28-90 1m1w Items 1-6 01-15-91 03-15-91 13D Amendment Change 03-15-91 3m1w Items 1-6 07-03-91 12-30-93 13D Amendment Change 12-30-93 2m3w Items 1,2, 03-31-94 4, 5-7 07-01-96 13D 6,506,667 07-11-96 1m 08-08-96 * = For the purpose of this table, the due date for amendments reflects the date the obligation to file the amendment arose. ** = Items refers to Items of Schedules 13D. ======END OF PAGE 10====== IV. FINDINGS Based on the above, the Commission finds that Mishkin violated Sections 13(d) and 16(a) of the Exchange Act, Rules 13d-1, 13d-2, 16a-2, 16a-3 and former Rule 16a-1 promulgated thereunder. V. OFFER OF SETTLEMENT Mishkin has submitted an Offer of Settlement in this proceeding which the Commission has determined to accept. Mishkin, in his Offer, consents to this Order making findings, as set forth above, and ordering him to cease and desist from committing or causing any violation of, and committing or causing any future violation of, Sections Section 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. VI. ORDER Accordingly, IT IS HEREBY ORDERED, pursuant to Section 21C of the Exchange Act, that Mishkin cease and desist from committing or causing any violation of, and committing or causing any future violation of, Sections 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. By the Commission. Jonathan G. Katz Secretary ======END OF PAGE 11======