Amended Statement of Beneficial Ownership (sc 13d/a)
October 12 2018 - 4:09PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED
IN STATEMENTS FILED PURSUANT
TO § 240.13d-1(a)
AND AMENDMENTS THERETO FILED PURSUANT TO
§ 240.13d-2(a)
(Amendment No. 3)
1
Fred’s, Inc.
(Name
of Issuer)
Class A Common Stock
(Title of Class of Securities)
356108100
(CUSIP Number)
Heath
freeman
alden
global capital llc
885 Third Avenue, 34
th
Floor
New York, NY 10022
(212)
888-5500
andrew
freedman, ESQ.
OLSHAN
FROME WOLOSKY LLP
1325
Avenue of the Americas
New
York, New York 10019
(212)
451-2300
(Name, Address and Telephone Number of Person
Authorized to Receive Notices
and Communications)
October 10, 2018
(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 that is the subject of this Schedule
13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following
box
¨
.
Note:
Schedules
filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.
See
§ 240.13d-7 for other parties to whom copies are to be sent.
1
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.
The information required
on 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
).
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1
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NAME OF REPORTING PERSON
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Strategic Investment Opportunities LLC
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) ☐
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(b) ☐
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS
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WC
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
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☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
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Delaware
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NUMBER OF
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7
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SOLE VOTING POWER
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SHARES
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BENEFICIALLY
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- 0 -
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OWNED BY
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8
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SHARED VOTING POWER
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EACH
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REPORTING
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9,275,000
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PERSON WITH
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9
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SOLE DISPOSITIVE POWER
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- 0 -
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10
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SHARED DISPOSITIVE POWER
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9,275,000
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
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9,275,000
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
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☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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24.9%
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14
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TYPE OF REPORTING PERSON
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OO
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1
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NAME OF REPORTING PERSON
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Alden Global Capital LLC
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) ☐
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(b) ☐
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS
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AF
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
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☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
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Delaware
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NUMBER OF
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7
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SOLE VOTING POWER
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SHARES
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BENEFICIALLY
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- 0 -
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OWNED BY
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8
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SHARED VOTING POWER
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EACH
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REPORTING
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9,275,000
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PERSON WITH
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9
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SOLE DISPOSITIVE POWER
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- 0 -
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10
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SHARED DISPOSITIVE POWER
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9,275,000
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
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9,275,000
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
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☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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24.9%
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14
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TYPE OF REPORTING PERSON
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IA, OO
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1
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NAME OF REPORTING PERSON
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Heath Freeman
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) ☐
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(b) ☐
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS
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AF
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
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☐
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
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USA
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NUMBER OF
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7
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SOLE VOTING POWER
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SHARES
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BENEFICIALLY
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231,617*
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OWNED BY
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8
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SHARED VOTING POWER
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EACH
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REPORTING
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9,275,000
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PERSON WITH
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9
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SOLE DISPOSITIVE POWER
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231,617*
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10
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SHARED DISPOSITIVE POWER
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9,275,000
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
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9,506,617*
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
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☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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25.5%
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14
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TYPE OF REPORTING PERSON
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IN
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____________________
* Represents restricted stock units that have not yet vested, which were granted to Mr. Freedman as compensation
for his service on the Board of Directors of the Issuer.
The following constitutes
Amendment No. 3 to the Schedule 13D filed by the undersigned (the “Amendment No. 3”). This Amendment No. 3 amends the
Schedule 13D as specifically set forth herein.
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Item 3.
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Source and Amount of Funds or Other Consideration
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Item 3 is hereby amended
to add the following:
The 231,617 Shares
reported owned by Mr. Freeman represent restricted stock units (“RSUs”) that have not yet vested, which were granted
to Mr. Freeman as compensation for his service on the Board of Directors of the Issuer (the “Board”).
The
RSUs vest as follows: (i) 59,028 RSUs vests upon the retirement of Mr. Freeman from the
Board
and
(ii) 172,589 RSUs vests six (6) months following the retirement of Mr. Freeman from the
Board
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Item 4.
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Purpose of Transaction
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Item 4 is hereby
amended to add the following:
On October 10, 2018,
the Issuer and the Reporting Persons entered into an amendment (the “Amendment”) to the Amended and Restated Cooperation
Agreement, dated as of August 11, 2017, between the Issuer and the Reporting Persons (the “Cooperation Agreement”).
The Amendment, among other things:
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·
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Extends the “Cooperation Period” under the Cooperation Agreement until September 1,
2019;
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·
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Deletes the Reporting Persons’ “top up” option that would otherwise arise in
connection with certain equity offerings;
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·
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Provides a consent, pursuant to Section 3 of the Cooperation Agreement, for the Reporting Persons
to acquire no more than 3,725,000 additional shares of the Issuer’s common stock, which would result in the Reporting Persons
owning no more than 13,000,000 shares of the Issuer’s common stock (excluding shares of Common Stock issued to Mr. Freeman
as compensation for his services on the Board) (the “Alden Ownership Limit”); and
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·
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Provides an exemption, pursuant to Section 25 of the Amended & Restated Rights Agreement, dated
as of September 18, 2017 (the “Rights Agreement”), by and between the Issuer and American Stock Transfer & Trust
Company, LLC, as rights agent, so long as the Reporting Persons’ ownership of the Issuer’s common stock (excluding
shares of Common Stock issued to Mr. Freeman as compensation for his services on the Board) remains at or below the Alden Ownership
Limit.
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The foregoing description
of the Amendment does not purport to describe all of the terms and provisions thereof and is qualified in its entirety by reference
to the Amendment, which is referenced as Exhibit 99.1 hereto and is incorporated herein by reference.
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Item 5.
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Interest in Securities of the Issuer
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Items 5(a)-(c) are
hereby amended and restated to read as follows:
The aggregate percentage
of Shares reported owned by each person named herein is based upon 37,260,158 Shares outstanding as of September 7, 2018, which
is the total number of Shares outstanding as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the Securities
and Exchange Commission on September 18, 2018.
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(a)
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As of the close of business on October 12, 2018, Opportunities beneficially owned 9,275,000 Shares.
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Percentage: Approximately
24.9%
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(b)
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1. Sole power to vote or direct vote: 0
2. Shared power to vote or direct vote: 9,275,000
3. Sole power to dispose or direct the disposition: 0
4. Shared power to dispose or direct the disposition: 9,275,000
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(c)
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Opportunities has not entered into any transactions in the Shares during the past 60 days.
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(a)
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Alden, as the investment manager of Opportunities, may be deemed the beneficial owner of the 9,275,000
Shares owned by Opportunities.
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Percentage: 24.9%
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(b)
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1. Sole power to vote or direct vote: 0
2. Shared power to vote or direct vote: 9,275,000
3. Sole power to dispose or direct the disposition: 0
4. Shared power to dispose or direct the disposition: 9,275,000
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(c)
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Alden has not entered into any transactions in the Shares during the past 60 days.
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(a)
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As of the close of business on October 12, 2018, Mr. Freeman beneficially owned 231,617 Shares
underlying RSUs which have not yet vested. Mr. Freeman, as the President of Alden, may be deemed the beneficial owner of the 9,275,000
Shares owned by Opportunities.
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Percentage: Approximately
25.5%
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(b)
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1. Sole power to vote or direct vote: 231,617
2. Shared power to vote or direct vote: 9,275,000
3. Sole power to dispose or direct the disposition: 231,617
4. Shared power to dispose or direct the disposition: 9,275,000
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(c)
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The transaction in the Shares by Mr. Freeman during the past 60 days is set forth in Schedule A
and is incorporated herein by reference.
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The Reporting Persons,
as members of a “group” for the purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, may
be deemed the beneficial owner of the Shares directly owned by the other Reporting Persons. Each Reporting Person disclaims beneficial
ownership of such Shares except to the extent of his or its pecuniary interest therein.
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Item 6.
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Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer
.
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Item 6 is hereby amended
to add the following:
On October 10, 2018,
the Reporting Persons and the Issuer entered into the Amendment defined and described in Item 4 above.
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Item 7.
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Material to be Filed as Exhibits
.
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Item 7 is hereby
amended to add the following exhibit:
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99.1
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Amendment No. 1 to the Amended and Restated Cooperation Agreement, dated October 10, 2018 (incorporated
by reference to Exhibit 10.1 of the Issuer’s Current Report on Form 8-K filed with the Securities and Exchange Commission
on October 11, 2018).
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SIGNATURES
After reasonable inquiry
and to the best of his knowledge and belief, the undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: October 12, 2018
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Strategic Investment Opportunities LLC
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By:
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Alden Global Capital LLC
Investment Manager
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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Alden Global Capital LLC
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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/s/ Heath Freeman
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Heath Freeman
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SCHEDULE A
Transaction in the Shares During the Past
Sixty Days
Shares of Common Stock
Purchased/(Sold)
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Price Per
Share($)
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Date of
Purchase/Sale
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HEATH
FREEMAN
____________________
*Represents RSUs awarded to Mr. Freeman
that
vest six (6) months following his retirement from the Board of Directors of the Issuer.
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