-----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, ATIG2fFSxHoTzeBykWprIbuIKRxKP29LrGLEQ+SwaakFpO6zFS3bOE+VoYYIduc6 RvSv8R4chDk+lOqpxuh1DA== 0000807985-96-000035.txt : 19961002 0000807985-96-000035.hdr.sgml : 19961002 ACCESSION NUMBER: 0000807985-96-000035 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19961001 SROS: NYSE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: RHODES INC CENTRAL INDEX KEY: 0000083679 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-FURNITURE STORES [5712] IRS NUMBER: 580536190 STATE OF INCORPORATION: GA FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-20907 FILM NUMBER: 96637688 BUSINESS ADDRESS: STREET 1: 4370 PEACHTREE RD N E CITY: ATLANTA STATE: GA ZIP: 30319 BUSINESS PHONE: 4042644600 MAIL ADDRESS: STREET 1: 4370 PEACHTREE RD N E CITY: ATLANTA STATE: GA ZIP: 30319 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SOUTHEASTERN ASSET MANAGEMENT INC/TN/ CENTRAL INDEX KEY: 0000807985 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 620951781 STATE OF INCORPORATION: TN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 860 RIDGELAKE BLVD STE 301 CITY: MEMPHIS STATE: TN ZIP: 38120 MAIL ADDRESS: STREET 1: 860 RIDGELAKE BLVD STREET 2: STE 301 CITY: MEMPHIS STATE: TN ZIP: 38120 SC 13D 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 Rhodes, Inc. ------------------------------------------ (Name of Issuer) Common Stock (No Par Value) ------------------------------------------- (Title of Class and Securities) 76235P101 -------------------------------------------- (CUSIP Number of Class of Securities) O. Mason Hawkins Chairman of the Board and C.E.O. and Charles D. Reaves Vice President & General Counsel Southeastern Asset Management, Inc. 6075 Poplar Avenue; Suite 900 Memphis, TN 38119 _______________________(901)_761-2474______________________ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) September 17, 1996 ---------------------------- (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 Statement and is filing this Schedule because of Rule 13d-1(b)(3) or (4), check the following box: [X] Check the following box if a fee is being paid with this Statement: [ ] Filing Fee of $100.00 is enclosed CUSIP No. 76235P101 13D - ------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS Southeastern Asset Management, Inc. I.D. No. 62-0951781 - ------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) (b) X - ------------------------------------------------------------------- (3) SEC USE ONLY - ------------------------------------------------------------------- (4) SOURCE OF FUNDS OO: Funds of investment advisory clients - ------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Tennessee - ------------------------------------------------------------------- :(7) SOLE VOTING POWER : (Discretionary Accounts) NUMBER OF SHARES BENEFICIALLY : 530,000 shares OWNED BY EACH REPORTING PERSON -------------------------------- WITH :(8) SHARED OR NO VOTING POWER (Includes Non-Discretionary) : 959,600 shares (Shared) 100,000 shares (None) -------------------------------- :(9) SOLE DISPOSITIVE POWER : (Discretionary Accounts) : 630,000 shares -------------------------------- :(10) SHARED DISPOSITIVE POWER : 959,600 shares - ------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON (Discretionary & Non-discretionary Accounts) 1,589,600 shares - ------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES - ------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 17.4% - ------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON IA - ------------------------------------------------------------------- CUSIP No. 76235P101 13D - ------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS Longleaf Partners Small-Cap Fund I.D. No. 62-1376170 - ------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) (b) X - ------------------------------------------------------------------- (3) SEC USE ONLY - ------------------------------------------------------------------- (4) SOURCE OF FUNDS OO: Funds of investment advisory clients - ------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Massachusetts - ------------------------------------------------------------------- :(7) SOLE VOTING POWER : (Discretionary Accounts) NUMBER OF SHARES BENEFICIALLY : None OWNED BY EACH REPORTING PERSON -------------------------------- WITH :(8) SHARED OR NO VOTING POWER : 723,000 shares -------------------------------- :(9) SOLE DISPOSITIVE POWER : (Discretionary Accounts) : None -------------------------------- :(10) SHARED DISPOSITIVE POWER : 723,000 shares - ------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON (Discretionary & Non-discretionary Accounts) 723,000 shares - ------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES - ------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 7.9% - ------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON IV - ------------------------------------------------------------------- CUSIP No. 76235P101 13D - ------------------------------------------------------------------- (1) NAMES OF REPORTING PERSONS O. Mason Hawkins I.D. No. ###-##-#### - ------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) (b) X - ------------------------------------------------------------------- (3) SEC USE ONLY - ------------------------------------------------------------------- (4) SOURCE OF FUNDS OO: None - ------------------------------------------------------------------- (5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - ------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION Citizen of United States - ------------------------------------------------------------------- :(7) SOLE VOTING POWER : (Discretionary Accounts) NUMBER OF SHARES BENEFICIALLY : None OWNED BY EACH REPORTING PERSON -------------------------------- WITH :(8) SHARED VOTING POWER : None -------------------------------- :(9) SOLE DISPOSITIVE POWER : None -------------------------------- :(10) SHARED DISPOSITIVE POWER : None - ------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON None (See Item 2 ) - ------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES - ------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 0.0% - ------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON IN - ------------------------------------------------------------------- Item 1. Security_and_Issuer The class of equity security to which this statement on Schedule 13D relates is the Common Stock, no par value (the "Securities") of Rhodes, Inc., a Georgia corporation (the "Issuer"). The Issuer has its principal executive offices located at 4370 Peachtree Road, N.E.; Atlanta, GA 30319. Item 2. Identity_and_Background Subparagraphs (a), (b), and (c). This statement is being filed by Southeastern Asset Management, Inc. ("Southeastern"), an investment advisor registered with the Securities & Exchange Commission under the Investment Advisers Act of 1940, as amended. The address of its principal office is 6075 Poplar Avenue, Suite 900; Memphis, Tennessee 38119. Southeastern serves as an investment advisor to various individual clients, institutions (including qualified retirement plans), endowment funds and to Longleaf Partners Funds Trust ("Longleaf"), a registered investment company organized as a Massachusetts business trust and having three separate series or portfolios. Two of those series, Longleaf Partners Small-Cap Fund and Longleaf Partners Realty Fund, are owners of the Securities. Longleaf Partners Small-Cap Fund owns more than 5% of the Securities outstanding, and is accordingly a joint filer of the Schedule 13D. The Securities of the Issuer reported in Item 5 herein were acquired on behalf of and for the benefit of the various client accounts, including the two series of Longleaf Partners Funds Trust, under discretionary authority granted Southeastern or in connection with accounts which have not granted discretionary authority but which acquired the Securities on the basis of Southeastern's recommendation. None of the Securities are owned by or on behalf of Southeastern or by any of its directors or officers, or any Trustees or officers of Longleaf. This statement is also being filed by Mr. O. Mason Hawkins, Chairman of the Board and Chief Executive Officer of Southeastern, in the event he could be deemed to be an indirect beneficial owner of the Securities reported by Southeastern through the exercise of voting control and/or dispositive power over the Securities as the result of his official positions or ownership of voting securities of Southeastern. Neither Southeastern nor Mr. Hawkins owns any Securities for its or his own account and each disclaims beneficial interest in any of the Securities reported herein. (d) During the last five years, neither Southeastern, Longleaf Partners Small-Cap Fund, Longleaf Partners Realty Fund, nor Mr. Hawkins has been convicted in any criminal proceeding. (e) During the last five years, neither Southeastern, Longleaf Partners Small-Cap Fund, Longleaf Partners Realty Fund, nor Mr. Hawkins has been a party to any civil or administrative proceeding involving any alleged violations of any securities laws. (f) Southeastern is a corporation organized and existing under the laws of the State of Tennessee; Longleaf Partners Funds Trust is a business trust organized and existing under the laws of the Commonwealth of Massachusetts; Mr. Hawkins is a citizen of the United States. The names, business addresses, and principal occupations of each director and executive officer of Southeastern and Longleaf Partners Funds Trust are set forth in Schedule I. Item 3. Source_and_Amount_of_Funds_or_Other_Consideration Southeastern used approximately $ 16,321,284 to purchase the Securities now held. All funds were provided through the accounts of investment advisory clients, including Longleaf, for whose accounts the Securities were purchased. None of the funds used to purchase the Securities were provided through borrowings of any nature. Item 4. Purpose_of_Transaction The Securities of the Issuer reported herein have been purchased and held for investment purposes on behalf of client accounts over which Southeastern has either sole or shared discretionary investment and/or voting power or non-discretionary investment and/or voting power. The Securities are reported by Southeastern in the event that it should be deemed to be a member of a group under Section 13(d)(3) or the beneficial owner of these Securities under the provisions of subparagraph (b) of Rule 13d-3 under the Securities Exchange Act of 1934. Beneficial ownership is expressly disclaimed, as permitted by Rule 13d-4. All purchases of Securities for both discretionary and non-discretionary accounts were made for investment purposes only, in the ordinary course of business of Southeastern as a registered investment advisor. Southeastern may purchase additional Securities on behalf of clients in the future, or may sell all or a part of the current holdings of the Securities. Southeastern's General Investment Management Practices and Procedures. Southeastern is engaged in the business of investment management of its clients' assets and pursues an investment philosophy of identifying undervalued situations and acquiring positions on behalf of its clients. In pursuing this investment philosophy, Southeastern analyzes the operations, capital structure and markets of companies, including those of the Issuer, in which it may invest on behalf of clients, and monitors the business operations of such companies on a continuous basis through analysis of financial statements and other documentation and through discussions with knowledgeable industry observers and with representatives of such companies (often at the invitation of management). Southeastern qualifies as an institution which may elect to file securities ownership reports required by the Securities Exchange Act of 1934 on Schedule 13G and, as a routine matter, Southeastern utilizes Schedule 13G for its reporting of the ownership positions held by its investment advisory clients. However, as the result of its analytical activities or the occurrence of other events, Southeastern may desire to participate in discussions with third parties or with the particular issuer's management on significant matters in which Southeastern may suggest or take a position or render advice with respect to potential changes in the operations, capital structure or general management of such issuers as a means of enhancing shareholder value. In such situations, Southeastern will generally choose to make an original filing on Schedule 13D. After filing a Schedule 13D, and depending on the circumstances, Southeastern's suggestions, positions, or advice could relate to one or more of the transactions specified in clauses (a) through (c) and clauses (e) through (j) of Item 4 of the Schedule 13D form, which are as follows: (a). The acquisition by any person of additional securities of the issuer, or the disposition of securities of the Issuer. (b). An extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the issuer or any of its subsidiaries. (c). A sale or transfer of a material amount of assets of the issuer or any of its subsidiaries. (d). Not applicable. (Filers have no current intention of seeking any change in the present Board of Directors or management of the Issuer). (e). Any material change in the present capitalization or dividend policy of the issuer. (f). Any other material change in the issuer's business or corporate structure. (g). Changes in the issuer's charter, bylaws or other instruments corresponding thereto. (h). Causing a class of securities of the issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association. (i). A class of equity securities of the issuer becoming eligible for termination of registration pursuant to Section 12(g) of the Act. (j). Any action similar to any of those enumerated above. Southeastern's Position With Respect To The Subject Issuer. On September 17, 1996, the Issuer ("Rhodes") through a press release announced that a definitive agreement had been reached to merge with Heilig-Meyers Company of Richmond, Virginia ("Heilig-Meyers") in a transaction which would cause Rhodes to become a subsidiary of Heilig-Meyers. Under the announced terms of the definitive agreement, as approved by Rhodes' Board of Directors, Rhodes shareholders would receive one Heilig-Meyers common share for each two shares of Rhodes held, or an aggregate of approximately 4.6 million shares of Heilig-Meyers stock for all currently outstanding Rhodes shares, structured as a tax free exchange of shares. According to the press release, the proposed acquisition is subject to Hart-Scott-Rodino clearance, approval by Rhodes shareholders, and certain other conditions. Market reaction to the announcement was reflected in the fall of the market price of Rhodes common stock by approximately 29% on the day following the announcement, from $10.625 prior to the announcement on September 17, 1996 to $7.500 at the close of business on September 18, 1996. Through its own internal analysis, management of Southeastern also believes that the terms of the proposed acquisition are unfair to existing shareholders who are not Rhodes insiders in that the consideration proposed to be given in return for the exchange of Rhodes shares is grossly inadequate, and that Rhodes' Board of Directors should be willing to seek and consider other alternatives such as a more beneficial offer for the company or the possibility of remaining independent. According to Rhodes' 1996 Annual Report and the Proxy Statement for its regular 1996 Annual Meeting of Shareholders, its largest shareholder is Mr. Holcombe T. Green, Jr., a director of Rhodes who, together with WPS Investors, L.P. and RW Holdings, partnerships controlled by Mr. Green, and certain others, collectively own approximately 31.9% of Rhodes' outstanding shares. Mr. Green served as Chairman of the Board of Rhodes from 1988 to 1994 and presently serves as Chairman of the Executive Committee of the Board. He is also Chairman of the Board and Chief Executive Officer of WestPoint Stevens Inc, a textile manufacturer, and is a director of American Buildings Company, a manufacturer of pre- engineered metal building systems. Mr. Green also serves with two of the other four directors of Rhodes on certain other boards of directors. Mr. Green is Chairman of the Board of HBO & Company, a provider of hospital information systems; Mr. James V. Napier, one of Rhodes' other directors, is also a director of HBO & Company. Mr. Green is a director of Georgia Gulf Corporation, a chemical manufacturer; Mr. James R. Kuse, one of Rhodes' other directors, is Chairman and also a director of Georgia Gulf Corporation, and owns a 12.5% limited partnership interest in Green Capital Investors, L.P., a limited partnership in which Mr. Green has been the principal since 1988. Southeastern represents the investment interests of beneficial owners comprising 17.4% of Rhodes' outstanding shares, and believes these shareholders, who are not insiders as to Rhodes, constitute the second largest collective beneficial ownership interest of Rhodes common stock. Following the announcement of the proposed acquisition on September 17, 1996, management of Southeastern has been unsuccessful in its endeavors to discuss with Mr. Green the terms of the acquisition proposal and his reasons for supporting a proposed consideration below the market price of Rhodes stock prior to the announcement and, in Southeastern's view, substantially less than a reasonable appraisal of Rhodes' intrinsic value. According to a Schedule 13D filed with the Securities and Exchange Commission by WPS Investors, L.P. on September 20, 1996, a Form 8-K filed by Rhodes on September 23, 1996, and a Schedule 13D filed by Heilig-Meyers, W.P.S. Investors, L.P., and Green Capital Investors, L.P. on September 27, 1996, these shareholders of Rhodes have entered into a formal Voting Agreement pursuant to which they will vote their combined ownership interests of approximately 31.8% of Rhodes' outstanding common stock in favor of the proposed acquisition. In addition, these documents disclose that Mr. Irwin L. Lowenstein, Chairman of the Board and Chief Executive Officer of Rhodes and Mr. Joel H. Dugan, Senior Vice President - Finance and Administration, have entered into formal Lock-Up Agreements with Heilig-Meyers in connection with their personal shares. Representatives of Southeastern met with top management of Rhodes at its corporate headquarters in Atlanta on August 13, 1996, in a regular "due diligence" meeting similar to those routinely used by Southeastern to keep abreast of developments within companies held in the portfolios of its clients. That meeting, held approximately one month prior to the decision by Rhodes' Board of Directors to approve the acquisition, was attended by Mr. Irwin L. Lowenstein, Chairman of the Board and Chief Executive Officer of Rhodes and Mr. Joel H. Dugan, Senior Vice President - Finance and Administration. In that meeting, these representatives of Rhodes imparted the following information to the Southeastern personnel in attendance: (i). Rhodes' then current financial situation was manageable. There were no circumstances under which credit lines would be a problem and, further, Rhodes' former primary lender wanted to regain its business. (ii). Rhodes had by August 13 substantially consolidated its two recent acquisitions and full integration of these acquisitions should be completed within the near future. (iii). Comparable store sales should begin to turn by the end of September of 1996. (iv). Mr. Lowenstein voluntarily denied a rumor to the effect that Rhodes was for sale at a price in the range of $7.00 a share, emphatically stating that if the price were that low ... "we would be the buyers." In response to Southeastern's observation that it appeared that the company was making satisfactory progress as an independent entity, and that there seemed to be no compelling reason for a sale of the company, Mr. Lowenstein indicated that he did not disagree with that analysis. However, he made further statements to the effect that Mr. Holcombe Green, Rhodes' largest shareholder, wants to sell, get his money out, and move on to something else. As a result, management may have no other choice. Rhodes' management on another occasion informed Southeastern that Mr. Green or entities with which he was affiliated had sold to the public in a secondary stock offering during 1994 approximately 2.5 million shares, or about half his total original position, for a price in the range of $18 per share. As previously set forth, the market price of Rhodes' common stock fell by approximately 29% on the day following the announcement of the proposed acquisition by Heilig-Meyers from $10.625 prior to the announcement on September 17, 1996 to $7.500 at the close of business on September 18, 1996. It is a settled principle of law that a board of directors has a fiduciary obligation to take into consideration the interests of all shareholders, particularly when the board's decision directly affects their economic interests, and to balance equitably any conflicting interests where there may be a difference between what is in the best interests of a majority of public shareholders when compared with the interests of an inside minority. Information on whether or not there may be undisclosed pressures imposed on Rhodes' Board of Directors by its dominant inside shareholder for reasons which may be particularly beneficial to or convenient for him or entities which he controls, possibly without due regard for the best interests of the outside majority shareholders, if true, is vital to an informed and complete understanding of the full background and reasons for what Southeastern believes to be the surprisingly low level of compensation being proposed for this acquisition. In all fairness to the public shareholders, full and complete information on the reasoning supporting this proposed acquisition in comparison with other alternatives should be disclosed in the Proxy Statement soliciting proxies for the votes of the additional public shareholders needed to approve the proposed transaction. Because Southeastern has been rebuffed in its efforts to discuss the reasons for or alternatives to the proposed acquisition with Rhodes' largest shareholder, and because of Southeastern's view that the proposed consideration for the acquisition is grossly inadequate, Southeastern may have contacts or enter into discussions with other persons or entities with the objective of seeking a more beneficial offer or encouraging alternative merger proposals for Rhodes. In addition, Southeastern may actively oppose the acquisition proposal upon its presentation to Rhodes' shareholders for approval in its Proxy Statement through procedures such as those authorized by Rule 14a-7 under the Securities Exchange Act of 1934, which allows a shareholder to communicate directly with all shareholders or requires the Issuer to forward a communication from a shareholder to all other shareholders, and Rule 14a-8 under the Securities Exchange Act of 1934, which allows a shareholder to include an alternative proposal in the Proxy Statement. Any such discussions, contacts, or other actions on the part of Southeastern are intended to enhance shareholder value and to be supportive of Southeastern's clients' inherent interests and rights as owners of Rhodes common stock. Except as set forth herein, Southeastern has no present intention on behalf of its clients or itself of seeking a change in the composition of the Issuer's Board of Directors or seeking any other changes in the composition of its management, nor of seeking control or of otherwise participating directly in its management by seeking representation on the Board of Directors or participating in its management in any other manner. Item 5. Interest_In_Securities_Of_The_Issuer (a) The aggregate number and percentage of Securities to which this Schedule 13D relates is 1,589,600 shares of the Common Stock of the Issuer, constituting approximately 17.4% of the 9,149,964 shares of Common Stock outstanding at June 30, 1996, as reported in the Issuer's Form 10-Q for the quarter ended May 31, 1996, as filed with the Securities & Exchange Commission. The holdings are as follows: Common % of Shares Common Shares Accounts Represented Shares Voting Rights Discretionary 530,000 5.8% Shared 959,600* 10.5% None 100,000 1.1% Total 1,589,600 17.4% Dispositive Power Discretionary 630,000 6.9% Shared 959,600* 10.5% Total 1,589,600 17.4% *Consists of 723,000 shares owned by Longleaf Partners Small-Cap Fund, and 236,600 shares owned by Longleaf Partners Realty Fund, which are series of Longleaf Partners Funds Trust, an open-end management investment company registered under the Investment Company Act of 1940. (b) Southeastern generally has the sole power to dispose of or to direct the disposition of the Securities held for Discretionary accounts of its investment clients, as set forth above and may be granted the sole power to vote or direct the vote of such Securities; such powers may be retained by or shared with the respective clients for shared or non-discretionary accounts, but Southeastern generally makes recommendations with respect thereto. Shares held by the two Series of Longleaf are reported in the "shared" category. (c) Information with respect to all transactions in the Securities which were effected during the past sixty days by Southeastern are set forth in Schedule II. (d) The private investment advisory clients of Southeastern have the sole right to receive and, subject to notice, to withdraw the proceeds from the sale of the Securities, and the sole power to direct the receipt of dividends from any of the Securities held for their respective accounts. Such clients may also terminate the investment advisory agreements without penalty upon appropriate notice. No client other than Longleaf Partners Small-Cap Fund has an interest that relates to more than 5% of the Securities. Southeastern does not have an economic interest in any of the Securities reported herein. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships_with_Respect_to_Securities_of_the_Issuer The powers of disposition with respect to Securities owned by discretionary private accounts of Southeastern are established in written investment advisory agreements between clients and Southeastern, which are entered into in the normal and usual course of the business of Southeastern as a registered investment advisor and which are generally applicable to all securities purchased for the benefit of each such discretionary private account. There are no special or different agreements relating to the Securities of the Issuer. The written investment advisory agreements with clients do not contain provisions relating to borrowing of funds to finance the acquisition of the Securities, acquisition of control, transfer of securities, joint ventures, or any of the other transactions listed in Item 7 of Schedule 13D other than voting of proxies. In connection with voting, Southeastern may be allowed or directed to vote the proxies received by accounts classified as "discretionary" or "shared" accounts; such authority is generally retained by the clients for accounts classified as "non-discretionary". Item 7. Material to be Filed as an Exhibit Schedule I. Information with Respect to Directors and Officers of Southeastern Asset Management, Inc. and the Trustees and Officers of Longleaf Partners Funds. Schedule II. Information with Respect to Transactions Effected In the Issuer's Securities During the Past Sixty Days SIGNATURES 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: October 1, 1996 SOUTHEASTERN ASSET LONGLEAF PARTNERS MANAGEMENT, INC. SMALL-CAP FUND By /s/ Charles D. Reaves By /s/ Charles D. Reaves - -------------------------- ------------------------- Charles D. Reaves Charles D. Reaves Vice President & General Exec. V. P. Counsel O. MASON HAWKINS (Individually) /s/ O. Mason Hawkins - --------------------------- Joint Filing Agreement In accordance with Rule 13d-1(f) under the Securities Exchange Act of 1934, the persons or entities named below agree to the joint filing on behalf of each of them of this Schedule 13D with respect to the Common Stock of Rhodes, Inc., and further agree that this joint filing agreement be included in this filing. In evidence thereof, the undersigned hereby execute this Agreement on the 1st day of October, 1996 SOUTHEASTERN ASSET LONGLEAF PARTNERS MANAGEMENT, INC. SMALL-CAP FUND By /s/ Charles D. Reaves By /s/ Charles D. Reaves - -------------------------- ------------------------- Charles D. Reaves Charles D. Reaves Vice President & General Exec. V. P. Counsel O. MASON HAWKINS (Individually) /s/ O. Mason Hawkins - --------------------------- SCHEDULE I Information with Respect to Executive ________Officers_and_Directors_______ The following information is disclosed for each of the directors and executive officers of Southeastern: name; business address; and present principal occupation or employment and the name, principal business and address of any corporation or other organization in which such employment is conducted. Unless otherwise specified, the principal employer of each such individual is Southeastern Asset Management, Inc., having its principal executive offices located at 6075 Poplar Ave., Suite 900, Memphis, Tennessee 38119. Each individual identified below is a citizen of the United States. To the knowledge of Southeastern, during the last five years, no such person has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), and no such person was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which he 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 law or finding any violation with respect to such laws. SOUTHEASTERN ASSET MANAGEMENT, INC. Directors: O. Mason Hawkins, Director; Chairman of the Board and Chief Executive Officer G. Staley Cates Director; President W. Reid Sanders Director; Executive Vice President Frank N. Stanley, III Director; Vice President-Investments Other Officers: John B. Buford Vice President C. T. Fitzpatrick Vice President Randy D. Holt Vice President and Secretary Joseph L. Ott Vice President and Treasurer Charles D. Reaves Vice President, General Counsel and Chief Compliance Officer Deborah L. Sullivan Vice President-Trading LONGLEAF PARTNERS FUNDS TRUST Trustees: O. Mason Hawkins - Trustee; Chairman of the Board and Chief Executive Officer; Co- Portfolio Manager W. Reid Sanders - Trustee; President Chadwick H. Carpenter, Jr. - Trustee; Principal occupation - a senior executive officer of Progress Software Corp., Bedford, MA Steven N. Melnyk - Trustee; Principal occupation - Chairman of the Executive Committee and President, Riverside Golf Group, Inc., Jacksonville, FL C. Barham Ray - Trustee; Principal occupation - Chairman of the Board and Secretary, SSM Corporation, Memphis, TN Other Officers: Charles D. Reaves - Executive Vice President Julie M. Douglas - Executive Vice President -Operations and Treasurer Lee B. Harper - Executive Vice President -Marketing G. Staley Cates - Vice President - Investments and Co- Portfolio Manager Frank N. Stanley, III- Vice President - Investments John B. Buford Vice President - Investments C. T. Fitzpatrick Vice President - Investments Randy D. Holt Vice President and Secretary SCHEDULE II Information With Respect to Transactions_Effected_During_the_Past_Sixty_Days Shares of Common Stock Aggregate Average Date Purchased Price(1)(2) Price(1)(2) - ----------------------------------------------------------- 8/01/96 96,000 $ 859,680 $ 8.96 8/06/96 8,000 $ 71,640 $ 8.96 8/06/96 17,000 $ 152,235 $ 8.96 8/19/96 46,600 $ 353,228 $ 7.58 9/09/96 8,000 $ 72,640 $ 9.08 ---------- ------------- 175,600 $ 1,509,423 - -------------------------------------------------------------- (1) Purchase prices include commissions; sales prices are net of commissions. (2) Insofar as the filer is aware, the majority of all transactions were effected on the New York Stock Exchange. -----END PRIVACY-ENHANCED MESSAGE-----