SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
Amendment No. 2
Integrated Security Systems, Inc.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
45812J101
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(CUSIP Number)
Russell Cleveland
Renaissance Capital Group, Inc.
8080 N. Central Expressway, Suite 210, LB-59
Dallas, Texas 75206-1857
(214) 891-8294
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(Name, Address, and Telephone Number of Person
Authorized to Receive Notices and Communications)
July 27, 2001
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(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-1(e), 13d-1(f), or 13d-1(g), check the following
box [ ].
(Continued on following pages)
CUSIP No. 45812J101 13D
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1. NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NUMBER
Renaissance Capital Growth & Income Fund III, Inc. 75-2533518
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
O ITEM 2(d) OR 2(e)
[ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Texas
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
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7. SOLE VOTING POWER
22,444,758
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8. SHARED VOTING POWER
None
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9. SOLE DISPOSITIVE POWER
22,444,758
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10. SHARED DISPOSITIVE POWER
None
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
22,444,758
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
68.4%
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14. TYPE OF REPORTING PERSON
IV
CUSIP No. 45812J101 13D
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1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NUMBER
Renaissance US Growth & Income Trust PLC None - Foreign
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [x]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
England
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
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7. SOLE VOTING POWER
21,608,445
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8. SHARED VOTING POWER
None
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9. SOLE DISPOSITIVE POWER
21,608,445
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10. SHARED DISPOSITIVE POWER
None
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
21,608,445
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES [ ]
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
67.5%
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14. TYPE OF REPORTING
IV
Item 1. Security and Issuer.
This statement relates to the Common Stock ("Common Shares") of Integrated
Security Systems, Inc. (the "Company"). The principal executive offices of the
Company are located at 8200 Springwood Drive, Irving, Texas 75063.
Item 2. Identity and Background.
(a) This Statement is filed by Renaissance Capital Growth & Income Fund
III, Inc. ("Renaissance III"), and Renaissance US Growth & Income Trust PLC
("Renaissance PLC"); Renaissance III and Renaissance PLC, collectively (the
"Reporting Persons").
Certain information concerning the directors and executive officers of the
Reporting Persons is set forth on Attachment 1 attached hereto and incorporated
herein by reference.
(b) Renaissance III is a business development company regulated under the
Investment Company Act of 1940, as amended, and organized under the laws of the
State of Texas, with its principal business and principal office at 8080 N.
Central Expressway, Suite 210, LB-59, Dallas, Texas 75206-1857.
Renaissance PLC is an investment trust organized under the laws of England
and Wales. Its address in the United States is c/o Renaissance Capital Group,
Inc., Investment Manager, 8080 N. Central Expressway, Suite 210, LB-59, Dallas,
Texas 75206-1857.
The business addresses of the directors and executive officers of the
Reporting Persons are set forth on Attachment 1 to this Statement and
incorporated herein by reference.
(c) Renaissance III and renaissance PLC are engaged in the business of
investing principally in emerging or undervalued U.S. public companies.
(d) Neither any of the Reporting Persons nor, to the best knowledge of such
persons, any person named in Attachment 1 to this Statement, has been convicted
in a criminal proceeding in the past five years (excluding traffic violations or
similar misdemeanors).
(e) Neither any of the Reporting Persons nor, to the best knowledge of such
persons, any person named in Attachment 1 to this Statement, was during the last
five years a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which such person 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 laws or finding
any violation with respect to such laws.
(f) All persons named on Attachment 1 to this Statement are citizens of the
United States, except as otherwise indicated on such Attachment.
Item 3. Source and Amount of Funds or Other Consideration.
The total amount of funds required by Renaissance III to acquire the
securities reported in Item 5(a) was $4,579,589. The source of such funds was
capital of Renaissance III.
The total amount of funds required by Renaissance PLC to acquire the
securities reported in Item 5(a) was $4,413,463. The source of such funds was
capital of Renaissance PLC.
Item 4. Purpose of Transaction.
The Reporting Persons each acquired beneficial ownership of the Common
Stock reported in Item 5(a) both in the ordinary course of business for
investment purposes and upon exchange of indebtedness in connection with the
financial restructuring of the Company. The President and CEO of Renaissance
Capital Group, Inc., the investment advisor to Renaissance III and the
investment manager of Renaissance PLC, Russell Cleveland, has been appointed to
the board of directors of the Company.
The Reporting Persons may participate in discussions with management or
third parties in which the Reporting Person may suggest or take a position with
respect to potential changes in the operations, management, or capital structure
of such companies as a means of enhancing shareholder value. Such suggestions or
positions may relate to one or more of the transactions specified in clauses (a)
through (j) of Item 4 of the Schedule 13D form, including, without limitation,
such matters as disposing of one or more businesses, selling the Company,
merging with another Company or acquiring another company or business, changing
operating or marketing strategies, changes in management or marketing, or
restructuring the Company's capitalization.
Each Reporting Person continues to assess the Company's business, financial
condition, results of operations and prospects, general economic conditions, the
securities markets in general and those for the Company's securities in
particular, other developments and other investment opportunities, as well as
the Reporting Person's investment objectives. Depending on such assessments, one
or both of the Reporting Persons may acquire additional securities or may
determine to sell or otherwise dispose of some or all of its holding of
securities.
Other than as described above, neither of the Reporting Persons has any
present plans or proposals which relate to or would result in any transaction,
change, or event specified in clauses (a) through (j) of Item 4 of the Schedule
13D.
Item 5. Interest in Securities of the Issuer.
(a) Renaissance III beneficially owns 22,444,758 Common Shares, and
Renaissance PLC beneficially owns 21,608,445 Common Shares. The Reporting
Persons beneficially own 44,053,203 Common Shares. Based upon information filed
with the Securities and Exchange Commission and using SEC computation rules, the
Common Shares beneficially owned by Renaissance III, Renaissance PLC, and
together represent approximately 68.4%, 67.5%, and 81.5%, respectively, of the
outstanding Common Stock of the Company. Renaissance III and Renaissance PLC
disclaim that they are members of a group for purposes of Regulation 13D.
The Common Shares beneficially owned by Renaissance III are comprised of
393,259 shares of Common Stock; 814,299 shares of Common Stock issuable upon the
exercise of warrants; 187,500 shares of Common Stock issuable upon the
conversion of 7,500 shares of Series D Preferred Stock; 2,714,945 shares of
Common Stock issuable upon conversion of 21,720 shares of Series F Convertible
Preferred Stock ("Series F Preferred Stock"); and 18,334,755 shares of Common
Stock issuable upon conversion of 146,678 shares of Series G Convertible
Preferred Stock ("Series G Preferred Stock"). The board of directors of
Renaissance III exercises voting and investment control over the securities of
the Company owned by it.
Renaissance PLC is deemed the beneficial owner of Common Shares comprised
of 393,258 shares of Common Stock; 808,617 shares of Common Stock issuable upon
the exercise of warrants; 187,500 shares of Common Stock issuable upon the
conversion of 7,500 shares of Series D Preferred Stock; 2,714,945 shares of
Common Stock issuable upon conversion of 21,720 shares of Series F Preferred
Stock; and 17,504,125 shares of Common Stock issuable upon conversion of 140,033
shares of Series G Preferred Stock. The board of directors of Renaissance PLC
exercises voting and investment control over the securities of the Company owned
by it.
(b) Holders of Series D Preferred Stock are entitled to one vote for each
share of Common Stock into which such share of Series D Preferred Stock could
then be converted. Presently, the holder of each share of Series D Preferred
stock is entitled to 25 votes. Holders of Series F Preferred Stock are entitled
to vote with the holders of Common Stock, the Series D Preferred Stock, the
Series E Preferred Stock , and the Series G Preferred Stock as a single class on
all matters on which stockholders are entitled to vote, including the election
of directors, except as otherwise required by law. Holders of Series F Preferred
Stock are also entitled to vote with any other class of equity securities which
may vote with the holders of the Common Stock as a single class with respect to
any matter. Holders of Series F Preferred Stock are entitled to a number of
votes per share of Series F Preferred Stock equal to the number of shares of
Common Stock into which the shares of Series F Preferred Stock are convertible
on the record date of the determination of stockholders entitled to receive
notice of and to vote on such matter. In addition, the consent of holders of 80%
of the Series F Preferred Stock and the Series G Preferred Stock, voting
together as a single class, will be required to (a) authorize, create, or
increase the authorized amount of any class of senior stock or parity stock,
other than Preferred Stock of the same class or securities to evidence bank debt
or asset securitization or (b) authorize a merger, consolidation, or sale of
assets, other than in the ordinary course of business, of the Company, including
the capital stock of the Company's subsidiaries. The consent of holders of 80%
of the Series F Preferred Stock, voting as a sing class, will be required to
approve any action to amend the Company's certificate of incorporation or bylaws
that would materially and adversely affect the rights of the Series F Preferred
Stock.
Holders of Series G Preferred Stock will be entitled to vote with the
holders of Common Stock, the Series D Preferred Stock, the Series E Preferred
Stock, and the Series F Preferred Stock as a single class on all matters on
which stockholders are entitled to vote, including the election of directors,
except as otherwise required by law. holders of Series G Preferred Stock are
also entitled to vote with any other class of equity securities which may vote
with the holders of the Common Stock as a single class with respect to any
matter. Holders of Series G Preferred Stock are entitled to a number of votes
per share of Series G Preferred Stock equal to the number of shares of Common
Stock into which the Shares of Series G Preferred Stock are convertible on the
record date of the determination of stockholders entitled to receive notice of
and to vote on such matter. In addition, the consent of holders of 80% of the
Series G Preferred Stock and the Series F Preferred Stock, voting together as a
single class, will be required (a) to authorize, create, or increase the
authorized amount of any class of senior stock or parity stock, other than
Preferred Stock of the same class or securities to evidence bank debt or
securitization or (b) authorize a merger, consolidation, or sale of assets,
other than in the ordinary course of business, of the Company, including the
capital stock of the Company's subsidiaries. The consent of holders of 80% of
the Series G Preferred Stock, voting as a single class, will be required to
approve any action to amend the Company's certificate of incorporation or bylaws
that would materially and adversely affect the rights of the Series G Preferred
Stock.
In addition to their right to vote with the holders of the Common Stock on
the election of directors, the Reporting Persons, as the holders of the Series G
Preferred Stock and the holders of the Series F Preferred Stock, voting together
as a single class, are entitled to elect two additional directors to the
Company's board of directors.
Each of the Reporting Persons has or will have upon the exercise of the
warrants issued to it by the Company the sole power to vote and dispose of all
of the Common Shares that it beneficially owns. None of the Reporting Persons
shares voting or disposition power with any person with respect to the Common
Shares.
(c) No transaction in the Common Shares was effected by a Reporting Person
during the past 60 days, except as follows: the issuance on July 27, 2001, of
3,000 shares of Series G Preferred Stock for $75,000 and the issuance of 1,000
shares of Series F Preferred Stock for $25,000 to Renaissance III and the
issuance of 3,000 shares of Series G Preferred Stock for $75,000 and the
issuance of 1,000 shares of Series F Preferred Stock for $25,000 to Renaissance
PLC.
(d) No person other than the Reporting Persons has the right to receive or
the power to direct the receipt of dividends from, or the proceeds from the sale
of, the Common Shares beneficially owned by the Reporting Persons.
(e) Not applicable.
2
Item 6. Contracts, Arrangements, Understandings, or Relationships With Respect
to Securities of the Issuer.
Not Applicable.
Item 7. Material to be Filed as Exhibits.
Exhibit 1 Joint Filing Agreement Pursuant to Rule 13d-1(k)
SIGNATURES
After reasonable inquire and to the best of their individual knowledge and
belief, the signatories below certify that the information set forth in this
statement is true, complete, and correct as of this 17th day of September, 2001.
The persons whose signatures appear below agree that this statement on
Schedule 13D is filed on behalf of each of them.
RENAISSANCE CAPITAL GROWTH & INCOME FUND III, INC.
By: ______________________________
Name: Russell Cleveland
Title: President and Chief Executive Officer
RENAISSANCE US GROWTH & INCOME TRUST PLC
By: _______________________________
Name: Russell Cleveland
Title: Director
ATTACHMENT 1
The name. business address. and principal occupation of the directors and
executive officers of Renaissance III are as follows:
DIRECTORS
Principal
Name Business Address Occupation
Edward O. Boshell, Jr. c/o Renaissance Capital Group, Inc. Director
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
Russell Cleveland c/o Renaissance Capital Group, Inc. Director
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
Peter Collins c/o Renaissance Capital Group, Inc. Director
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
Ernest C. Hill c/o Renaissance Capital Group, Inc. Director
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
OFFICERS
Russell Cleveland c/o Renaissance Capital Group, Inc. President and
8080 North Central Expressway Chief Executive
Suite 210, LB-59 Officer
Dallas, TX 75206-1857
John A. Schmit c/o Renaissance Capital Group, Inc. Vice President
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
Robert C. Pearson c/o Renaissance Capital Group, Inc. Vice President
8080 North Central Expressway
Suite 210, LB-59
Dallas, TX 75206-1857
Barbara A. Butschek c/o Renaissance Capital Group, Inc. Secretary and
8080 North Central Expressway Treasurer
Suite 210, LB-59
Dallas, TX 75206-1857
The name, business address, and principal occupation of the directors and
executive officers of Renaissance PLC are as follows:
DIRECTORS
Principal
Name Business Address Occupation
Michael B. Cannan c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
Russell Cleveland c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
Ernest J. Fenton c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
Lord Mark Fitzalan Howard OBE c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
C. A. Rundell, Jr. c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
William W. Vanderfelt c/o Sinclair Henderson Limited Director
23 Cathedral Yard
Exeter EX11HB
OFFICERS
None
JOINT FILING AGREEMENT PURSUANT TO RULE 13d-1(k)
The undersigned acknowledge and agree that the foregoing statement on
Schedule 13D is filed on behalf of each of the undersigned and that all of each
of the undersigned without the necessity of filing additional joint filing
agreements. The undersigned acknowledge that each shall be responsible for the
timely filing of such amendments, and for the completeness and accuracy of the
information concerning it contained therein, but shall not be responsible for
the completeness and accuracy of the information concerning the others, except
to the extent it knows or has reason to believe that such information is
inaccurate. This Joint Filing Agreement may be executed in any number of
counterparts and all of such counterparts taken together shall constitute one
and the same instrument.
RENAISSANCE CAPITAL GROWTH & INCOME FUND III, INC.
By: ___________________________________________
Name: Russell Cleveland
itle: President and Chief Executive Officer
RENAISSANCE US GROWTH & INCOME TRUST PLC
By: ___________________________________________
Name: Russell Cleveland
Title: Director