___________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
_______________________
FORM 10-K/A-1
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended March 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
Commission file number 0-25226
EMERSON RADIO CORP.
(Exact name of registrant as specified in its charter)
________Delaware_____________ ____________22-3285224 ____________
(State or other jurisdiction of
incorporation or organization) (I.R.S. Employer Identification Number)
____Nine Entin Road, Parsippany, NJ _____________07054__________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: ___(201) 884-5800____
Securities registered pursuant to
Section 12(b) of the Act:
Title of each class Name of each exchange on
which registered
Common Shares, par value $.01 per share American Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: Series A
Preferred Stock and Warrants.
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to
such filing requirement for the past 90 days. [X] YES [ ] NO.
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ].
Aggregate market value of the voting stock of the registrant held by non-
affiliates of the registrant at June 15, 1995 (computed by reference to the
last reported sale price of the Common Shares on the American Stock
Exchange on such date): $26,042,103.
Indicate by check mark whether the registrant has filed all documents and
reports to be filed by Section 12, 13 or 15(d) of the Securities Exchange
Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. [X] YES [ ] NO.
Number of Common Shares outstanding at June 15, 1995: 40,252,772
DOCUMENTS INCORPORATED BY REFERENCE: None
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-K
pursuant to the Securities Exchange Act of 1934, as amended, as set forth
in the pages attached hereto:
PART III, Item 10 - 13 are amended by the inclusion of such items
herein.
PART III
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS
MANAGEMENT
Officers and Directors
The following table sets forth certain information regarding the
officers and directors of Emerson Radio Corp. (the "Company") as of the
date hereof:
Name Age Position
Geoffrey P. Jurick(1) 54 Chairman of the Board and Chief Executive
Officer, Director
Eugene I. Davis(1) 40 President and Interim Chief Financial
Officer, Director
John P. Walker 32 Senior Vice President - Finance
Albert G. McGrath, Jr. 38 Senior Vice President, Secretary and
General Counsel
Eddie Rishty 35 Vice President - Controller
Merle W. Eakins 48 Vice President - Sales
Andrew Cohan 40 Vice President - Merchandising
John J. Raab 59 Vice President - Far East Operations
Frank L. Guerriero 51 Vice President - Logistics
Stuart D. Slugh 40 Vice President - Engineering/After
Sales Service
Elizabeth J. Calianese 37 Vice President - Human Resources
Robert H. Brown, Jr.(2)(3) 42 Director
Peter G. Bnger(2) 54 Director
Jerome H. Farnum(1) 59 Director
Raymond L. Steele(2)(3) 60 Director
_____________________________
(1) Member of Executive Committee
(2) Member of Audit Committee
(3) Member of Compensation and Personnel Committee
Geoffrey P. Jurick has served as Director since September 1990, Chief
Executive Officer since July 7, 1992 and Chairman since December 22, 1993.
Mr. Jurick served as President from July 1993 to October 1994. Since March
1990, he has been President and Director of Fidenas Investment Limited.
Since December 1993, Mr. Jurick has served as a Director of Fidenas
International Limited L.L.C. ("Fidenas International"), and since May 1994,
as an officer and general manager of Fidenas International and as a
Director, Chairman and Chief Executive Officer of GSE Multimedia
Technologies Corp. ("GSE") which is traded on the pink sheets of the
over-the-counter market. For more than the past five years, Mr. Jurick has
held a variety of senior executive positions with several of the entities
comprising the Fidenas group of companies ("Fidenas Group"), whose
activities encompass merchant banking, investment banking, investment
management and corporate development.
Eugene I. Davis has served as President since October 1994, Interim Chief
Financial Officer since February 7, 1993 and a Director since September
1990. Mr. Davis served as Executive Vice President from July 7, 1992 to
October 1994. From June 1989 to July 1992, Mr. Davis was a shareholder and
director of the law firm of Holmes Millard & Duncan, P.C., in Dallas,
Texas. From February 1988 to June 1989, he was a partner in the law firm
of Arter & Hadden, P.C., in Dallas, Texas. Since August 1992, Mr. Davis
has served as a director of Tipperary Corporation, which is traded on the
American Stock Exchange, and, since October 1993, he has been a director of
Crandall Finance Corporation, which is traded on the pink sheets of the
over-the-counter market.
John P. Walker has served as Senior Vice President since April 1994. Mr.
Walker was Vice President - Finance from February 1993 to April 1994,
Assistant Vice President - Finance from June 1991 to January 1993 and
Director of Financial Management from September 1990 to May 1991. Prior
thereto, Mr. Walker was Supervising Senior Accountant with KPMG - Peat
Marwick.
Albert G. McGrath, Jr. has served as Secretary and General Counsel since
August 1992 and Senior Vice President since July 1993. Prior thereto, Mr.
McGrath was a shareholder of Holmes Millard & Duncan, P.C., in Dallas,
Texas, from January 1990 through August 1992.
Eddie Rishty has served as Vice President - Controller since July 1993 and
was Corporate Controller from October 1991 to June 1993. Prior thereto,
Mr. Rishty was Assistant Controller from April 1989 to September 1991.
Merle W. Eakins joined the Company as Vice President - Sales in July 1993.
Since 1976, Mr. Eakins was with Philips Consumer Electronics Company in a
variety of positions, most recently as Vice President, National Accounts.
Andrew Cohan joined the Company in October 1994 as Vice President-
Merchandising. Prior thereto, he was an independent consultant from August
1993 until October 1994, and was employed as Senior Vice President - Retail
Stores for McCrory Stores Corporation from June 1992 to July 1993 and as
Vice President - Retail Stores for Ames Department Stores, Inc. from
February 1984 to June 1992. Prior thereto and for more than the past five
years, Mr. Cohan was employed by Ames Department Stores, Inc. in a variety
of positions. Each of McCrory Stores Corporation and Ames Department
Stores, Inc. filed for relief under the United States Bankruptcy Code.
John J. Raab joined the Company in March 1995 as Vice President-Far East
Operations. Prior thereto, he was President and Chief Operating Officer of
Robeson Industries Corp. from March 1990 to March 1994. Robeson Industries
Corp. has filed for relief under the United States Bankruptcy Code.
Frank L. Guerriero has served as Vice President - Logistics since September
1994. Prior thereto, Mr. Guerriero was Assistant Vice President -
Operations and Logistics from April 1994 until September 1994, and was the
Director of Transportation and Distribution for the Company from July 1981
until April 1994.
Stuart D. Slugh has served as Vice President - Engineering and After Sales
Service since September 1994. Prior thereto, Mr. Slugh was Assistant Vice
President - Engineering and After Sales Service from April 1994 until
September 1994, and was Director of Technical Sales Services for the
Company from May 1993 until April 1994. Prior thereto and for more than
the past five years, Mr. Slugh was National Parts Manager for the Company.
Elizabeth J. Calianese has served as Vice President - Human Resources since
May 1995. Since April 1991, Ms. Calianese has served as Assistant General
Counsel. Prior thereto, from June 1989 until March 1991, Ms. Calianese was
a corporate attorney with the Company.
Robert H. Brown, Jr. has been a Director since July 7, 1992. Since
February 1994, he has been Executive Vice President of Capital Markets of
Rauscher Pierce Refsnes, Inc. ("Rauscher") in Dallas, Texas. From January
1990 until February 1994, Mr. Brown was Senior Vice President and Director
of the Corporate Finance Department of Rauscher. Since May 1993, Mr. Brown
has served as a director of Stevens Graphics Corp., which is traded on the
American Stock Exchange.
Peter G. Bunger has been a Director since July 7, 1992. Since October
1992, Mr. Bunger has served as Director of Savarina AG, engaged in the
business of portfolio management monitoring in Zurich, Switzerland and
since 1992, as director of ISCS, a computer software company. From
December 1991 until December 1993, he was Vice Chairman of Montcour Bank
and Trust Company Limited, a bank organized in the Bahamas and an affiliate
of Fidenas International. From 1981 until 1992, Mr. Bunger was owner and
Managing Director of Peter G. Bunger Investment Consulting, a firm which
supervises, controls, and analyzes investments for individuals.
Jerome H. Farnum has been a Director since July 7 1992. Since July 1994,
Mr. Farnum has been an independent consultant. From 1979 until 1994, Mr.
Farnum served as a senior executive with several of the entities comprising
the Fidenas Group, in charge of legal and tax affairs, accounting, asset
and investment management, foreign exchange relations and financial
affairs.
Raymond L. Steele has been a Director since July 7, 1992. Mr. Steele has
been retired since September 1993. From August 1990 until September 1993,
Mr. Steele served as Executive Vice President of Pacholder Associates,
Inc., a company providing investment management and other financial
advisory services to institutional clients. Mr. Steele is a member of the
Board of Directors of Orion Pictures Corporation, whose common stock is
traded on NASDAQ, and Pharmhouse, Inc., a publicly-traded retail drug
chain.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's Directors and executive officers, and persons who
own more than ten percent of a registered class of the Company's equity
securities, to file with the Securities and Exchange Commission initial
reports of ownership and reports of change in ownership of Common Stock and
other equity securities of the Company. Executive officers, Directors and
greater than ten percent stockholders are required by SEC Regulations to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and representations that no other
reports were required, during the year ended March 31, 1995, all Section
16(a) filing requirements applicable to the officers, Directors and greater
than ten percent beneficial owners were complied with except that (i)
initial reports of ownership were made for each officer and Director on
January 10, 1995 after shares of Common Stock began trading on the American
Stock Exchange on December 22, 1994, (ii) the initial reports filed by
Geoffrey Jurick and Gerald Calabrese inadvertently omitted beneficial
ownership of 100 and 987 shares of Common Stock, respectively, which
omissions were subsequently cured and (iii) Fidenas International and GSE
did not file timely initial reports of ownership. It is the practice of
the Company to attend to the filing of Section 16(a) forms on behalf of the
officers and directors of the Company.
ITEM 11 - EXECUTIVE COMPENSATION AND OTHER INFORMATION
Compensation of Executive Officers
The following executive compensation disclosures reflect all plan and
non-plan compensation awarded to, earned by, or paid to the named executive
officers of the Company. The "named executive officers" are the Company's
Chief Executive Officer (the "CEO"), regardless of compensation level, and
the four most highly compensated executive officers other than the CEO
serving as such on March 31, 1995. Where a named executive officer has
served during any part of the Company's fiscal year ended March 31, 1995
("Fiscal 1995"), the disclosures reflect compensation for the full year in
each of the periods presented.
Three Year Compensation Summary
The following table summarizes for the years indicated the
compensation awarded to, earned by or paid to the Named Executives for
services rendered in all capacities to the Company:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
Awards
<C> <C> <C> <C> <C> <C> <C> <C>
<S> OTHER ALL
Name and Principal Position (s) FISCAL ANNUAL SECURITIES OTHER
YEAR SALARY BONUS COMPENS- RESTRICTED UNDERLYING LTIP COMPENS-
ATION STOCK AWARDS OPTIONS PAYOUTS ATION
(3) (1) (6) (4)
GEOFFREY P. JURICK 1995 $378,333 $275,000 $78,702 - 600,000 - $ 311
CHAIRMAN OF THE 1994 250,000 195,000 - - - - -
BOARD AND CHIEF 1993 187,500 - 5,589 - - - -
EXECUTIVE OFFICER
(2) (5)
EUGENE I. DAVIS 1995 360,000 175,000 102,024 - 600,000 - 6,986
PRESIDENT AND 1994 360,000 150,000 102,385 - - - 5,524
INTERIM CHIEF
FINANCIAL OFFICER 1993 261,692 161,290 172,281 - - - 5,473
(2) (5)
ALBERT G. MCGRATH, JR. 1995 175,000 75,000 19,958 - 200,000 - 5,451
SENIOR VICE PRESIDENT, 1994 175,000 100,000 18,462 - - - 4,671
SECRETARY AND 1993 107,693 29,166 21,273 - - - -
GENERAL COUNSEL (5)
MERLE W. EAKINS 1995 193,077 40,000 89,185 - 40,000 - 5,950
VICE PRESIDENT-SALES (5) 1994 130,577 40,000 45,870 - - - 621
1993 - - - - - - -
JOHN P. WALKER 1995 110,000 75,000 20,420 - 200,000 - 3,841
SENIOR VICE 1994 110,000 100,000 9,483 - - - 1,918
PRESIDENT-FINANCE 1993 96,625 18,000 700 - - - 2,406
</TABLE>
____________________
(1) Consists of (i) car allowance and auto expenses afforded to the
listed Company executive officers, including $26,947 and $17,277 paid
to Messrs. Davis and Walker, respectively, in Fiscal 1995, (ii) tax
preparation services provided to Mr. Davis, (iii) expenses paid by
the Company on behalf of Mr. Davis, covering his country club
membership, and (iv) relocation and temporary lodging expenses and
associated tax gross-ups in the amount of $73,394, $0 and $0 for Mr.
Jurick, $43,002, $64,643 and $132,270 for Mr. Davis, $0, $9,137 and
$16,249 for Mr. McGrath, and $80,784 and $39,570 for Mr. Eakins paid
by the Company in Fiscal 1995 and 1994, respectively. See "Certain
Relationships and Related Transactions."
(2) Does not include Director's fees of $5,000 received by each of
Messrs. Jurick and Davis prior to becoming officers for Fiscal 1993.
(3) In the case of Messrs. Davis and McGrath consists of one-time bonus
payments upon joining the Company in Fiscal 1993.
(4) Consists of the Company's contribution to its 401(k) employee savings
plan, life insurance and, disability insurance.
(5) Messrs. Jurick and Davis became executive officers of the Company in
July 1992, Mr. McGrath became an executive officer of the Company in
August 1992 and Mr. Eakins became an executive officer of the Company
in July 1993.
(6) In July 1994, the Company granted incentive stock options ("ISO's")
to purchase 600,000, 600,000, 200,000, 200,000 and 30,000 shares of
Common Stock to each of Messrs. Jurick, Davis, McGrath, Walker and
Eakins respectively, exercisable at an exercise price of $1 per share
(except $1.10 in the case of Mr. Jurick). In September 1994, Mr.
Eakins was granted an additional option to purchase 10,000 shares of
common stock at an exercise price of $1 per share. The options vest
in annual increments of one-third, commencing one year from the date
of grant, and their exercise is contingent on continued employment
with the Company.
STOCK OPTIONS
The following table sets forth information regarding the grant of
stock options during Fiscal 1995 to the Named Executive Officers:
<TABLE>
OPTION GRANTS IN FISCAL 1995
<S> <C> <C> <C> <C>
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation
Individual Grants for Option Term (2)
% of Total
Number Options Granted Exercise
of Options to Employees Price Per Expiration
Name Granted in Fiscal 1995 Share Date (1) 5% 10%
GEOFFREY P. JURICK 600,000 32% $1.10 7/7/04 $317,337 $896,245
EUGENE I. DAVIS 600,000 32% $1.00 7/7/04 $377,337 $956,245
ALBERT G. MCGRATH 200,000 11% $1.00 7/7/04 $125,779 $318,748
JOHN P. WALKER 200,000 11% $1.00 7/7/04 $125,779 $318,748
MERLE W. EAKINS 30,000 2% $1.00 7/7/04 $ 18,867 $ 47,812
10,000 1% $1.00 9/6/04 $ 6,289 $ 15,937
</TABLE>
(1) The incentive stock options ("ISO's") were issued under the 1994 Stock
Compensation Program, and are exercisable commencing one year after
the grant date in the three equal annual installments, with full
vesting occurring on the third anniversary of the date of the grant.
(2) The dollar amounts under these columns are the result of calculations at
the assumed compounded market appreciation rates of 5% and 10% as
required by the Securities and Exchange Commission over a ten-year
term and therefore, are not intended to forecast possible future
appreciation, if any, of the stock price.
OPTION EXERCISES AND HOLDINGS
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during Fiscal 1995
and unexercised options held at March 31, 1995:
<TABLE>
<CAPTION>
OPTION EXERCISES IN FISCAL 1995
AND MARCH 31, 1995 OPTION VALUES
<S> <C> <C> <C> <C>
Number of Value of Unexercised
Unexercised In-the-Money
Number of Options at Options at
Shares March 31, 1995 March 31, 1995
Acquired on Value Exercisable/ Exercisable/
Name Exercised Realized Unexercisable Unexercisable(1)
GEOFFREY P. JURICK 0 $- 0/600,000 $0/$1,215,000
EUGENE I. DAVIS 0 $- 0/600,000 $0/$1,275,000
ALBERT G. MCGRATH 0 $- 0/200,000 $0/$ 425,000
JOHN P. WALKER 0 $- 0/ 200,000 $0/$ 425,000
MERLE W. EAKINS 0 $- 0/ 40,000 $0/$ 85,000
</TABLE>
(1) Calculated based on the difference between the aggregate fair market
value of the shares subject to options at March 31, 1995 and the
aggregate option exercise price.
Certain Employment Contracts
On August 13, 1992, the Board of Directors of the Company approved
the Employment Agreements of certain of the Company's senior management,
including certain of the senior management included in the table set forth
above. A description of the material terms of such employment agreements,
each of which is effective as of July 7, 1992 (unless stated to the
contrary) follows.
Geoffrey P. Jurick, Chairman and Chief Executive Officer of the
Company, entered into five year employment agreements ("Jurick Employment
Agreements") with the Company and two of its wholly-owned subsidiaries,
Emerson Radio (Hong Kong), Limited and Emerson Radio International Ltd.
(formerly Emerson Radio (B.V.I.), Ltd.) (hereinafter, collectively the
"Companies"), providing for an aggregate annual compensation of $250,000,
which was increased to $390,000 in May 1994 and to $490,000 effective April
1, 1995. In addition to his base salary, Mr. Jurick is entitled to an
annual bonus upon recommendation by the Compensation and Personnel
Committee of the Company's Board of Directors, subject to the final
approval of the Company's Board of Directors.
Subject to certain conditions, each of the Jurick Employment
Agreements grants to Mr. Jurick severance benefits, through expiration of
the respective terms of each of such agreements, commensurate with Mr.
Jurick's base salary, in the event that his employment with the Companies
terminates due to permanent disability, without cause or as a result of
constructive discharge (as defined therein). In the event that Mr.
Jurick's employment with the Companies terminates due to termination for
"cause," because Mr. Jurick unilaterally terminates the agreements or for
reasons other than constructive discharge or permanent disability, Mr.
Jurick shall only be entitled to base salary earned through the applicable
date of termination. Similar provisions are set forth in each of the
contracts described below.
Eugene I. Davis, President and Interim Chief Financial Officer
entered into a five year Employment Agreement ("Davis Employment
Agreement") with the Company providing for an annual compensation of
$360,000, which was increased to $450,000 effective April 1, 1995. In
addition to his base salary, Mr. Davis is entitled to an annual bonus equal
to an amount up to 30% of Mr. Davis' base salary, based upon attainment of
objectives identified in the Company's five-year business plan ("Business
Plan"). Mr. Davis may also receive an additional annual performance bonus
to be recommended by the Compensation and Personnel Committee of the
Company's Board of Directors, subject to the final approval of the
Company's Board of Directors.
Pursuant to the Davis Employment Agreement, the Company granted to
Mr. Davis an option to purchase 500,000 shares of Common Stock. Such
option was cancelled pursuant to the Plan of Reorganization; however, the
Company subsequently granted Mr. Davis options to purchase 600,000 shares
of Common Stock. The Company has also agreed for the term of the Davis
Employment Agreement and three years thereafter, to pay for and maintain
legal malpractice insurance covering Mr. Davis for occurrences and actions
taken by him at any time prior to or during the term of such agreement on
behalf of the Company or its employees. The Company has also agreed to pay
all sums which may be deductible amounts not otherwise paid by such
insurer.
Upon execution of the Davis Employment Agreement, the Company
provided Mr. Davis with a one-time lump sum payment of $100,000, which
figure is net of applicable taxes and withholdings. In connection with Mr.
Davis' relocation to New Jersey, the Company assumed certain relocation
expenses and associated tax gross-ups on Mr. Davis' behalf aggregating
$239,915. See "Summary Compensation Table."
Albert G. McGrath, Jr., General Counsel, Senior Vice President and
Secretary, entered into a five-year Employment Agreement ("McGrath
Employment Agreement") with the Company providing for an annual
compensation of $175,000, which was increased to $210,000 effective April
1, 1995. In addition to his base salary, Mr. McGrath is entitled to an
annual performance bonus to be recommended by the Compensation and
Personnel Committee of the Company's Board of Directors, subject to the
final approval of the Company's Board of Directors.
Upon execution of the McGrath Employment Agreement, the Company
provided Mr. McGrath with a one-time lump sum payment of $29,166, which
figure is before applicable taxes and withholdings. In connection with Mr.
McGrath's relocation to New Jersey, the Company assumed relocation expenses
and associated tax gross-ups on Mr. McGrath's behalf aggregating $25,386.
See "Summary Compensation Table."
Merle W. Eakins, Vice President-Sales, entered into a three-year
employment agreement with the Company providing for an annual compensation
of $175,000; which was increased to $195,000 effective May 1, 1994. In
addition to his base salary, Mr. Eakins is entitled to an annual bonus
equal to an amount up to 30% of Mr. Eakins' base salary, upon attainment of
objectives identified by the Board of Directors. In connection with Mr.
Eakins' employment in New Jersey, the Company assumed relocation expenses
and associated tax gross-ups on Mr. Eakins' behalf aggregating $120,354.
See "Summary Compensation Table".
John P. Walker, Senior Vice President-Finance, entered into a three-
year employment agreement with the Company providing for an annual
compensation of $110,000, which was increased to $165,000 effective April
1, 1995. In additional to his base salary, Mr. Walker is entitled to an
annual bonus equal to an amount up to 30% of Mr. Walker's base salary; upon
attainment of objectives identified by the Executive Committee. Mr. Walker
may also receive an additional annual performance bonus to be recommended
by the Compensation and Personnel Committee of the Company's Board of
Directors, subject to the final approval of the Company's Board of
Directors.
In the event that Messrs. Jurick, Davis, McGrath, Eakins and Walker
were to be terminated due to permanent disability, without cause or as a
result of constructive discharge, the estimated dollar amount to be paid
after March 31, 1995 to each such individual, based on the terms of their
respective contracts, would be $1,112,000, $1,021,000, $501,000, $263,000
and $330,000, respectively.
Compensation of Directors
Directors of the Company who are employees do not receive
compensation for serving on the Board. Non-employee Directors are paid
$20,000 per annum in quarterly installments. The Chairmen of the Audit
Committee and Compensation and Personnel Committee each receive an
additional $10,000 per annum. Each of the Company's independent directors
received cash compensation of $20,000 (excluding the Comittee Chairmen who
each received $27,500). Pursuant to the terms of the Company's 1994 Non-
Employee Director Stock Option Plan (the "Plan"), each non-employee
Director was granted, subject to stockholder approval, options to purchase
25,000 shares of Common Stock on October 7, 1994. On October 7, 1994, each
Chairman was also granted, subject to stockholder approval, options to
purchase 25,000 shares of Common Stock. Messrs. Jurick and Davis
constitute the Committee charged with administering the Plan. Mr. Peter
Bunger also served as a consultant to certain subsidiaries of the Company.
See "Item 13 - Certain Relationships and Related Transactions."
Compensation Committee Interlocks and Insider Participation
During Fiscal 1995, the Compensation and Personnel Committee of the
Board of Directors was comprised of Raymond Steele, Robert Brown and Colin
Honess. Until January of 1995, Mr. Honess served as President and Director
of Fidenas International Bank Limited, a banking institution organized
under the laws of the Commonwealth of Bahamas. The bank is the subject of
liquidation proceedings pending in Nassau, Bahamas. Mr. Jurick is
affiliated with the Bank.
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
PRINCIPAL STOCKHOLDERS
The following table below sets forth certain information regarding
the beneficial ownership of Common Stock as of July 28, 1995 by (i) each
director and nominee for director, (ii) Executive Officers and Directors as
a group and (iii) each person or entity known by the Company to be the
beneficial owner of more than 5% of the outstanding Common Stock. For
purposes of this Form 10-K/A-1, beneficial ownership of securities is
defined in accordance with the rules of the Securities and Exchange
Commission and means generally the power to vote or exercise investment
discretion with respect to securities, regardless of any economic interests
therein. Except as otherwise indicated and based upon the Company's review
of information on file with the Securities and Exchange Commission, the
Company believes that the beneficial owners of the securities listed below
have sole investment and voting power with respect to such shares, subject
to community property laws where applicable.
Amount and
Name and Address of Nature of Beneficial Percent of
Beneficial Owner Ownership(3) Class
Geoffrey P. Jurick(1)(7) 30,200,100 74.7%
Nine Entin Road
Parsippany, NJ 07054
Fidenas International Limited, L.L.C. (2)
831 Route 10
Suite 38, #113
Whippany, NJ 07981 30,000,000 74.5%
Elision International, Inc.(4) 1,600,000 4.0%
275 Wyman Street
Waltham, MA 02154
GSE Multimedia 12,000,000 29.8%
Technologies Corporation(4)
Kostheimer Landstrasse 36
Mainz-Kostheim
Germany D6502
Eugene I. Davis(7) 290,000 (8)
Robert H. Brown, Jr. -0- (8)
Peter G. Bunger -0- (8)
Jerome Farnum -0- (8)
Raymond L. Steele -0- (8)
All Directors and Officers
as a Group (15 persons) (5)(6) 30,661,212 75.1%
_______________
(1) Consists of 16,400,000, 1,600,000 and 12,000,000 shares of Common Stock
held by Fidenas International, Elision International, Inc. ("Elision")
and GSE, respectively, including 847,458 shares of Common Stock held
by Fidenas International, as nominee, as to which Fidenas
International and Mr. Jurick disclaim beneficial ownership. Mr.
Jurick indirectly owns, through a controlled holding company,
approximately 80% of Fidenas International. In addition, Mr. Jurick
is an officer and director of Fidenas International. Fidenas
International owns approximately 14.3% of Elision. Mr. Jurick
indirectly owns, through certain holding companies and beneficial
interests in affiliates, a controlling interest in each of GSE and
Elision. The shares of Common Stock issued to GSE, Fidenas
International and Elision in connection with the Restructuring are the
subject of certain legal proceedings in the Commonwealth of the
Bahamas and the United States. See "Legal Proceedings - Litigation
Regarding Certain Outstanding Common Stock."
(2) Includes 12,000,000 shares of Common Stock owned by GSE and 1,600,000
shares of Common Stock owned by Elision. Fidenas International, GSE
and Elision may be deemed to be under common control. Also includes
847,458 shares held by Fidenas International, as nominee, as to which
Fidenas International disclaims beneficial ownership.
(3) Based on 40,252,772 shares of Common Stock outstanding as of July 28,
1995 plus shares of Common Stock under option of any director or
executive officer, exercisable within 60 days. Does not include (i)
shares of Common Stock issuable upon conversion of 10,000 shares of
Series A Preferred Stock (ii) Common Stock issuable upon exercise of
certain warrants issued to former creditors of the Company or (iii)
Common Stock issuable upon exercise of outstanding options, which are
not currently exercisable within 60 days.
(4) A petition for the winding-up of Fidenas International Bank Limited, a
holder of approximately 18% of the shares of Elision and 11% of the
shares of GSE, was filed by the majority of the shareholders of the
bank in the Commonwealth of Bahamas on July 29, 1994. See "Note L to
Consolidated Financial Statements."
(5) Includes 571,112 shares of Common Stock subject to unexercised stock
options which were exercisable within 60 days under the Company's
Stock Compensation Program.
(6) Does not include options to purchase an aggregate of 1,352,221 shares
of Common Stock not currently exercisable within 60 days.
(7) Includes option exercisable within 60 days to purchase 200,000 shares
of Common Stock. Does not include options to purchase an aggregate of
400,000 shares of Common Stock not currently exercisable.
(8) Represents less than 1% of the outstanding Common Stock.
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Plan of Reorganization
Debtor-in-Possession Financing
During the pendency of the Company's Restructuring, the Company
obtained Debtor-in-Possession financing ("DIP Financing") from its present
secured lender. Fidenas Investment Limited, of which Mr. Jurick is
President and a director, which is also an affiliate of Fidenas
International, guaranteed payment of the DIP Financing. In April 1994, in
connection with the DIP Financing, the Company paid (i) $187,000 as a
cumulative credit enhancement fee which accrued commencing October 1, 1993
and (ii) $208,000 for reimbursement of various legal, accounting and filing
fees at the direction of the President of Fidenas Investment Limited to its
designee.
Capital Infusion at Confirmation of the Plan
To fund the Plan of Reorganization, Fidenas International, Elision
and GSE provided to the Company an aggregate of approximately $30 million,
for which they collectively received 30 million shares of Common Stock.
See "ITEM 12 - Security Ownership of Certain Beneficial Owners and
Management." Certain of the officers and directors of the Company are
affiliated with Fidenas International, Elision and GSE. See "ITEM 10 -
Directors and Executive Officers." In connection with the capital
infusion, reimbursements of $568,000 for various legal, accounting and
filing fees were paid at the direction of the President of Fidenas
International to its designee.
Other Transactions
The law firm of Lowenstein, Sandler, Kohl, Fisher & Boylan, P.A., was
retained as the Company's outside counsel following the settlement of a
proxy contest conducted in 1992. The firm was retained by the Company as
special corporate counsel during the Restructuring proceedings and received
payment for services rendered and expenses incurred during such
proceedings. In addition, the firm provides ongoing services for the
Company, including representing the Company in this Offering. The firm
received approximately $737,000 during Fiscal 1995. A brother of Mr. Davis
joined such law firm subsequent to its retention by the Company and serves
of counsel to such law firm.
In connection with the execution of their respective employment
agreements with the Company, each of Messrs. Martin Holleran (a former
officer of the Company), Davis, and Alex Wijnen (a former officer of the
Company) agreed to relocate their respective residences to the general
locality of the Company's principal executive offices. To assist in such
relocation, in the Fiscal year ended March 31, 1993, the Company provided
to Messrs. Holleran, Davis and Wijnen interest-free bridge loans of
$140,000, $120,000 and $130,000, respectively. In connection with the
resignations of Messrs. Holleran and Wijnen from the Company, and the
settlement of claims under their respective employment contracts, Mr.
Holleran's obligation to repay such loans was discharged and Mr. Wijnen's
loan will be repaid through consulting services to be rendered in calendar
1995. The maturity date of Mr. Davis' loan has been extended and is due in
the fical year ending March 31, 1996.
Mr. Pablo Bunger, the brother of Peter Bunger, a director of the
Company, was the Managing Director of the Company's Spanish branch.
Pursuant to a consulting arrangement, Mr. Bunger received compensation and
reimbursement of expenses aggregating $118,000 in Fiscal 1995. The Company
will be closing the Spanish branch and has assigned the exclusive
distribution rights for Emerson brand products in Spain to a corporation
controlled by Mr. Pablo Bunger.
The Company is in the process of reorganizing its Canadian
operations. In connection with such reorganization, Emerson's Canadian
subsidiary has entered into a series of agreements with Tammy Venator,
doing business as Venator Electronics Sales and Service Ltd. ("Venator").
Ms. Venator is the daughter of Theo Heuthorst, former President of
Emerson's Canadian subsidiary, and she was formerly the National Service
Manager of such subsidiary. Effective April 1, 1995, Emerson's Canadian
subsidiary entered into several three-year agreements with Venator
providing for (i) Venator receiving returned products, (ii) Venator
purchasing returned products on an "as-is" basis for refurbishing and
resale by Venator, (iii) Venator processing warranty claims submitted by
service centers authorized to engage in warranty service of Emerson
products sold in Canada, (iv) Venator distributing parts to customers and
service centers for Emerson products, which it will purchase from the
Company's Canadian subsidiary at a premium over their costs, and (v)
Venator maintaining an effective service center network to accommodate all
customers of Emerson's Canadian subsidiary, maintaining a factory service
center, and maintaining a parts distribution center, and providing other
after sale services. Through these agreements, the Company believes it
will be able to reduce its costs of operations in Canada, while maintaining
its market presence in Canada. The Company believes that the terms on
which it has entered into the agreements with Venator described above are
no less favorable than could have been obtained from an unrelated third
party.
In Fiscal 1995, the Company sold finished goods and spare parts to
GSE for $341,000 on terms no more favorable than those available to third
parties. The Company was owed $163,000 for these purchases as of March 31,
1995.
Rauscher Pierce Refsnes, Inc. was retained by the Company, for a fee
of $20,000, to make offers in connection with the public offering of the
Company's Common Stock authorized by the Plan of Reorganization in those
states requiring that all sales in such states be made through
broker/dealers. Robert H. Brown, Jr., a Director of the Company, is
Executive Vice President of Capital Markets of Rauscher. See "Management."
At March 31, 1994 Emerson Radio (Hong Kong) Ltd., a wholly owned
subsidiary of the Company, had $1 million on deposit with Fidenas
International Bank Limited. The deposit was withdrawn shortly after March
31, 1994.
In October 1994 and February 1995 the Company employed two
individuals who were, and continue to act as, professional advisers to Mr.
Jurick and certain entities with which Mr. Jurick is affiliated or
associated. One individual was paid $52,885 by the Company in Fiscal 1995,
as well as receiving automobile benefits and related expenses in the amount
of $3,027. The other individual was paid $6,856 by the Company in Fiscal
1995, as well as receiving automobile benefits in the amount of $1,295.
The services of the first individual will be terminated as of July 31, 1995
and the other will continue to be employed by the Company and to receive
the benefits described herein. In addition to services rendered to the
Company, each of the individuals continue to devote substantial amounts of
time to services for Mr. Jurick and his associated or affiliated entities,
and consequently, Mr. Jurick may be deemed to receive an indirect benefit
from the payment by the Company of the salary and other expenses of these
two individuals.
Peter G. Bunger, a Director of the Company, has been engaged as a
consultant to two foreign subsidiaries of the Company. The agreements,
effective as of October 1, 1994, provide for aggregate annual compensation
of $140,000, have terms of two years and authorize reimbursement for
reasonable travel and business expenses. Mr. Bunger has agreed to
terminate the agreements as of September 30, 1995.
Emerson Radio (Hong Kong) Ltd. retained Roger Vickery as a consultant
for a period of five months during Fiscal 1995. Mr. Vickery, formerly a
director of certain entities with which Mr. Jurick was affiliated or
associated, received $70,000 for services rendered and $75,841 was paid for
expenses incurred in connection with such services.
In Fiscal 1995, the Company paid Elision the sum of $34,275 for
consulting services with respect to management information services.
Elision owns 1,600,000 shares of Common Stock. Mr. Jurick indirectly owns
a controlling interest in Elision.
In May 1995, the Company and Elision organized Merchandising
Information Systems, L.L.C. ("MIS"), with equal ownership, for the purpose
of conducting a feasibility study to determine the marketability of certain
of Emerson's software applications and know-how associated therewith
through Elision's communications and marketing services, to provide an on-
line bureau administration service for sourcing and distribution in the
consumer electronics industry. Initially, each of Emerson and Elision has
contributed $22,500 to MIS for purposes of conducting such study. Further
financing from each of Emerson and Elision will be necessary if they
determine to pursue the marketing of such technology. The President of
Elision will initially serve as the President and Manager of MIS, and John
P. Walker and Anthony Ainsworth will also serve as officers of MIS.
The Company has adopted a policy that all future affiliated
transactions and loans will be made or entered into on terms no less
favorable to the Company than those that can be obtained from unaffiliated
third parties. In addition, all future affiliated transactions and loans,
and any forgiveness of loans, must be approved by a majority of the
independent outside members of the Company's Board of Directors who do not
have an interest in the transactions.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Company has duly caused this
amendment to be signed on its behalf by the undersigned, thereunto duly
authorized.
EMERSON RADIO CORP.
By:/s/ Geoffrey P. Jurick
Geoffrey P. Jurick,
Chairman of the Board
July 31, 1995
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
/s/ Geoffrey P. Jurick Chairman of the Board July 31, 1995
Geoffrey P. Jurick Chief Executive Officer
/s/ Eugene I. Davis President and Director July 31, 1995
Eugene I. Davis
/s/ Robert H. Brown, Jr. Director July 31, 1995
Robert H. Brown, Jr.
/s/ Peter G. Bunger Director July 31, 1995
Peter G. Bunger
/s/ Jerome H. Farnum Director July 31, 1995
Jerome H. Farnum
/s/ Raymond L. Steele Director July 31, 1995
Raymond L. Steele
