<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 10-K/A
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED APRIL 30, 1999
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______________ TO ______________
COMMISSION FILE NUMBER 1-9078
------------------------
THE ALPINE GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 22-1620387
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
1790 BROADWAY 10019-1412
NEW YORK, NEW YORK (Zip code)
(Address of principal executive offices)
Registrant's telephone number, including area code 212-757-3333
------------------------
Securities registered pursuant to Section 12(b) of the Act:
<TABLE>
<CAPTION>
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
<S> <C>
Common Stock, par value $.10 per share New York Stock Exchange
</TABLE>
Securities registered pursuant to Section 12(g) of the Act: None
------------------------
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 requirements for the past 90 days. Yes X 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 the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K/A or any
amendment to this Form 10-K/A. /X/
At August 12, 1999, the registrant had 14,944,775 shares of common stock,
par value $.10 per share, outstanding, and the aggregate market value of the
outstanding shares of such common stock held by non-affiliates of the registrant
on such date was approximately $169,349,868 million, based on the closing price
of $18 per share of such common stock on such date.
------------------------
DOCUMENTS INCORPORATED BY REFERENCE:
None
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<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
DIRECTORS
The Board of Directors of the Company consists of three classes of
directors, with terms expiring in successive years. The term of Mr. Jansing
expires in 1999, the terms of Messrs. Byers, Harrison and Janson expire in 2000
and the terms of Messrs. Elbaum, Kanely and Schut expire in 2001.
<TABLE>
<CAPTION>
YEAR
FIRST
ELECTED
NAME AGE DIRECTOR POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ----------- -----------------------------------------------------------
<S> <C> <C> <C>
Kenneth G. Byers, Jr................ 56 1993 President and sole shareholder of Byers Engineering
Company, a telecommunications technical services and
software firm, since 1971.
Steven S. Elbaum.................... 50 1980 Chairman of the Board of Directors and Chief Executive
Officer of the Company since 1984. Chairman of the Board of
Directors and Chief Executive Officer of Superior TeleCom
Inc., a manufacturer of wire and cable products and the
Company's majority owned subsidiary, since 1996. Chairman
of the Board of Directors of Superior Cables Limited
(formerly known as Cables of Zion United Works, Ltd.), an
Israel-based, publicly traded wire and cable manufacturer
and Superior TeleCom Inc.'s 51 percent owned subsidiary,
and PolyVision Corporation, an information display company.
A director of Interim Services, Inc., a provider of value
added staffing and health care services, and Vestaur
Securities, Inc., an investment company.
Randolph Harrison................... 67 1980 Private investor and consultant to Poten & Partners, Inc.,
an energy and shipping industry consulting firm.
John C. Jansing..................... 73 1978 Private investor. A director of Vestaur Securities, Inc.
and 14 Lord Abbett mutual funds.
Ernest C. Janson, Jr................ 76 1987 A partner with Coopers & Lybrand LLP, independent public
accountants, until his retirement in 1985.
James R. Kanely..................... 58 1993 Private investor. President and Chief Operating Officer of
the Company from November 1993 to October 1995. Prior
thereto, President of Superior TeleTec Inc., a manufacturer
of wire and cable products. A director of PolyVision
Corporation.
Bragi F. Schut...................... 58 1983 Executive Vice President of the Company since 1986. A
director of Superior TeleCom Inc., Superior Cables Limited
and PolyVision Corporation.
</TABLE>
2
<PAGE>
EXECUTIVE OFFICERS
Set forth below is certain information regarding the executive officers of
the Company, each of whom
serves at the discretion of the Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ---------------------------------------------------------------------
<S> <C> <C>
Steven S. Elbaum.................... 50 Chairman of the Board of Directors and Chief Executive Officer of the
Company since 1984. Chairman of the Board of Directors and Chief
Executive Officer of Superior TeleCom Inc. since 1996.
Bragi F. Schut...................... 58 Executive Vice President of the Company since 1986.
Stephen M. Johnson.................. 50 Executive Vice President and Chief Operating Officer of the Company
since November 1995. President of Premier Refractories Inc., a
refractories products and services company and a former subsidiary of
the Company, from April 1994 through October 1995.
David S. Aldridge................... 45 Chief Financial Officer of the Company since November 1993 and
Treasurer since January 1994. Chief Financial Officer and Treasurer
of Superior TeleCom Inc. since 1996.
Stewart H. Wahrsager................ 50 Senior Vice President, General Counsel and Secretary of the Company
since January 1996 and Secretary of Superior TeleCom Inc. since 1996.
Prior thereto he was a partner in the New York law firm of Rubin Baum
Levin Constant & Friedman.
</TABLE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of the reports and representations furnished to the
Company during the last fiscal year, the Company believes that each of the
persons required to file reports under Section 16(a) of the Securities Exchange
Act of 1934, as amended, was in compliance with all applicable filing
requirements with respect to the Company's most recent fiscal year.
ITEM 11. EXECUTIVE COMPENSATION.
The following table sets forth certain information during each of the
Company's three fiscal years ended April 30, 1997, April 30, 1998 and April 30,
1999 with respect to compensation earned by or paid to the Company's Chief
Executive Officer and each of the four most highly compensated executive
officers of the Company other than the Chief Executive Officer.
3
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION (1) COMPENSATION AWARDS
------------------------------------ -------------------------------
FISCAL OTHER ANNUAL RESTRICTED
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS (3) COMPENSATION STOCK OPTION SHARES (6) OTHER (10)
- -------------------------------- ------ -------- ---------- ------------ ---------- ----------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Steven S. Elbaum................ 1999 $555,000(2) $1,160,000 $150,013(4) $1,449,501(5) 523,000(7) $34,014
Chairman and Chief 1998 540,000(2) $ 650,000 134,006(4) 280,350(8) 13,043
Executive Officer 1997 433,200(2) 650,000 74,259(4) 347,716(9) 9,271
1999 $278,000 $ 468,000 $ 507,502(5) 229,000(7) $56,554
Bragi F. Schut.................. 1998 270,000 293,000 70,200(8) 33,425
Executive Vice President 1997 237,800 293,000 118,705(9) 31,762
Stephen M. Johnson.............. 1999 $321,000 $ 121,000 88,000 $18,816
Executive Vice President and 1998 312,000 250,000 27,750(8) 14,930
Chief Operating Officer 1997 294,000 169,000 113,800 8,838
1999 $245,000 $ 409,000 $ 43,658(4) $ 397,498(5) 177,000(7) $29,581
David S. Aldridge............... 1998 240,000 250,000 119,953(4) 70,200(8) 24,844
Chief Financial Officer 1997 195,000 252,000 52,500(4) 57,700 18,185
Stewart H. Wahrsager............ 1999 $183,000 $ 144,000 $ 174,745(5) 93,000(7) $17,658
Senior Vice President, General 1998 178,000 144,400 8,250(8) 15,004
Counsel and Secretary 1997 151,000 144,000 34,000 14,245
</TABLE>
- ------------------------
(1) The aggregate dollar value of all perquisites and other personal benefits,
securities or property earned by or paid to any of the named individuals did
not exceed the lesser of $50,000 or 10 percent of the total annual salary
and bonus set forth for such individual during any of the last three fiscal
years.
(2) Does not include salary of $175,000, $175,000 and $102,000 paid to Mr.
Elbaum by Superior TeleCom Inc. in fiscal 1999, fiscal 1998 and fiscal 1997,
respectively, under his employment agreement with such entity. See "Item 13.
Certain Relationships and Related Transactions."
(3) Includes payments made pursuant to the annual cash incentive bonus program
of the Company and discretionary cash bonuses awarded by the Executive
Compensation and Organization Committee of the Board of Directors of the
Company (the "Compensation Committee"). Included also are deferrals of
$300,000 and $125,000 for Messrs. Elbaum and Schut, respectively, to The
Alpine Group, Inc. Deferred Cash Account Plan. Mr. Johnson's 1999 bonus
represents only the annual cash incentive bonus. This table does not include
a discretionary bonus anticipated to be paid to Mr. Johnson in relation to
the June 1999 sale by the Company of its former Premier Refractories
International Inc. subsidiary.
(4) Payments to Messrs. Elbaum and Aldridge pursuant to their employment
agreements for tax consequences upon vesting of certain restricted stock
grants.
(5) Based on the closing prices of $10.0625 and $10.25 of the common stock, par
value $.10 per share, of the Company ("Alpine Common Stock") on March 18,
1999 and March 23, 1999, respectively, the dates on which the restricted
stock grants were made by the Company. The shares of restricted stock
granted on March 18, 1999 represent a portion of each of the executive
officers' discretionary annual bonus (40 percent for Mr. Elbaum and 30
percent for each of Messrs. Schut, Aldridge and Wahrsager) which the
Compensation Committee automatically deferred to The Alpine Group, Inc.
Deferred Stock Account Plan (the "Deferred Stock Plan"); such restricted
stock vests on March 18, 2001 and will be distributed from the Deferred
Stock Plan at such time unless a longer deferral period is elected by the
executive officer in accordance with the terms of the plan. The shares of
restricted stock granted on March 23, 1999, which were awarded by the
Compensation Committee pursuant to the
4
<PAGE>
long term incentive award component of the Company's senior executive
compensation program, vest in equal installments on each of March 23, 2000,
March 23, 2001 and March 23, 2002.
The following table presents the number of shares of restricted stock
awarded to the executive officers named above on each of March 18, 1999 and
March 23, 1999, the total number of shares of restricted stock held by such
officers as of April 30, 1999 and the aggregate value of such restricted
stock holdings, based on the closing price of $13.875 of the Alpine Common
Stock on April 30, 1999:
<TABLE>
<CAPTION>
TOTAL SHARES OF AGGREGATE VALUE OF
RESTRICTED STOCK RESTRICTED STOCK AS
OWNED AS OF OF
NAME MARCH 18, 1999 MARCH 23, 1999 APRIL 30, 1999 APRIL 30, 1999
- ---------------------------------- --------------- --------------- ----------------- --------------------
<S> <C> <C> <C> <C>
Steven S. Elbaum.................. 76,820 66,000 142,820 $ 1,981,627
Bragi F. Schut.................... 19,876 30,000 49,876 $ 692,029
David S. Aldridge................. 17,093 22,000 39,093 $ 542,415
Stewart H. Wahrsager.............. 6,161 11,000 17,161 $ 238,108
</TABLE>
(6) All options to purchase Alpine Common Stock that have become vested by June
30, 1999 are eligible for exercise under The Alpine Group, Inc. 1999 Stock
Option Reload Program. As of April 30, 1999, none of the above-named
executive officers had been granted a reload option.
(7) Includes options to purchase Alpine Common Stock as well as options to
purchase from the Company issued and outstanding shares of common stock, par
value $.01 per share, of Superior TeleCom Inc. ("Superior Common Stock") and
common stock, par value $.001 per share, of PolyVision Corporation
("PolyVision Common Stock") that are owned by the Company. As set forth in
the table entitled "Stock Option Grants in Fiscal 1999" below, certain of
the options to purchase Alpine Common Stock were granted in respect of
fiscal 1998. The number of shares of Superior Common Stock and PolyVision
Common Stock underlying the options to purchase such shares from the Company
is set forth in the following table:
<TABLE>
<CAPTION>
NUMBER OF SHARES
NUMBER OF SHARES UNDERLYING OPTIONS
UNDERLYING OPTIONS TO TO
PURCHASE SUPERIOR PURCHASE POLYVISION
NAME COMMON STOCK COMMON STOCK
- --------------------------------------------------------------- --------------------- --------------------
<S> <C> <C>
Steven S. Elbaum............................................... 32,000 105,000
Bragi F. Schut................................................. 14,000 47,000
David S. Aldridge.............................................. 10,000 34,000
Stewart H. Wahrsager........................................... 5,000 17,000
</TABLE>
The options to purchase Superior Common Stock and PolyVision Common Stock
were granted on March 23, 1999 and expire on March 23, 2009. One-third of
each of these options becomes exercisable on each of the first, second and
third anniversaries of the date of grant at an exercise price of $18.375 for
the Superior Common Stock and $2.625 for the PolyVision Common Stock.
(8) During fiscal 1997, the Company discontinued the use of performance options
due to the variable accounting nature of such stock options and the
resulting non-cash charges to earnings. In fiscal 1998, for the foregoing
reasons and because the historical financial performance of the Company
indicated that certain performance targets were likely to be achieved, the
Company converted performance options granted to its executive officers in
fiscal 1995 and 1996 to non-contingent stock options. All of the other terms
of the options remained unchanged, as follows: (i) the options are priced,
as to the 1995 tranche, at fair market value, and as to the 1996 tranche, at
150 percent of fair market value, on the date of their initial grant; (ii)
the options vested three years, and expire 10 years, after the date of such
grant; and (iii) in light of the Company's likely attainment of the relevant
financial performance targets, the options are exercisable for the maximum
number of shares issuable under the executive officers' stock option
agreements with the Company.
5
<PAGE>
(9) Options granted to Messrs. Elbaum and Schut include 183,016 and 61,005
options, respectively, which represent a reissuance of previously issued
options that were due to expire during fiscal 1997. The new options are
identical to the original options, except that the new options vest over the
three-year period commencing on the date of the reissuance.
(10) The amounts set forth include (i) matching contributions made by the
Company under defined contribution plans of its subsidiaries, (ii) $11,520
accrued under an unfunded, nonqualified defined benefit plan for the payment
of future annuities to Mr. Aldridge, (iii) with respect to Mr. Schut,
$30,532 representing the net present value of the vested portion of an
annuity the Company has agreed to pay in 15 equal annual installments of
$18,900 commencing in the year Mr. Shut reaches age 60, (iv) medical
reimbursement, (v) automobile allowance and (vi) group term life insurance.
STOCK OPTION GRANTS IN FISCAL 1999
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE (AT ASSUMED
NUMBER OF % OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM)
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION ----------------------
NAME GRANTED FISCAL 1999 PRICE ($/SH) DATE 5% 10%
- ------------------------------------------------ ---------- ------------ ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Steven S. Elbaum................................ 180,000(1) 11.5% $20.813 7/15/08 $2,356,053 $5,970,701
206,000 13.1% $ 10.25 3/23/09 1,327,911 3,365,187
Bragi F. Schut.................................. 75,000(1) 4.8% $20.813 7/15/08 981,689 2,487,792
93,000 5.9% $ 10.25 3/23/09 599,494 1,519,235
Stephen M. Johnson.............................. 88,000 5.6% $20.813 7/15/08 1,151,848 2,919,909
David S. Aldridge............................... 66,000(1) 4.2% $20.813 7/15/08 863,886 2,189,257
67,000 4.3% $ 10.25 3/23/09 431,893 1,094,503
Stewart H. Wahrsager............................ 37,000(1) 2.4% $20.813 7/15/08 484,300 1,227,311
34,000 6.5% $ 10.25 3/23/09 657,509 1,666,258
</TABLE>
- ------------------------
(1) Represents grants in respect of fiscal 1998.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
There were no exercises of stock options during the fiscal year ended April
30, 1999. The following table presents information for the individuals named
above as to the number of shares underlying, and the value of, unexercised
options outstanding at April 30, 1999:
<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS (1)
--------------------------- ---------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Steven S. Elbaum...................................................... 905,185 449,800 $ 8,289,117 $1,152,538
Bragi F. Schut........................................................ 292,175 187,234 2,653,294 447,721
Stephen M. Johnson.................................................... 137,733 172,117 1,028,133 633,553
David S. Aldridge..................................................... 211,637 175,668 1,595,385 564,232
Stewart H. Wahrsager.................................................. 46,999 96,084 358,302 312,129
</TABLE>
6
<PAGE>
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
--------------------
REMUNERATION 15 20
- ---------------------------------------------------------- --------- ---------
<S> <C> <C>
125,000................................................... 30,399 46,024
150,000................................................... 39,774 58,524
175,000................................................... 49,149 71,024
200,000................................................... 58,524 83,524
225,000................................................... 67,899 96,024
250,000................................................... 77,274 108,524
300,000................................................... 96,024 133,524
400,000................................................... 133,524 183,524
450,000................................................... 152,274 208,524
500,000................................................... 171,024 233,524
</TABLE>
Each executive officer is a participant in a Senior Executive Retirement
Plan ("SERP"). The SERP is an unfunded defined benefit plan. Subject to vesting,
each participant will be entitled to an annual retirement benefit upon reaching
age 65 equal to 2.5 percent times his years of credited service (up to a maximum
of 20 years), multiplied by his highest average cash compensation during any
three consecutive years during the final five years of his employment, less
primary social security benefits and certain other retirement benefits paid by
the Company and other employers. The estimated years of credited service for
each of the above-named executive officers are as follows: Steven S. Elbaum, 19
years; Bragi F. Schut, 16 years; Stephen M. Johnson, 10 years; David S.
Aldridge, 15 years; and Stewart H. Wahrsager, 8 years.
COMPENSATION OF DIRECTORS
Effective January 1, 1999, the Company increased the annual retainer to
$25,000 from $20,000 for directors who are not employees of the Company or
otherwise compensated by the Company, together with expenses of attendance. The
Company also increased to $1,500 from $1,000 the amount a non-employee director
will receive for each meeting of the Board of Directors or of a committee of the
Board attended ($2,000 for committee chairmen). A non-employee director with at
least five years of service also receives, upon reaching age 70 and termination
of service to the Company, a retirement benefit of $10,000 per year for 15 years
after his retirement, payable to the director or the director's beneficiaries in
the event of his death.
In addition to increasing the annual retainer and per committee meeting
fees, effective January 1, 1999, the Board adopted The Alpine Group, Inc. Stock
Compensation Plan for Non-Employee Directors (the "Stock Compensation Plan").
Under the Stock Compensation Plan, non-employee directors of the Company will
automatically receive 50 percent of the annual retainer in either restricted
stock or stock options, as elected by the non-employee director. Each
non-employee director may also elect to receive all or a portion of the
remaining amount of the annual retainer, in excess of 50 percent of the annual
retainer, and meeting fees in the form of restricted stock or stock options
instead of in cash.
Restricted stock and stock options that are attributable to the annual
retainer will be granted as of the first business day of each quarter of the
Company's fiscal year. Restricted stock and stock options that are attributable
to meeting fees will be granted as of the date of the meeting of the Board
and/or the committee of the Board with respect to which such grants relate.
Shares to be issued under the Stock Compensation Plan will be made available
only from issued shares of Alpine Common Stock reacquired by the Company and
held in treasury until such time as the Stock Compensation Plan may be approved
by the stockholders of the Company.
The number of shares of restricted stock to be granted under the Stock
Compensation Plan will be determined by dividing
7
<PAGE>
(1) the amount of the annual retainer or meeting fees that a non-employee
director elected to receive in restricted stock, by
(2) the lesser of
(a) 100 percent of the fair market value of the Alpine Common Stock on
the first business day of the Company's fiscal year and
(b) 100 percent of the fair market value of the Alpine Common Stock at
the time of grant.
The number of stock options to be granted under the Stock Compensation Plan
will be determined by dividing
(1) the amount of the annual retainer or meeting fees that a non-employee
director elected to receive in stock options, by
(2) the value of a stock option on the date of grant as determined by the
Board, based on the purchase price per share of the Alpine Common Stock,
a Black-Scholes option pricing model and such other factors as the Board
deems appropriate.
Stock options granted under the Stock Compensation Plan will have a purchase
price equal to the lesser of:
(1) 100 percent of the fair market value of the Alpine Common Stock on the
first business day of the Company's fiscal year; and
(2) 100 percent of the fair market value of the Alpine Common Stock on the
date of grant.
Each stock option granted under the Stock Compensation Plan will expire on
the tenth anniversary of the date of grant.
Awards of restricted stock and stock options under the Stock Compensation
Plan will vest upon the earliest of the following to occur:
(1) the third anniversary of the date of grant;
(2) a non-employee director's death; and
(3) a change in control of the Company, as defined in the Stock Compensation
Plan.
The Stock Compensation Plan is administered and interpreted by the Board of
Directors.
EMPLOYMENT AGREEMENTS
The Company has employment agreements with each of its executive officers.
Pursuant to these agreements, during fiscal 1999, Mr. Elbaum served as Chairman
of the Board and Chief Executive Officer at a base salary of $555,000, Mr.
Johnson served as Executive Vice President and Chief Operating Officer at a base
salary of $321,000, Mr. Schut served as Executive Vice President at a base
salary of $278,000, Mr. Aldridge served as Chief Financial Officer at a base
salary of $245,000 and Mr. Wahrsager served as Senior Vice President, General
Counsel and Secretary at a base salary of $183,000. The agreements also provide
for annual performance-based bonuses, participation in a performance-based,
long-term incentive stock option award program, indemnification from any income
tax liability arising from the vesting of certain restricted stock awards and
certain other benefits, including medical, dental and other insurance benefits.
The agreements with Messrs. Elbaum and Schut also provide that they will serve
on the Board of Directors of the Company, and Mr. Schut's agreement provides for
the annuity described in footnote 10 to the Summary Compensation Table.
Each employment agreement is for a term ending upon the occurrence of any of
the following events: (i) notification by the executive or the Company to the
other that he or it desires to terminate the
8
<PAGE>
employment agreement; (ii) death or disability of the executive; (iii)
termination by the Company for "cause"or (iv) termination by the executive for
"good reason." Generally, if an executive terminates his employment for "good
reason" or the Company terminates his employment without cause, the executive is
entitled to receive a severance payment equal to one to one and one-half times
his annual salary and bonus for the prior year. In the event of termination of
employment under other circumstances, including a "change in control" of the
Company (which is defined as (i) the acquisition by a person or entity of 20
percent of the Company's voting securities, (ii) the occurrence of circumstances
such that individuals who constituted the Company's Board of Directors as of
April 26, 1996 no longer constitute a majority of the Company's Board of
Directors, (iii) a transaction involving the sale of all or substantially all of
the Company's assets or (iv) certain other business combinations), each
executive is entitled to varying benefits described in his employment agreement.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Randolph Harrison, John C. Jansing and Ernest C. Janson, Jr. served on the
Executive Compensation and Organization Committee (formerly known as the
Compensation Committee) during fiscal 1999. There were no compensation committee
interlocks or insider (employee) participation during fiscal 1999.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
As of August 12, 1999, there were issued and outstanding 14,944,775 shares
of Alpine Common Stock and 19,669,002 shares of Superior Common Stock. The
following table contains information as of such date regarding the number of
shares of Alpine Common Stock and Superior Common Stock beneficially owned by
(i) each person known to the Company to have beneficial ownership of more than
five percent of the Alpine Common Stock, (ii) each director of the Company,
(iii) each executive officer named in the Summary Compensation Table herein and
(iv) all directors and executive officers as a group. The information contained
herein is based on information provided by such beneficial holders to the
Company.
9
<PAGE>
BENEFICIAL OWNERSHIP OF VOTING SECURITIES
<TABLE>
<CAPTION>
ALPINE COMMON STOCK SUPERIOR COMMON STOCK
----------------------- ------------------------
NUMBER OF PERCENT OF NUMBER OF PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER (1) SHARES CLASS SHARES CLASS
- ----------------------------------------------------------------------------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Steven S. Elbaum............................................................. 2,372,676(2) 14.9% 10,546,325(15) 52.6%
Heartland Advisors, Inc...................................................... 1,581,800(3) 10.6% -- --
790 North Milwaukee Street
Milwaukee, WI 53202
Alexandra Investment Management, Ltd......................................... 1,380,191(4) 9.2% -- --
237 Park Avenue
Ninth Floor
New York, NY 10017
Jeffrey L. Gendell........................................................... 855,200(5) 5.7% -- --
200 Park Avenue
Suite 3900
New York, NY 10166
Bragi F. Schut............................................................... 765,543(6) 5.0% 35,156(16) *
Kenneth G. Byers, Jr......................................................... 526,202(7) 3.5% -- --
David S. Aldridge............................................................ 400,523(8) 2.6% 78,125(16) *
Stephen M. Johnson........................................................... 243,249(9) 1.6% 46,875(16) *
John C. Jansing.............................................................. 203,078(10) 1.4% -- --
James R. Kanely.............................................................. 200,025(11) 1.3% -- --
Stewart H. Wahrsager......................................................... 101,243(12) * 39,063(16) *
Randolph Harrison............................................................ 56,542(13) * -- --
Ernest C. Janson, Jr......................................................... 26,000 * -- --
All directors and executive officers as a group.............................. 4,851,951(14) 28.8% 10,745,544(17) 53.3%
</TABLE>
- ------------------------
* Less than one percent
(1) Unless otherwise indicated, the address of each beneficial owner is c/o The
Alpine Group, Inc., 1790 Broadway, New York, New York 10019-1412.
(2) Includes (i) 1,262 shares owned by Mr. Elbaum's wife as custodian for their
minor son, as to which shares Mr. Elbaum disclaims beneficial ownership,
(ii) 974,085 shares issuable upon exercise of certain stock options and
(iii) 198,173 shares of restricted stock, which includes: (A) 76,820 shares
of restricted stock credited to Mr. Elbaum's account under the Deferred
Stock Plan, which provides that such shares shall be voted by action of the
Board of Directors of the Company; and (B) 55,353 shares
10
<PAGE>
of restricted stock credited to the account of certain other officers and
employees of the Company under the Deferred Stock Plan, which provides that
all of such shares shall be voted by Mr. Elbaum.
(3) Based upon information provided to the Company by Heartland Advisors, Inc.
in connection with the preparation of this Form 10-K/A. Heartland Advisors,
Inc. has sole voting power with respect to 535,500 of such shares and sole
dispositive power with respect to all of such shares.
(4) Based upon a Schedule 13D, Amendment No. 1, filed with the Securities and
Exchange Commission on or about November 26, 1997. In addition, Mikhail A.
Filimonov, the Chairman, Chief Executive Officer and Chief Investment
Officer of Alexandra Investment Management, Ltd., and Dimitri Sogoloff, the
Chief Operations Officer of Alexandra Investment Management, Ltd., may be
deemed to be the beneficial owners of such shares by reason of their power
to direct the voting and disposition of such shares.
(5) Based upon a Schedule 13G filed with the Securities and Exchange Commission
on July 30, 1999. Mr. Gendell is the managing member of Tontine Management,
L.L.C., the general partner of Tontine Partners, L.P., and of Tontine
Overseas Associates, L.L.C., which serves as investment manager to Tontine
Overseas Fund, Ltd., and, in such capacity, has the shared power to vote and
dispose of the 323,050 shares directly owned by Tontine Partners, L.P. and
the 532,150 shares directly owned by Tontine Overseas Fund, Ltd.
(6) Includes (i) 3,450 shares owned by Mr. Schut's wife, as to which shares Mr.
Schut disclaims beneficial ownership, (ii) 317,175 shares issuable upon
exercise of certain stock options and (iii) 49,876 shares of restricted
stock. An aggregate of 19,876 shares of restricted stock have been credited
to Mr. Schut's account under the Deferred Stock Plan, which provides that
Steven S. Elbaum has the sole power to vote such shares.
(7) Includes 39,409 shares owned by Byers Engineering Company, of which Mr.
Byers is the president and sole shareholder.
(8) Includes (i) 4,042 shares held in Superior Telecommunications Inc. 401(k)
Plan, (ii) 257,071 shares issuable upon exercise of certain stock options
and (iii) 39,093 shares of restricted stock. An aggregate of 17,093 shares
of restricted stock have been credited to Mr. Aldridge's account under the
Deferred Stock Plan, which provides that Steven S. Elbaum has the sole power
to vote such shares.
(9) Includes 213,249 shares issuable upon exercise of certain stock options.
(10) Includes 30,503 shares issuable upon exercise of certain stock options and
1,242 shares of restricted stock.
(11) Includes (i) 122,011 shares issuable upon exercise of certain stock
options, (ii) 6,260 shares held in Superior Telecommunications Inc. 401(k)
Plan and (iii) 138 shares owned by Mr. Kanely's wife, as to which shares Mr.
Kanely disclaims beneficial ownership.
(12) Includes 73,082 shares issuable upon exercise of certain stock options and
17,161 shares of restricted stock. An aggregate of 6,161 shares of
restricted stock have been credited to Mr. Wahrsager's account under the
Deferred Stock Plan, which provides that Steven S. Elbaum has the sole power
to vote such shares.
(13) Includes 665 shares of restricted stock.
(14) Includes (i) 1,987,176 shares issuable upon exercise of certain stock
options, (ii) 263,080 shares of restricted stock and (iii) 4,850 shares as
to which the officers and directors disclaim beneficial ownership.
(15) Includes 10,155,700 shares of Superior Common Stock owned by the Company.
Mr. Elbaum may be deemed to be the beneficial owner of such shares by virtue
of his position as Chairman of the Board
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<PAGE>
and Chief Executive Officer of the Company and his beneficial ownership of
14.9 percent of the issued and outstanding shares of Alpine Common Stock.
Also includes 390,625 shares issuable upon exercise of certain stock
options.
(16) Shares issuable upon exercise of certain stock options.
(17) Includes (i) 10,155,170 shares of Superior Common Stock owned by the
Company and (ii) 589,884 shares issuable upon exercise of certain stock
options.
In addition, there are issued and outstanding 250 shares of the Company's 9
percent Cumulative Convertible Senior Preferred Stock, par value $1.00 per
share, all of which are held by Patrick W. Allender, 5 Holly Leaf Court,
Bethesda, Maryland 20817.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On October 2, 1996, in connection with a reorganization of its subsidiaries,
the Company entered into an agreement (as amended and extended to date, the
"Services Agreement") with Superior TeleCom Inc., the Company's majority owned
subsidiary. Pursuant to the Services Agreement, the Company provides certain
financial, audit and accounting, corporate finance and strategic planning,
legal, treasury, insurance and administrative services to Superior TeleCom Inc.
for a per annum fee of $2.7 million, in addition to reimbursement of incidental
costs and expenses incurred in connection with the Company's provision of such
services. Such annual fee is estimated to reflect commercially reasonable costs
for the services provided.
In connection with the foregoing reorganization, Superior TeleCom Inc. also
entered into an employment agreement with Mr. Elbaum, pursuant to which Mr.
Elbaum provides his services as Chairman of the Board and Chief Executive
Officer of Superior TeleCom Inc. for an indefinite term at an annual base salary
of $175,000, as adjusted annually for increases in the Consumer Price Index, and
an annual bonus payable at the discretion of the Board of Directors of Superior
TeleCom Inc. Mr. Elbaum's employment agreement with Superior TeleCom Inc.
contains customary terms and provisions with respect to termination and other
matters.
Pursuant to their employment agreements with the Company, Steven S. Elbaum,
Stephen M. Johnson, Executive Vice President and Chief Operating Officer of the
Company, Bragi F. Schut, Executive Vice President of the Company, and Stewart H.
Wahrsager, Senior Vice President, General Counsel and Secretary of the Company,
were loaned by the Company approximately $398,000, $140,000, $105,000 and
$71,000, respectively, in respect of the tax consequences of certain restricted
stock awards. The indebtedness, which was outstanding as of July 31, 1999, bears
interest at the annual rate of 5.96 percent.
As of July 15, 1998, the Executive Compensation and Organization Committee
determined that a $300,000 loan (which bears interest at the prime rate plus
one-half percentage point) made by the Company in June 1987 to Steven S. Elbaum,
Chairman of the Board and Chief Executive Officer of the Company, to finance Mr.
Elbaum's exercise of certain stock options would be forgiven over a period of
four years, provided that if Mr. Elbaum voluntarily ceases his employment with
the Company at any time during such period, the then outstanding balance of the
loan and interest thereon would be immediately due and payable. Mr. Elbaum will
pay all taxes relating to any cancellation of indebtedness income arising out of
the forgiveness of the loan. In addition, as of July 31, 1999, Mr. Elbaum owed
the Company approximately $14,000, which indebtedness bears interest at the
prime rate.
In November 1998, in connection with the acquisition by PolyVision
Corporation ("PolyVision") of Alliance International Group Inc., the Company
exchanged approximately $25.2 million in PolyVision's 8 percent Series A
Preferred Stock (plus accrued dividends) and a loan receivable from PolyVision
of approximately $7.4 million for 5.3 million shares of PolyVision's common
stock and approximately $12.4 million in liquidation value of PolyVision's
Series B Convertible Preferred Stock. As part of this transaction, Alpine also
acquired $5.0 million of PolyVision's Series C Convertible Preferred Stock for
cash
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<PAGE>
and received a further $0.5 million of PolyVision's Series B Convertible
Preferred Stock and 200,000 shares of PolyVision's common stock for professional
services rendered to PolyVision in connection with its acquisition. The
aforementioned recapitalization resulted in the Company's common share equity
ownership in PolyVision increasing to 48 percent from 17 percent. Mr. Elbaum is
the Chairman of the Board of PolyVision and is the beneficial owner of in excess
of 10 percent of PolyVision's common stock.
The Company has a consulting agreement with James R. Kanely, a current
director and a former officer of the Company, which provides for the payment to
Mr. Kanely of a $10,000 per month consulting fee until October 2000. The
consulting agreement also provides that Mr. Kanely is entitled to (i) receive
health and medical benefits, (ii) continue participation under a supplemental
executive retirement plan maintained by a subsidiary of Superior TeleCom, Inc.
and (iii) receive an annuity of $34,700 per year for 15 years, commencing in
2001, all substantially in accordance with the terms of his former employment
agreement. In consideration of the termination of this employment agreement in
November 1995, the Company made a one-time payment to Mr. Kanely of $610,000.
The Company invests in an investment fund for which Mikhail A. Filimonov,
the Chairman, Chief Executive Officer and Chief Investment Officer of Alexandra
Investment Management, Ltd.("AIM"), acts as investment advisor. AIM beneficially
owns in excess of five percent of Alpine Common Stock. During the fiscal year
ended April 30, 1999, the Company paid fees of $107,000 to AIM for investment
advisory services in respect of such fund.
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<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 of 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
<TABLE>
<S> <C> <C>
Dated: August 27, 1999 THE ALPINE GROUP, INC.
By: /s/ STEVEN S. ELBAUM
-----------------------------------------
Steven S. Elbaum
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
</TABLE>
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.
<TABLE>
<C> <S> <C>
Chairman of the Board and
/s/ STEVEN S. ELBAUM * Chief Executive Officer
- ------------------------------ (principal executive August 27, 1996
Steven S. Elbaum * officer)
Chief Financial Officer
/s/ DAVID S. ALDRIDGE * and Treasurer (principal
- ------------------------------ financial and accounting August 27, 1996
David S. Aldridge officer)
/s/ KENNETH G. BYERS, JR. *
- ------------------------------ Director August 27, 1996
Kenneth G. Byers, Jr.
/s/ RANDOLPH HARRISON *
- ------------------------------ Director August 27, 1996
Randolph Harrison
/s/ JOHN C. JANSING *
- ------------------------------ Director August 27, 1996
John C. Jansing
/s/ ERNEST C. JANSON, JR. *
- ------------------------------ Director August 27, 1996
Ernest C. Janson, Jr.
/s/ JAMES R. KANELY *
- ------------------------------ Director August 27, 1996
James R. Kanely
/s/ BRAGI F. SCHUT *
- ------------------------------ Director August 27, 1996
Bragi F. Schut
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ STEWART H.
WAHRSAGER
-------------------------
Stewart H. Wahrsager
ATTORNEY-IN-FACT
</TABLE>
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