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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 10-K/A
(Mark One)
AMENDMENT NO. 1
TO
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 0-1298
ADVANCED TECHNICAL PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 11-1581582
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
200 MANSELL CT. EAST, SUITE 505
ROSWELL, GEORGIA 30076
(Address of principal executive offices) (Zip Code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (770) 993-0291
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
------------------- -----------------------------------------
Common Stock, $0.01 par value Nasdaq / National Market System
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 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. [ ]
The aggregate market value of the voting stock held by non-affiliates of the
registrant, on April 26, 1999 was $34,735,743 (3,656,394 shares at $9.50 per
share, the closing price of the registrant's common stock on the Nasdaq National
Market on April 26, 1999). As of that date, 5,259,089 shares of the registrant's
common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE: None
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<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Certificate of Incorporation and Bylaws of Advanced Technical Products,
Inc. ("ATP" or the "Company"), each as amended, provide that the members of the
Board of Directors will be classified as nearly as possible into three classes,
each with, as nearly as possible, one-third of the members of the Board of
Directors. The following sets forth certain information concerning each of the
directors of the Company now in office and each of the executive officers of the
Company who are not directors. Each of the Class II and Class III directors were
designated as directors of the Company effective October 31, 1997 in connection
with the consummation of the merger (the "Merger") of TPG Holdings, Inc. ("TPG")
and Lunn Industries, Inc. ("Lunn") under the name "Advanced Technical Products,
Inc." The terms of the Class II directors expire on the date of the Company's
1999 Annual Meeting. Each of the Class I directors were elected to the Board of
Directors at the Company's 1998 Annual Meeting. The age of each director nominee
and continuing director, his positions and offices with the Company, the year in
which he first became a director of the Company, his business experience during
the past five years or more, and the other directorships he holds are shown
below. Similar information is provided concerning executive officers who are
neither directors nor nominees for election as directors.
CLASS II DIRECTORS - TERMS EXPIRING 1999
GARRETT L. DOMINY, 53. Mr. Dominy has been Executive Vice President, Chief
Financial Officer, Assistant Secretary and Treasurer of the Company since
October 1997. Mr. Dominy served as the Chief Financial Officer, Executive Vice
President, Secretary and Treasurer of TPG from June 1995 until the Merger. Prior
to that time, Mr. Dominy was an audit partner of Arthur Andersen Worldwide. Mr.
Dominy is a Certified Public Accountant.
SAM P. DOUGLASS, 66. Mr. Douglass is a member of the Compensation Committee.
Mr. Douglass served as a director of TPG from its inception in 1995 until the
Merger. Mr. Douglass has been Chairman of the Board and Chief Executive Officer
of Equus Capital Corporation, the managing general partner of Equus Equity
Appreciation Fund L.P., since its formation in September 1983. Mr. Douglass has
also been Chairman of the Board and Chief Executive Officer of Equus II
Incorporated, an investment company that trades as a closed-end fund on the
American Stock Exchange, and Equus Capital Management Corporation, since their
formation in 1983. Since 1978, Mr. Douglass has served as Chairman and Chief
Executive Officer of Equus Corporation International, a privately owned
corporation engaged in a variety of investment activities.
CLASS III DIRECTORS - TERMS EXPIRING 2000
JAMES S. CARTER, 63. Mr. Carter is the Chairman of the Board, President and
Chief Executive Officer of the Company. Mr. Carter served as the President and
Chief Executive Officer and as a director of TPG from its inception in 1995
until the Merger. Mr. Carter served as an aerospace industry consultant from
1993 to 1995 and Vice President and General Manager of the Composite Structures
Division of Alcoa Composites, Inc. from 1989 to 1993. Prior to joining Alcoa
Composites, Inc., Mr. Carter was Director of Composites with Northrop
Corporation for the B-2 Aircraft Group from 1980 to 1989. Mr. Carter began his
career in the aerospace industry with the Brunswick Technical Group of Brunswick
Corporation in 1956.
GARY L. FORBES, 55. Mr. Forbes is a member of the Audit Committee and the
Compensation Committee. Mr. Forbes served as a director of TPG from its
inception in 1995 until the Merger. Mr. Forbes has been
2
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a Vice President of Equus II Incorporated, a closed-end investment fund, since
1991. Mr. Forbes is a director of Consolidated Graphics, Inc. (a NYSE
consolidator of commercial printing companies), Drypers Corporation (a Nasdaq
National Market manufacturer of disposable diapers), and NCI Building Systems,
Inc. (a Nasdaq National Market consolidator of pre-engineered metal building
manufacturers).
JOHN M. SIMON, 56. Mr. Simon is a member of the Compensation Committee. Mr.
Simon has been Managing Director of Allen & Company Incorporated for more than
five years. Mr. Simon is a director of Immune Response Corporation and Neurogen
Corporation, all of which are Nasdaq National Market companies. Mr. Simon was
originally elected a director of Lunn in 1993.
CLASS I DIRECTORS - TERMS EXPIRING 2001
ALAN W. BALDWIN, 62. Mr. Baldwin is a member of the Audit Committee. From
March 1994 through October 31, 1997, Mr. Baldwin served as the Chairman of the
Board and Chief Executive Officer of Lunn. Mr. Baldwin was Vice President of
Lunn from December 1993 to March 1994 and was an independent consultant from
1991 to March 1994. Mr. Baldwin served as a director of Lunn since 1993.
ROBERT C. SIGRIST, 66. Mr. Sigrist is a member of the Nominating Committee.
Mr. Sigrist served as a director of TPG from August 1995 until October 1997.
Prior to that time, Mr. Sigrist served as the President of the Brunswick
Technical Group of Brunswick Corporation for seven years.
LAWRENCE E. WESNESKI, 51. Mr. Wesneski is a member of the Audit Committee and
Nominating Committee. Mr. Wesneski has been President and Chief Executive
Officer of Hoak Breedlove Wesneski & Co. since August 1996. Mr. Wesneski has
been engaged in the investment banking industry for approximately 21 years.
Prior to the formation of Hoak Breedlove Wesneski & Co., Mr. Wesneski was
president and managing director of Breedlove Wesneski & Co. for ten years. Mr.
Wesneski was formerly head of the Southwest Corporate Finance Department of Bear
Stearns & Co., Inc., a Managing Director of Corporate Finance at Eppler, Guerin
& Turner, Inc., and a member of the Corporate Finance Department at Dean Witter
Reynolds, Inc. Mr. Wesneski is a director of STB Systems, Inc. and TSC
Communications Corp. Mr. Wesneski served as a director of TPG from its inception
in 1995 until the Merger.
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
H. DWIGHT BYRD, 61. Mr. Byrd has been a Vice President of ATP and President
of the Marion Composites Division since the Merger. From April 1995 until the
Merger, Mr. Byrd served as a Vice President of TPG and President of the Marion
Composites Division. During the period from April 1992 to April 1995, Mr. Byrd
served as General Manager of Brunswick Corporation's Marion, Virginia division.
During 1991 to April 1992, Mr. Byrd served as Director of Manufacturing for
Brunswick's Mercury Marine Division in Stillwater, Oklahoma.
BRIAN W. HODGES, 38. Mr. Hodges has been Vice President of ATP and President
of the Intellitec Division since May 1998. Prior to May 1998, Mr. Hodges served
as Intellitec's Vice President and General Manager for Defense Products and Vice
President of Operations. Mr. Hodges served as Director of Operations, and held
other senior management positions for Brunswick's Technical Group between 1987
and 1995. Prior to 1987, Mr. Hodges held supervisory and engineering positions
at both Honeywell Inc. and Texas Instruments, Inc.
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<PAGE>
EDWARD KILEY, 49. Mr. Kiley has been President and General Manager of Alcore,
a wholly owned subsidiary of the Company, since May 1996. Mr. Kiley was Vice
President and General Manager of Alcore from October 1993 to May 1996. Mr. Kiley
was Vice President and General Manager of Lunn from January 1993 through October
1993. Prior to December 1992, Mr. Kiley was Director of Sales and Marketing of
Hexcel Corporation.
MICHAEL KOHLER, 34. Mr. Kohler has been Vice President of ATP and President
of Lunn Industries since the Merger. From 1994 to 1997, Mr. Kohler served as
Director of Engineering for Lunn and, for over three years prior to 1994, served
as a quality assurance manager and quality engineer for Lunn.
RICHARD J. RASHILLA, JR., 39. Mr. Rashilla has been Vice President of ATP and
President of the Lincoln Composites Division since January of 1999. Prior to
January 1999, Mr. Rashilla served as Lincoln Composites' Vice President and
General Manager. Mr. Rashilla served as Executive Director of Business
Development and held other senior management positions for Brunswick's Technical
Group between 1983 and 1995.
SECTION 16 REQUIREMENTS
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
10% of a registered class of the Company's equity securities, to file initial
reports of ownership and reports of changes in ownership with the Securities and
Exchange Commission (the "SEC") and the Nasdaq Stock Market. Such persons are
required by the SEC to furnish the Company with copies of all Section 16(a)
forms they file.
Based solely on its review of the copies of such forms received by it with
respect to fiscal 1998, or written representations from certain reporting
persons, the Company believes that all filing requirements applicable to its
directors, officers and persons who own more than 10% of a registered class of
the Company's equity securities have been complied with, except as follows: Mr.
Byrd reported a transaction on a Form 5 filed February 15,1999 that should have
been reported on a Form 4 due on November 11, 1998. Mr. Hodges became an
executive officer of the Company on January 1, 1999, but did not report his
holdings on a Form 5 until February 15, 1999. Mr Wesneski reported a transaction
on a Form 5 filed on February 17, 1999 that should have been filed on February
15, 1999.
4
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ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation
paid to the Company's Chairman of the Board, President and Chief Executive
Officer and each of the Company's four other most highly compensated executive
officers (collectively, the "Named Executive Officers"), with respect to each of
the Company's last three fiscal years, based on salary and bonus earned during
each year.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------------ -------------------------------
SECURITIES
OTHER UNDER-
ANNUAL RESTRICTED LYING ALL OTHER
COMPEN- STOCK OPTIONS/ LTIP COMPEN-
SALARY BONUS SATION AWARD(S) SARS PAYMENTS SATION
NAME YEAR ($) ($) ($) ($) (#) ($) ($)(1)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
James S. Carter 1998 $305,192 $ 50,000 $ 0 0 $ 9,914
Chairman, President and 1997 $246,400 $ 0 $ 0 41,500 $19,466
Chief Executive Officer 1996 $226,884 $106,638 $ 0 0 $62,982
Garrett L. Dominy 1998 $240,577 $ 35,000 $ 0 0 $ 6,828
Executive Vice President and 1997 $193,259 $ 0 $ 0 37,000 $ 2,302
Chief Financial Officer 1996 $170,673 $ 79,279 $ 0 0 $51,962
H. Dwight Byrd 1998 $175,264 $ 0 $ 1,853 0 $ 6,426
Vice President 1997 $163,427 $ 0 $ 1,926 10,000 $ 2,851
1996 $145,558 $ 69,778 $ 0 0 $ 3,906
James G. Fuller 1998 $156,846 $ 0 $ 0 0 $ 6,675
Vice President 1997 $149,256 $ 0 $ 0 10,000 $ 2,330
1996 $135,285 $ 64,896 $ 0 0 $ 2,095
Edward Kiley 1998 $150,000 $ 0 $12,125 0 $ 3,663
Vice President 1997 $127,412 $ 62,750 $ 6,000 22,500 $ 2,405
1996 $111,784 $ 37,500 $36,437 0 $ 1,054
</TABLE>
- -------------------
(1)"All Other Compensation" for 1998 for the Named Executive Officers is
comprised of the following: (a) Company contributions to retirement savings
plans for Messrs. Carter ($5,000), Dominy ($4,812), Byrd ($3,505), Fuller
($3,137) and Kiley ($2,923), and (b) the taxable amount of life insurance
premiums paid by the Company for Messrs. Carter ($4,914), Dominy ($2,016), Byrd
($2,921), Fuller ($3,538) and Kiley ($740).
OPTION GRANTS DURING 1998 FISCAL YEAR
The Company did not grant any employee stock options during 1998, nor did the
Company grant any stock appreciation rights during 1998.
5
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OPTION EXERCISES DURING 1998 FISCAL YEAR AND FISCAL YEAR END OPTION VALUES
The following table sets forth the aggregate dollar value of in-the-money,
unexercised options held at the end of 1998 by the Named Executive Officers.
There were no stock options exercised during 1998 by any of the Named Executive
Officers.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-
OPTIONS/SARS AT FISCAL THE-MONEY OPTIONS/SARS
SHARES VALUE YEAR-END (#) AT FISCAL YEAR-END ($)
ACQUIRED ON REALIZED ---------------------------- -----------------------------
NAME EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
James S. Carter .............. 0 0 8,300 33,200 $ 0 $ 0
Garrett L. Dominy ............ 0 0 7,400 29,600 $ 0 $ 0
H. Dwight Byrd ............... 0 0 2,000 8,000 $ 0 $ 0
James G. Fuller ............... 0 0 2,000 8,000 $ 0 $ 0
Edward Kiley ................. 0 0 23,000 2,000 $30,813 $ 0
</TABLE>
EMPLOYMENT AGREEMENTS
The Company has entered into three-year employment agreements with each of
James S. Carter and Garrett L. Dominy. Pursuant to the employment agreements,
Mr. Carter will serve as Chairman of the Board, President and Chief Executive
Officer of the Company and Mr. Dominy will serve as an Executive Vice President
and Chief Financial Officer of the Company. The employment agreements provide
for base salaries, which are $350,000 and $275,000 per year as of January 1,
1999 for Mr. Carter and Mr. Dominy, respectively, subject to annual increases
based, at a minimum, on the consumer price index for the previous year. Mr.
Carter and Mr. Dominy are also entitled to receive, subject to the discretion of
the Board, annual bonuses of up to 75% of their then annual base salary. The
employment agreements are terminable by the Company with or without cause;
provided that if the Company terminates the employment of Mr. Carter or Mr.
Dominy without cause, such executive will be entitled to continue to receive his
base salary and incentive bonus for specified periods. The employment agreements
also provide that if there is a "change in control" of the Company or a
constructive termination of the executive without cause, then the executives are
entitled to a lump-sum payment of a specified amount within 60 days of the
effective date of termination. Following any termination of Mr. Carter's or Mr.
Dominy's employment for cause or upon such employee's breach of the terms of his
employment agreement, it is expected that such executive will be subject to
non-disclosure and non-competition covenants for up to two years.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company receive $20,000 annually.
Additionally, non-employee directors who have not previously served on the Board
receive a grant under the Advanced Technical Products, Inc. Non-Employee
Director Stock Option Plan (the "Non-Employee Director Plan") of options to
purchase 7,500 shares of the common stock of the Company (the "Common Stock")
upon commencement of their term, and continuing non-employee directors receive a
grant under the Non-Employee Director Plan of options to purchase 1,000 shares
of Common Stock immediately following each annual meeting of the stockholders.
6
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors is responsible for
determining executive compensation. The Compensation Committee is currently
comprised of three non-employee directors, Mr. Douglass, Mr. Forbes and Mr.
Simon.
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors (the "Committee"), which
consists of three independent outside directors, reviews and approves the
Company's total compensation philosophy and programs covering executive officers
and key management employees. The Committee reviews the performance levels of
executive officers and determines the annual base salaries and incentive awards
to be paid.
The Company's executive compensation program is designed to help the Company
attract, motivate and retain the executive resources that the Company needs in
order to maximize its return to stockholders. Specifically, the goals of the
Company's compensation program are to:
1. Align executive compensation with the interests of the stockholders;
2. Provide compensation packages that are consistent with competitive market
norms for companies similar in size, activity and complexity to the Company;
1. Link pay to Company, operating group and individual performance; and
2. Achieve a balance between incentives for short-term and long-term
performance.
The principal elements of compensation provided to executive and other
officers of the Company historically have consisted of a base salary, annual
incentives and stock option grants. The Committee estimates an executive's level
of total compensation based on information drawn from a variety of sources,
including proxy statements, special surveys and compensation consultants. Total
compensation is targeted to be competitive at the median level of a peer group
of comparable companies.
BASE SALARY. Salaries for executive officers are determined by the Committee
annually, based on review of each executive's level of responsibility,
experience, expertise and sustained corporate, business unit and individual
performance. The Committee exercises its judgment based upon the above criteria
and does not apply a specific formula or assign a weight to each factor
considered.
ANNUAL INCENTIVE COMPENSATION. Annual incentive awards are designed to focus
management's attention on the performance of the Company, particularly in the
short-term. At the beginning of each year, the Board of Directors establishes
performance goals of the Company for that year, which may include target
increases in sales, net income and earnings per share, as well as more
subjective goals. Incentive awards are based upon the achievement of one or more
of these goals.
STOCK OPTION PROGRAM. Each executive officer is eligible to receive a grant
of stock options with an exercise price equal to the fair market value of the
stock on the grant date. Stock options are designed to focus executives on the
long-term performance of the Company by enabling executives to share in any
increases in value of the Company's stock. Accordingly, the Committee believes
that the grant of stock
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options is a significant method of aligning management's long-term interests
with those of the stockholders of the Company.
CHIEF EXECUTIVE OFFICER COMPENSATION. Mr. Carter, the Chairman of the Board,
President and Chief Executive Officer of the Company, is entitled to receive a
minimum annual salary of $265,000 pursuant to his employment agreement with the
Company. Subject to this minimum, Mr. Carter's base salary rate may be adjusted
at the discretion of the Board of Directors based upon such factors as the Board
of Directors deems appropriate. Mr. Carter's base salary for fiscal 1998 was
$305,192. The Committee believes that Mr. Carter's total compensation is near
the median for the chief executive officers of the Company's peer group.
This report is submitted by the members of the Compensation Committee.
SAM P. DOUGLASS
GARY L. FORBES
JOHN M. SIMON
STOCK PERFORMANCE GRAPH
Set forth below is a graph comparing the cumulative total returns (assuming
an investment of $100 on December 31, 1993 and reinvestment of dividends) of the
Company, the Standard and Poor's 500 Composite Stock Index (the "S&P 500 Index")
and the Aerospace/Defense 500 Index (the "Aero/Def 500 Index"). The value of the
investment in the Company for the period reflected is based on the market price
of the stock of Lunn restated for the 10-to-1 reverse stock split effected by
the Merger.
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
<TABLE>
<CAPTION>
12/31/93 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
ATP 100.00 25.00 37.50 37.50 53.00 36.50
S & P 500 Index 100.00 101.36 139.32 171.23 228.27 293.38
Aerospace/Defense 500 Index 100.00 108.16 178.77 238.96 245.85 188.57
</TABLE>
8
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of April 26, 1999, the number of shares of
Common Stock and the 8% Cumulative Redeemable Preferred Stock, par value $1.00
per share, of the Company (the "Preferred Stock") beneficially owned by (1) each
person or group known by the Company to own beneficially more than 5% of the
outstanding shares of Common Stock, (2) each director and each nominee for
director, (3) the Company's Chief Executive Officer and each of the Company's
four other most highly compensated executive officers, and (4) all directors and
executive officers as a group. At the close of business on that date, the
Company had 5,259,089 shares of Common Stock issued and outstanding. Except as
otherwise indicated, each of the persons or groups named below has sole voting
power and investment power with respect to such Common Stock and Preferred
Stock.
COMMON STOCK PREFERRED STOCK
----------------- ------------------
NAME OF BENEFICIAL OWNER OR GROUP SHARES PERCENT SHARES PERCENT
--------------------------------- ------ ------- ------ -------
Equus Corporation
International (1)(2).............. 267,602 5.09% 913,043 91.30%
Equus Capital Management
Corporation (1)(2)............... 267,602 5.09% 913,043 91.30%
Equus Equity Appreciation
Fund, L.P. (2)................... -- -- 913,043 91.30%
Alan W. Baldwin (3)................ 52,500 * -- --
H. Dwight Byrd (4)................. 200,802 3.82% -- --
James S. Carter (5)................ 304,087 5.77% -- --
Garrett L. Dominy (6).............. 165,273 3.14% -- --
Sam P. Douglass (1)(2)(7)(8)....... 378,326 7.19% 913,043 91.30%
Gary L. Forbes (8)................. 63,719 1.21% -- --
Edward Kiley (9)................... 30,565 * -- --
James G. Fuller (10)............... 197,191 3.75% -- --
Robert C. Sigrist (8).............. 61,657 1.17% 21,739 2.17%
John M. Simon (10)................. 3,500 * -- --
Lawrence E. Wesneski (11).......... 144,477 2.75% 15,946 1.59%
All directors and executive
officers as a group
(13 persons)(12)................. 1,735,491 32.19% 37,685 3.77%
- ---------------
* Less than one percent
(1) Equus Capital Management Corporation ("ECMC") owns beneficially and of
record 11,750 shares of the Common Stock. ECMC may also be deemed to
beneficially own 255,852 shares of the Common Stock that are owned
beneficially and of record by Equus Capital Corporation ("ECC"), a
wholly-owned subsidiary of ECMC. ECMC disclaims beneficial ownership of
these shares. Equus Corporation International ("ECI") may be deemed to own
the 267,602 shares that are beneficially owned by ECMC as a result of ECI's
ownership of 80% of the common stock of ECMC. ECI disclaims beneficial
ownership of these shares.
(2) Equus Equity Appreciation Fund, L.P. ("EEAF") owns beneficially and of
record 913,043 shares of the Preferred Stock. ECMC and ECI may be deemed to
beneficially own the 913,043 shares of the Preferred Stock owned by EEAF as
a result of the relationship described in (1) above. Each of ECMC and ECI
disclaim beneficial ownership of these shares. In addition, Mr. Douglass
may be deemed to beneficially own the 913,043 shares of the Preferred Stock
that ECI may be deemed to own as a result of the relationship described in
(7) below. Mr. Douglass disclaims beneficial ownership of these shares.
(3) Includes 50,000 shares of Common Stock that may be acquired within 60 days
of April 26, 1999 upon exercise of options granted by the Company and 2,500
shares of Common Stock that may be acquired within 60 days of April 26,
1999 upon exercise of options granted pursuant to the Non-Employee
Directors Plan.
(4) Includes 197,191 shares of Common Stock held by the Harvey Dwight Byrd, Sr.
Revocable Trust DTD, which Mr. Byrd may be deemed to own as a settlor and
trustee of such trust. Mr. Byrd disclaims beneficial ownership of these
shares. In addition, includes 111 shares purchased through the Advanced
Technical Products, Inc. 1998 Employee Stock Purchase Plan (the "Stock
Purchase Plan") and 2,000 shares of Common Stock that may be acquired
within 60 days of April 26, 1999 upon exercise of options granted pursuant
to the 1997 Advanced Technical Products, Inc. Stock Option Plan (the
"Employee Plan").
(5) Includes 8,300 shares of Common Stock that may be acquired within 60 days
of April 26, 1999 upon exercise of options granted pursuant to the Employee
Plan.
(6) Includes 7,400 shares of Common Stock that may be acquired within 60 days
of April 26, 1999 upon exercise of options granted pursuant to the Employee
Plan and 120 shares purchased through the Stock Purchase Plan.
(7) Includes 267,602 shares of Common Stock that each of the Douglass Trust IV,
FBO Preston Douglass, Jr. and the Douglass Trust IV, FBO Brooke Douglass
(collectively, the "Douglass Trusts") may be deemed to
9
<PAGE>
beneficially own as a result of their ownership of all of the outstanding
common stock of ECI. Mr. Douglass is the trustee of each of the Douglass
Trusts. Mr. Douglass, for himself and as trustee of the Douglass Trusts,
disclaims beneficial ownership of such shares. In addition, includes 54,112
shares of Common Stock that are owned of record by the Douglass Trust IV,
FBO Preston Douglass, Jr. and 54,112 shares of Common Stock that are owned
of record by the Douglass Trust IV, FBO Brooke Douglass. Mr. Douglass
disclaims beneficial ownership of these shares.
(8) Includes 2,500 shares of Common Stock that may be acquired within 60 days
of April 26, 1999 upon exercise of options granted under the Non-Employee
Director Plan.
(9) Includes 22,500 shares of Common Stock which may be acquired within 60 days
of April 26, 1999 pursuant to the exercise of options granted by the
Company, 500 shares of Common Stock that may be acquired within 60 days of
April 26, 1999 upon exercise of options granted pursuant to the Employee
Plan and 65 shares purchased through the Stock Purchase Plan.
(10) Includes 1,500 shares of Common Stock that may be acquired within 60 days
of April 26, 1999 upon exercise of options granted by the Company and 2,000
that may be acquired within 60 days of April 26, 1999 upon exercise of
options granted pursuant to the Non-Employee Directors Plan.
(11) Includes 43,382 shares of Common Stock held directly by Mr. Wesneski
through a SEPIRA and 98,595 shares held by Breedlove & Wesneski, L.P., of
which Mr. Wesneski is a general partner. Mr. Wesneski disclaims beneficial
ownership of these shares. Also includes 2,500 shares of Common Stock that
may be acquired within 60 days of April 26, 1999 upon exercise of options
granted under the Non-Employee Director Plan.
(12) Includes 132,796 shares of Common Stock which may be acquired within 60
days of April 26, 1999 pursuant to the exercise of options.
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ITEMS 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On April 28, 1995, TPG loaned James S. Carter, then its President and Chief
Executive Officer, $74, 925 to help fund Mr. Carter's acquisition of 35,625
shares of the common stock of TPG, which were then converted into 295,787 shares
of the common stock of the Company. Mr. Carter executed a promissory note in
favor of TPG, bearing interest at 8% per annum, the principal and interest of
which mature on April 28, 2001. The promissory note from Mr. Carter is secured
by a stock pledge agreement pursuant to which Mr. Carter pledged his shares to
TPG. As of December 31, 1998, an aggregate of $96,903 of principal and accrued
and unpaid interest were due and owing under such note.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Section 13 or 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, in the City of
Atlanta, State of Georgia, on April 30, 1999
ADVANCED TECHNICAL PRODUCTS, INC.
/s/ JAMES S. CARTER
James S. Carter
CHAIRMAN OF THE BOARD, CHIEF EXECUTIVE OFFICER AND
PRESIDENT
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