<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A-1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: July 30, 1996
Date of earliest event reported: June 14, 1996
CHADMOORE WIRELESS GROUP, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 0-20999 84-1058165
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
4720 Polaris Street, Las Vegas, Nevada 89103
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (702) 891-5255
---------------------------
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE> 2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On June 14, 1996, Registrant executed a Stock Purchase Agreement (the
"Agreement") (see, Exhibit 10.11 included herein) with Libero Limited
("Libero"). Pursuant to the Agreement, Registrant acquired from Libero all the
issued and outstanding common stock of CMRS Systems, Inc. ("CMRS") and 800 SMR
Network, Inc. ("800") (jointly the "Management Companies"). The Management
Companies intend to engage in the business of constructing and managing
multi-channel trunked 800 MHz trunked Specialized Mobile Radio ("SMR") stations
("Stations"). The Management Companies have entered into management agreements
("Management Agreements") with certain companies (the "Companies"), pursuant to
which CMRS or 800, as the case may be, has agreed, in accordance with
applicable Federal Communications Commission ("FCC") rules, regulations and
policies, to construct and manage all of the Stations for which the Companies
have received licenses from the FCC. The respective shareholders of the
Companies have granted to CMRS or 800, as the case may be, options to acquire
all of the stock of the Companies ("Options"), at such time as all conditions
of such transfer of control have been met, as set forth in the FCC rules,
regulations and policies and as required by Section 310 of the Communications
Act of 1934, as amended by 47 U.S.C. Section 310. Libero, the Management
Companies and the Companies are sometimes collectively referred to herein as
the "Transferors".
No material relationship exists between any of the Transferors and
Registrant or any of its affiliates, any director or officer of Registrant or
any associate of any such director or officer.
Registrant consummated such acquisition for consideration valued at
$33,085,446. The Registrant has accounted for the acquisition under the
purchase method of accounting. The purchase price was paid with (1) an
aggregate cash consideration of $3,547,000; (2) 508,000 shares of Registrant's
restricted common stock valued at $1,238,250; and (3) a grant of an option to
purchase 8,323,857 shares of Registrant's common stock for a period of ten
years at an exercise price of $.50 per share, pursuant to an Offshore
Securities Purchase Agreement and Stock Option Agreement valued at $28,300,196.
The Registrant is seeking to obtain seperate independent verifications of the
value of the Stations acquired and the value of the Securities issued in
connection with the acquisition. The Registrant had sufficient cash on hand
for the cash consideration paid.
The acquisition is significant to the Registrant in that such acquisition
substantially increases the number of Stations under management and expands the
service footprint of the Registrant to over two hundred markets located in
forty-seven States and the U.S. Territories of Puerto Rico and the Virgin
Islands. The Management Companies intend to construct, manage and operate the
Stations in accordance with the terms and conditions of the Management
Agreements and FCC rules, regulations and policies. Once the Stations are
constructed, the Management Companies intend to manage and operate Stations to
provide wireless communications services to the population resident in the
service footprint of the Stations. Further, once all conditions to transfer of
control of the Companies have been met, as set forth in the rules, regulations
and policies of the FCC, the Management Companies will seek FCC consent to the
transfer of control of the Companies to the Management Company.
2
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
None.
(b) Pro forma financial information. The following pro forma
information is hereby filed:
Chadmoore Wireless Group, Inc.
Unaudited Pro Forma Condensed Consolidated Balance Sheet at
March 31, 1996
Unaudited Pro Forma Condensed Consolidated Statements of Operations
for the twelve months ended December 31, 1995
Unaudited Pro Forma Condensed Consolidated Statements of Operations
for the three months ended March 31, 1996
Notes to Unaudited Pro Forma Condensed Consolidated Statements
(c) Exhibits
Exhibit Number and Brief Description
2.1 Agreement and Plan of Reorganization dated February 2, 1995, by and
between Registrant (f/k/a CapVest Internationale, Ltd.) and Chadmoore
Communications, Inc.(1)
2.2 Addendum to the Agreement and Plan of Reorganization, dated February 21,
1995, by and between Registrant (f/k/a CapVest Internationale, Ltd.) and
Chadmoore Communications, Inc.(1)
2.3 Addendum No. 2 to the Agreement and Plan of Reorganization, dated March
31, 1995, by and between Registrant (f/k/a CapVest Internationale, Ltd.)
and Chadmoore Communications, Inc.(1)
4.1 Form of Warrant Certificate, together with the Terms of Warrants(2)
4.2 Registration Rights Agreement(3)
4.3 Certificate of Designation of Rights and Preferences of Series A
Convertible Preferred Stock of Registrant(4)
10.11 Stock Purchase Agreement dated June 14, 1996, by and between Chadmoore
Wireless Group, Inc. and Libero Limited(5)
17.1 Resignation of David J. Chadwick dated April 30, 1996(6)
- -------------------
(1) Incorporated by reference to Exhibit 1 in Registrant's Form 8-K, under Item
2, date of earliest event reported - February 21, 1995
(2) Incorporated by reference to Exhibit 4.1 to Registrant's Form 10-KSB for the
year ended December 31, 1995
(3) Incorporated by reference to Exhibit 4.2 to Registrant's Form 10-KSB for the
year ended December 31, 1995
(4) Incorporated by reference to Exhibit 3.4 to Registrant's Form 10-KSB for the
year ended December 31, 1995
(5) Filed herewith
(6) Incorporated by reference to Exhibit 17.1 in Registrant's Form 8-K, under
Item 6, date of earliest event reported - April 30, 1996
3
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CHADMOORE WIRELESS GROUP, INC.
By: /s/ ROBERT W. MOORE
------------------------------------
Robert W. Moore, President
Date: July, 30, 1996
4
<PAGE> 5
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying Unaudited Pro Forma Condensed Consolidated Financial
Statements as of and for the period ended March 31, 1996 present pro forma
information for Chadmoore Wireless Group, Inc. (the "Company") giving effect to
the private placement of Convertible Notes and the acquisition (Acquisition)
with CMRS Systems, Inc. ("CMRS") and 800 SMR Network, Inc. ("800").
The Unaudited Pro Forma Condensed Consolidated Financial Statements are
based on the Historical Consolidated Financial Statements of Chadmoore Wireless
Group, Inc. and the Historical Consolidated Financial Statements of CMRS
Systems, Inc. and 800 SMR Network, Inc. as of and for the period ended March
31, 1996. The accompanying Unaudited Pro Forma Condensed Consolidated Balance
Sheet has been presented on the assumption that the Acquisition occurred on
January 1, 1995. The accompanying Unaudited Pro Forma Condensed Consolidated
Statements of Operations for the twelve months ended December 31, 1995 and for
the three months ended March 31, 1996, have been presented on the assumption
that the Acquisition occurred on January 1, 1995. These Unaudited Pro Forma
Condensed Consolidated Financial Statements and the related notes thereto
should be read in conjunction with the Consolidated Financial Statements of
Chadmoore Wireless Group, Inc. and the notes thereto.
The pro forma adjustments are based upon currently available information
and upon certain assumptions that management believes are reasonable. There
can be no assurance that the actual adjustments will not differ significantly
from the pro forma adjustments reflected herein.
5
<PAGE> 6
<TABLE>
<CAPTION>
CHADMOORE WIRELESS GROUP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1996
CHADMOORE CMRS SYSTEMS,
WIRELESS INC. AND 800 SMR PRO FORMA PRO FORMA
GROUP, INC. NETWORK, INC. ADJUSTMENTS BALANCES
------------- ---------------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Current assets $ 1,276,635 4,416,976 (1)
(3,547,000) (2) $ 2,146,611
Property and equipment, net 1,365,633 1,365,633
FCC licenses, net 1,452,955 1,452,955
Investment in license options 1,321,220 1,321,220
Deposit on licenses 1,682,106 1,682,106
Management contracts - 29,776,901 (2) 29,776,901
Investment in options to acquire
stock of licensee corporations - 3,308,545 (2) 3,308,545
Other noncurrent assets 30,646 30,646
----------- --------------- ---------- -----------
Total assets $ 7,129,195 - 33,955,422 $41,084,617
=========== =============== ========== ===========
Accounts payable $ 320,014 $ 320,014
Accrued interest payable - 500,000 (3) 500,000
Deposit on sale 72,029 72,029
Licenses - Options 413,950 413,950
License option commission payable 524,800 524,800
Convertible Notes, net - 4,578,927 (1),(4) 4,578,927
Current portion of long-term debt 151,250 151,250
Long-term debt 1,057,837 1,057,837
----------- --------------- ---------- -----------
Total liabilities 2,539,880 - 5,078,927 7,618,807
----------- --------------- ---------- -----------
Common stock 9,734 508 (2) 10,242
Additional paid-in capital 12,285,568 2,000 29,537,938 (2)(5) 41,825,506
Stock subscribed 821,848 821,848
Deficit accumulated during the
development stage (8,527,835) (2,000) (661,951) (3),(4)(5) (9,191,786)
----------- --------------- ---------- -----------
Total stockholders' equity 4,589,315 - 28,876,495 33,465,810
----------- --------------- ---------- -----------
Total liabilities and
stockholders' equity $ 7,129,195 - 33,955,422 $41,084,617
=========== =============== ========== ===========
</TABLE>
6
<PAGE> 7
<TABLE>
<CAPTION>
CHADMOORE WIRELESS GROUP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1995
CHADMOORE CMRS SYSTEMS,
WIRELESS INC. AND 800 SMR PRO FORMA PRO FORMA
GROUP, INC. NETWORK, INC. ADJUSTMENTS BALANCES
-------------- ---------------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Revenues $ - - - $ -
Costs and expenses:
Cost of sales - - - -
Salaries, wages and benefits 549,060 - - 549,060
General and administrative 6,729,962 - - 6,729,962
Depreciation and amortization 191,343 - 129,561 (4) 320,904
------------- ---------------- ---------- ---------------
7,470,365 - 129,561 7,599,926
------------- ---------------- ---------- ---------------
Loss from operations (7,470,365) - (129,561) (7,599,926)
------------- ---------------- ---------- ---------------
Other income (expense):
Management fees 246,005 - - 246,005
Interest expense (129,527) - (400,000) (3) (529,527)
Gain on sale of assets 330,643 - - 330,643
Loss on retirement of note payable (32,404) - - (32,404)
Other, net 22,323 - - 22,323
------------- ---------------- ---------- ---------------
437,040 - (400,000) 37,040
------------- ---------------- ---------- ---------------
Net loss $(7,033,325) - (529,561) $(7,562,886)
============= ================ ========== ===============
Weighted-average number of common
shares outstanding 5,459,524 - 508,000 (2) 5,967,524
============= ================ ========== ===============
Net loss per share $ (1.29) - - $ (1.27)
============= ================ ========== ===============
</TABLE>
7
<PAGE> 8
CHADMOORE WIRELESS GROUP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1996
<TABLE>
<CAPTION>
CHADMOORE CMRS SYSTEMS,
WIRELESS INC. AND 800 SMR PRO FORMA PRO FORMA
GROUP, INC. NETWORK, INC. ADJUSTMENTS BALANCES
------------- ---------------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $ 187,824 - - $ 187,824
Costs and expenses:
Cost of sales 48,454 - - 48,454
Salaries, wages and benefits 251,130 - - 251,130
General and administrative 585,347 - - 585,347
Depreciation and amortization 50,333 - 32,390 (4) 82,723
------------ ---------------- ---------- ----------
935,264 - 32,390 967,654
------------ ---------------- ---------- ----------
Loss from operations (747,440) - (32,390) (779,830)
------------ ---------------- ---------- ----------
Other income (expense):
Management fees 100,198 - - 100,198
Interest expense (22,048) - (100,000)(3) (122,048)
Other, net 1,875 - - 1,875
------------ ---------------- ---------- ----------
80,025 - (100,000) (19,975)
------------ ---------------- ---------- ----------
Net loss $ (667,415) - (132,390) $ (799,805)
============ ================ ========== ==========
Weighted-average number of
common shares outstanding 9,105,746 - 508,000 (2) 9,613,746
============ ================ ========== ==========
Net loss per share $ (0.07) - - $ (0.08)
============ ================ ========== ==========
</TABLE>
8
<PAGE> 9
CHADMOORE WIRELESS GROUP, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS
(1) Adjustment to record a private placement conducted in accordance with
Regulation S ("Regulation S") of the Securities Act of 1933, as amended.
Registrant sold $5,000,000 of 8% Convertible Notes due June 5, 1999,
through a Distributor, as defined in Regulation S. The proceeds received
were $4,416,976, net of issuance costs of $583,024. The Convertible Notes
are presented net of unamortized issuance costs.
(2) Adjustment to record purchase of all the issued and outstanding stock of
CMRS Systems, Inc. and 800 SMR Network, Inc. The purchase was in exchange
for $3,547,000 in cash, 508,000 shares of restricted common stock of the
Company (valued at $1,238,250), and options to purchase 8,323,857 shares
of the Company's common stock (valued at $28,300,196). This acquisition
was for combined consideration valued at $33,085,446. Combined
consideration of $29,776,901 was allocated to management contracts held by
CMRS and 800 and combined consideration of $3,308,545 was allocated to
options to acquire the stock of the licensee corporations also held by
CMRS and 800. These allocations were based on management's estimates of
value. The Company will begin amortizing the cost allocated to the
management contracts over the useful lives commencing upon the underlying
Station being placed in service not to extend past June 2006.
(3) Adjustment to record interest accrued on the Convertible Notes referenced
in note (1) above. This has been presented with the assumption that the
Convertible Notes were issued on January 1, 1995.
(4) Adjustment to record amortization of issuance costs of the Convertible
Notes referenced in note (1) above. This has been presented with the
assumption that the Convertible Notes were issued on January 1, 1995 and
issuance costs are amortized on the straight line method, which
approximates the interest method, over the term of the Convertible Notes.
(5) Adjustment to eliminate the equity of CMRS and 800.
9
<PAGE> 10
EXHIBIT INDEX
Exhibit
Number Exhibit Description Page
- ------- ------------------- ----
27.1 Financial Data Schedule for Quarterly Period Ended
March 31, 1996
27.2 Financial Data Schedule for Fiscal Year End 1995
<TABLE> <S> <C>
<ARTICLE> 5
<RESTATED>
<CIK> 0000815755
<NAME> CHADMOORE WIRELESS GROUP, INC.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,146,611
<PP&E> 1,365,633
<DEPRECIATION> 0
<TOTAL-ASSETS> 41,084,617
<CURRENT-LIABILITIES> 6,560,970
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 41,084,617
<SALES> 0
<TOTAL-REVENUES> 187,824
<CGS> 48,454
<TOTAL-COSTS> 967,654
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 122,048
<INCOME-PRETAX> (799,805)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (799,805)
<EPS-PRIMARY> (.08)
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<RESTATED>
<CIK> 0000815755
<NAME> CHADMOORE WIRELESS GROUP, INC.
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 7,599,926
<OTHER-EXPENSES> 32,404
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,562,886)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,562,886)
<EPS-PRIMARY> (1.27)
<EPS-DILUTED> 0
</TABLE>
