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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 2
(MARK ONE)
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<S> <C>
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 For the fiscal year ended December 31, 1999.
OR
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the transition period from __________ to
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Commission file number 1-13002
AQUIS COMMUNICATIONS GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 22-3281446
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1719A ROUTE 10
SUITE 300
PARSIPPANY, NEW JERSEY 07054
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (973) 560-8000
Securities registered under Section 12(b) of the Securities Exchange Act of
1934:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
Common Stock, $0.01 par value Boston Stock Exchange
Securities registered under Section 12(g) of the Securities Exchange Act of
1934:
Title of Each Class
None
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Summary of Amendment
The purpose of this amendment is to adjust certain data provided
in the tables entitled "Summary Compensation Table", "Option Grants in Year
Ended December 31, 1999" and "Aggregated Opinion Exercise in Fiscal Year 1999
and 1999 Fiscal Year-End Option Values" required under Part III, Item 11, of
the Annual Report Form 10-K for Aquis Communications Group, Inc. (the
"Company") for the period ended December 31, 1999, which tables were filed
with the Commission on April 28, 2000 on Amendment No. 1 to the Company's
Annual Report on Form 10-K/A.
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PART III
ITEM 11. EXECUTIVE COMPENSATION
The following tables sets forth a summary of the compensation paid or
accrued for the fiscal years ended December 31, 1999, 1998 and 1997 by the
Company to or for the benefit of each person who served as chief executive
officer during the fiscal year ended December 31, 1999 and the other executive
officers of the Company whose cash compensation exceeded $100,000 (the "Named
Executive Officers"):
SUMMARY COMPENSATION TABLE
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LONG TERM COMPENSATION
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AWARDS PAYOUTS
-------------------------------- -----------------
ANNUAL COMPENSATION RESTRICTED
------------------------- STOCK OPTIONS/ ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS AWARD(S)($) SARS(#) COMPENSATION(1)
- --------------------------- ---- ------ ----- ------------ --------- ----------------
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JOHN X. ADILETTA(2) 1999 $222,922 -0- -0- 430,683 $4,949
Former Chief Executive 1998 N/A N/A N/A N/A N/A
Officer 1997 N/A N/A N/A N/A N/A
D. BRIAN PLUNKETT 1999 $141,667 -0- -0- 316,762 -0-
Chief Financial Officer 1998 N/A N/A N/A N/A N/A
1997 N/A N/A N/A N/A N/A
RICHARD J. GIACCHI(3) 1999 $129,647 -0- -0- -0- -0-
Former President and Chief 1998 $171,000 -0- -0- -0- -0-
Executive Officer 1997 $143,000 -0- -0- -0- -0-
BRIAN M. BOBECK 1999 $111,458 -0- -0- 53,500 $3,129
Vice President - Engineering 1998 N/A N/A N/A N/A N/A
1997 N/A N/A N/A N/A N/A
DAVID S. LAIBLE 1999 $111,577 $31,000 -0- 53,500 $3,977
Vice President - Sales 1998 N/A N/A N/A N/A N/A
1997 N/A N/A N/A N/A -0-
LYNN SZAFRAN 1999 $ 92,500 $15,511 -0- 53,500 $2,551
Vice President - Operations 1998 N/A N/A N/A N/A N/A
1997 N/A N/A N/A) N/A N/A
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(1) Represents matching contributors to the Company's 401(k) plan.
(2) Mr. Adiletta served as President and Chief Executive Officer from
March 31, 1999 until November, 1999. Mr. Adiletta brought an
arbitration proceeding against the Company seeking additional payments
under his employment agreement. The Company and Mr. Adiletta have
resolved all issues related to Mr. Adiletta's claim pursuant to a
Settlement Agreement dated as of April 4, 2000.
(3) Mr.Giacchi served as President and Chief Executive Officer until
March 31, 1999. Does not include options to purchase 50,000 shares of
Common Stock granted to Mr. Giacchi in settlement of claims under his
employment agreement subsequent to his resignation as an officer of the
Company.
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OPTION GRANTS IN YEAR ENDED DECEMBER 31, 1999
The following stock options were granted to the Named Executive Officers
during the year ended December 31, 1999.
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# of Securities # of Total
Underlying Options Granted Grant Date
Options Granted to Employees in Exercise Price Present Value
Name (#) Fiscal Year (%) Per Share ($/SH) Expiration Date ($)(4)
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John X. Adiletta(5) 355,683 33.6% 1.125 January 4, 2009 364,200
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75,000 7.1% 1.375 August 31, 2009 93,375
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D. Brian Plunkett 266,762 25.2% 1.125 January 4, 2009 273,150
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50,000 4.7% 1.375 August 31, 2009 62,250
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Richard J. Giacchi - - - - -
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Brian M. Bobeck 53,500 5% 1.00 May 4, 2009 48,850
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David S. Laible 53,500 5% 1.00 May 4, 2009 48,850
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Lynn Szafran 53,500 5% 1.00 May 4, 2009 48,850
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(4) The valuation method used was the Black-Scholes option pricing model.
The calculations are based on the following factors as of the grant date:
(i) the price of the stock on the date of grant, (ii) a risk-free interest
rate ranging from 4.57% to 5.81% based on grant dates, (iii) no dividend
yield, (iv) volatility of 100%, (v) a weighted average expected life of the
options of nine to ten years, and (vi) no risk of forfeiture.
(5) The Options granted to Mr. Adiletta terminated upon the end of his
service as President and Chief Executive Officer in November, 1999.
Pursuant to a Settlement Agreement between the Company and Mr. Adiletta
dated April 4, 2000, 55,000 of those options were reinstated at an
exercise price of $1.12 per share.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1999 AND 1999 FISCAL YEAR-END OPTION
VALUES
The table below sets forth information relating to the exercise of options
during the year ended December 31, 1999 by each Named Executive Officer and the
year-end value of unexercised options.
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Value of Unexercised
# of Securities Underlying in-the-money Options at
Unexercised Options at Fiscal Year End ($)
Shares Acquired Fiscal Year End Exercisable/
Name on Exercise (#) Value Realized ($) (#) Exercisable/ Unexercisable
Unexercisable
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John X. Adiletta None None 0/55,000 0/292,050
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D. Brian Plunkett None None 0/316,762 0/1,669,256
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Richard J. Giacchi None None - -
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Brian M. Bobeck None None 0/53,500 0/290,773
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David S. Laible None None 0/53,500 0/290,773
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Lynn Szafran None None 0/53,500 0/290,773
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EMPLOYMENT ARRANGEMENTS
Effective as of January 4, 2000, the Company entered into an employment
agreement with Nick T. Catania to employ him as President and Chief Executive
Officer of the Company, with annual base compensation of $200,000. In addition,
Mr. Catania was granted ten-year stock options to purchase 900,000 shares of the
Company's common stock, which vest over three years. Of the options, 300,000 are
exercisable at $0.75 per share, 300,000 will be exercisable at the closing price
on January 2, 2001, and the remainder will be exercisable at the closing price
on January 2, 2002. In the event of a change in control in the Company, all
options will immediately vest and will be exercisable at the average exercise
prices of all previously vested options at the time of the change in control.
The employment agreement is for a one-year term, with successive renewal periods
of one-year unless terminated by either the Company or Mr. Catania at least 60
days prior to the scheduled expiration of the agreement.
D. Brian Plunkett, the Company's Chief Financial Officer, entered into
an employment Agreement with BAP Acquisition Corp. in November 1998, pursuant
to which he receives a base salary of $125,000 (subject to a minimum upward
adjustment of 5% annually). Mr. Plunkett is also eligible for such bonus
compensation as may be determined by the Board of Directors from time to
time. The employment agreement terminates on December 31, 2001. In
conjunction with the execution of the Employment Agreement, Mr. Plunkett was
awarded options to purchase BAP Acquisition Corp. common stock, which
options, following the merger of BAP Acquisition Corp. into a subsidiary
of Paging Partners Inc. in March 1999, now represent the right to purchase
266,762 shares of the Company's common stock. The options vest over a
three-year period from the date of the employment agreement.
Effective as of June 15, 1999, Aquis Communications, Inc., a
wholly-owned subsidiary of the Company, entered into an employment agreement
with John Hobko to employ Mr. Hobko as Executive Vice President - Sales of
Aquis Wireless Communications, Inc. with an annual base salary of $150,000.
In addition, Mr. Hobko entered into a Stock Option and Restriction Agreement
pursuant to which he was granted ten-year options to purchase 53,500 shares
of the Company's common stock, which options vest over three years. The
employment agreement is for a three-year term.
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COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION IN COMPENSATION DECISIONS
The Company's Compensation Committee consists of Messers. Frieling and
Salerno, each of which is an independent director of the Company. Except as set
forth below, neither of these individuals had an "interlock" relationship to
report during 1999. During 1999, the Company paid investment banking fees
totaling $316,061 to Deerfield Capital, L.P. and Deerfield Partners, LLC. Mr.
Frieling serves as managing director of Deerfield Partners, LLC, which in turn
serves as general partner of Deerfield Capital, L.P.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires the Company's officers and directors, and persons who
own more than ten percent (10%) of a class of the Company's equity securities
registered under the Exchange Act to file reports of ownership on Form 3 and
changes in ownership on Form 4 or 5 with the Securities and Exchange Commission
(the "SEC"). Such officers, directors and ten percent (10%) stockholders are
also required by SEC rules to furnish the Company with copies of all forms that
they file pursuant to Section 16(a). Based solely on its review of copies of
forms filed pursuant to Section 16(a) of the Exchange Act, and written
representations from certain reporting persons, the Company believes that all
Section 16(a) filing requirements during the fiscal year ended December 31, 1999
applicable to the Company's officers, directors and ten percent (10%)
stockholders were complied with in a timely fashion them, except for certain
reports, which include: Messrs. Egan, Frieling and Salerno failed to timely file
a Form 4 and a Form 5 in connection with the grant of stock and stock options to
them in December 1999.
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SIGNATURES
Pursuant to the requirements of Section 13 and 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Amendment No. 1 to its
Annual Report on Form 10-K to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: May 1, 2000
AQUIS COMMUNICATIONS GROUP, INC.
(Registrant)
By: /s/ NICK T. CATANIA
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Nick T. Catania, President
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