SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2
TO
FORM 10-K
AMENDMENT TO APPLICATION OR REPORT
FILED PURSUANT TO SECTION 12, 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
HUDSON HOTELS CORPORATION
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(Exact name of registrant as specified in its charter)
AMENDMENT NO. 2
The undersigned registrant hereby amends the following items of
its Annual Report for the fiscal year ended December 31, 1999 on Form 10-K as
set forth in the pages attached hereto:
Item 10. Directors and Executive Officers of the Company; Compliance with
Section 16(A) of the Exchange Act.
Item 11. Executive Compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K/A
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Year Ended Commission File
December 31, 1999 Number 0-17838
HUDSON HOTELS CORPORATION
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(Exact name of registrant as specified in its charter)
A New York Corporation IRS Employer Identification
No. 16-1312167
Address Telephone Number
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300 Bausch & Lomb Place (716) 454-3400
Rochester, New York 14604
Securities registered pursuant to Section 12(b) of the Act:
Name of Exchange on
Title of Each Class Which Registered
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None None Securities registered pursuant to Section 12(g) of the Act:
Common Stock $.001 Par Value
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(Title of the Class)
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 or any amendment to this
Form 10-K. [X]
The Registrant's revenues for the year ended December 31, 1999: $51,271,369.
The aggregate market value of the Common Stock held by non-affiliates of the
Registrant (computed by reference to the closing price as reported by the
National Quotation Bureau, Inc. as of March 28, 2000) was $3,745,796 (3,866,628
shares at $31/32 per share).
The number of shares outstanding of each of the Registrant's classes of common
stock as of March 28, 2000, is as follows:
6,496,902 Shares of Common Stock
Par Value $.001 per share
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
As of April 26, 2000 the directors and executive officers of the
Company were as follows:
NAME AGE POSITION
E. Anthony Wilson 55 Chairman of the Board of Directors, President,
Chief Executive Officer, and Director
Bruce A. Sahs 54 Senior Vice President
Ralph L. Peek 50 Vice President, Treasurer and Director
Richard C. Fox 53 Director
Alan S. Lockwood 46 Director and Secretary
All directors serve for a term of one year and until their successors
are duly elected. All officers serve at the discretion of the Board of
Directors.
Information regarding the Company's Executive Officers and Directors
is included below.
Name and Title Age Business Experience
E. Anthony Wilson, Chairman of the 55 E. Anthony Wilson serves as the Chairman of the Board, President
Board and Chief Executive Officer and Chief Executive Officer of the Company. Mr. Wilson was a
co-founder of the Company, has served as its Chairman of the
Board since its inception, and as Chief Executive Officer
since January 1993. In 1984 he co-founded Hudson Hotels Corp.
which was acquired by the Company in June 1992. He has over 25
years experience in the hospitality and real estate industries
as a developer, owner and manager. As general partner of
Wilson Enterprises, L.P., a real estate development firm in
Rochester, New York, he has developed a significant amount of
office, warehouse, apartments and related facilities. Mr.
Wilson is an alumnus of the School of Business at Indiana
University. He has served as the Chairperson of the Strong
Memorial Hospital Children's Fund, and has been a Director of
Erdle Perforating Corp., and the Rochester Family of Mutual
Funds.
Bruce A. Sahs, Senior Vice 55 Mr. Sahs is currently serving as the Company's Senior Vice
President President and has held various other capacities throughout
his tenure, commencing in June 1986.
Prior to his employment with Hudson, Mr. Sahs was a partner in
a Rochester based Certified Public Accounting firm, practicing
public accounting since 1967, specializing in hotel and
restaurant auditing controls and management services.
Mr. Sahs received his degree from the Rochester Institute of
Technology, is a Certified Public Accountant, as well as a
Certified Hotel Administrator. He is also a member of the
New York State Society of Certified Public Accountants.
Alan S. Lockwood, Director and 47 Alan S. Lockwood is a partner in the law firm of Boylan,
Secretary Brown, Code, Vigdor & Wilson, LLP of Rochester, New
York, which firm is general counsel to the Company. Mr.
Lockwood specializes in corporate finance and has been
affiliated with Boylan, Brown since 1978. He is a graduate of
Cornell University School of Arts and Sciences and Cornell Law
School. Mr. Lockwood has served as Secretary of the Company
since its inception.
Ralph L. Peek, CPA 51 Ralph L. Peek has been a general partner of Wilson
Vice President and Treasurer Enterprises, L.P. since 1978, and he has been involved with
the Company and has served as a Director since its inception
in 1987. As of December 31, 1996, Mr. Peek was named Vice
President and Treasurer of the Company. Mr. Peek is licensed
as a certified public accountant and received his Bachelor of
Science degree from the Rochester Institute of Technology.
Richard C. Fox 53, Richard C. Fox currently owns and operates 86 Wendy's restaurants
and has been a franchisee of Wendy's for over 20 years. Mr.
Fox's restaurants are located principally in Rochester, New
York, Ft. Wayne and South Bend, Indiana, Erie, Pennsylvania,
Cleveland, Ohio and Buffalo, New York. Mr. Fox is originally
from the Cleveland, Ohio area, is a graduate of Kenyon College
and received his MBA from Harvard Business School in 1971. After
graduating from Harvard, Mr. Fox worked with Price Waterhouse
Co. In 1974, he moved to Columbus, Ohio to become the Financial
Vice President of Wendy's International, Inc. He left Wendy's
International, Inc. to become a Wendy's franchisee in 1976. Mr.
Fox is a member of the Board of Trustees of the Norman Howard
School, the McQuaid Jesuit High School, St. Thomas More Church,
Genesee Country Museum and is a member of the Board of Directors
of Vehicare Corp.
There are no arrangements or understandings between any director or
executive officer and any other persons pursuant to which any such directors or
executive officers was or is to be selected as a director or nominee for
director.
In September 1993, the Company adopted the 1993 Director Stock Option
Plan. The 1993 Director Stock Option Plan originally authorized the issuance of
options to purchase up to 135,000 shares of Common Stock by Directors pursuant
to the formula set forth in the plan; on June 11, 1998, the Shareholders
authorized the issuance of an additional 81,000 shares pursuant thereto.
Pursuant to the 1993 Director Stock Option Plan, each non-employee director is
granted options to purchase 27,000 shares of the Company's stock, at the closing
price on the date of grant, vesting over three years. Options to purchase 54,000
under the 1993 Director Stock Option Plan were outstanding as of December 31,
1999; none of these options have been exercised.
Non-management directors are paid $1,000 for each board meeting
attended and $500 for each committee meeting attended. Directors who are also
full time employees are not paid directors' fees.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT. Based solely upon
its review for Forms 3 and 4 year ended December 31, 1999 and in reliance
upon written representations regarding the necessity to file Form 5, and
except as previously reported, the Company has determined that, to the best
of its knowledge, no officer, director or shareholder required to file such
form has failed to do so timely.
ITEM 11. EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
The following table sets forth the cash compensation for fiscal 1997,
1998 and 1999 to the Company's Chief Executive Officer, officers who earned in
excess of $100,000 and to all executive officers as a group.
SUMMARY COMPENSATION TABLE
NAME OF INDIVIDUAL OR GROUP YEAR CASH COMPENSATION (a) OPTIONS/SARS (#) RESTRICTED
AND PRINCIPAL POSITION STOCK AWARDS
($)
E. Anthony Wilson, CEO 1999 $ 431,327 0 0
1998 300,146 500,000 0
1997 359,892 50,000 0
Michael George, COO 1999 $332,083 0 0
1998 124,819 500,000 $20,000
1997 N/A N/A 0
John M. Sabin, CFO 1999 $254,299 0 $19,688
1998 169,704 500,000 20,000
1997 N/A N/A 0
Ralph L. Peek 1999 $111,903 0 0
1998 89,668 0 0
1997 78,685 10,000 0
Taras Kolcio 1999 $101,650 0 0
1998 87,135 10,000 0
1997 81,324 10,000 0
All Executive Officers as a Group (6 1999 $1,328,491 0 $19,688
in 1999; 6 in 1998; 4 in 1997) 1998 909,960 1,510,000 $40,000
1997 677,327 80,000 0
Note: Columnar information required by Item 402(a)(2) has
been omitted for categories where there has been no
compensation awarded to, earned by, or paid to, any
of the named Executives required to be reported in
the table during fiscal 1997, 1998 and 1999.
(a) In addition, the Company provided Messrs. Wilson, George, Sabin and
Sahs with an automobile. Other than the cash compensation set forth in
the table, none of the Executive Officers individually, nor the
Executive Officers as a group, received non-cash benefits having a
value exceeding $50,000, or 10% of their cash compensation.
(b) In 1999, the Company issued to Mr. Sabin 25,000 shares of common stock
in connection with the termination of Mr. Sabin's employment agreement.
AGGREGATED OPTION EXERCISES IN 1999 AND
1999 YEAR-END OPTION VALUES
(1)
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES VALUE AT FY-END (#) AT FY END
ACQUIRED REALIZED EXERCISABLE EXERCISABLE
NAME ON EXERCISE $ UNEXERCISABLE UNEXERCISABLE
- ----------------------------- --------------------- -------------- ---------------------- ----------------------
E. Anthony Wilson 0 0 450,000/ 0/0
400,000
Ralph L. Peek 0 0 37,000/ 0/0
0
Michael George 0 0 0/ 0/0
0
Bruce A. Sahs 0 0 155,000/ 0/0
0
Taras Kolcio 0 0 28,667/ 0/0
3,333
(1) based upon a stock price of $0.625 the closing price on April 26, 2000.
EMPLOYMENT AGREEMENTS
E. Anthony Wilson, Chairman, President and Chief Executive Officer;
entered into an Employment Agreement with the Company effective May 1, 1998.
The employment agreement was entered into in contemplation that Hudson Hotels
Trust would also employ Mr. Wilson and share the obligations under the
contracts; however, with the failure of Hudson Hotels Trust, the Company is
responsible for all obligations thereunder. The Company also had employment
agreements with John Sabin and Michael George. Mr. Sabin's agreement was
terminated effective September 1, 1999, and Mr. George's agreement was
terminated effective March 1, 2000.
The Employment Agreement has a term of five years, and may be
terminated by the Company for cause (as defined in the Agreements) or upon the
death or disability of the employee. In addition, either the Company or the
Employee can terminate the Agreement if the IPO of Hudson Hotels Trust has not
been completed within one year from the effective date. In the event of the
disability of Employee or termination of the Agreement by the Employee for Good
Reason, the Employee is entitled to receive severance equal to one year's base
salary, payable over two years. Good Reason means (i) material change of
Employee's duties, (ii) material breach by the Company, or (iii) voluntary
termination by Employee within ninety (90) days after a Change in Control. The
severance is also payable in the event of a termination due to the failure to
complete the IPO of Hudson Hotels Trust.
The Employment Agreement sets out the following compensation:
BASE SALARY BONUS POOL STOCK OPTIONS(2)
PARTICIPATION(1)
E. Anthony Wilson $360,000 20% 500,000
For the purposes of the Agreements, "CHANGE IN CONTROL" means
the occurrence of any one of the following events:
(i) (A) any consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or which contemplates that all or
substantially all of the business and/or assets of the Company, shall be
controlled by another corporation or (B) a recapitalization (including an
exchange of the Company's equity securities by the holders thereof), in either
case, in which any "Person" (as such term is used in Section 13 (d) and 14 (d)
(2) of the Exchange Act), becomes the beneficial owner (within the meaning of
Rule 13d 3 promulgated under the Exchange Act) of securities of the Company
representing more than 50% of the combined power of the then outstanding
securities ordinarily having the right to vote in the election of directors;
(ii) any sale, lease, exchange or transfer (in one transaction or series of
related transactions) of all or substantially all of the assets of the Company;
(iii) approval by the shareholders of the Company, as the case may be, of any
plan or proposal for the liquidation or dissolution of the Company, unless such
plan or proposal is abandoned within sixty (60) days following such approval;
(iv) any "Person" (as such term is used in Sections 13 (d) and 14 (d) (2) of
the Exchange Act), shall become the beneficial owner of securities of the
Company, representing more than 50% of the combined voting power of outstanding
securities ordinarily having the right to vote in the election of directors more
than 50% of the then existing directors of either the Company are changed at any
election of the Board of
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(1) Subject to maximum cap of 100% of base salary.
(2) 100,000 vested immediately; the balance vested over time, subject to meeting
certain performance-based criteria.
Directors and such new Board of Directors asks for the resignation of or
terminates the employment of Employee.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee consist of Messrs. Fox and
Lockwood. Each member is a non-employee director and does not have any direct
or indirect material interest in or relationship with the Company outside of
his position as director, except that Mr. Lockwood is a partner in the law
firm that serves as counsel to the Company.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of April 26, 2000, the name and
address of each director and executive officer who owns shares of Common Stock
and each other person known by the Company to own beneficially more than 5% of
the Company's outstanding shares of Common Stock and the number of shares owned
by all directors and executive officers of the Company, as a group, together
with the respective percentage holdings of each such person.
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF
OF BENEFICIAL OWNER(1)(2) BENEFICIAL OWNERSHIP (1)(2) CLASS (1)(2)
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E. Anthony Wilson 1,328,416(3) 15.00%
300 Bausch & Lomb Place
Rochester, New York 14604
Bruce Sahs 155,858(4) 1.87%
300 Bausch & Lomb Place
Rochester, New York 14604
Ralph L. Peek 522,869(5) 6.35%
300 Bausch & Lomb Place
Rochester, New York 14604
Richard C. Fox 152,798(6) 1.87%
20 North Union Street
Rochester, New York 14607
Alan S. Lockwood 34,950(7) 0.43%
7291 Dennisport Lane
Victor, New York 14564
M,L,R&R 1,538,107(8) 18.28%
300 Willowbrook Office Park
Fairport, New York 14550
LIVA & Co., f/b/o 454,900(9) 5.41%
The Q-Tip Trust of
Jennifer L. Ansley
The Chase Manhattan Bank, N.A.
Rochester, New York
Oppenheimer Convertible Securities Fund 1,666,667 20.42%
2 World Trade Center, 34th Floor
New York, New York 10048-0203
All directors and executive officers 2,061,009(1),(2),(3),(4),(5),(6),(7), 22.67%
as a group (5 persons)
(1) Unless otherwise indicated below, each director, officer and 5% shareholder
has sole voting and investment power with respect to all shares
beneficially owned.
(2) Does not give effect to 668,125 shares reserved for issuance upon the
exercise of outstanding warrants issued to non-affiliates.
(3) Includes 22,000 shares in trust to Rebecca S. Wilson, Mr. Wilson's
daughter. Includes 211,875 shares issuable upon exercise of outstanding
warrants of the Company, which shares Mr. Wilson has the right to acquire
within sixty (60) days. Includes 102,007 shares owned by Wilson
Enterprises, L.P. and 31,875 shares issuable upon exercise of non-qualified
stock options granted to Wilson Enterprises, L.P. of which Mr. Wilson is a
general partner, and which option shares Mr. Wilson has the right to
acquire within 60 days. Also includes an aggregate of 450,000 shares
issuable upon exercise of non-qualified stock options granted to E. Anthony
Wilson, which shares Mr. Wilson has the right to acquire within 60 days.
Does not include 300,000 shares issuable upon exercise of the options,
which shares have not yet vested, and 100,000 shares issuable upon exercise
of options, which exercise is conditioned upon the fulfillment of a
material performance standard.
(4) Includes an aggregate of 155,000 shares issuable upon exercise of
non-qualified stock options granted to Mr. Sahs, which shares Mr. Sahs has
the right to receive within 60 days.
(5) Includes 127,094 shares owned beneficially and of record by Patricia L.
Peek, wife of Mr. Peek, ownership of which shares Mr. Peek specifically
disclaims. Includes 18,000 shares owned by Kacey L. Peek, Mr. Peek's
daughter under the Uniform Gifts to Minors Act. Includes 102,007 shares by
Wilson Enterprises, L.P. and 31,875 shares issuable upon exercise of a
non-qualified stock option granted to Wilson Enterprises, L.P. of which
Ralph L. Peek is a general partner, and an aggregate of 37,000 shares
issuable upon exercise of non-qualified stock options granted to Ralph L.
Peek, which shares Mr. Peek has the right to acquire within 60 days.
(6) Includes 43,000 shares owned by Wendy's Restaurants of Rochester, Inc. and
40,000 shares owned by JV Renard & Company, Inc. Includes 18,000 shares
issuable upon exercise of a non-qualified stock option granted to Mr. Fox
as a director of the Company, which shares Mr. Fox has the right to acquire
within sixty (60) days; does not include 9,000 shares issuable upon
exercise of the option, which shares have not yet vested.
(7) Includes 18,000 shares issuable upon exercise of a non-qualified stock
option granted to Mr. Lockwood as a director of the Company, which shares
Mr. Lockwood has the right to acquire within sixty (60) days; does not
include 9,000 shares issuable upon exercise of the option, which shares
have not yet vested. Also includes 6,667 shares issuable upon exercise of a
non-qualified stock option granted to 900 Midtown Investments, an
investment partnership whose sole partners are Robert Brown, John Wilson,
Richard Palumbo, Michael Howard, Howard Konar, Catherine Foerster, Sue
Jacobson and Mr. Lockwood, which shares 900 Midtown Investments has the
right to acquire within 60 days.
(8) Includes 1,000,000 shares owned by M, L, R &R, and 250,000 shares issuable
upon exercise of warrants issued to M, L, R & R, which shares M, L, R & R
has the right to acquire within sixty (60) days. Also includes the
following numbers of shares owned individually by the partners of M, L, R &
R: The Marvin Sands Master Trust - 19,500; Richard E. Sands - 176,216;
Robert S. Sands - 45,847; CWC Partnership-I - 46,544. Does not include any
shares owned by LIVA & Co. f/b/o the Q-Tip Trust of Jennifer L. Ansley
(Sands), the wife of Richard E. Sands, ownership of which shares Mr. Sands
disclaims. Each of the partners of M, L, R & R disclaims ownership of
three-quarters of the shares owned by M, L, R & R, and of all of the shares
owned individually by any other partner of M, L, R & R.
(9) Includes 247,467 shares issuable upon conversion of the Company's Series A
Preferred Stock, which the Trust has the right to receive within 60 days.
Does not include an aggregate of 39,640 shares held by trusts for the
children of Loren G. Ansley, or 47,256 shares reserved for issuance upon
conversion of 47,256 Series A Preferred Shares held by those trusts.
SIGNATURES
Pursuant to the requirements of 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.
HUDSON HOTELS CORPORATION
Dated: April 28, 2000 By: /s/ E. Anthony Wilson
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E. Anthony Wilson
Chief Executive Officer,
President and Director
Dated: April 28, 2000 By: /s/ Ralph L. Peek
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Ralph L. Peek
Vice President and Director
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:
SIGNATURE TITLE DATE
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PRINCIPAL EXECUTIVE OFFICER:
/s/ E. Anthony Wilson Chairman of the Board, April 28, 2000
- ------------------------------ Chief Executive Officer,
E. Anthony Wilson President and Director
PRINCIPAL FINANCIAL OFFICER:
/s/ Ralph L. Peek Vice President, Treasurer April 28, 2000
- ------------------------------ and Director
Ralph L. Peek
/s/ Richard C. Fox Director April 28, 2000
- ------------------------------
Richard C. Fox
/s/ Alan S. Lockwood Secretary and Director April 28, 2000
- ------------------------------
Alan S. Lockwood