##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-K/A
  (Mark One)þ
    
    Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for the fiscal year ended December 31, 2007
  o
    
    Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
  180 CONNECT INC.
 (Exact Name of Registrant as Specified in its Charter)
 Delaware(State of Incorporation)
    
    20-2650200(IRS Employer Identification Number)
 (Address of principal executive offices)
 
 SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE EXCHANGE ACT:
 SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
 Common Stock, par value $0.0001 per share
Units, each consisting of one share of Common Stock and two Warrants
Warrants, exercisable for Common Stock at an exercise price of $5.00 per share
 o þ
 o þ
 þ o
 þ
   Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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##### Table of Contents



EXPLANATORY NOTE




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##### 



TABLE OF CONTENTS
  
 Item No.
    
    
    
    PagePART IIIItem 10.
    
    Directors, Executive Officers and Corporate Governance
    
    
    1Item 11.
    
    Executive Compensation
    
    
    4Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
    
    
    9Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    12Item 14.
    
    Principal Accountant Fees and Services
    
    
    12PART IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    14Signatures
    
    
    15EX-31.3 Section 302 Certification of CEOEX-31.4 Section 302 Certification of CFO




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##### Table of Contents



PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance
 Directors, Executive Officers
 Name
    
    Age
    
    Position/OfficeLawrence J. Askowitz
    
    
    42
    
    
    DirectorHoward S. Balter
    
    
    46
    
    
    DirectorMark Burel
    
    
    50
    
    
    Chief Operating OfficerThomas Calo
    
    
    60
    
    
    DirectorPeter Giacalone
    
    
    48
    
    
    President, Chief Executive Officer and DirectorDavid Hallmen
    
    
    46
    
    
    DirectorM. Brian McCarthy
    
    
    56
    
    
    Chairman of the BoardJiri Modry
    
    
    55
    
    
    DirectorByron Osing
    
    
    44
    
    
    DirectorIlan M. Slasky
    
    
    37
    
    
    DirectorSteven Westberg
    
    
    53
    
    
    Chief Financial Officer
 Lawrence J. Askowitz
 Howard S. Balter
 Mark Burel
 Thomas Calo
 1




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##### Table of Contents



Peter Giacalone
 David Hallmen
 M. Brian McCarthy
 Jiri Modry
 Byron Osing
 Ilan M. Slasky
 Steven Westberg
 2




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##### Table of Contents



Classified Board
  Year
    
    DirectorAnnual Meeting in 2008
    
    Messrs. Askowitz, Modry and OsingAnnual Meeting in 2009
    
    Messrs. Hallmen, Calo and SlaskyAnnual Meeting in 2010
    
    Messrs. Balter, Giacalone and McCarthy
 Audit Committee Financial Expert
  Nominating and Governance Committee
  Compensation Committee
  Code of Ethics
  Compliance with Section 16(a) of the Exchange Act
  3




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##### Table of Contents



Item 11. Executive Compensation
 Summary Compensation Table
  NonqualifiedNonequity
    
    
    deferredStock
    
    
    Option
    
    
    incentive plan
    
    
    compensation
    
    
    All otherName and principal
    
    
    
    
    
    Salary
    
    
    Bonus
    
    
    awards(2)
    
    
    awards(3)
    
    
    compensation
    
    
    earnings
    
    
    compensation(4)
    
    
    Totalposition
    
    Year
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)Peter Giacalone,
    
    
    2007
    
    
    
    450,000
    
    
    
    775,000
    
    
    
    192,066
    
    
    
    142,241
    
    
    
    
    
    
    
    
    
    
    
    14,400
    
    
    
    1,573,707Chief Executive
Officer
    
    
    2006
    
    
    
    450,000
    
    
    
    150,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,400
    
    
    
    614,400Howard Balter,
    
    
    2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,341
    
    
    
    17,341Former Chairman of
the Board and Chief
Executive Officer,
current Director(1)
    
    
    2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    M. Brian McCarthy,
    
    
    2007
    
    
    
    480,000
    
    
    
    2,075,000
    
    
    
    176,493
    
    
    
    133,961
    
    
    
    
    
    
    
    
    
    
    
    14,400
    
    
    
    2,879,854Chairman of the Board
    
    
    2006
    
    
    
    386,000
    
    
    
    560,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32,229
    
    
    
    978,229Steven Westberg,
    
    
    2007
    
    
    
    275,000
    
    
    
    50,000
    
    
    
    10,833
    
    
    
    14,199
    
    
    
    
    
    
    
    
    
    
    
    62,664
    
    
    
    412,696Chief Financial
Officer
    
    
    2006
    
    
    
    21,154
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,154
 
 (1)
    
    Mr. Balter resigned as Chairman and Chief Executive Officer of the Company effective as of
August 24, 2007.(2)
    
    This column represents the dollar amount recognized for financial statement reporting purposes
with respect to each year for the fair value of shares of restricted stock granted in such year as
well as prior fiscal years, determined in accordance with SFAS 123R. Pursuant to SEC rules, the
amounts shown exclude the impact of estimated forfeitures related to service-based vesting
conditions. For information regarding the assumptions made in the valuation, refer to Note 16,
Stock-Based Compensation and Changes in Shareholders Equity, in the consolidated financial
statements in the Form 10-K. These amounts reflect our accounting expense for these awards, as
determined in accordance with SFAS 123R, and do not correspond to the actual value that may be
realized by the named executive officers.(3)
    
    This column represents the dollar amount recognized for financial statement reporting purposes
with respect to each year for the fair value of stock options and stock appreciation rights
(SARs) granted to each of the named executive officers, in such years as well as prior fiscal
years, as applicable, determined in accordance with SFAS 123R. Pursuant to SEC rules, the amounts
shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For
information regarding the assumptions made in the valuation, refer to Note 16, Stock-Based
Compensation and Changes in Shareholders Equity, in the consolidated financial statements in the
Form 10-K. These amounts reflect our accounting expense for these awards, as determined in
accordance with SFAS 123R, and do not correspond to the actual value that may be realized by the
named executive officers.(4)
    
    All other compensation consists of auto allowances of $14,400 for Mr. Giacalone in 2007 and
2006, respectively; director fees of $15,850 and medical insurance premium reimbursement of $1,491
for Mr. Balter in 2007; auto allowances of $14,400 and $14,400 for Mr. McCarthy in 2007 and 2006,
respectively, and $17,829 for director fees for Mr. McCarthy in 2006; and auto allowance of $4,708
and relocation expense reimbursement for Mr. Westberg of $57,956 in 2007. 4




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Employment Agreements
  Agreement with Mr. Giacalone
    Agreement with Mr. McCarthy
  5




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##### Table of Contents



Agreement with Mr. Westberg
    6




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Outstanding Equity Awards at Fiscal Year-End
 Option awards
    
    
    Stock awardsEquityincentiveEquity
    
    
    planEquity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    incentive
    
    
    awards:incentive
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    plan
    
    
    Market orplan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    awards:
    
    
    payoutawards:
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Market
    
    
    Number of
    
    
    value ofNumber of
    
    
    Number of
    
    
    Number of
    
    
    
    
    
    
    
    
    
    
    Number of
    
    
    value of
    
    
    unearned
    
    
    unearnedsecurities
    
    
    securities
    
    
    securities
    
    
    
    
    
    
    
    
    
    
    shares or
    
    
    shares of
    
    
    shares,
    
    
    shares,underlying
    
    
    underlying
    
    
    underlying
    
    
    
    
    
    
    
    
    
    
    units of
    
    
    units of
    
    
    units or
    
    
    units orunexercised
    
    
    unexercised
    
    
    unexercised
    
    
    Option
    
    
    
    
    
    
    stock that
    
    
    stock that
    
    
    other rights
    
    
    other rightsoptions
    
    
    options
    
    
    unearned
    
    
    exercise
    
    
    
    
    
    
    have not
    
    
    have not
    
    
    that have
    
    
    that have(#)
    
    
    (#)
    
    
    options
    
    
    price
    
    
    Option
    
    
    vested
    
    
    vested
    
    
    not vested
    
    
    not vestedName
    
    exercisable
    
    
    unexercisable
    
    
    (#)
    
    
    ($)
    
    
    expiration date
    
    
    (#)
    
    
    ($)(6)
    
    
    (#)
    
    
    ($)Peter Giacalone
    
    
    15,000
    
    
    
    45,000
    (1)
    
    
    
    
    
    $
    2.50
    
    
    
    12/6/11
    
    
    
    185,000
    (4)
    
    $
    259,000
    
    
    
    
    
    
    
    
    
    
    
    185,000
    (2)
    
    
    
    
    
    $
    3.25
    
    
    
    9/5/14Howard Balter
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    M. Brian McCarthy
    
    
    15,000
    
    
    
    45,000
    (1)
    
    
    
    
    
    $
    2.50
    
    
    
    12/6/11
    
    
    
    170,000
    (4)
    
    $
    238,000
    
    
    
    
    
    
    
    
    
    
    
    170,000
    (2)
    
    
    
    
    
    $
    3.25
    
    
    
    9/5/14Steven Westberg
    
    
    2,000
    
    
    
    5,999
    (1)
    
    
    
    
    
    $
    2.50
    
    
    
    12/6/11
    
    
    
    40,000
    (5)
    
    $
    56,000
    
    
    
    
    
    
    
    
    
    
    
    60,000
    (3)
    
    
    
    
    
    $
    3.25
    
    
    
    9/5/14
 
 (1)
    
    These SARs vest and become exercisable in equal installments on December 6, 2008, 2009 and
2010.(2)
    
    These options vest and become exercisable in equal installments on March 1, 2008 and September
5, 2008, 2009 and 2010.(3)
    
    These options vest and become exercisable in equal installments on September 5, 2008, 2009,
2010 and 2011.(4)
    
    These restricted stock units vest and become exercisable in equal installments on March 1,
2008 and September 5, 2008, 2009 and 2010.(5)
    
    These restricted stock units vest and become exercisable in equal installments on September 5,
2008, 2009, 2010 and 2011.(6)
    
    Based on the closing price on December 31, 2007 of $1.40 per share of common stock. 7




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Director Compensation Table
  NonqualifiedNon-equity
    
    
    deferredFees earned or
    
    
    Stock
    
    
    Option
    
    
    incentive plan
    
    
    compensation
    
    
    All otherpaid in cash
    
    
    awards
    
    
    awards
    
    
    compensation
    
    
    earnings
    
    
    compensation
    
    
    TotalName
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($) (1)
    
    
    ($)Lawrence J. Askowitz
    
    
    28,045
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,045Thomas Joseph Calo
    
    
    13,250
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,250David Hallmen
    
    
    55,375
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,375Jiri Modry
    
    
    20,005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,005Byron Osing
    
    
    62,750
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    62,750Ilan M. Slasky
    
    
    15,850
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,491
    
    
    
    17,341Joel Meltzner
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Shlomo Kalish
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    All other compensation for Mr. Slasky consists of medical insurance premium reimbursement
of $1,491. 8




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##### Table of Contents



Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
 Equity Compensation Plan Information
  Equity Compensation Plan InformationNumber of securitiesremaining available forfuture issuance underNumber of securities to
    
    
    Weighted-average
    
    
    equity compensationbe issued upon exercise
    
    
    exercise price of
    
    
    plans (excludingof outstanding options,
    
    
    outstanding options,
    
    
    securities reflected inwarrants and rights
    
    
    warrants and rights
    
    
    column (a))Plan category
    
    (a)
    
    
    (b)
    
    
    (c)Equity compensation
plans approved by
security holders(1)
    
    
    2,376,650
    
    
    $
    2.10
    
    
    
    20,000Equity compensation
plans not approved
by security holders
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    2,376,650
    
    
    $
    2.10
    
    
    
    20,000
 
 (1)
    
    Consists of 1,980,000 restricted stock units and options issued pursuant to the Companys 2007
Long Term Incentive Plan, 167,999 SARs issued in 2006 and options issued in connection with our
2003 acquisition of a minority interest in Cable Play Inc. For further details regarding our
equity compensation plans, see to Note 16, Stock-Based Compensation and Changes in Shareholders
Equity, in the consolidated financial statements in the Form 10-K. Security Ownership of Certain Beneficial Owners and Management
  
    
    each person known by us to be the beneficial owner of more than 5% of our outstanding shares
of common stock;
    
    each of our directors and named executive officers; and
    
    all of our executive officers and directors as a group.
  9




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##### Table of Contents



Name and Address of
    
    Amount and Nature ofBeneficial Owner
    
    Beneficial Ownership
    
    
    Percent of ClassHoward S. Balter(1)
    
    
    3,631,511
    (2)
    
    
    14.3
    %Ilan M. Slasky(1)
    
    
    2,482,782
    (3)
    
    
    9.9
    %Lawrence J. Askowitz(1)
    
    
    45,000
    
    
    
    *M. Brian McCarthy(1)
    
    
    157,500
    (4)
    
    
    *Peter Giacalone(1)
    
    
    302,500
    (5)
    
    
    *David Hallmen(1)
    
    
    125,522
    (6)
    
    
    *Byron Osing(1)
    
    
    1,225,000
    (7)
    
    
    5.1
    %Jiri Modry(1)
    
    
    0
    
    
    
    *Thomas Calo(1)
    
    
    0
    
    
    
    *Steven Westberg(1)
    
    
    2,000
    (8)
    
    
    *Creative
Vistas Inc.
2100 Forbes Street, Unit 8-10, Whitby, Ontario L1N 9T3
Canada
    
    
    3,124,407
    (9)
    
    
    12.9
    %Magnetar Capital Partners LP
Supernova Management LLC
Alec N. Litowitz
c/o Magnetar Capital LLC
1603 Orrington Ave.
Evanston, Illinois 60201
    
    
    1,300,688
    (10)
    
    
    5.4
    %Quaker Capital Management
Corporation
401 Wood Street, Suite 1300
Pittsburgh, PA 15222
    
    
    1,328,360
    (11)
    
    
    5.6
    %Millenco, LLC
666 Fifth Avenue, 8th Floor
New York, New York 10103
    
    
    1,969,304
    (12)
    
    
    8.3
    %All directors and executive
officers as a group (10
individuals)
    
    
    7,971,815
    (13)
    
    
    29.4
    %
 
 *
    
    Less than 1%.(1)
    
    The business address is c/o 180 Connect Inc., 6501 E. Belleview Avenue, Englewood, Colorado
80111.(2)
    
    Includes (i) 1,005,829 shares held by Mr. Balter;
(ii) 1,729,602 shares which may be purchased upon exercise of warrants that were
exercisable as of April 18, 2008, or within 60 days of such
date; (iii) 300,000 shares held by H.
Balter 2007 Associates, LLC, of which Mr. Balter is sole
non-managing member; (iv) 200,000 shares
held by The Howard S. Balter 2007 Grantor Retained Annuity Trust II;
(v) 95,000 shares held by 180 Connect Disposition LLC; (vi) 222,000 shares held by
Myrna Weinberger TTEE, Balter Family Trust U/A DTD 11/17/1997;
(vii) 24,360 shares which may be sold upon exercise of options held by certain third parties that were exercisable as of April
18, 2008, or within 60 days of such date; and (viii) 1,760
shares which may be sold upon
exercise of options that were exercisable as of April 18, 2008, or within 60 days of such date,
which Mr. Balter has agreed to sell to certain third parties. Mr. Balter disclaims beneficial
ownership of the shares held by Myrna Weinberger TTEE, Balter Family Trust U/A DTD 11/17/1997.(3)
    
    Includes (i) 676,500 shares held by Mr. Slasky; (ii) 300,000 shares held by the Ilan Slasky
2007 Grantor Retained Annuity Trust (the Slasky GRAT); (iii) 216,484 shares held jointly with
Reva Slasky; (iv) 1,264,798 shares held jointly with Reva Slasky which may be purchased upon
exercise of warrants that were exercisable as of April 18, 2008,
or within 60 days of such date; and (v) 25,000 shares which
may be sold upon exercise of options held by certain third parties
that were exercisable as of April 18, 2008, or within 60 days of
such date.(4)
    
    Includes (i) 42,500 shares which may be purchased upon exercise of options that were
exercisable as of April 18, 2008, or within 60 days of such date; (ii) 42,500 shares which may be
purchased upon exercise of restricted stock units that were exercisable as of April 18, 2008, or
within 60 days of such date; and (iii) 15,000 shares which may be purchased upon exercise of SARs
that were exercisable as of April 18, 2008, or within 60 days of such date.(5)
    
    Includes (i) 46,250 shares which may be purchased upon exercise of options that were
exercisable as of April 18, 2008, or within 60 days of such date; (ii) 46,250 shares which may be
purchased upon exercise of restricted stock units that were exercisable as of April 18, 2008, or
within 60 days of such date; and (iii) 15,000 shares which may be purchased upon exercise of SARs
that were exercisable as of April 18, 2008, or within 60 days of such date. 10




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##### Table of Contents



(6)
    
    Includes 51,657 shares which may be purchased upon exercise of options that were exercisable as
of April 18, 2008, or within 60 days of such date.(7)
    
    Includes 85,233 shares which may be purchased upon exercise of options that were exercisable as
of April 18, 2008, or within 60 days of such date.(8)
    
    Includes 2,000 shares which may be purchased upon exercise of SARs that were exercisable as of
April 18, 2008, or within 60 days of such date.(9)
    
    Includes 450,000 shares issuable upon exercise of outstanding warrants within 60 days of
April18, 2008.(10)
    
    Derived from a jointly-filed Schedule 13D, dated April 18, 2008, filed by Magnetar Investment
Management, LLC, a Delaware limited liability company, Magnetar Capital Partners LP, a Delaware
limited partnership (Magnetar Capital Partners), Supernova Management LLC, a Delaware limited
liability company (Supernova Management), and Mr. Alex N. Litowitz (Mr. Litowitz). As of April
18, 2008, each of Magnetar Capital Partners, Supernova Management, and Mr. Litowitz may be deemed
to be the beneficial owner of 1,300,688 shares of common stock, including 266,393 shares of common
stock issuable upon exercise of warrants by Magnetar Capital Master Fund, Ltd.(11)
    
    Derived from a jointly-filed Schedule 13D, dated August 24, 2007, filed by Quaker Capital
Management Corporation, a Pennsylania corporation (Quaker Capital Management), Quaker Capital
Partners I, LP, a Delaware limited partnership, Quaker Capital Partners II, LP, a Delaware limited
partnership, Quaker Premier, LP, a Delaware limited partnership, Quaker Premier II, LP, a Delaware
limited partnership, and Mr. Mark G. Schoeppner. As of August 24, 2007, Quaker Capital Management
may be deemed to be the beneficial owner of 1,328,360 shares of common stock.(12)
    
    Derived from a jointly-filed Schedule 13D, dated August 24, 2007, filed by Millenco, LLC, a
Delaware limited liability company (formerly Millenco, L.P., a Delaware limited partnership)
(Millenco), Millennium Management, LLC, a Delaware limited liability company (Millennium
Management), and Israel A. Englander (Mr. Englander). As of August 24, 2007, each of Millenco,
Millennium Management, and Mr. Englander may be deemed to be the beneficial owner of 1,969,304
warrants to purchase shares of common stock.(13)
    
    Includes (i) 2,994,400 shares which may be purchased upon exercise of warrants that were
exercisable as of April 18, 2008, or within 60 days of such
date; (ii) 276,760 shares which may be
purchased upon exercise of options that were exercisable as of April 18, 2008, or within 60 days of
such date; (iii) 88,750 shares which may be purchased upon exercise of restricted stock units that
were exercisable as of April 18, 2008, or within 60 days of such date; and (iv) 32,000 shares which
may be purchased upon exercise of SARs that were exercisable as of April 18, 2008, or within 60
days of such date. 11




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##### Table of Contents



Item 13. Certain Relationships and Related Transactions, and Director Independence
 Transactions with Related Persons
    Loans
  Director Independence
  
 Item 14. Principal Accountant Fee and Services
  Year ended December 31,Fee Category
    
    2007
    
    
    2006Audit Fees
    
    $
    1,167,126
    
    
    $
    66,000Audit-Related Fees
    
    
    
    
    
    
    Tax Fees
    
    
    41,674
    
    
    
    All Other Fees
    
    
    782,023
    
    
    
    Total Fees
    
    $
    1,990,824
    
    
    $
    66,000
 12




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##### Table of Contents



Audit Fees.
 Audit-Related Fees.
 Tax Fees.
 All Other Fees.
 Policy on Audit Committee Pre-Approval of Audit and Permissible Non-audit Services of Independent
Auditors
  13




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##### Table of Contents



PART IV
 
 Item 15. Exhibits and Financial Statements Schedules
  31.3
    
    Section 302 Certification from Chief Executive Officer31.4
    
    Section 302 Certification from Chief Financial Officer
 14




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##### Table of Contents



SIGNATURES
  Date: April 29, 2008
    By:
    /s/ Steven WestbergSteven WestbergChief Financial Officer 15