-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MkQXmz2Fyqwl9F+GuLuU5RINcivTJ6zzX8EhHsWrKps7oE4h2CHxLCgk7vo5uNX9 lNKOMuEjU46ryaF69L/cwg== 0000725876-00-000004.txt : 20000426 0000725876-00-000004.hdr.sgml : 20000426 ACCESSION NUMBER: 0000725876-00-000004 CONFORMED SUBMISSION TYPE: 10KSB/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000425 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GATEWAY INDUSTRIES INC /DE/ CENTRAL INDEX KEY: 0000725876 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER COMMUNICATIONS EQUIPMENT [3576] IRS NUMBER: 330637631 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10KSB/A SEC ACT: SEC FILE NUMBER: 000-13803 FILM NUMBER: 608280 BUSINESS ADDRESS: STREET 1: 150 EAST 52ND ST 21ST FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 8774312942 MAIL ADDRESS: STREET 1: 150 EAST 52ND ST 21ST FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 FORMER COMPANY: FORMER CONFORMED NAME: GATEWAY COMMUNICATIONS INC DATE OF NAME CHANGE: 19920703 10KSB/A 1 GATEWAY INDUSTRIES, INC. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-KSB/A [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 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 0-13803 GATEWAY INDUSTRIES, INC. (Name of small business issuer in its charter) Delaware 33-0637631 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 150 East 52nd Street New York, New York 10022 (Address of principal executive offices including zip code) Issuer's telephone number, including area code: 877-431-2942 Securities registered under Section 12(b) of the Act: NONE. Securities registered under Section 12(g) of the Exchange Act: Common Stock, $.001 par value Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 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 [ ] Check if no disclosure of delinquent filers in response to Item 405 of Regulation S-B is contained in this form, and no disclosure will 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-KSB or any amendments to this Form 10-KSB. [X] Issuer has had no revenues in its most recent fiscal year. The aggregate market value of voting stock held by non-affiliates of the Issuer at March 31, 2000 was approximately $8,749,420 based on the average high/low ask/bid price of $3.6875 for such stock on that date. As of March 31, 2000, the Registrant had 4,192,024 shares of common stock, $.001 par value per share, outstanding. Transitional small business disclosure format: Yes [ ] No [X] DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant's definitive Proxy Statement to be used in connection with its Annual Meeting of Stockholders to be held on June 30, 2000, are incorporated by reference into Part III of this report. PART III ITEM 9. Directors and Executive Officers The directors and executive officers of the Company are as follows; NAME AGE POSITION ---- --- -------- Warren G. Lichtenstein 34 Chairman of the Board of 150 East 52nd Street Directors, and Chief Executive Officer New York, NY 10022 Jack Howard 38 Acting President 2927 Montecito Avenue Director Santa Rosa, CA 95404 Ronald W. Hayes 62 Director 810 Saturn Street Suite 16-432 Jupiter, FL 33477-4398 Warren G. Lichtenstein was appointed a director of the Company in May 1994 and became Chairman of the Board in October 1995. Mr. Lichtenstein has been the Chairman of the Board, Secretary and the Managing Member of Steel Partners, L.L.C. ("Steel LLC"), the general partner of Steel Partners II, L.P. since January 1, 1996. Prior to such time, Mr. Lichtenstein was the Chairman and a director of Steel Partners, Ltd., the general partner of Steel Partners Associates, L.P., which was the general partner of Steel Partners II, L.P. since 1993 and prior to January 1, 1996. Mr. Lichtenstein has also been President and Chief Executive Officer of WebFinancial Corporation since December 1997. Mr. Lichtenstein served as President and director of Marsel Mirror and Glass Products, Inc. ("Marsel"), a subsidiary of the Company, from its inception in July 1995 until shortly after the acquisition of its business by the Company in November 1995, and continued as a director until its disposition in December 1996. Marsel filed for protection under Chapter 11 of the United States Bankruptcy Code shortly following the Company's disposition of its interest in Marsel. Mr. Lichtenstein is a director of the following publicly held companies: WebFinancial Corporation, PLM International, Inc., Tech-Sym Corporation, CPX Corp., ECC International Corp. and Saratoga Beverage Group, Inc. Ronald W. Hayes was appointed a director of the company in May 1993. Mr. Hayes is the owner of Lincoln Consultors & Investors, Inc., an investing and consulting firm, for over five years. Jack L. Howard was appointed Acting President and Chief Financial Officer of the Company in September 1994, and was elected director of the Company in May 1994. Mr. Howard has been a registered principal of Mutual Securities, Inc., a stock brokerage firm since prior to 1993. Mr. Howard has also been the Vice President, Secretary, and Treasurer of WebFinancial Corporation since December 1997. Mr. Howard is a director of the following publicly held companies: WebFinancial Corporation and Pubco Corporation. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Securities Exchange Act of 1934 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 with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Officers, directors and greater-than 10% shareholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. The Company believes that all such reports required to be filed during the fiscal year ended December 31, 1999 ("Fiscal 1999"), were filed on a timely basis. The Company 's belief is based solely on its review of Forms 3, 4, and 5 and amendments thereto furnished to the Company during, and with respect to, Fiscal 1999 by persons known to be subject to Section 16 of the Exchange Act. To the Company's knowledge, based solely on its review of the copies of such reports furnished to the Company, during its fiscal year ended December 31, 1999, all Section 16(a) filing requirements applicable to its officers, directors and greater-than 10% beneficial owners were satisfied. ITEM 10. Executive Compensation The following table sets forth all compensation paid to the Company's Acting President during its fiscal years ended December 31, 1999, 1998 and 1997 (the "Named Executive Officers"). No other executive officer received annual compensation at the rate of $100,000 or more during the fiscal year. SUMMARY COMPENSATION TABLE ANNUAL COMPENSATION
Annual Long-term Compensation Compensation ------------ ------------ Securities Underlying Name and Principal Position Fiscal Year Bonus($) Options - --------------------------- ----------- ------- ------- Warren G. Lichtenstein 1999 0 50,000 Chairman of the Board 1998 0 and Chief Executive Officer 1997 0 Jack Howard 1999 0 10,000 Acting President 1998 $50,000 and Chief Financial Officer 1997 $50,000
DIRECTOR COMPENSATION The director who is not an officer receives, as his total annual compensation, 2000 options to purchase Company common stock. The options are granted each year at the time of the annual meeting. The exercise price of the options is the fair market value of the common stock at the time of the grant. OPTION GRANTS IN LAST FISCAL YEAR The following table sets forth information with respect to options granted to the named executives during 1999. No stock appreciation rights were granted to the named executives during 1999. Individual Grants ----------------- Percent of Number Total of Options Securities Granted to Underlying Employees in Exercise or Options Fiscal Base Price Expiration Name Granted(1) Year(2) ($/Sh) Date ---- ------- ---- ---- ---- Warren G. Lichtenstein 50,000 31.85% $2.00 7-20-04 Jack L. Howard 10,000 6.37% $2.00 7-20-04 - ----------- (1) All of the options were granted in respect of Mr. Lichtenstein's and Mr. Howard's service as executive officers of the Company. (2) Based on an aggregate of 173,500 options granted to all employees, non-employees, and consultants during 1999. Options vest in 3 equal annual installments. AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES The following table sets forth information concerning options exercised during the fiscal year ended December 31, 1999, and the number of unexercised options held by the Company's executive officers at the end of such fiscal year:
Number of Shares Shares Value of Unexercised Acquired Value Number of Unexercised Options in-the-Money Options Name On Exercise Realized($) at FY-End(#) at FY-End($) - ---- ----------- ---------- ----------- ----------- Exercisable/Unexercisable Exercisable/Unexercisable ------------------------- ------------------------- Warren G. Lichtenstein 0 0 116,667/33,333 33,334/66,666 Jack Howard 0 0 84,300/23,200 67,000/43,500 - ----------- (1) Based on $2.00, the average high/low bid prices for the Common Stock on the last date of 1999 for which trading was reported.
ITEM 11. Security Ownership of Certain Beneficial Owners and Management The following table sets forth information as of March 31, 2000 regarding the beneficial ownership of the Common Stock by each person known by the Company to own beneficially more than 5% of the Common Stock, by each director and executive officer, individually, and by all directors and executive officers as a group. Name and Address Amount and Nature of Percent of Beneficial Owner Beneficial Ownership of Class - ------------------- -------------------- -------- Warren G. Lichtenstein 1,865,760 (1)(2) 44.51% 150 East 52nd Street New York, NY 10022 Ronald W. Hayes 98,840 (3) 2.36% 810 Saturn Street Suite 16-432 Jupiter, FL 33477-4398 Jack Howard 162,700 (4) 3.88% 2927 Montecito Avenue Santa Rosa, CA 95404 Steel Partners II, L.P. 1,674,208 39.94% 150 East 52nd Street New York, NY 10022 George Soros 827,716 (5) 19.75% 888 Seventh Avenue New York, NY 10022 All directors and executive officers 2,127,300 (1) 50.75% as a group (three persons) - ------------------------- (1) Includes: (i) 1,674,208 shares owned by Steel Partners II, L.P., an entity controlled by Mr. Lichtenstein, (ii) 41,552 shares owned directly by Mr. Lichtenstein, and (iii) 150,000 shares underlying stock options held by Mr. Lichtenstein, all of which are exercisable within sixty days of March 31, 2000. (2) More than one beneficial owner is listed above for the same securities, since the shares owned beneficially by Steel Partners II, L.P. are included in the shares beneficially owned by Mr. Lichtenstein. See note (1) above. (3) Includes 50,500 options, all of which are exercisable within sixty days of March 31, 2000 (4) Includes 107,500 stock options, all of which are exercisable within sixty days of March 31, 2000 (5) As reported in the shareholder's most recent Schedule 13D. (4) Includes 107,500 stock options, all of which are exercisable within sixty days of March 31, 2000 (5) As reported in the shareholder's most recent Schedule 13D. ITEM 12. Certain Relationships and Related Transactions The Company occupies offices at 150 East 52nd Street, New York, New York 10022, under a lease agreement extending through March 30, 2001. It subleased office space, at one-third of its cost for the space, to each of (a) Steel Partners Services, Ltd. ("SPS"), an entity controlled by the Company's Chairman, and (b) WebFinancial Corporation ("WEFN"), a public company in which Steel Partners II, L.P. , an entity controlled by the Company's Chairman, and the Company's Chairman have an approximately 30 % beneficial interest. Mr. Howard is also a director of WEFN. As of January 1, 1999, the rent on the office space is paid by SPS and the Company pays a management fee to SPS. During the year ended December 31, 1999, the Company paid a management fee of approximately $275,000 to Steel Partners Services, Ltd., for certain management, consulting and advisory services. The fee also included the Company's one-third share of rent expense which was paid entirely by SPS during 1999. The Company believes that the cost of obtaining the type and quality of services rendered by SPS is no less favorable than the cost at which the Company could obtain from unaffiliated entities. As of February 15, 2000, Oaktree entered into a Reciprocal Agency Agreement with MDM Technologies, L.L.C. ("MDM"). The agreement provides that Oaktree and MDM will each pay one another, as appropriate, a market rate based fee for sales leads generated that result in new revenues for each other. MDM is majority owned by Warren G. Lichtenstein, the Company's Chairman. 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. GATEWAY INDUSTRIES, INC. Date: April 25, 2000 By: /s/ Jack L. Howard Jack L. Howard, Acting President Principal Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----