SCHEDULE 14A INFORMATION
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Comission Only
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14(a)-11(c) or Rule 14(a)-12
Gateway Industries, Inc.
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(Name of Registrant as Specified in Charter)
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(Name of Persons filing Proxy Statement, if other than Registrant)
Payment of Filing Fee, Check the appropriate box):
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
GATEWAY INDUSTRIES, INC.
150 EAST 52ND STREET
NEW YORK, NEW YORK 10022
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The annual meeting of stockholders of Gateway Industries, Inc. (the
"Corporation") will be held at the Corporate office 150 East 52nd Street, 21st
Floor, New York, NY 10022 on Tuesday June 15, 1999 at 11:00 a.m. (local time)
for the following purposes:
1. to elect three (3) directors of the Corporation;
2. to ratify the appointment of Ernst & Young LLP as the Corporation's
independent accountants; and
3. to transact such other business as may properly come before the meeting or
any adjournments thereof.
This booklet includes a formal notice of the meeting and the proxy
statement. The proxy statement tells you more about the agenda and procedures
for the meeting.
The Board of Directors has fixed the close of business on April 26, 1999 as
the record date for determining stockholders entitled to notice of and to vote
at the meeting. A proxy and return envelope are enclosed for your convenience.
By order of the Board of Directors,
Jack L. Howard
Acting President and Secretary
April 30, 1999
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YOUR VOTE IS IMPORTANT
Please mark, sign, and date the enclosed proxy card
and return it promptly in the enclosed
self-addressed, stamped envelope
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<PAGE>
GATEWAY INDUSTRIES, INC.
150 EAST 52ND STREET
NEW YORK, NEW YORK 10022
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PROXY STATEMENT
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This Proxy Statement is furnished to the stockholders of Gateway
Industries, Inc., a Delaware corporation (the "Corporation"), in connection with
the solicitation of proxies by the Board of Directors for use at the annual
meeting of stockholders of the Corporation to be held on June 15, 1999 and any
adjournment or adjournments thereof (the "Annual Meeting"). A copy of the notice
of meeting accompanies this Proxy Statement. It is anticipated that the mailing
of this Proxy Statement will commence on or about May 5, 1999.
Only holders of securities entitled to vote at the Annual Meeting at the
close of business on April 26, 1999, the record date for the Annual Meeting,
will be entitled to notice of and to vote at the Annual Meeting. On the record
date the Corporation had issued and outstanding 3,592,024 shares of common
stock, $.001 par value (the "Common Stock"), entitled to vote at the Annual
Meeting, each share being entitled to one vote.
Stockholders who execute proxies may revoke them by (1) giving written
notice to the Secretary of the Corporation at any time before such proxies are
voted, (2) voting in person at the Annual Meeting, or (3) notification in
writing to the Corporation at 150 East 52nd Street, New York, NY 10022.
The presence, in person or by proxy, of the holders of at least a majority
of the shares of Common Stock outstanding on the record date is necessary to
have a quorum for the Annual Meeting. Abstentions and broker "non-votes" are
counted as present for purposes of determining a quorum. A broker "non-vote"
occurs when a nominee holding shares of Common Stock for a beneficial owner does
not vote on a particular proposal because the nominee does not have
discretionary voting power with respect to that item and has not received
instructions from the beneficial owner.
The Board of Directors does not know of any matter that is expected to be
presented for consideration at the Annual Meeting, other than those matters
described on the attached Notice and herein. However, if other matters properly
come before the Annual Meeting, the persons named in the accompanying proxy
intend to vote thereon in accordance with their judgment.
All proxies received pursuant to this solicitation will be voted except as
to matters where authority to vote is specifically withheld and, where a choice
is specified as to the proposal, they will be voted in accordance with such
specification. If no instructions are given, the persons named in the proxy
solicited by the Board of Directors of the Corporation intend to vote for the
nominees for election as directors of the Corporation listed herein and for
those matters described on the attached Notice and herein. With regard to the
election of directors, votes cast may be withheld from each nominee; votes that
are withheld will be excluded entirely from the vote and will have no effect.
Abstentions may be specified on all proposals except the election of directors
and will have the same effect as a vote against a proposal. Abstentions and
broker non-votes are not counted as votes cast on any matter to which they
relate.
PRINCIPAL STOCKHOLDERS
The following table sets forth information as of March 31, 1999 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, each
executive officer named in the Summary Compensation Table, and by all directors
and executive officers as a group. Shares listed below have been adjusted to
reflect the one-for-five split effective September 22, 1994.
Name and Address Amount and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
- ------------------- -------------------- --------
Warren G. Lichtenstein
150 East 52nd Street
New York, NY 10022 1,815,760 (1)(2) 50.5%
Ronald W. Hayes
810 Saturn Street
Suite 16-432
Jupiter, FL 33477-4398 103,340 (3) 2.9%
Jack Howard
2927 Montecito Avenue
Santa Rosa, CA 95404 140,820 (4) 3.9%
Steel Partners II, L.P.
150 East 52nd Street
New York, NY 10022 1,674,208 38.7%
George Soros
888 Seventh Avenue
New York, NY 10022 827,716 (5) 23.0%
All directors and executive
officers as a group (three persons) 2,059,920 (1) 57.3%
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(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) 100,000 shares underlying stock options exercisable
within 60 days hereof.
(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 8,333 shares which may be acquired in 120 days through the
exercise of stock options.
(4) Includes 16,667 shares which may be acquired in 120 days through the
exercise of stock options.
(5) As reported in the shareholder's most recent Schedule 13D.
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Except as noted in the footnotes above, (i) none of such shares is known
by the Corporation to be shares with respect to which the beneficial owner has
the right to acquire beneficial ownership and (ii) the Corporation believes the
beneficial owners listed above have sole voting and investment power with
respect to the shares shown as being beneficially owned by such holder.
DIRECTORS AND EXECUTIVE OFFICERS
ELECTION OF DIRECTORS
Listed below are the nominees for election at this Annual Meeting. The
directors elected at this Annual Meeting will serve one-year terms expiring at
the next annual meeting of stockholders.
NAME POSITION WITH THE CORPORATION
- ---- -----------------------------
Warren G. Lichtenstein Chairman of the Board of Directors
Ronald W. Hayes Director
Jack L . Howard Acting President and Director
DIRECTORS AND EXECUTIVE OFFICERS
The name of, principal occupation of and certain additional information
about the directors and executive officers of the Corporation is set forth below
NAME AGE POSITION
---- --- --------
Ronald W. Hayes 61 Director
810 Saturn Street
Suite 16-432
Jupiter, FL 33477-4398
Jack Howard 37 Acting President
2927 Montecito Avenue Director
Santa Rosa, CA 95404
Warren G. Lichtenstein 33 Chairman of the Board
150 East 52nd Street of Directors
New York, NY 10022
WARREN G. LICHTENSTEIN was appointed a director of the Company in May 1994
and became Chairman of the Board in October 1995. He served as President and
Director of Marsel from its inception in July 1995 until shortly after the
acquisition of its business in November 1995, and continued as a director until
its disposition in December 1996. Mr. Lichtenstein has been chief executive
officer of the general partner of Steel Partners II, LP, a private investment
firm, since 1993 and Chairman of Steel Partners Services, Ltd., a private
investment firm, since 1993. Mr. Lichtenstein is President and CEO of Rose's
Holdings, Inc., parent of WebBank; and Chairman of Aydin Corporation. He is a
director of Saratoga Spring Water Corporation, Inc. and PLM International.
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.
JACK L. HOWARD was appointed Acting President of the Company in September
1994. He was elected director of the Company in May 1994. Since 1989, he has
been a principal of Mutual Securities, Inc (securities brokers). Mr. Howard
serves on the Board of Directors of Rose's Holdings, Inc. and Pubco Inc.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
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
Corporation believes that all such reports required to be filed during the
fiscal year ended December 31, 1998 ("Fiscal 1998") were filed on a timely basis
except that each of Messrs. Howard, Lichtenstein, and Hayes inadvertently did
not file a report on a timely basis relating to stock purchased. Upon discovery,
the reports were filed. The Corporation's belief is based solely on its review
of Forms 3, 4, and 5 and amendments thereto furnished to the Corporation during,
and with respect to, Fiscal 1998 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, 1998 all Section 16(a) filing requirements applicable to its
officers, directors and greater-than 10% beneficial owners were satisfied.
BOARD AND COMMITTEE MEETINGS
The Board of Directors of the Company held two formal meetings during its
fiscal year ended December 31, 1998. Presently, the Board of Directors has no
standing committees. No director attended less than 75% of the total number of
Board meetings held during the fiscal year.
EXECUTIVE COMPENSATION
The following table sets forth all compensation paid to the Company's
Acting President during its fiscal year ended December 31, 1998. No executive
officer received annual compensation at the rate of $100,000 or more during the
fiscal year.
SUMMARY COMPENSATION TABLE
Long Term
Compensation
Annual Compensation Awards
Name and Principal Fiscal Salary Bonus All Other
Position Year Compensation Options
-------- ---- ------------ -------
Jack L. Howard, 1998 -- $50,000 --
Acting President 1997 -- $50,000 --
STOCK OPTIONS
OPTION GRANTS IN LAST FISCAL YEAR
None
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
The following table sets forth information concerning options exercised
during the fiscal year ended December 31, 1998 and the number of unexercised
options held by the Company's executive officers at the end of such fiscal year:
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised in-the-Money
Shares Options at Options at
Acquired Value FY-End(#) FY-End($)
On Realized
Name Exercise(#) ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Jack Howard 0 0 82,834/16,666 0/0
Acting President
Warren G. Lichtenstein 0 0 100,000/0 0/0
Chairman of the Board
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<FN>
(1) Based on $1.6875, the average high/low bid prices for the Common Stock on
the last date of 1998 for which trading was reported.
</FN>
</TABLE>
PROPOSAL ONE
ELECTION OF DIRECTORS
Three directors are to be elected at the Annual Meeting. The Board has
nominated Warren G. Lichtenstein, Ronald W. Hayes, and Jack L. Howard to be
re-elected for one-year terms, expiring at the annual meeting in 2000. Holders
of proxies solicited by this Proxy Statement will vote the proxies received by
them as directed on the proxy card or, if no direction is made, for the election
of the Board's nominee. If the Board's nominee should become unavailable for any
reason, which the Board does not anticipate, proxy holders will vote for a
nominee designated by the present Board to fill the vacancy at or prior to the
meeting.
If any nominee should become unavailable for any reason, which management
does not anticipate, the proxy will be voted for any substitute nominee or
nominees who may be selected by management prior to or at the meeting. Directors
will be elected by a plurality of the votes cast. The information concerning the
nominees and each director continuing in office has been furnished by them to
the Corporation. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR ALL
NOMINEES.
PROPOSAL TWO
INDEPENDENT AUDITORS
The Board of Directors has appointed Ernst & Young LLP, independent
certified public accountants, to audit the books and records of the Corporation
for the 1999 fiscal year. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE
STOCKHOLDERS VOTE IN FAVOR OF THE PROPOSAL TO CONFIRM SUCH
APPOINTMENT.
The Corporation will bear the cost of the Annual Meeting and the cost of
soliciting proxies, including the cost of mailing the proxy material. In
addition to solicitation by mail, directors, officers, and regular employees of
the Corporation (who will not be specifically compensated for such services) may
solicit proxies by telephone or otherwise. The Corporation has also retained
MacKenzie Partners, Inc. ("MacKenzie") to assist in the solicitation of proxies.
MacKenzie will receive a fee for such services of approximately $7,500 plus
reasonable out-of-pocket expenses, which will be paid by the Corporation.
Arrangements will be made with brokerage houses and other custodians, nominees,
and fiduciaries to forward proxies and proxy material to their principals, and
the Corporation will reimburse them for their expenses.
STOCKHOLDER PROPOSALS
If a stockholder notifies the Corporation after March 16, 2000 of an intent
to present a proposal at the Corporation's 2000 Annual Meeting, the Corporation
will have the right to exercise its discretionary voting authority with respect
to such proposal, if presented at the meeting, without including information
regarding such proposal in its proxy materials. Stockholders of the Corporation
wishing to include proposals in the proxy material in relation to the Annual
Meeting must submit the same in writing so as to be received at the executive
offices of the Corporation on or before January 1, 2000. Such proposals must
also meet the other requirements of the rules of the Securities and Exchange
Commission relating to stockholders' proposals.
ANNUAL REPORT
The Corporation has sent, or is currently sending, all stockholders of
record as of April 26, 1999 a copy of its Annual Report for the fiscal year
ended December 31, 1998. Such report contains the Corporation's certified
financial statements for the fiscal year ended December 31, 1998.
By Order of the Board of Directors,
Jack L. Howard
Secretary
April 30, 1999
<PAGE>
GATEWAY INDUSTRIES, INC.
PROXY
The undersigned appoints Warren G. Lichtenstein and Jack L. Howard, and
either of them, with power of substitution, to represent and to vote on behalf
of the undersigned all of the shares of Gateway Industries, Inc. (the
"Corporation") that the undersigned is entitled to vote at the annual meeting of
stockholders to be held at the Corporation's principal executive offices at 150
East 52nd Street, New York, New York 10022, on Wednesday, November 4, 1998 at
11:00 A.M., and at any adjournment or adjournments thereof, hereby revoking all
proxies heretofore given with respect to such stock, upon the following
proposals more fully described in the notice of, and proxy statement relating
to, the meeting (receipt whereof is hereby acknowledged).
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR (1) and (2).
1. ELECTION OF DIRECTORS
FOR all nominees listed WITHHOLD AUTHORITY to
below except as marked vote for all nominees
to the contrary below [] listed below []
Warren G. Lichtenstein, Ronald W. Hayes, and Jack L. Howard
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name in the space provided below.)
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2. PROPOSAL TO RATIFY THE APPOINTMENT OF ERNST & YOUNG LLP AS THE
INDEPENDENT AUDITORS OF THE CORPORATION
[] FOR [] AGAINST [] ABSTAIN
3. In their discretion upon such other matters as may properly come before the
meeting.
<PAGE>
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR PROPOSALS (1) and (2).
Please sign exactly as your name appears on your stock certificates. When
shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee, or guardian, please give full title as such.
If a corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
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Signature
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Signature if held jointly
DATED: __________________, 1999
Please return in the enclosed postage paid envelope.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
