April 6, 1995
Dear Shareholder:
You are cordially invited to attend
the Annual Meeting of Shareholders of
Pacific Gateway Properties, Inc., to be
held on Tuesday, May 9, 1995, at the World
Trade Club located in the World Trade
Center which is the clock tower building at
the foot of Market Street on the
Embarcadero waterfront area, San Francisco,
California.
While the meeting begins promptly at
9:00 a.m., the doors will be open at 8:30
a.m. Members of the Board of Directors and
the officers of the Company welcome the
opportunity to visit with shareholders on
an informal basis during the time preceding
the meeting.
At the meeting you will be asked to
elect directors for the coming year and to
consider and vote on such other business as
may properly come before the meeting.
These matters are described in the enclosed
Proxy Statement. In addition, there will
be a discussion of corporate events,
followed by a question and answer period.
It is important that your shares are
represented at the meeting whether or not
you plan to attend. Accordingly, please
take a moment now to fill in, sign, date
and mail the enclosed proxy in the envelope
provided.
Your cooperation is appreciated.
Sincerely,
Roger D. Snell
President and Chief Executive Officer
<PAGE>
PACIFIC GATEWAY PROPERTIES, INC.
101 Spear Street, Suite 215
San Francisco, CA 94105
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On May 9, 1995
To the Shareholders of
Pacific Gateway Properties, Inc.:
NOTICE IS HEREBY GIVEN that the
Annual Meeting of Shareholders of PACIFIC
GATEWAY PROPERTIES, INC. (the "Company"),
will be held at the World Trade Club
located in the World Trade Center which is
the clock tower building at the foot of
Market Street on the Embarcadero waterfront
area, San Francisco, California, on
Tuesday, May 9, 1995, at 9:00 a.m., for the
following purposes:
A.To elect seven Directors to serve
until the next annual meeting of
shareholders or special meeting of
shareholders held in place thereof
and until their respective
successors are elected and have
qualified; and
B.To transact such other business as
may properly come before the
meeting or any adjournment or
adjournments thereof.
The Board of Directors has amended
the By-Law of the Corporation fixing the
size of the Board to increase the number of
directors constituting the entire Board of
Directors from five to seven effective as
of the date of the Annual Meeting. The By-
Law, as amended, reads as follows:
"4.3 Number. The number
of directors constituting the entire
Board of Directors shall be seven
(7). Such number may be increased up
to the maximum number permitted by
Article SIXTH of the Certificate of
Incorporation or decreased to any
number not less than three (3) by
amendment to these By-Laws."
The Board of Directors has fixed the
close of business on March 27, 1995, as the
record date for the determination of common
shareholders entitled to vote at the
meeting.
Shareholders who do not expect to
attend in person and who wish their stock
to be voted are urged to fill in, sign,
date and return the accompanying form of
proxy in the enclosed envelope, to which no
postage need be affixed if mailed in the
United States.
By order of the Board of Directors,
Raymond V. Marino
Secretary
April 6, 1995
San Francisco, California
The Annual Report and Form 10-K of
the Company, including financial statements
for the year 1994, is being sent to
shareholders concurrently with this Notice.<PAGE>
PACIFIC GATEWAY PROPERTIES, INC.
101 Spear Street, Suite 215
San Francisco, CA 94105
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
May 9, 1995
This proxy statement is furnished to
holders of the Common Stock, par value
$1.00 per share, of PACIFIC GATEWAY
PROPERTIES, INC. (hereinafter called the
"Company") in connection with the
solicitation of proxies by the Board of
Directors of the Company to be used at the
Annual Meeting of Shareholders of the
Company to be held at the World Trade Club
in the World Trade Center which is the
clock tower building at the foot of Market
Street on the Embarcadero waterfront area,
San Francisco, California, on Tuesday, May
9, 1995 at 9:00 a.m., and at any
adjournment or adjournments thereof, for
the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders.
If the accompanying form of proxy is
executed and returned, it may nevertheless
be revoked at any time insofar as it has
not been exercised. The persons named in
the accompanying form of proxy will vote
such proxy for election to the Board of the
nominees named below. It is anticipated
that this Proxy Statement and the enclosed
Proxy will be first mailed to record
holders of the Company's Common Stock on or
about April 6, 1995.
The Board of Directors has fixed the
close of business on March 27, 1995, as the
record date for the determination of
shareholders entitled to receive notice of
and vote at the annual meeting of
shareholders. As of March 27, 1995, the
Company had outstanding 3,892,596 shares of
Common Stock, par value $1.00 per share.
Each share of Common Stock is entitled to
one vote.
SHAREHOLDER PROPOSALS FOR THE 1996 ANNUAL
MEETING
Any proposal of a shareholder
intended to be presented at the Company's
1996 Annual Meeting of Shareholders must be
received by the Company for inclusion in
the proxy statement and form of proxy for
that meeting no later than December 11,
1995.
A. ELECTION OF DIRECTORS
Under the Company's Certificate of
Incorporation and By-Laws, the Board of
Directors of the Company may have between
three and thirteen members. On March 23,
1995, the Board, by amendment to the By-
Laws, increased the number of directors to
be elected at 1995 Annual Meeting from five
to seven, each director to hold office
until the next annual meeting of
shareholders or special meeting of
shareholders held in place thereof, and
until his successor is chosen and
qualified. Messrs. Robert P. Freeman and
Roderick A. Young, who are presently
directors of the Company, will not stand
for re-election. The Board of Directors
does not contemplate that any nominee will
be unable to serve as a director for any
reason; however, if that should occur prior
to the meeting, the proxy holders will
select another nominee to stand for
election in his place and stead.
<PAGE>
The following table sets forth
certain information as of March 3, 1995,
concerning beneficial ownership of the
Common Stock of the Company by each
director, nominee and executive officer,
individually, and the executive officers
and directors of the Company as a group.
Also included in the table with respect to
each nominee for election as a director and
each executive officer is his principal
occupation or employment during the past
five years and his age.
<TABLE>
Amount and Nature of Beneficial
Ownership of Common Stock (1)
Sole Shared
Voting andVoting and
Office and InvestmentInvestment
Name and Age Principal Occupation Power Power
Nominees:
<S> <C> <C>
H. Todd Cobey, Jr. (52)President of Cobey, Jacobson 65,500 391,800
and Gordon, Inc., a registered
investment management firm.
Lawrence B. Helzel (47)Member, Pacific Stock Exchange, Inc. 4,500 110,900
(Self employed market maker, options floor);
co-founder Buylar Investments, Inc., a real
estate investment company.
Marshall A. Jacobs (75)Director of the Company since 200 ---
February 1984; of Counsel, law firm
of Jacobs Persinger & Parker, prior
thereto, senior partner in the firm.
David E. Post (A) (38)Director of the Company since May 318,850 ---
1993; Hanson Investment Management
Company; prior thereto, President, CSI
Capital Management; President, Alternative
Capital Corporation; President, HS
Partners, Inc. (a subsidiary of HS
Resources, Inc.)
Martin S. Roher (45)Sole general partner and managing 250,000 ---
partner of MSR Capital Partners -
a limited partnership engaged in
securities investments
Roger D. Snell (A) (39)Director of the Company since July 55,632 ---
1992; President and Chief Executive
Officer of the Company; prior thereto,
partner and Vice President Paragon Group,
a real estate investment & management company.
John V. Winfield (48)Chairman of the Board, President 310,500 ---
and CEO of The Intergroup Corporation,
a diversified real estate company.
Other Executive Officers:
Raymond V. Marino (36)Vice President of the Company 6,000 ---
since August 1992; prior thereto, Vice
President of Finance and Controller
Hunting Gate Investments, Inc., a real estate
investment & management company.
Christopher M. WatsonVice President of the Company 6,000 ---
(36) since September 1992; prior thereto, Vice
President Coldwell Banker
Commercial Real Estate Services, Inc., a real
estate management company.
</TABLE>
<TABLE>
% of
Aggregate Class
<C> <C>
457,300(2) 11.8%
115,400 3%
200 *
318,850(2) 8.2%
250,000(2) 6.4%
55,632(3) 1.4%
310,500(2) 8%
6,000(3) *
6,000(3) *<PAGE>
</TABLE>
Amount and Nature of Beneficial
<TABLE>
Ownership of Common Stock (1)
Sole Shared
Voting andVoting and
Office and InvestmentInvestment % of
Name and AgePrincipal OccupationPower Power Aggregate Class
Directors Not Standing for
Re-election:
<S> <C> <C> <C> <C>
Robert P. Freeman (50) N/A 900 --- 900 *
Roderick A. Young (A) (51)N/A 1,000 --- 1,000 *
All present directors and 388,582 --- 388,582 10%
executive officers as a group
(7 persons)
* Less than one percent
</TABLE>
(1) Beneficial ownership is the direct or
indirect ownership of Common Stock of
the Company including the right to
control the vote or investment of or
acquire such Common Stock within the
meaning of Rule 13d-3 under the
Securities Exchange Act of 1934. The
shares owned by each person or by the
group, and the shares included in the
total number of shares outstanding
have been adjusted in accordance with
said Rule 13d-3. The aggregate
percentage owned has been determined
by dividing the aggregate total of
shares owned by each person, or by
the group, by the number of shares of
Common Stock of the Company
outstanding on March 1, 1995.
(2) Additional information concerning the
nature of the beneficial ownership of
such shares by Messrs. Cobey, Post,
Roher and Winfield is set forth below
in the table under the caption
"CERTAIN OTHER BENEFICIAL HOLDERS"
and notes (3), (8), (7) and (6),
respectively.
(3) Represents 40,000, 6,000, and 6,000
shares of Common Stock issuable under
presently exercisable stock options
granted under the 1984 Incentive
Stock Option Plan as of December 31,
1994 for Roger D. Snell, Raymond V.
Marino, and Christopher M. Watson,
respectively. In addition, Mr. Snell
was issued 12,632 restricted shares
of the Company's common stock as part
of his 1994 bonus.
(A) Member of the Audit Committee.
Directors who are not officers of the
Company may receive an annual fee of
$7,500, and supplemental fees of $750 for
each meeting of the Board or a committee
thereof attended, and $375 for each
telephone meeting, plus out-of-pocket
expenses incurred in connection with
services rendered to the Company and travel
and lodging for each board meeting.
The Board of Directors of the Company
held five meetings in 1994. The Board does
not have a Compensation Committee or a
Nominating Committee. Since the size of
the Board of Directors was reduced to five
members in 1993, it was decided that only
an Audit Committee consisting of three
members was necessary. The Audit
Committee's duties are to oversee the audit
function of the Company's independent
certified public accountants, to
periodically review significant financial
information relating to the Company and to
act as a communication link between the
Board of Directors and such certified
public accountants. The Audit Committee
met two times in 1994. Roderick A. Young,
presently a director and Chairman of the
Audit Committee, is not a nominee for
election as a director and it is intended
that a new member and chairman of the Audit
Committee will be appointed by the Board of
Directors following the Annual Meeting.
The other members of the Audit Committee
are identified in the above table.
Compensation issues were voted upon by the
full Board of Directors. Mr. Snell did not
vote on compensation issues for himself.
During 1994, all of the directors of
the Company attended every meeting of the
Board of Directors and the committee of
which they are members, except Roderick A.
Young who was absent from one Board of
Directors meeting.
Except as set forth below, none of
the nominees is a director of any company
which is subject to the reporting
requirements of the Securities Exchange Act
of 1934 or which is a registered investment
company under the Investment Company Act of
1940.
Name of NomineeDirector of
H. Todd Cobey, Jr.
Cobey, Jacobson & Gordon, Inc.
John V. Winfield
The Intergroup Corporation
CERTAIN OTHER BENEFICIAL HOLDERS
The following table sets forth
certain information concerning beneficial
ownership, as of March 1, 1995, of the
Common Stock of the Company by certain
other holders of in excess of 5% of the
Common Stock of the Company.
According to the information
available to the Board of Directors no
person owns of record, or beneficially,
more than 5% of the outstanding Common
Stock of the Company except as set forth
below and in the first table under the
caption "ELECTION OF DIRECTORS".
<PAGE>
<TABLE>
Amount and Nature of Beneficial
Ownership of Common Stock
Sole Shared
Voting andVoting and
InvestmentInvestment % of
Name Address Power Power AggregateClass(1)
<S> <C> <C> <C>
Citicorp Real Estate,.1 Sansome St 1,000,000 --- 1,000,000(2)20.4%
Inc.a subsidiary ofSuite 2830
Citibank San Francisco, CA 94104
H.Todd Cobey, Jr.10 Liberty Square 65,500 391,800 457,300(3)11.8%
Boston, MA 02109
Perry Goldberg Specks & Goldberg 208,600 99,500 308,100(4)8%
10 S. Wacker Drive
Suite 3600
Chicago, IL 60606
Harris Associates L.P.2 No LaSalle St None 235,250 235,250(5)6.1%
Suite 500
Chicago, IL 60602
The Intergroup 2121 Ave of the Stars 310,500 --- 310,500(6)8%
Corporation Suite 2020
Los Angeles, CA 90067
MSR Capital One Embarcadero Ctr 250,000 --- 250,000(7)6.4%
Partners Suite 2330
San Francisco, CA 94111
David E. Post Hanson Investment 318,850 --- 318,850(8)8.2%
Management Company
4000 Civic Center Drive
Suite 200
San Rafael, CA 94903
</TABLE>
(1) Calculated in accordance with Rule
13d-3. See footnote (1) on Page 3 hereof.
(2) Based on information contained in
Schedule 13D for Citicorp Real
Estate, Inc. ("CREI"), dated
December 30, 1993. The Company
issued to CREI warrants to acquire an
aggregate of 2,000,000 shares of the
Common Stock. Warrants with respect
to 1,000,000 shares are presently
exercisable and, if such warrants
were exercised, CREI would become
owner of approximately 20.4% of the
outstanding shares of Common Sock of
the Company. CREI has no present
power to vote or direct the voting of
any shares since no warrants have
been exercised. If the warrants
were exercised by CREI, CREI would
have the sole power to vote or direct
the voting of such shares. On
January 31, 1995, 350,000 of the
2,000,000 warrants were cancelled as
a result of certain debt repayments
in accordance with the terms of the
loan agreement with CREI.
(3) Based on information contained in
Amendment No. 3 to Schedule 13D for
H. Todd Cobey, Jr., dated December
30, 1994. Mr. Cobey is the direct or
indirect beneficial owner of 457,300
shares of the Common Stock of the
Company. Mr. Cobey has sole
dispositive and voting power with
respect to 65,500 shares of common
stock owned by him personally; shared
voting and shared dispositive power
with respect to 190,900 shares of
common stock owned by Ellis Fund
Limited Partnership, a Massachusetts
limited partnership; and shared
dispositive power and no voting power
with respect to 200,900 shares of
Common Stock for which Cobey,
Jacobson & Gordon, Inc., a
Massachusetts corporation, acts in an
investment advisory capacity. Mr.
Cobey is an investment advisor with,
and President of, Cobey, Jacobson &
Gordon, Inc. Mr. Cobey is also a
partner in CTG Associates, a
Massachusetts partnership, which is
the sole general partner of Ellis
Fund Limited Partnership.
(4) Based on information contained in
Amendment No. 2 to Schedule 13D of
Perry Goldberg, dated March 9, 1995.
Mr. Goldberg beneficially owns
308,100 shares of the Common Stock.
Mr. Goldberg has sole voting and sole
dispositive power with respect to
208,600 shares; and shared voting
power and shared dispositive power
with respect to 99,500 shares, 98,300
shares of which are owned of record
by Specks & Goldberg Ltd. Profit
Sharing Plan and Trust, for which Mr.
Goldberg is a trustee, and 1,200
shares of which are owned of record
by his wife, Margaret Goldberg. In
addition, Mr. Goldberg disclaims
beneficial ownership of 9,400 shares
owned by his adult daughters, but as
to which Mr. Goldberg may be deemed
to be the beneficial owner, and to
have voting and/or dispositive power.
(5) Based on information contained in
Schedule 13G of Harris Associates
L.P., a Delaware limited partnership,
dated February 14, 1995: Harris
Associates L.P. has shared power to
vote 235,250 shares of common stock
of the Company. Harris Associates
L.P. has sole dispositive power with
respect to 155,250 shares and shared
dispositive power with respect to
80,000 shares. Harris Associates
Inc., a Delaware corporation, is the
general partner of Harris Associates
L.P.
(6) Based on information contained in
Amendment No. 1 to Schedule 13D for
The Intergroup Corporation dated
March 1, 1995: The Intergroup
Corporation has sole voting and sole
dispositive power with respect to
310,500 shares. The Intergroup
Corporation is a Delaware
corporation.
(7) Based on information contained in
Amendment No. 1 to Schedule 13D for
MSR Capital Partners, dated December
6, 1994: MSR Capital Partners has
sole voting and sole dispositive
power with respect to 250,000 shares.
MSR Capital Partners is a California
limited partnership. The general
partner of MSR Capital Partners is
Mr. Martin S. Roher.
(8) Based on information contained in
Amendment No. 1 to Schedule 13D of
David E. Post, dated December 15,
1990. Includes 102,900 shares held
by MiJen L.P. 1 of which David Post
is the general partner. The
remaining 215,950 shares are held by
three trusts and two Individual
Retirement Accounts for which David
E. Post acts as investment adviser.
<PAGE>
EXECUTIVE COMPENSATION
The Summary Compensation Table below
sets forth individual compensation
information for each of the Company's last
three fiscal years of the Chief Executive
Officer ("CEO") and other most highly paid
executive officers who were serving as such
at the end of the Company's fiscal year
ended December 31, 1994, and whose total
annual salary and bonus for such fiscal
year exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
Long Term
Compensation
Awards
Annual Compensation Stock All Other
Name and Principal Position Year Salary Bonus Options Compensation
<S> <C> <C> <C> <C> <C>
Roger D. Snell 1994 $250,000 $ 75,000 20,500 ---
President and CEO (1) 1993 $170,000 $147,500 --- ---
1992 $ 74,375 $ 39,73 6100,000 ---
Christopher M. Watson (2) 1994 $ 70,000 $ 30,000 6,175 $82,007
Vice President 1993 $ 60,000 $ 30,000 --- $45,714
1992 $ 16,250 $ 4,399 15,000 ---
Raymond V. Marino (3) 1994 $ 91,553 $ 25,000 6,175 ---
Vice President 1993 $ 80,000 $ 15,000 --- ---
1992 $ 30,000 $ 1,60 115,000 ---
</TABLE>
(1)Mr. Snell joined the Company as
President and CEO in July 1992. Mr.
Snell's employment arrangements
effective January 1, 1994, included an
annual base salary of $250,000 and a
bonus and stock options as determined
by the Board of Directors. Mr.
Snell's bonus for 1994 was comprised
of a cash payment of $30,000 and the
issuance to him (subject to the
listing of such shares with the
American Stock Exchange) of 12,632
shares of the Common Stock of the
Company representing the cash
equivalent of $45,000 based upon the
mean between the high and low sales
prices for such shares reported on the
date of the grant, December 5, 1994.
(2)Mr. Watson joined the Company as a
Vice President in September 1992. His
other compensation consisted of lease
commissions of $79,007 in 1994 and
$42,714 in 1993 and an auto allowance
of $3,000 in each year.
(3)Mr. Marino joined the Company as a
Vice President in August 1992.
None of the officers listed in the
compensation table were eligible for a
Simplified Employee Pension Plan (SEP)
contribution in 1994.
Option Tables
The following table sets forth, for the
CEO and each of the other executive
officers named in the Summary Compensation
Table, information with respect to grants
of stock options made during the last
fiscal year.
<PAGE>
Option Grants in Fiscal Year
Ended December 31, 1994
<TABLE>
Potential
Realizable
Individual Grants Value at Assumed
Number % of Total Annual Rates of
of Shares Options Stock Price
Underlying Granted to Exercise or Appreciation for
Options Emp in Base Price Exp Option Term
Granted (#) Fiscal Year ($/sh) Date 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
Roger D. Snell 20,500 43% $3.688 03/06/04 $47,547 $120,493
Christopher M.
Watson 6,175 13% $3.688 03/06/04 $14,322 $ 36,295
Raymond V. Marino 2,150 4% $3.688 03/06/04 $ 4,987 $ 12,637
4,025 9% $4.56 09/09/04 $11,543 $ 29,252
</TABLE>
The following table sets forth option exercise activity in the last fiscal
year and the fiscal year-end option values with respect to the CEO and each
of the other executive officers named in the Summary Compensation Table.
Aggregated Option Exercises in the Fiscal Year Ended
December 31, 1994 and Fiscal Year End Option Values
<TABLE>
Values of
Number of Unexercised In-
Unexercised the-Money
Options at Options at
12/31/94(#) 12/31/94 $ (1)
Shares Acquired Value Exercisable/ Exercisable/
Name On Exercise(#) Realized($) Unexercisable Unexercisable
<S> <C> <C> <C> <C>
Roger D. Snell --- --- 40,000/80,500 $15,000/$28,906
Christopher M. Watson --- --- 6,000/12,175 $6,192/$11,218
Raymond V. Marino --- --- 6,000/12,175 $5,250/$ 8,547
</TABLE>
(1)These values are based upon the
difference between the exercise
prices of all options awarded and the
December 31, 1994 closing price for
the Company's Common Stock of $4.00
per share.
Compensation Committee Interlocks and
Insider Participation. Mr. Snell, a
Director of the Company, is its President
and Chief Executive Officer. (Mr. Freeman,
presently a director of the Company who is
not seeking re-election, was President and
Chief Executive Officer of the Company
until July 1992). See Report of the Board
of Directors on Executive Compensation for
information on participation in
deliberations concerning Executive Officer
Compensation.
Mr. Jacobs is Of Counsel to the law
firm of Jacobs Persinger & Parker. Such
law firm performed services for the Company
during fiscal 1994, and the Company
proposes to retain such firm in fiscal
1995.
<PAGE>
Report of the Board of Directors on
Executive Compensation
Because of the small size of the Board
of Directors of the Company, there is no
compensation committee. The Board of
Directors reviews and determines all
executive compensation matters including
the awarding of bonuses, the granting of
stock options, and the administration of
the Company's stock option plans. Mr.
Snell, who is President, Chief Executive
Officer and a Director of the Company, does
not participate in executive compensation
determinations with respect to himself, but
does participate with respect to the other
executive officers and makes
recommendations as to the salaries, bonuses
and granting of stock options to such
executive officers.
Executive Compensation Policies
In mid-1992 at the time the Company
moved its headquarters from Framingham,
Massachusetts, to San Francisco,
California, the Board of Directors had to
assemble a new management team including a
new Chief Executive Officer and other new
executive officers. In this connection,
the Board of Directors had determined to
pay base salaries and incentive bonuses at
levels required to attract and retain
executives who could manage the operations
of the Company in the difficult economic
circumstances which the Company faced. The
fixing of the base salaries and potential
bonus awards and the granting of options
was negotiated by the former Chief
Executive Officer subject to the approval
of the Board of Directors.
The Company has no formal bonus plan.
Executives officers are evaluated on the
basis of performance against individual
work plan objectives. The work plan
objectives include as to each of the
executive officers, other than the Chief
Executive Officer, specific improvements in
department function of the department which
such executive heads. The executive
officer responsible for leasing is also
eligible for a commission on new or re-
leased space of properties of the Company
(with which he is involved). In December
1994, the Board determined, based upon its
subjective evaluation of each of such
executive officers achievement of his work
plan objectives and the operations of his
department, to award $25,000 and $30,000
bonuses, respectively, to Messrs. Marino
and Watson, for 1994. Based upon the same
evaluation, the Board also determined to
increase Mr. Marino's annual base salary to
$95,000 effective September 9, 1994.
In 1992, in connection with assembling
the new management team, the Board of
Directors had determined to provide long
term incentive compensation to the new
Chief Executive Officer and other executive
officers by granting options under the
Company's incentive stock option plan. This
effort continued in 1994 with options
granted to purchase a total of 47,850
shares of the common stock of the Company
under the Incentive Stock Option Plan
approved by the shareholders in May 1986.
The number of shares subject to an option
granted to an executive officer is based
upon the Board's subjective judgment as to
the relative contribution to the long term
success of the Company which such officer
may make. The proposal in 1994 for the
adoption of another incentive stock option
plan was not approved by the shareholders
at the Annual Meeting of Shareholders of
the Company held on May 10, 1994.
<PAGE>
Chief Executive Officer Compensation
Mr. Snell's employment arrangements,
including his compensation for 1993, were
negotiated in June 1992, and as described
above, included base salary, annual
incentive bonus, and stock options. The
Company has the right to terminate Mr.
Snell at any time, provided, however, that
if this occurs prior to June 30, 1995,
then, except in certain circumstances, Mr.
Snell will be entitled to severance pay of
twice the amount of his base annual salary,
all benefits will continue for one year and
the ability to exercise of his stock
options will be accelerated. Mr. Snell's
work plan objectives included financing and
development objectives, operating
performance improvement at specific
properties, and overall management
responsibilities. In December 1994, based
upon the Board's subjective evaluation of
Mr. Snell's performance in achieving his
work plan objectives, including
specifically the negotiation of the offer
for the Company's interest in Golden
Gateway Center and the leasing of South Bay
Office Tower and Walnut Creek Executive
Park, the Board determined to pay Mr. Snell
a $75,000 bonus for 1994. Mr. Snell's
bonus for 1994 was comprised of a cash
payment of $30,000 and the issuance to him
(subject to the listing of such shares with
the American Stock Exchange) of 12,632
shares of the Common Stock of the Company
representing the cash equivalent of $45,000
based upon the mean between the high and
low sales prices for such shares reported
on the date of the grant, December 5, 1994.
No other determination as to the Chief
Executive Officer's 1995 compensation was
made.
The Board of Directors:
Robert P. Freeman
Marshall A. Jacobs
David E. Post
Roger D. Snell
Roderick A. Young
<PAGE>
PACIFIC GATEWAY PROPERTIES, INC. (PGP)
PERFORMANCE GRAPH
Comparison of Five Year Cumulative Total
Return*
Among PGP, Dow Jones Equity Market Index
and Dow Jones Real Estate Inv. Index**
[INSERT GRAPH AND TABLE HERE]
See attached camera ready page
Assumes $100 invested on 12/31/88 in Pacific Gateway
Properties Common Stock. Dow Jones Equity Mkt. Index
and Dow Jones Real Estate Inv. Index
* Total return assumes reinvestment of dividends.
** Fiscal year ending December 31.
The above graph compares the performance of
PGP with that of the Dow Jones Equity
Market Index and the Dow Jones Real Estate
Investment Index. The real estate
companies in the Dow Jones Real Estate
Investment Index are: Catellus
Development, Federal Realty Investment
Trust, Host Marriott Corporation,
Meditrust, Newhall Land, New Plan Realty
Trust, Rockefeller Center Properties, the
Rouse Company and Weingarten.
<PAGE>
B. OTHER MATTERS
The Board of Directors knows of no
matters which will be presented for
consideration at the meeting other than the
matters referred to in this statement.
Should any other matters properly come
before the meeting, it is the intention of
the persons named in the accompanying proxy
to vote such proxy in accordance with their
best judgement.
VOTING PROCEDURES
A stockholder who abstains from a
vote by registering an abstention vote will
be deemed present at the meeting for quorum
purposes but will not be deemed to have
voted on the particular matter. Similarly,
in the event a nominee holding shares for
beneficial owners votes on certain matters
pursuant to discretionary authority or
instructions from beneficial owners, but
with respect to one or more other matters
does not receive instructions from
beneficial owners and does not exercise
discretionary authority (a so-called "non-
vote"), the shares held by the nominee will
be deemed present at the meeting for quorum
purposes but will not be deemed to have
voted on such other matters. Thus, on the
vote for the proposal to elect directors
where the outcome depends on the votes
cast, abstentions and non-votes will have
no effect. Directors are elected by a
plurality of the votes cast by the holders
of shares entitled to vote in the election.
RELATIONSHIP WITH INDEPENDENT PUBLIC
ACCOUNTANTS
The financial statements of the
Company and its subsidiaries included in
the 1994 Annual Report on Form 10-K have
been examined by Arthur Andersen LLP. A
representative of Arthur Andersen LLP is
expected to attend the Annual Meeting with
the opportunity to make a statement if he
so desires. It is expected that such
representative will be available to respond
to appropriate questions from shareholders.<PAGE>
SOLICITATION OF PROXIES
The Company will bear the cost of
this solicitation of proxies. In addition
to solicitation of proxies by mail, the
Company may reimburse brokers and other
nominees for the expense of forwarding
proxy materials to the beneficial owners of
stock held in their names. Directors,
officers and employees of the Company may
also solicit proxies on behalf of the Board
of Directors but will not receive any
additional compensation therefor.
IT IS IMPORTANT THAT PROXIES BE
RETURNED PROMPTLY. THEREFORE, SHAREHOLDERS
ARE URGED TO FILL IN, SIGN, DATE AND RETURN
THE ACCOMPANYING FORM OF PROXY IN THE
ENCLOSED ENVELOPE.
By order of the Board of Directors
Raymond V. Marino
Secretary
San Francisco, California
April 6, 1995
Upon the written request of any
shareholder, the Company will provide a
copy of its Annual Report on Form 10-K for
1994, including the financial statements
and the schedules thereto, filed with the
Securities and Exchange Commission. Any
request should be directed to Raymond V.
Marino, Vice President, Pacific Gateway
Properties, Inc., One Rincon Center, 101
Spear Street, Suite 215, San Francisco,
California 94105, Telephone Number (415)
543-8600, Facsimile Number (415) 777-3765.
There will be no charge for such report
unless one or more exhibits thereto are
requested, in which case the Company's
reasonable expenses of furnishing exhibits
may be charged.
