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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(RULE 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d - 1(a) AND AMENDMENTS THERETO FILED PURSUANT
TO RULE 13d - 2(a)
(Amendment No._____)*
MARCUM NATURAL GAS SERVICES, INC.
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(Name of Issuer)
COMMON STOCK, PAR VALUE $.01 PER SHARE
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(Title of Class of Securities)
566323-30-9
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(CUSIP Number)
A. BRADLEY GABBARD
MARCUM NATURAL GAS SERVICES, INC.
1675 BROADWAY, SUITE 2150
DENVER, CO 80202
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
SEPTEMBER 10, 1998
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box. [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule including all exhibits. See Rule 13d - 7(b) for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 7 Pages
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SCHEDULE 13
<TABLE>
<CAPTION>
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CUSIP NO. 566323-30-9 PAGE 2 OF 7 PAGES
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<S> <C> <C>
1 NAME OF REPORTING PERSONS
W. Phillip Marcum
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES OF AMERICA
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7 SOLE VOTING POWER
193,103
NUMBER OF -------------------------------------------------------------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 0
EACH -------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH
193,103
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
193,103
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* / /
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.29%
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14 TYPE OF REPORTING PERSON*
IN
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</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO.
Page 2 of 7 Pages
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SCHEDULE 13D
ITEM 1. SECURITY AND ISSUER.
--------------------
This statement on Schedule 13D ("Statement") relates to the common
stock, par value $.01 per share ("Common Stock"), of Marcum Natural Gas
Services, Inc., a Delaware corporation ("Issuer"). The principal executive
offices of the Issuer are located at 1675 Broadway, Suite 2150, Denver, Colorado
80202. All share and per share amounts set forth in this Statement have been
adjusted to reflect the 1-for-4 reverse split of the Common Stock of the Issuer
effected on July 6, 1998.
ITEM 2. IDENTITY AND BACKGROUND.
------------------------
(a) The name of the person filing this Statement is W. Phillip
Marcum ("Reporting Person").
(b) The business address of the Reporting Person is 1675 Broadway,
Suite 2150, Denver, Colorado 80202.
(c) The present principal occupation of the Reporting Person is
the Chairman of the Board, President and Chief Executive
Officer of the Issuer, Marcum Natural Gas Services, Inc., 1675
Broadway, Suites 2150, Denver, Colorado 80202.
(d) During the last five years, the Reporting Person has not been
convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) During the last five years, the Reporting Person has not been
a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such
proceeding was not and is not subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
(f) The Reporting Person is a citizen of the United States of
America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
--------------------------------------------------
All purchases by the Reporting Person of shares of Common Stock
beneficially owned by him were made with the Reporting Person's personal funds.
During 1991, the Reporting Person purchased 17,500 shares of Common
Stock (of which 2,500 are held in the name of his wife, Barbara Marcum) in
private placements at $5.00 per share for an aggregate purchase price of
$87,500, as a founder of the Issuer in connection with the organization of the
Issuer. During 1996, the Reporting Person purchased 6,142 shares of Common Stock
pursuant to the Issuer's 1996 Employee Stock Purchase Plan for an aggregate
purchase price of $15,188. In January 1997, the Reporting Person exercised
options to purchase 6,250 shares of Common Stock at an aggregate exercise price
of $21,875. In May 1997, the Reporting Person purchased 7,625 shares of Common
Stock (of which 5,250 are held of record in his wife's name) in ordinary
brokers' transactions for an aggregate purchase price of $26,238. During 1998,
the Reporting Person purchased 10,966 shares of Common Stock pursuant to the
Issuer's 1998 Employee Stock Purchase Plan for an aggregate purchase price of
$20,863.
Page 3 of 7 Pages
CUSIP NO.
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Between August 25, 1998 and September 10, 1998 (as described in Item
5(c)), the Reporting Person purchased 40,000 shares of Common Stock in ordinary
brokers' transactions for an aggregate purchase price of $80,147.
On September 10, 1998, the Reporting Person became entitled to receive
warrants to purchase 22,120 shares of Common Stock (1,937 in his wife's name) at
no cost as a dividend from the Issuer pursuant to the Issuer's distribution of
warrants to all its stockholders. The warrants are exercisable at a price of
$4.00 per share until September 10, 2013.
At various dates from 1991 through 1997, the Issuer granted to the
Reporting Person options to purchase 82,500 shares of Common Stock, which
options are exercisable at exercise prices of either $3.36 or $6.36 per share,
and at expiration dates ranging from August 6, 2002 through July 14, 2007.
ITEM 4. PURPOSE OF THE TRANSACTION.
---------------------------
The Reporting Person acquired the Common Stock beneficially owned by
him for investment purposes. The Reporting Person may from time to time in the
future acquire beneficial ownership of additional shares of Common Stock or
securities convertible into shares of Common Stock or dispose of any shares of
Common Stock beneficially owned by him. In addition, as a member of the Board of
Directors of the Issuer, and in his capacity as Chairman of the Board, Chief
Executive Officer and President of the Issuer, the Reporting Person will
participate from time to time in the consideration of possible actions or
transactions involving the Issuer, some of which may, in whole or in part,
relate to or result in one or more of the actions specified in (a) through (j)
of Item 4.
Other than as set forth above, the Reporting Person does not have any
present plans or proposals which would relate to or would result in any of the
actions specified in (a) through (j) of Item 4, although the Reporting Person
reserves the right to change his plans and intentions at any time as he deems
appropriate.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
-------------------------------------
(a) As of September 10, 1998, the Reporting Person beneficially
owned 193,103 shares of Common Stock (including 7,750 shares
of Common Stock held of record by his wife, Barbara Marcum),
representing 5.29% of the issued and outstanding shares of
Common Stock of the Issuer (based upon 3,546,445 shares of
Common Stock issued and outstanding as of such date, plus
exercisable options to purchase 82,500 shares of Common Stock
and exercisable warrants to purchase 22,120 shares of Common
Stock).
The amounts included in the beneficial ownership of the
Reporting Person in this Statement do not include options to
purchase 37,500 shares of Common Stock granted to the
Reporting Person which will not be exercisable until the
closing sale price of the Common Stock as reported on the
Nasdaq National Market equals or exceeds $6.00, $8.00 and
$10.00. Upon each such event, options to purchase 12,500
shares of Common Stock shall become vested and exercisable by
the Reporting Person at an exercise price of $3.36 per share.
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CUSIP NO.
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(b) The Reporting Person has sole power to vote or to direct the
vote and sole power to dispose of or to direct the disposition
of all shares of Common Stock beneficially owned by him, other
than 104,620 shares of Common Stock underlying exercisable but
unexercised options and warrants.
(c) During the past 60 days, the Reporting Person has effected the
following transactions in the Common Stock, all of which were
purchased in ordinary brokers' transactions, except the
Warrants, which were issued as a divided at no cost by the
Issuer to all holders of Common Stock:
Amount of Price
Date Securities Per Share
---- ---------- ---------
August 25, 1998 5,000 Shares $2.09375
August 26, 1998 5,000 Shares $2.0625
August 28, 1998 5,000 Shares $2.000
August 31, 1998 3,500 Shares $2.000
September 1, 1998 1,500 Shares $1.96875
September 2, 1998 5,000 Shares $1.96875
September 3, 1998 5,000 Shares $1.96875
September 4, 1998 1,900 Shares $1.96875
September 9, 1998 3,100 Shares $2.03125
September 10, 1998 5,000 Shares $1.9375
September 10, 1998 22,120 Warrants $0 (Dividend)
(d) No other person has the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the
sale of, the Common Stock beneficially owned by the Reporting
Person.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
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RESPECT TO SECURITIES OF THE ISSUER.
------------------------------------
The Reporting Person has the right to acquire 82,500 shares of Common
Stock upon the exercise of currently exercisable options pursuant to the
Issuer's 1998 Stock Incentive Plan, 22,120 shares of Common Stock upon the
exercise of currently exercisable warrants pursuant to the Issuer's Warrant
Agency Agreement, dated September 10, 1998, between the Issuer and American
Securities Transfer & Trust, Inc., and 37,500 shares of Common Stock upon the
exercise of currently unexercisable options. In addition, pursuant to the
Employment Agreement, dated June 11, 1991, as amended, between the Reporting
Person and the Issuer, upon the termination of the employment of the Reporting
Person for any reason whatsoever, the Reporting Person has the right to require
the Issuer to repurchase up to 10,000 shares of Common Stock held by him on the
date of termination at the "Fair Market Value" of such shares of Common Stock on
the date of receipt by the Issuer of a written repurchase notice. For purposes
of the Employment Agreement, the "Fair Market Value" of his shares shall be the
average closing bid price of the shares of Common Stock over the 20 trading days
preceding the date of notice.
Page 5 of 7 Pages
CUSIP NO.
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In addition, pursuant to the Reporting Person's Employment Agreement,
the Issuer is required to establish an Incentive Compensation Fund, to be
administered by the Compensation Committee of the Board of Directors of the
Issuer, to provide for incentive compensation to be paid by each officer or
employee (including the Reporting Person) deemed by the Compensation Committee
to have made a substantial contribution to the Issuer in the event of a change
of control of the Issuer or of the sale of substantially all of the assets of
the Issuer or similar transactions. The total amounts of incentive compensation
from the fund available for distribution will be determined by a formula based
on the amount by which the Fair Market Value per share of the Common Stock
exceeds $10.08, multiplied by a factor ranging from 10-20% depending upon the
ratio of the Fair Market Value to $10.08. In the case of the sale of the
significant subsidiary of the Issuer or substantially all of the assets of a
significant subsidiary, a similar pro-rata distribution is required.
Except as set forth herein, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) between the Reporting
Person and any other person with respect to any securities of the Issuer,
including but not limited to the transfer or voting of securities, finder's
fees, joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profits or loss or the giving or withholding of proxies or
otherwise.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
---------------------------------
1. Employment Agreement, dated as of June 11, 1991, between
Marcum Natural Gas Services, Inc. and W. Phillip Marcum
(incorporated by reference to Exhibit 10.4 to the Issuer's
Registration Statement on Form S-18, Registration No.
33-44558).
2. Amendment No. 1 to the Employment Agreement between Marcum
Natural Gas Services, Inc. and W. Phillip Marcum (incorporated
by reference to Exhibit 10.1 to the Issuer's Quarterly Report
on Form 10-QSB for the quarterly period ended September 30,
1997).
3. Marcum Natural Gas Services, Inc. 1991 Stock Option Plan, is
amended and restated December 5, 1996 (incorporated by
reference to Exhibit 10.2 to the Issuer's Form 10-QSB for the
year ended December 31, 1996).
4. Form of Common Stock Purchase Warrant (incorporated by
reference to Exhibit 4.4 to the Issuer's Registration
Statement on Form S-3, Registration No. 333-60925).
5. Form of Warrant Agency Agreement between Marcum Natural Gas
Services, Inc. and American Securities Transfer & Trust, Inc.
(incorporated by reference to Exhibit 4.5 to the Issuer's
Registration Statement on Form S-3, Registration No.
333-60925).
Page 6 of 7 Pages
CUSIP NO.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: September 18, 1998 /s/ W. Phillip Marcum
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W. Phillip Marcum
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