UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C
Information Statement Pursuant to Section
14c of the
Securities Exchange Act of 1934
Check the appropriate box:
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Preliminary Information Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
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Definitive Information Statement
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General Steel Holdings, Inc.
(Name of Registrant as Specified In Its
Charter)
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Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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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)
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Proposed maximum aggregate value of transaction:
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Fee paid previously with preliminary materials.
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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.
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(1)
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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GENERAL STEEL HOLDINGS, INC.
Level 21, Tower B, Jia Ming Center
No. 27 Dong San Huan North Road
Chaoyang District, Beijing, China 100020
Notice of Action Taken Pursuant to Written
Consent of Stockholders
Dear Stockholder:
The accompanying Information Statement
is furnished to holders of shares of common stock, par value $0.001 per share (the “Common Stock”), of General
Steel Holdings, Inc. (the “Company”, “our”, “we” or “us”). The purpose of
this Information Statement is to notify our stockholders that, on July 18, 2014, we received a written consent from certain
of our stockholders, holding or able to direct the vote of approximately 57% of the then total issued and outstanding voting
capital stock of the Company (the “Stockholder Consent”), comprised of 58,314,688 shares of our Common Stock and
3,092,899 shares of our Series A Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock,” and
together with the Common Stock, “Voting Stock”), to implement the ratifications and approvals described
below.
We are required
to obtain
stockholder approval of the private placement described below to ensure compliance with Section 312.03 of the New York Stock
Exchange (“NYSE”) listed company manual. On July 14, 2014, we entered into a Subscription Agreement with Zuosheng Yu,
our Chairman and Chief Executive Officer (the “Subscription Agreement”), pursuant to which Mr. Yu has agreed
to purchase 5,000,000 shares of Common Stock in a private placement from us in exchange for an investment of $7,500,000 (the
“Private Placement”). The Private Placement requires shareholder approval under Section 312.03 of the NYSE listed
company manual due to the number of shares being purchased.
To ensure compliance with the NYSE requirements
referenced above and the Subscription Agreement closing conditions, the Stockholder Consent was obtained to approve the consummation
of the Private Placement in accordance with the terms of the Subscription Agreement. The Subscription Agreement was filed as an
Exhibit to our Form 8-K, filed with the United States Securities and Exchange Commission on July 18, 2014.
This Information Statement is being furnished
to you to inform you that the foregoing consent actions have been approved by the holders of, or persons able to direct the vote
of, a majority of the outstanding shares of our Voting Stock. The Board of Directors is not soliciting your proxy in connection
with the stockholder consent actions and proxies are not requested from stockholders. The approvals set forth in the
Stockholder Consent will not become effective before a date which is 20 days after this Information Statement is first mailed to
our stockholders. You are urged to read the Information Statement in its entirety for a description of the action taken by a majority
of the holders of our Voting Stock.
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By Order
of the Board of Directors
of
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General Steel Holdings, Inc.
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/s/ John Chen
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John Chen
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Secretary
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Beijing, China
[_____] [___], 2014
THE ACCOMPANYING INFORMATION STATEMENT
IS BEING MAILED TO STOCKHOLDERS ON OR ABOUT [_____] [___], 2014.
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US
A PROXY.
GENERAL STEEL HOLDINGS, INC.
Level 21, Tower B, Jia Ming Center
No. 27 Dong San Huan North Road
Chaoyang District, Beijing, China 100020
INFORMATION STATEMENT
NO VOTE OR OTHER ACTION OF THE COMPANY’S
STOCKHOLDERS
IS REQUIRED IN CONNECTION WITH THIS INFORMATION
STATEMENT.
WE ARE NOT ASKING YOU FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY
This Information Statement is first
being furnished on or about [_____] [___], 2014, to the holders of record of the common stock, par value $0.001 per
share (“Common Stock”) of General Steel Holdings, Inc. (the “Company”) as of the close of
business on July 18, 2014.
The Board of Directors of the
Company (the “Board”) has approved and stockholders of the Company, including the holder of our Series A
Preferred Stock, par value $0.001 per share (“Series A Preferred Stock,” and together with the Common Stock,
“Voting Stock”), collectively representing approximately 57% of our issued and outstanding shares of Voting Stock
as of July 18, 2014, have consented in writing to the actions described below. Such approval and consent constitute
the approval and consent of a majority of the total number of shares of the Company’s outstanding Voting Stock and
is sufficient under the Nevada Revised Statutes, the Company’s Articles of Incorporation, as amended, the
Company’s Bylaws, and the rules of the New York Stock Exchange to approve such actions. Accordingly, the actions
will not be submitted to the other stockholders of the Company for a vote, and this Information Statement is being furnished
to such other stockholders to provide them with certain information concerning the actions in accordance with the
requirements of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the
regulations promulgated under the Exchange Act, including Regulation 14C.
Delivery of Documents to Stockholders Sharing an Address
The Company will only deliver one Information
Statement to multiple security holders sharing an address unless the Company has received contrary instructions from one or more
of the security holders. Upon written or oral request, we will promptly deliver a separate copy of this Information
Statement and any future annual reports and information statements to any security holder at a shared address to which a single
copy of this Information Statement was delivered, or deliver a single copy of this Information Statement and any future annual
reports and information statements to any security holder or holders sharing an address to which multiple copies are now delivered.
You should direct any such requests to the following address: General Steel Holdings, Inc., Level 21, Tower B, Jia Ming Center,
No. 27 Dong San Huan North Road, Chaoyang District, Beijing, China 100020 or by telephone at + 86 (10) 57757691.
Record Date; Stockholders Entitled to Information Statement
This Information Statement is being mailed
to you on or about [_____] [___], 2014. The Company will pay all costs associated with the distribution of this Information
Statement, including the costs of printing and mailing. The Company will reimburse brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by them in sending this Information Statement to the beneficial owners
of the Common Stock. Additional copies of this Information Statement may be obtained at no charge by writing the Company at:
General Steel Holdings, Inc., Level 21, Tower B, Jia Ming Center, No. 27 Dong San Huan North Road, Chaoyang District, Beijing,
China 100020.
The close of business on July 18,
2014 (the “Record Date”) has been established by the Board as the record date for the determination of stockholders
entitled to receive this Information Statement and this notice of the written consent from certain of our stockholders (the “Stockholder
Consent”) with respect to actions discussed under the heading “
NOTICE TO STOCKHOLDERS OF ACTION APPROVED BY
CONSENTING STOCKHOLDERS”
below.
Stockholder Proposals
No proposals have been provided by stockholders
of the Company for inclusion in this Information Sheet.
Dissenters Rights of Appraisal
None.
Additional Information
The Company files reports with the
United States Securities and Exchange Commission (the “SEC”), including annual and quarterly reports, as well as other
information the Company is required to file pursuant to securities laws. You may read and copy materials we file with the SEC at
the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation
of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy
and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov.
VOTING AND VOTE REQUIRED
Pursuant to the Company’s Bylaws
and the rules of the New York Stock Exchange, a vote by the holders of at least a majority of the Company’s outstanding
Voting Stock is required to affect the actions described herein. The Company’s Articles of Incorporation, as amended,
do not authorize cumulative voting. As of the Record Date, the Company had 58,314,688 shares of Common Stock issued and
outstanding and 3,092,899 shares of Series A Preferred Stock issued and outstanding. The 3,092,899 shares of
Series A Preferred Stock have in the aggregate voting rights equal to 30% of the Company’s total Voting Stock.
The voting power representing not less than a majority of our Voting Stock is required to pass any stockholder resolutions.
The consenting stockholders, including the holder of the Series A Preferred Stock, collectively hold approximately 57% of
the voting power attributed to the Company's issued and outstanding shares of Voting Stock. Pursuant to the Nevada
Revised Statutes, and in accordance with the statements above, the consenting stockholders voted in favor of the actions
described herein in a stockholder consent, dated July 18, 2014.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth certain information
as July 18, 2014 as to shares of Common Stock and Series A Preferred Stock beneficially owned by: (i) each person
who is known by the Company to own beneficially more than 5% of Common Stock and Series A Preferred Stock, (ii)
each of the Company's current named executive officers, (iii) each of the Company's current directors and (iv) all the
Company's current directors and named executive officers as a group. Unless otherwise stated below, the address of each beneficial
owner listed on the table is c/o General Steel Holdings, Inc., Level 21, Tower B, Jiaming Center, No. 27 Dong San Huan North Road,
Chaoyang District, Beijing, China, 100020.
Name of Beneficial Owner
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Shares
Beneficially
Owned
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Percentage Beneficial
Ownership of Class (1)
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Percentage of
Voting Power
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Common Stock
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Directors and Named Executive Officers
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Common
Stock
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Series A
Preferred Stock
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Zuosheng Yu (2)
Chief Executive Officer and Chairman of the Board
of Directors
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8,203,900
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14.1
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%
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9.8
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%
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John Chen
Chief Financial Officer, Secretary and Director
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195,000
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*
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*
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Angela He
Director
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48,750
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*
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*
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James Hu
Director
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55,000
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*
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*
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Zhongkui Cao
Director
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12,500
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*
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*
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Executive Officers and Directors as a group
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14.6
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%
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10.2
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%
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5% Owners
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Golden Eight Investments Limited (2)
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14,000,000
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24.0
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%
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16.8
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%
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Series A Preferred Stock
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Victory New Holdings Limited (3)
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3,092,899
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100
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%
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30.0
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%
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* less than 1%
(1) Percentages based on 58,314,688 shares of Common Stock
and 3,092,899 shares of Series A Preferred Stock outstanding as of July 18, 2014.
(2) Mr. Yu is the beneficial owner of 8,203,900 shares of Common
Stock held in his name and 14,000,000 shares of Common Stock held in the name of Golden Eight Investments Limited (“Golden
Eight”). Mr. Yu is the sole director of Golden Eight. Golden Eight is wholly owned by The GSI Family
Trust U/A/D 01/21/10 (the “Trust”). Mr. Yu has sole power of revocation over the Trust and is the sole member
of the Investment Committee of the Trust. As such, Mr. Yu has voting and investment control directly over the securities held by
the Trust and indirectly over the securities held by Golden Eight. Mr. Yu also has voting and investment control over 3,092,899
shares of Series A Preferred Stock held in the name of Victory New Holdings Limited, a British Virgin Islands registered company,
which, while outstanding, have a voting power equal to 30% of the combined voting power of the Company’s Common Stock and
Series A Preferred Stock.
(3) Victory New Holdings Limited, a British Virgin Islands registered
company (“Victory New”), is controlled by the Company’s Chairman and Chief Executive Officer, Zuosheng Yu. Victory
New holds 3,092,899 shares of the Company’s Series A Preferred Stock which, while outstanding, have a voting power equal
to 30% of the combined voting power of the Company’s Common Stock and Series A Preferred Stock.
Change in Control
To the knowledge of management, there are
no present arrangements or pledges of securities of the Company which may result in a change in control of the Company.
SUMMARY OF CORPORATE ACTIONS
General
The corporate actions described below are
required to be approved by the stockholders of the Company to ensure compliance with Section 312.03(b) (“Section 312”)
of the New York Stock Exchange (“NYSE”) listed company manual. The provisions of Section 312 requiring such
approvals are set forth as follows:
“(b) Shareholder approval is required prior to
the issuance of common stock, or of securities convertible into or exercisable for common stock, in any transaction or series of
related transactions, to: (1) a director, officer or substantial security holder of the company;…if the number of shares
of common stock to be issued, or if the number of shares of common stock into which the securities may be convertible or exercisable,
exceeds either one percent of the number of shares of common stock or one percent of the voting power outstanding before the issuance.”
Private Placement Transaction
On July 14, 2014 we entered into a
Subscription Agreement with Zuosheng Yu, our Chairman and Chief Executive Officer (the “Subscription
Agreement”), pursuant to which Mr. Yu has agreed to purchase 5,000,000 shares of Common Stock in a private placement
from us at a purchase price of $1.50 per share (the “Purchase Price”), for an aggregate investment of $7,500,000.
The Purchase Price represents a 23% premium to the volume weighted average closing price of the Common Stock from March 5,
2014 to July 11, 2014, which ranged from $0.90 to $1.47 per share of Common Stock during such period. Such private placement,
including the offer, sale and issuance of the shares is referred to herein as the Private Placement. The Private Placement
requires shareholder approval under Section 312.03 of the NYSE listed company manual due to the number of shares being
purchased being in excess of the one percent threshold described above. To ensure compliance with the NYSE requirements
referenced above and the Subscription Agreement closing conditions, the Stockholder Consent was obtained to approve the
consummation of the Private Placement in accordance with the terms of the Subscription Agreement.
Shareholder Approval of the Private Placement
Section 6 of the Subscription Agreement
requires the Company to obtain stockholder approval of the Private Placement to ensure compliance with the rules and regulations
of the NYSE.
NYSE Applicable Rules
As described above, Section 312 requires
that the Company obtain stockholder approval of the Private Placement.
General Effect on Rights of Existing Security Holders
The issuance of the shares of Common Stock
issued in the Private Placement will substantially dilute the equity interest and the earnings per share of existing holders of
the Common Stock. Other than the dilutive impacts of having additional shares outstanding as described above, the relative
voting and other rights of holders of the Common Stock will not be altered by the authorization and issuance of the additional
shares of Common Stock. Each share of Common Stock will continue to entitle its owner to one vote.
Use of Proceeds
The Company intends to use the proceeds
of the Private Placement to fund its expansion into high-growth bulk commodity e-commerce.
DESCRIPTION OF CAPITAL STOCK
The following description of the
Company’s capital stock summarizes the material terms and provisions of the Common Stock and Series A Preferred Stock,
which is the only series of the Company’s preferred stock that is currently authorized and outstanding. For
the complete terms of Common Stock and Series A Preferred Stock, please refer to the Company’s Articles of
Incorporation, as amended to date, and Bylaws, all of which have been filed as exhibits have been included as exhibits to
previously filed SEC reports. Our authorized capital stock consists of 200,000,000 shares, $0.001 par value. As of
July 18, 2014, there were 58,314,688 shares of Common Stock issued and outstanding and 3,092,889 shares of Series A
Preferred Stock issued and outstanding.
Common Stock
The holders of the Company’s Common
Stock are entitled to one vote for each share held. The affirmative vote of a majority of votes cast at a meeting that commences
with a lawful quorum is sufficient for approval of matters upon which shareholders may vote, including questions presented for
approval or ratification at the annual meeting. The Common Stock does not carry cumulative voting rights, and holders of more than
50% of the Company’s Voting Stock have the power to elect all directors and, as a practical matter, to control our company.
Holders of the Common Stock are not entitled to preemptive rights, and the Common Stock may only be redeemed at the Company’s
election.
After the satisfaction of requirements with
respect to preferential dividends, if any, holders of Common Stock are entitled to receive, pro rata, dividends when and as declared
by the Board out of funds legally available therefore. Upon the Company’s liquidation, dissolution or winding-up, after distribution
in full of the preferential amount, if any, to be distributed to holders of preferred stock, holders of the Common Stock are entitled
to share ratably in its assets legally available for distribution to the Company’s stockholders. All outstanding shares of
Common Stock are fully paid and non-assessable.
Preferred Stock
As of July 18, 2014, the Company had
3,092,899 shares of Series A Preferred Stock issued and outstanding. The Series A Preferred Stock is not convertible
into Common Stock. The 3,092,899 shares of Series A Preferred Stock have an aggregate voting power equal to 30% of the combined
voting power of the Common Stock and preferred stock as long as the Company is in existence.
The Series A Preferred Stock ranks,
with respect to rights to the payment of dividends and the distribution of assets in the event of the Company’s liquidation,
dissolution or winding up, senior to Common Stock. The Company’s Series A Preferred shall be entitled to received dividends
only as, when and if such dividends are declared by the Board. In the event of a liquidation, dissolution or winding up, the Company
is required to pay to the holder of each share of Series A Preferred Stock, the amount paid to the Company for each share of Series
A Preferred Stock plus any accrued and unpaid dividends with respect to such shares of Series A Preferred Stock through the date
of liquidation, dissolution or winding up. The Series A Preferred Stock is not redeemable.
Interests
of Certain Persons In or Opposition to Matters to be Acted Upon
Zuosheng Yu, the Company’s Chairman
and Chief Executive Officer, voted and consented individually and through the entities which he beneficially owns and controls,
as set forth in the “Security Ownership of Certain Beneficial Owners and Management” section above (collectively, the
“Yu Affiliates”), to approve the Private Placement in which he was the Investor. Yu, together with the Yu Affiliates,
beneficially owned approximately 57% of the outstanding Voting Stock prior to the Private Placement.
NOTICE TO STOCKHOLDERS OF ACTION APPROVED
BY CONSENTING STOCKHOLDERS
The Board has determined that the actions
set forth herein are in the best interests of the Company and directed the executive officers of the Company to take all actions
required to secure the approval thereof by the Company’s stockholders by consent.
The approval of the Private Placement
was taken based upon the unanimous recommendation of the Board, and is evidenced by the written consent, dated July 18, 2014,
of the consenting stockholders, including the holder of the Series A Preferred Stock, collectively representing
approximately 57% of the Company’s issued and outstanding shares of Voting Stock, approving the Private
Placement pursuant to Nevada Revised Statutes 78.320.
By Order of the Board of Directors,
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General Steel Holdings, Inc.
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/s/ John Chen
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John Chen
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Secretary
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Beijing, China
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[_____] [__], 2014
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