SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
January 26, 2007
GALES INDUSTRIES INCORPORATED
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(Exact Name of Registrant as Specified in its Charter)
Delaware 000-29245 20-4458244
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State of Commission IRS Employer
Incorporation File Number I.D. Number
1479 North Clinton Avenue, Bay Shore, NY 11706
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Address of principal executive offices
Registrant's telephone number: (631) 968-5000
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 3.02. Unregistered Sales of Equity Securities.
On November 30, 2005, in connection with the acquisition by Gales Industries
Incorporated (the "Company") of its wholly-owned subsidiary, Air Industries
Machining, Corp. ("AIM"), the Company issued $332,631 principal amount
convertible promissory notes to each of Peter Rettaliata, our President, Chief
Executive Officer and a Director, and Dario Peragallo, our Executive Vice
President and a Director, convertible into shares of our common stock at the
conversion price of $0.40 per share.
On January 26, 2007, each of Mr. Rettaliata and Mr. Peragallo exercised their
right of conversion of the convertible promissory notes and converted the entire
$359,886.22 of principal and interest outstanding under the convertible
promissory notes into 899,716 shares of common stock at a conversion price of
$0.40 per share. These shares of common stock were issued pursuant to an
exemption under Section 4(2) under the Securities Act.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits
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99.1 Press Release, dated January 30, 2007, of Gales Industries Incorporated.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this Current Report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: January 29, 2007
GALES INDUSTRIES INCORPORATED
By: /s/ Michael A. Gales
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Michael A. Gales, Executive Chairman
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EXHIBIT INDEX
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99.1 Press Release, dated January 30, 2007, of Gales Industries Incorporated.
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For Immediate Release
Gales Industries Incorporated Executive Management
Converts Debt into Common Shares
Demonstrates Ongoing Support and Commitment
BAY SHORE, NY -- January 30, 2007 -- Gales Industries Incorporated (OTCBB: GLDS)
(the "Company"), a holding company established to consolidate manufacturers,
engineering integrators and specialized service providers to the
aerospace/defense industry, today announced that Peter D. Rettaliata and Dario
A. Peragallo, President and Executive Vice President respectively, have agreed
to convert $719,772.44 in principal amount of notes plus accrued interest due
from the Company into 1,799,431 shares of Gales common stock.
On November 30, 2005, as part of the stock purchase between the Company and Air
Industries Machining Corp. ("AIM"), the Company issued notes payable for an
aggregate of $1,627,262 to three former AIM shareholders, two of whom have
become part of the Company's senior management and are also stockholders in the
Company. The notes payable to the two senior management members, Messrs.
Rettaliata and Peragallo, aggregated $665,262 and would have matured on November
30, 2010, along with accrued interest. The outstanding principal amount of these
notes together with interest accrued thereon has been converted in total at the
holders' option into the Company's common stock.
"We appreciate the continued commitment of our senior executives," said Gales
Industries' Executive Chairman Michael A. Gales. "They have through this
transaction demonstrated their support for and confidence in the future of the
Company. As a result of this conversion, the Company has reduced its debt
significantly and eliminated interest obligations that had approximated $50,000
per year, thus enhancing and strengthening the Company's balance sheet."
ABOUT GALES INDUSTRIES INCORPORATED
Gales Industries Incorporated (OTCBB: GLDS) is a holding company established to
engage in the consolidation of manufacturers, engineering integrators and
related service providers to the aerospace/defense and commercial aviation
industries. The Company is focused on flight safety and other critical
componentry. The Company's first acquisition was of Air Industries Machining
Corp., a leading aerospace/defense manufacturer and engineering integrator based
in Bay Shore, Long Island, NY. Consolidation opportunities include companies
operating within highly synergistic disciplines of manufacturing, technical
services and strategic products distribution. The Company's strategy and
attendant tactical plan is to execute its consolidation principally amongst Tier
III, IV and V aerospace/defense subcontractors. Gales offers a tailored exit
strategy or management continuity strategy in exchange for qualified
acquisitions, and targets technically superior middle market organizations with
revenues of up to $100 million annually. Information on the Company and its
products may be found online at www.airindmc.com.
# # #
Certain matters discussed in this press release are 'forward-looking statements'
intended to qualify for the safe harbors from liability established by the
Private Securities Litigation Reform Act of 1995. In particular, the Company's
statements regarding trends in the marketplace, firm backlog, projected backlog,
potential future results and acquisitions, are examples of such forward-looking
statements. The forward-looking statements include risks and uncertainties,
including, but not limited to, the timing of projects due to the variability in
size, scope and duration of projects, estimates, projections and forecasts made
by management with respect to the Company's critical accounting policies, firm
backlog, projected backlog, regulatory delays, government funding and budgets,
matters pertaining to potential and pending acquisitions subject to and after
closings, and other factors, including results of financial audits and general
economic conditions, not within the Company's control. Certain of the Company's
forward looking statements, with the projected backlog in particular, are
formulated based on management's extensive industry experience and understanding
and assessment of industry trends, customer requirements, and related government
spending. Projected backlog may be subject to variability and may increase or
decrease at any time based on a variety of factors, including but not limited to
modifications of previously released orders, acceleration of orders under
general purchase agreements, etc. The factors discussed herein and expressed
from time to time in the Company's filings with the Securities and Exchange
Commission could cause actual results and developments to be materially
different from those expressed in or implied by such statements. The
forward-looking statements are made only as of the date of this press release
and the Company undertakes no obligation to publicly update such forward-looking
statements to reflect subsequent events or circumstances.
Contacts:
Jordan M. Darrow
Darrow Associates, Inc.
631-367-1866
jdarrow@darrowir.com
or
Gales Industries Incorporated
Michael A. Gales
631-328-7024
mag@airindmc.com