UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 38477 / April 4, 1997 ADMINISTRATIVE PROCEEDING File No. 3-9286 ------------------------------- : : ORDER INSTITUTING CEASE- In the Matter of : AND-DESIST PROCEEDINGS : PURSUANT TO SECTION 21C OF RONALD W. DAW : THE SECURITIES EXCHANGE ACT and J. WESTON DAW, : OF 1934 AND FINDINGS AND : ORDER OF THE COMMISSION Respondents. : : -------------------------------- I. The Commission deems it appropriate and in the public interest that public administrative proceedings be, and they hereby are, instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") to determine whether Ronald W. Daw ("Ronald Daw") and J. Weston Daw ("Weston Daw") have failed to comply with Sections 13(g) and 16(a) of the Exchange Act, and Rules 13d-1, 13d-2, 16a-2 and 16a-3 thereunder. II. In anticipation of the institution of these administrative proceedings, Ronald Daw and Weston Daw ("the Respondents") have submitted Offers of Settlement which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, the Respondents, without admitting or denying the matters set forth herein, consent to the issuance of this Order Instituting Cease- and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934 and Findings and Order of the Commission ("the Order"), and to the entry of the findings, and imposition of the remedial sanctions set forth below. III. On the basis of this Order and the Respondents' Offers of Settlement, the Commission finds the following: ==========================================START OF PAGE 2====== A. FACTS 1. Respondents a. Ronald W. Daw Ronald Daw, age 44, a resident of Murray, Utah, has been Chairman of the Board of Directors, President and Chief Executive Officer, of Daw Technologies, Inc. ("Daw Technologies") since October 1992. As of April 1, 1996, Ronald Daw beneficially owned approximately 18% of Daw Technologies common stock and at all relevant times has beneficially owned more than ten percent of the equity securities of Daw Technologies. b. J. Weston Daw J. Weston Daw, age 72, is a resident of Murray, Utah, and was a director and more than ten percent beneficial owner of the common stock of Daw Technologies from at least July 1993. Weston Daw resigned as a director of Daw Technologies in November 1995. As of April 1, 1996, Weston Daw beneficially owned approximately 19.8% of Daw Technologies common stock. 2. Issuer Daw Technologies, a Utah corporation with its principal offices in Salt Lake City, supplies cleanrooms to the semiconductor industry. According to its Annual Report on Form 10-K for the year ended December 31, 1995, the company had total assets of over $40 million and stockholders' equity of approximately $19.4 million. As of March 26, 1996, Daw Technologies had 12,330,254 shares of common stock outstanding. Daw Technologies reported net income of $287,000 for its 1995 fiscal year. The company's common stock has been registered with the Commission pursuant to Section 12 of the Exchange Act since July 17, 1993, and is traded on Nasdaq's National Market System. B. APPLICABLE LAW Section 13(g) of the Exchange Act and Rule 13d-1(c) thereunder, in relevant part, require any person who, as of December 31, 1978 or as of the end of any calendar year thereafter, beneficially owns more than 5 percent of any equity security of a company registered pursuant to Section 12 of the Exchange Act, and who is not otherwise required to file a Schedule 13D, to file a Schedule 13G with the Commission within 45 days of the end of the calendar year in which the obligation arises. Rule 13d-2(b) provides that yearly amendments shall be filed to Schedule 13G reporting changes in the information previously reported. ==========================================START OF PAGE 3====== Section 16(a) of the Exchange Act and the rules thereunder require that beneficial owners of more than ten percent of any class of any equity security registered pursuant to Section 12 of the Exchange Act and the officers and directors of the issuer of any such security (hereinafter "insider") file a statement with the Commission by the effective date of a registration statement filed pursuant to Section 12 of the Exchange Act, or within ten days of becoming such officer, director or beneficial owner, reporting the amount of all equity securities of such issuer of which they are a beneficial owner. Section 16(a) also requires an insider to file with the Commission within ten days after the close of each calendar month, if there has been a change in the insider's ownership of the issuer's equity securities during such month, a statement indicating such changes. The rules enacted pursuant to Section 16(a) provide that an initial statement by an insider is to be made on a Form 3 and subsequent statements of changes in beneficial ownership are to be made on a Form 4 or a Form 5. C. VIOLATIONS OF SECTION 13(g) OF THE EXCHANGE ACT AND THE RULES THEREUNDER Ronald Daw failed for more than two years and three months to file a Schedule 13G, and failed for three months and two weeks and more than one year and three months to file two amendments to his Schedule 13G reporting changes in the information contained in Schedule 13G. Weston Daw failed for more than two years and three months to file a Schedule 13G, and failed for three months and two weeks and more than one year and three months to file two amendments to his Schedule 13G reporting changes in the information contained in Schedule 13G. D. VIOLATIONS OF SECTION 16(a) OF THE EXCHANGE ACT AND THE RULES THEREUNDER Ronald Daw failed for more than two years and ten months to file an amendment to his Form 3 with the Commission reporting his holdings of Daw Technologies, failed for periods ranging from one week to more than two years and nine months to file twelve Forms 4 reporting changes in his beneficial ownership of securities of Daw Technologies, and failed for periods ranging from more than three weeks to more than two years and three months to file four Forms 5 and amendments thereto. The combined value of Ronald Daw's securities transactions reported late on Forms 4 and 5 is $2,284,794. Weston Daw failed for more than two years and ten months to file an amendment to his Form 3 with the Commission reporting his holdings of Daw Technologies, failed for periods ranging from one week to more than two years and nine months to file twelve Forms ==========================================START OF PAGE 4====== 4 reporting changes in his beneficial ownership of securities of Daw Technologies, and failed for periods ranging from one month and two weeks to more than two years and three months to file four Forms 5 and amendments thereto. The combined value of Weston Daw's securities transactions reported late on Forms 4 and 5 is $2,483,471. The history of late filings, by Ronald Daw and Weston Daw, compiled from the ownership reports and schedules they filed with the Commission, is set forth below: ==========================================START OF PAGE 5====== RONALD W. DAW Forms 3, 4 and 5 Daw Technologies, Inc. July 19, 1993 through May 31, 1996 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late Form 3 07-93 C/S 3,353,570 07-19-93T ConvDeb 2,570,400 07-22-93 07-93 C/S 1,301,635 07-19- 93 2y10m1w Amend. ConvDeb 1,285,200 05-31-96 Opts 100,000 Forms 4, 5 07-93 Sale 3,000 3.25 9,750 08-10- 93 1m1w 5,000 3.50 17,500 09-20-93 8,377 3.56 29,822 57,072 07-93 Conv 1,285,200 .34 436,968 08-10- 93 2y9m3w of ConvDeb 05-31-96 into shrs 07-93 Exer of 100,000 .34 34,000 08-10- 93 2y9m3w opt 05-31-96 07-93 Opt 100,000 1.50 150,000 08-10- 93 2y9m3w Grant 05-31-96 08-93 Sale 4,000 3.50 14,000 09-10-931w 500 3.38 1,690 09-20-93 1,000 3.13 3,130 2,600 2.75 7,150 1,000 3.13 3,130 ==========================================START OF PAGE 6====== 1,300 3.38 4,394 2,000 3.38 6,760 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 08-93 1,000 3.38 3,380 (cont.) 850 3.38 2,873 3,000 3.50 10,500 57,007 08-93 Sale 2,000 3.13 6,260 09-10-931m 400 3.13 1,252 10-15-93 7,512 08-93 Sale 500 3.38 1,690 09-10- 93 2y8m3w Amend. 05-31-96 11-93 Sale 2,500 3.50 8,750 12-10-931w 12-20-93 11-93 Opt 30,000 3.56 106,800 02-14- 94 2y3m2w Grant 05-31-96 12-93 Sale 2,350 3.50 8,225 01-10-94T 600 3.38 2,028 12-20-93 1,400 3.50 4,900 12-93 Opt 30,000 3.75 112,500 02-14- 94 1y1m2w Grant 03-31-95 12-93 Disp by 7,500 N/A N/A 02-14- 94 2y3m2w Amend. Gift 05-31-96 FY-93 Form 5 02-14-94 2y3m2w 05-31-96 03-94 Sale 25,000 3.50 87,500 04-11-941w 25,000 4.00 100,000 04-19-94 50,000 6.50 325,000 11,500 6.13 70,495 582,995 ==========================================START OF PAGE 7====== 03-94 Sale 10,000 5.38 53,800 04-11- 94 11m3w 03-31-95 06-94 OtherDisp 55,636 N/A N/A 07-11- 94 1y10m2w (Cancel) 05-31-96 08-94 Disp by 11,623 N/A N/A 02-14- 95 1y3m2w Gift 05-31-96 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 11-94 Opt 30,000 5.75 172,500 02-14- 95 1m2w Grant 03-31-95 12-94 Disp by 100 N/A N/A 02-14-951y Gift 600 N/A N/A 02-14-96 12-94 Acq by 219,300 N/A N/A 02-14-951y Gift 02-14-96 12-94 Disp by 219,300 N/A N/A 02-14- 95 1y3w Gift 03-11-96 12-94 Acq by 100 N/A N/A 02-14- 95 1y3w Gift 600 N/A N/A 03-11-96 12-94 Disp by 10,000 N/A N/A 02-14- 95 1y3m2w Gift 500 N/A N/A 05-31-96 FY-94 Form 5 02-14-95 1m2w 03-31-95 05-95 Sale 15,000 7.25 108,750 06-12-95T 15,000 7.13 106,950 06-15-95 5,000 6.75 33,750 10,000 7.15 71,500 10,000 7.38 73,800 5,000 7.25 36,250 40,000 7.62 304,800 10,000 8.30 83,000 ==========================================START OF PAGE 8====== 16,250 7.75 125,938 10,000 7.94 79,400 3,750 7.88 29,550 10,000 7.81 78,100 05-95 Disp by 7,000 N/A N/A 02-14- 96 3m2w Gift 05-31-96 07-95 Sale 15,000 10.13 151,950 08-10-954m 25,000 10.25 256,250 12-11-95 10,000 9.50 95,000 503,200 07-95 Disp by 10,000 9.75 97,500 02-14-96T Gift 12-11-95 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 11-95 Exer of 100,000 1.50 150,000 12-11-95T Opt 12-11-95 11-95 Opt 25,000 6.63 165,750 02-14-96T Grant 02-14-96 FY-95 Form 5 02-14-96 T 02-14-96 FY-95 Form 5 02-14-96 3w Amend. 03-11-96 FY-95 Form 5 02-14-96 3m2w Amend. 05-31-96 03-96 Buy 10,000 5.13 51,300 04-10-96T 04-10-96 Total value late reported transactions: $2,284,794 ==========================================START OF PAGE 9====== * = Price per share rounded off T = Timely C/S = Common Stock ConvDeb = Convertible Debentures Conv = Conversion Opt = Option ==========================================START OF PAGE 10====== RONALD W. DAW Schedules 13G and Amendments Daw Technologies, Inc. February 14, 1994 through May 31, 1996 Date Year Event Due/ Apprx. of No. of Triggering Date Yrs/Mos/ Trans. Type Shares Amendment Rec'd Wks.Late 1993 13G 5,713,168 02-14-94 2y3m2w 05-31-96 1994 13G Amendment Change in 02-14-95 1y3m2w Information 05-31-96 1995 13G Amendment " 02-14-96 3m2w 05-31-96 ==========================================START OF PAGE 11====== J. WESTON DAW Forms 3, 4 and 5 Daw Technologies, Inc. July 19, 1993 through July 18, 1996 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late Form 3 07-93 C/S 1,689,717 07-19-93T ConvDeb 1,285,200 07-22-93 07-93 C/S 1,672,277 07-19- 93 2y10m1w Amend. ConvDeb 1,285,200 05-31-96 Opts 100,000 Forms 4, 5 07-93 Conv 1,285,200 .34 436,968 08-10- 93 2y9m3w of ConvDeb 05-31-96 into shrs 07-93 Exer of 100,000 .34 34,000 08-10- 93 2y9m3w opt 05-31-96 07-93 Opt 100,000 1.50 150,000 08-10- 93 2y9m3w Grant 05-31-96 08-93 Sale 5,000 3.13 15,650 09-10-931w 09-20-93 08-93 Sale 8,376 3.56 29,818 09-10- 93 2y8m3w Amend. 05-31-96 11-93 Sale 18,000 3.50 63,000 12-10-931w 12-20-93 11-93 Opt 5,000 3.56 17,800 02-14- ==========================================START OF PAGE 12====== 94 1y1m2w Grant 03-31-95 12-93 Sale 2,000 3.50 7,000 01-10-94T 12-20-93 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 12-93 Disp by 7,000 N/A N/A 02-14- 94 2y3m2w Gift 05-31-96 FY-93 Form 5 02-14-94 2y3m2w 05-31-96 02-94 Sale 10,000 5.38 53,800 03-10- 94 1y3w 03-31-95 03-94 Sale 22,000 6.13 134,860 04-11- 94 11m3w 03-31-95 03-94 Sale 25,000 3.50 87,500 04-11- 94 2y1m2w 25,000 4.00 100,000 05-31-96 50,000 6.50 325,000 512,500 06-94 Other 71,035 N/A N/A 07-11- 94 1y10m2w Disp(Cancel) 05-31-96 08-94 Disp of 11,624 N/A N/A 02-14- 95 1y3m2w Gift 05-31-96 11-94 Opt 5,000 5.75 28,750 02-14- 95 1m2w Grant 03-31-95 12-94 Disp of 5,000 N/A N/A 02-14- 95 1y3m2w Gift 05-31-96 FY-94 Form 5 02-14-95 1m2w 03-31-95 ==========================================START OF PAGE 13====== FY-94 Form 5 02-14-95 1y3m2w Amend. 05-31-96 05-95 Sale 10,000 7.13 71,300 06-12-95T 90,000 7.62 685,800 06-15-95 10,000 8.30 83,000 16,250 7.75 125,938 10,000 7.75 77,500 3,750 7.88 29,550 10,000 7.81 78,100 07-95 Disp by 12,000 N/R N/R 02-14-96T Gift 3,000 N/R N/R 10-10-95 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 07-95 Sale 40,000 9.50 380,000 08-10-952m 25,000 9.63 240,750 10-10-95 10,000 8.88 88,800 709,550 08-95 Sale 10,000 8.63 86,300 09-11-951m 15,000 8.63 129,450 10-10-95 215,750 08-95 Disp by 57,200 N/R N/R 02-14-96T Gift 10-10-95 09-95 Sale 18,000 3.50 63,000 10-10-95T 10-10-95 11-95 Exer of 100,000 1.50 150,000 12-11-95T Opt 12-11-95 11-95 Other 1,440,802 N/A N/A 12-11- 95 7m1w Acq 07-18-96 11-95 Other 1,440,802 N/A N/A 12-11- 95 7m1w Disp 07-18-96 12-95 Disp by 341 N/A N/A 02-14- 96 3m2w Gift 05-31-96 FY-95 Form 5 02-14-96 3m2w ==========================================START OF PAGE 14====== 05-31-96 01-96 Disp by 500,000 N/A N/A 02-14-97T Gift 05-31-96 01-96 Acq by 500,000 N/A N/A 02-14-97T Gift 05-31-96 03-96 Buy 2,500 4.63 11,575 04-10-961m 500 4.63 2,315 05-10-96 500 4.63 2,315 1,500 4.63 6,945 7,500 4.63 34,725 5,000 4.63 23,150 81,025 Date Month Price Due/ Apprx. of No. of Per Total Date Yrs/Mos/ Trans. Type Shares Share* $Value Rec'd Wks.Late 04-96 Buy 1,000 4.88 4,880 05-10-96T 1,000 4.88 4,880 05-10-96 500 4.88 2,440 4,000 4.88 19,520 31,720 Total value late reported transactions: $ 2,483,471 * = Price per share rounded off T = Timely C/S = Common Stock ConvDeb = Convertible Debentures Conv = Conversion Opt = Option ==========================================START OF PAGE 15====== J. WESTON DAW Schedules 13G and Amendments Daw Technologies, Inc. February 14, 1996 through May 31, 1996 Date Year Event Due/ Apprx. of No. of Triggering Date Yrs/Mos/ Trans. Type Shares Amendment Rec'd Wks.Late 1993 13G 2,817,101 02-14-94 2y3m2w 05-31-96 1994 13G Amendment Change in 02-14-95 1y3m2w Information 05-31-96 1995 13G Amendment " 02-14-96 3m2w 05-31-96 ==========================================START OF PAGE 16====== IV. FINDINGS Based on the above, the Commission finds that Ronald Daw and Weston Daw violated Sections 13(g) and 16(a) of the Exchange Act, and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. V. OFFERS OF SETTLEMENT Ronald Daw and Weston Daw have submitted Offers of Settlement in this proceeding which the Commission has determined to accept. Ronald Daw and Weston Daw, in their Offers, consent to this Order making findings, as set forth above, and ordering them to cease and desist from committing or causing any violation of, and committing or causing any future violation of, Sections 13(g) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulated thereunder. VI. ORDER Accordingly, IT IS HEREBY ORDERED, pursuant to Section 21C of the Exchange Act, that Ronald Daw and Weston Daw cease and desist from committing or causing any violation of, and committing or causing any future violation of, Sections 13(g) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. By the Commission. Jonathan G. Katz Secretary