UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Information Required Pursuant To
Rule 14f-1 Under The Securities Exchange Act Of 1934
August 30, 2002
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(Date of Report)
Ventures National Incorporated
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(Exact name of registrant as specified in its charter)
Utah 000-32847 87-0433444
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1855 Norman Avenue
Santa Clara, California 95054-2029
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(Address of principal executive offices)
(408) 727-7513
(Registrant's telephone number, including area code)
This Information Statement is being mailed to holders of record of shares of
common stock, par value $0.001 per share (the "Common Stock"), of Ventures
National Incorporated, a Utah corporation (the "Company"), as of August 29,
2002 (the "Record Date"), pursuant to the requirements of Section 14(f) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 14f-
1 promulgated thereunder. THIS INFORMATION STATEMENT IS BEING PROVIDED SOLELY
FOR INFORMATIONAL PURPOSES AND NOT IN CONNECTION WITH A VOTE OF THE COMPANY'S
STOCKHOLDERS.
Background
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The Company has recently entered into an agreement relating to a
transaction which will ultimately result in the replacement of the majority of
the Board of Directors of the Company. The following is a brief summary of
this transaction.
On August 12, 2002, the Company entered into an Agreement and Plan of
Merger (the "Merger Agreement") with Titan EMS Acquisition Corp., a newly-
formed Delaware corporation and wholly-owned subsidiary of the Company ("Titan
Acquisition"), and Titan EMS, Inc., a Delaware corporation ("Titan"), which
sets forth the terms and conditions of the business combination of the Company
and Titan through the merger of Titan Acquisition with and into Titan (the
"Merger") as a result of which Titan has become a wholly-owned subsidiary of
the Company. The Merger became effective on August 30, 2002 (the "Effective
Time") upon the satisfaction or waiver of each of the closing conditions set
forth in the Merger Agreement and the subsequent filing of a Certificate of
Merger of Titan Acquisition into Titan with the Secretary of State of the
State of Delaware.
Titan is a manufacturer of time sensitive, high tech, prototype, and
pre-production printed circuit boards. Beginning in the year 2001, Titan and
its predecessors began acquiring technology equipment and processes from
competitors unable to remain in business due to a severe market downturn and
overwhelming debt. Titan also obtained customer lists and orders from several
of these firms, resulting in potential new business opportunities. Titan has
begun the process of relocating and upgrading its current PCB plant into a
facility formerly occupied by Tyco Electronics Inc. in Fremont, California.
It is currently anticipated, and the Merger Agreement provides, that the
three directors of the Company immediately prior to the Effective Time, John
Winchester, Tyler Despain and Luke Bradley, will continue as directors of the
Company after the Effective Time until ten days after the date this
Information Statement is first mailed to the Company's stockholders (the
"Director Transition Date"), at which time they will each resign as a director
of the Company and David Marks, Louis George, Gregory Jacobs and Robert I.
Weisberg will each be appointed to and will comprise the entire Board of
Directors of the Company.
Voting Securities And Principal Holders Thereof
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On the Record Date, there were 99,211 shares of Common Stock issued and
outstanding. As of the Record Date, (i) no shares of Common Stock were
reserved for issuance pursuant to option grants and (ii) no shares of Common
Stock were reserved for issuance pursuant to other securities exercisable for,
or convertible into or exchangeable for, shares of Common Stock. Each holder
of Common Stock is entitled to cast one vote, in person or by proxy, for each
share of Common Stock held by him. The Common Stock is the only capital stock
of the Company outstanding.
The following table sets forth certain information with respect to
persons known by the management of the Company to own beneficially more than
five (5%) percent of the Common Stock of the Company as of the Record Date
(based on 99,211 shares of Common Stock outstanding). None of the three
directors and officers of the Company as of the Effective Time owned any
shares of Common Stock.
Number of Shares Percentage
Name Beneficially Owned of Class
---- ------------------ --------
James P. Doolin 16,667 16.7%
1223 Wilshire Boulevard, #912
Santa Monica, CA 90403
Don J. Woroner 28,454 28.7%
770 Second Avenue
St. Petersburg, FL 33701
On August 30, 2002, giving effect to the consummation of the Merger and
as of the Effective Time, there were 8,609,132 shares of Common Stock issued
and outstanding. Upon the Effective Time, (i) 710,000 shares of Common Stock
were reserved for issuance pursuant to option grants and (ii) 350,000 shares
of Common Stock were reserved for issuance pursuant to other securities
exercisable for, or convertible into or exchangeable for, shares of Common
Stock.
The following table sets forth the number of shares of Common Stock of
the Company owned by persons known by the management of the Company to own
beneficially more than five (5%) percent of the Common Stock as of the
Effective Time as well as the officers and directors of the Company after the
Effective Time and the Director Transition Date, respectively (based on
8,609,132 shares of Common Stock outstanding):
Number of Shares Percentage
Name Beneficially Owned of Class
---- ------------------ --------
David Marks 7,959,921(1) 92.5%
1818 North Farwell Avenue
Milwaukee, WI, 53202
Ohio Investors of
Wisconsin LLC 1,160,7642 13.5%
1818 North Farwell Avenue
Milwaukee, WI, 53202
SVPC Partners LLC 800,000 9.3%
1855 Norman Avenue
Santa Clara, CA, 95054
Louis George 400,000(3) 4.0%
Gregory B. Jacobs 0 0.0%
Robert I. Weisberg 0 0.0%
All Executive Officers and
Directors As a group
(4 persons) 8,359,921(1,3) 97.1%
1. Includes 5,800,000 shares held by Irrevocable Children's Trust, of which
Mr. Marks is the trustee with voting and dispository powers with respect to
its shares of Common Stock and an additional 68,677 shares issued by the
Company to Irrevocable Children's Trust upon the effectiveness of the Merger
in consideration for the cancellation of $103,000 of indebtedness of Titan.
Includes 1,160,764 shares held by Ohio Investors of Wisconsin LLC, which is
controlled by Irrevocable Children's Trust (issued by the Company upon the
effectiveness of the Merger in consideration for the cancellation of
$1,741,146 of indebtedness of Titan), of which Mr. Marks is the trustee with
voting and dispository powers with respect to such shares. Includes 800,000
shares held by SVPC Partners LLC, which is controlled by Irrevocable
Children's Trust, of which Mr. Marks is the trustee with voting and
dispository powers with respect to such shares. Includes 123,823 shares held
by Phoenix Business Trust, which is controlled by Irrevocable Children's
Trust, of which Mr. Marks is the trustee with voting and dispository powers
with respect to such shares. Includes 6,667 shares held by Forest Home
Investors I, LLC, which is controlled by Irrevocable Children's Trust, of
which Mr. Marks is the trustee with voting and dispository powers with respect
to such shares.
2. Represents shares issued by the Company upon the effectiveness of the
Merger in consideration for the cancellation of $1,741,146 of indebtedness of
Titan.
3. Includes 50,000 shares of Common Stock received in consideration for Mr.
George's contribution of certain assets into Titan prior to the Effective Time
and options to purchase up to 350,000 shares of Common Stock at a purchase
price of $1.50 per share exercisable through July 31, 2007, granted pursuant
to Mr. George's employment agreement with Titan (the Company assumed the
obligations under Mr. George's option agreement with Titan pursuant to the
Merger Agreement).
Change In Control
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Pursuant to the terms and conditions of the Merger Agreement, upon the
Effective Time, Titan Acquisition merged with and into Titan, with Titan as
the surviving corporation. As a result, Titan became a wholly-owned
subsidiary of the Company. Pursuant to the Merger Agreement, the Company
issued 6,880,490 shares of Common Stock to the stockholders of Titan, which
represents approximately 79.9% of the issued and outstanding shares of Common
Stock (and 71.2% of the fully-diluted equity capitalization) of the Company
immediately after the Effective Time.
Due to the issuance of the Merger Shares, the change in the officers of
the Company, which became effective on August 30, 2002, and the change of
directors of the Company, which will occur on the tenth day after the date
this Information Statement is first mailed to the Company's stockholders, a
change in control of the Company has occurred and will occur on the date of
the change of directors.
Directors And Executive Officers And Nominees For Directors
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Prior to the Effective Time and the Director Transition Date
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The following table sets forth as of certain information with respect to the
directors and named executive officers of the Company as of the Record Date.
Name Age Position
- ---- --- --------
John Winchester 28 President
Director
Tyler Despain 28 Vice President
Director
Luke Bradley 26 Secretary
Director
The following is a brief description of the business background of the
executive officers and directors of the Company as of the Record Date:
John Winchester, President and a director is 28 years of age. Mr. Winchester
received a bachelors degree from the University of Utah in Organizational
Communication in May 1999. Mr. Winchester has been working as a production
director for a major drafting company, in Salt Lake City, Utah, for the past
six years.
Tyler Despain, Vice President and a director is 28 years of age. Mr. Despain
received a Bachelor of Arts, with a degree in sociology in December 2000 from
the University of Utah. Mr. Despain is currently working for a software
developer in southern California.
Luke Bradley, Secretary and a director is 26 years of age. Mr. Bradley is
currently attending the University of Utah, in Salt Lake City. He was
graduated in 2001, with a bachelor of science, finance degree. Mr. Bradley
currently works for a firm that specializes in promotional merchandise for
companies.
Executive Officers as of the Effective Time and Director Nominees
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Set forth below is certain information with respect to the individuals
to be named director of the Company at the Director Transition Date and
officers of the Company as of the Effective Time.
Name Age Position
---- --- --------
David Marks 34 Chairman of the Board and Director
Louis George 36 President, Chief Executive Officer,
Acting Treasurer and Director
Gregory B. Jacobs 44 Director
Robert I. Weisberg 56 Director
David Marks, 34, Chairman and Director. Mr. Marks has been a Director of
Titan since its inception and prior to Mr. George's hiring, served as
President and Chief Executive Officer of Titan. Mr. Marks has served as
Trustee of Irrevocable Children's Trust and Irrevocable Children's Trust No.2
(the "Trusts") since 1994. The Trusts currently have an ownership or
investment interest in over thirty (30) investment ventures including
approximately twenty-five (25) commercial properties, private residences,
natural resources, offshore casino gaming, telecommunications, and technology
companies, and other miscellaneous business and investment ventures. Most
investments by the Trusts are made through subsidiary limited liability
companies, corporations or other special purpose-single asset entities
ultimately controlled or managed by Mr. Marks on behalf of the Trusts. Mr.
Marks has the responsibility in overseeing all investments by the Trusts with
responsibilities beginning at acquisition and continuing through ownership.
He has played a key role in all of the business acquisitions, borrowings, and
post-closing management of the Trusts' assets and their subsidiaries. Mr.
Marks generally acts in the capacity of officer or director for all of the
operating companies and is involved in strategic planning, and major decision-
making. Mr. Marks holds a BS in Economics from the University of Wisconsin.
Louis George, 36, President, Chief Executive Officer, Acting Treasurer and
Director. Mr. George has been a Director of Titan since August 6, 2002. Mr.
George has most recently held the position as Managing Director of Assembly
Operations for the Tyco Printed Circuit Group where he had responsibility for
four assembly divisions throughout the world manufacturing Backpanel
Assemblies and Systems Integration. Prior to this position, he was the
Northern California Director of Operations for three successful Printed
Circuit Board Divisions having complete accountability for profit and losses.
After Tyco's acquisition of Sigma Circuits, Inc., Louis was given the
opportunity to manage both Rigid and Flexible Circuit Divisions. At Sigma
Circuits, Louis held multiple General Manager Positions which consisted of
overseeing a Time Sensitive, High Technology, Commercial and Military, Rigid
PCB Facility, the Flexible Circuit Division and the Systems Integrations
Operation. His professional career in the PCB industry stems from a family
operation and began long before joining Tyco (formerly Sigma Circuits, Inc.)
in 1983. Since that time, a variety of operational and management level
positions has provided him the ability to develop an extensive knowledge of
all facets of the PCB manufacturing industry. He has obtained ISO 9000
certification for two facilities and recently TL 9000 at another. With Tyco,
Louis actively participated in acquisitions of PCB companies and facility
consolidations. At Sigma Circuits, he was involved in the initial public
offering and sale of the company.
Gregory B. Jacobs, 44, Director. Since 1997, Mr. Jacobs has worked at
Greenwich Capital Markets, where he most recently held the post of Managing
Director. At Greenwich Capital Markets he serves as the Head of Non-Agency
and Commercial Trading and Co-Head of the Commercial Assets Group. From 1996
to 1997, Mr. Jacobs served as the President of FS Capital LLC, which conducted
broker/dealer activities in the securitized asset sectors of the fixed income
capital markets. Since 1994, Mr. Jacobs has served as a Member and Principal
of the Financial Structuring LLC, a consulting and advisory services company
that provides structuring and analysis within the Commercial Mortgage Market
and Small Business Acquisitions. From 1991 to 1994, Mr. Jacobs had been with
Daiwa Securities America Inc., where he served as a Managing Director B
Mortgage Trading. Previously, Mr. Jacobs had been with Salomon Brothers Inc.,
where he successively served in the Real Estate Finance Department from 1983
to 1984, was Vice-President, Government Trading from 1984 to 1986 and served
as Vice President, Mortgage Trading from 1986 to 1991. Before joining Salomon
Brothers, Mr. Jacobs served as a Financial Analyst for Xerox Corporation,
Engineering and Graphic Products. Mr. Jacobs holds an M.S. Business
Management with a concentration in Finance and Option Theory from the Sloan
School of Management, Massachusetts Institute of Technology and a Sc.B.
Mechanical Engineering from Brown University.
Robert I. Weisberg, 56, Director. Mr. Weisberg is the past Chairman of
the Board and President of the Commercial Finance Association, which is the
National Trade Association of Asset-based Lending among Banks and Independent
Finance Companies. He is President and CEO of ALCO Financial Services, LLC in
Larkspur, CA. Prior to this position Mr. Weisberg spent eight years with
Fleet Financial Group as President of Fleet Credit and Executive Vice
President of Fleet Bank. During his tenure with Fleet, Mr. Weisberg acquired
and sold numerous non-bank entities. Prior to Fleet Mr. Weisberg spent 18
years at Bank of Boston in a variety of capacities in the Commercial Finance,
Factoring and Asset-based Lending units. His last three years were spent as
President of the Banks operations headquartered in Montreal, Canada and
Executive Vice President of the Parent. Mr. Weisberg has served on many
corporate and not for profit boards including Environmental Power Group,
Monterey Mutual Funds, Pacific Income Advisors, Miriam Hospital, Northeastern
University and Langston Hughes Center for the Arts. He is also a Trustee of
the Reed Union School District, which includes the towns of Belvedere,
Tiburon, and East Corte Madera in the San Francisco Bay Area. Mr. Weisberg
holds a B.S. from Northeastern University and is also a graduate of the joint
program of the Graduate School of Credit and Financial Management between
Harvard University and Williams College.
Currently, the Board of Directors has no separate audit, nominating or
compensation committees and acts as such as an entire Board.
Board Meetings. There was one regularly scheduled meeting of the Board
of Directors held during the year ended June 30, 2002, which meeting was
attended by all of the Company's existing directors.
Executive Compensation Of Current Management
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As of the Record Date, the Company was not a party to any employment
contracts, or termination of employment or change-in-control arrangements.
Lou George, the Company's President and Chief Executive Officer commencing as
of the Effective Time, is party to an employment agreement with the Titan,
pursuant to which he is entitled to receive (i) annual compensation in the
aggregate amount of $165,000, and (ii) options to purchase up to 350,000
shares of Common Stock at a purchase price of $1.50 per share, exercisable
through July 31, 2007 (the Company assumed this obligation pursuant to the
Merger Agreement). Stephen Saul Kennedy, the Company's Vice-President, Sales,
commencing as of the Effective Time, is party to an employment agreement with
Titan, pursuant to which he is entitled to receive (i) annual compensation in
the aggregate amount of $140,000, and (ii) options to purchase up to 360,000
shares of Common Stock at a purchase price of $1.50 per share, exercisable
through July 31, 2007 (the Company assumed this obligation pursuant to the
Merger Agreement).
No other Executive Officer of the Company as of the Effective Date is
party to an employment agreement with the Company. No employee had
compensation of more than $100,000 during the last fiscal year. No bonuses,
other annual, compensation, stock appreciation rights, long-term compensation
awards, long-term incentive plan payouts or other compensation (as defined in
the proxy regulations of the Securities and Exchange Commission) were awarded
to, earned by, or paid to the Chief Executive Officer during any of the
Company's last three fiscal years.
The Company does not currently pay directors any compensation as a
director. The Company is evaluating a directors compensation plan, and plans
to implement such plan in the near future.
Certain Relationships And Related Transactions
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Neither the Company's Board of Directors nor members of its management
or Titan's Board of Directors or management following the Effective Time or
the Director Transition Date will receive any benefits arising from their
ownership of Company Common Stock as a result of the Merger that was not
equally extended to all of the stockholders of the Company and Titan, and the
Titan stockholders had no ownership interest in the Company or Titan
Acquisition prior to the Effective Time.
Compliance With Section 16 Of The Securities Exchange Act Of 1934
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Pursuant to Section 16 of the Securities Exchange Act of 1934, as
amended, the Company's directors and executive officers and beneficial owners
of more than 10% of the Common Stock are required to file certain reports,
within specified time periods, indicating their holdings of and transactions
in the Common Stock. Based solely on a review of such reports provided to the
Company and written representations from such persons regarding the necessity
to file reports or report transactions in a timely manner during the Company's
fiscal year ended June 30, 2002, the Company's officers, directors and 10%
shareholders complied with all Section 16(a) filing requirements applicable to
such individuals.
Legal Proceedings
No current officer, director, affiliate or person known to the Company
to be the record or beneficial owners of in excess of 5% of the Company's
Common Stock, or any person known to be an associate of any of the foregoing
is a party adverse to the Company or has a material interest in any material
pending legal proceeding.