Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officer.
Election of Thomas W. Hines as a Director
Effective as of
February 27, 2019, the Board of Directors (the “Board”) of the Company elected Thomas W. Hines to serve as a director until the next annual meeting of shareholders and until his successor is duly elected and qualified.
Thomas W. Hines, age 60, is a Vice President with Lowery Asset Consulting. Previously, Mr. Hines served as the Executive Vice President at Good Harbor Financial, as the National Director of Financial Planning at The Northern Trust Company, and as a tax partner at Ernst & Young in the financial planning group. Mr. Hines is a Certified Public Accountant (CPA) and a Chartered Financial Analyst (CFA). Mr. Hines holds a Bachelor of Science degree in Accounting from Marquette University, and a Master of Science in Taxation from the University of Wisconsin-Milwaukee. Mr. Hines has been featured in publications including Fortune, American Banker, and the Premier edition of Wealth magazine. Mr. Hines has completed over 120 Triathlons, including the Hawaii Ironman World Championship.
At this time, there is no arrangement to pay Mr. Hines compensation for his service as a director of the company. He is likely to be reimbursed by the Company for board-related expenses which, as of the date of this
Current Report on Form 8-K
, are not expected to be material.
Appointment of William C. “Jake” Jacobs, CPA as President, Chief Financial Officer and Treasurer
Effective as of
February 27, 2019, the Board appointed
William C. “Jake” Jacobs, CPA, the son of our Company’s Chief Executive Officer Gerard M. Jacobs, to serve as the President, Chief Financial Officer and Treasurer of the Company. Those positions were previously held by Gerard M. Jacobs who stepped down from the positions to focus on the Chief Executive Officer role. Gerard M. Jacobs will remain as the Company’s Chairman, Chief Executive Officer and Secretary.
Prior to becoming the President, Chief Financial Officer and Treasurer of the Company, William C. Jacobs, CPA, age 30, served as an independent contractor for the Company for the past several years. Mr. Jacobs also is the President and Chief Financial Officer of Beachin Company, which owns and manages multi-family apartment buildings in Daytona Beach, Florida. Previously, Mr. Jacobs worked in the Assurance Division of Ernst & Young (doing business as EY), auditing both publicly traded and privately held companies. Mr. Jacobs graduated from the University of Southern California, with a double major in Accounting and Finance. In 2015, Mr. Jacobs won a Gold Medal at the United States of America Snowboard and Freeski Association (USASA) National Championships in the BoarderCross Snowboard Senior (23-29) Men’s division.
William C. Jacobs will earn compensation from the Company at the rate of $5,000 per month. He is also entitled to reimbursement for all of his business-related expenses. As of the date of
this Current Report on Form 8-K, the Company owes Mr. Jacobs $175,000
for unpaid independent contractor fees that have been accruing since 2016.
Pursuant to the SPA described in Section Item 1.01 above, William C. Jacobs is expected to be granted full access to the corporate and financial books and records of “Sellers” Ablis, Bendistillery and Bend Spirits, and will be able to monitor and be allowed to ask Sellers' internal financial personnel and their CPA questions from time to time regarding Sellers' financial results, balance sheets, transactions, expenses, financial controls, tax returns and other tax forms. Pursuant to the SPA, he shall also be provided accurate and complete answers to such questions including supporting documentation, and shall be copied on all communications between Sellers and their CPA. In addition, Sellers shall pay William C. Jacobs a quarterly fee in connection with the foregoing in an amount which shall be mutually acceptable to James A. Bendis and William C. Jacobs, but which in no event shall be less than $5,000 per quarter, and Sellers shall pay or reimburse all of William C. Jacobs' reasonable expenses incurred in connection with business trips to Bend, Oregon, to perform such financial oversight functions and to provide consulting/advisory services to Sellers relating thereto.
Committees of the board of directors to which Messrs. Hines and William C. Jacobs have been named
Messrs. Hines and William C. Jacobs will be members of the Company’s Investment Committee, recently formed by the Board of Directors. In addition to Messrs. Hines and William C. Jacobs, the initial members of the Investment Committee will include Gerard M. Jacobs. Future acquisitions by the Company of direct equity ownership interests in any entity other than Ablis, Bendistillery and Bend Spirits will be subject to unanimous approval by such Investment Committee and to majority approval by the Board of Directors of the Company, provided that the requirement of unanimous approval by such Investment Committee will be terminated if the investors in the Preferred Stock no longer hold 25% or more of their investment in the form of Preferred Stock or common stock of the Company following conversion, or if the Company’s common stock has closed at $10.00 per share or higher for 20 consecutive trading days and there have been on average at least 50,000 shares traded on each of those 20 consecutive trading days, or if 84 months have passed since the first date that the registration statement is effective.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On February 12, 2019, the Company filed a certificate of designation of the relative rights and preferences of the Series A convertible preferred stock of Acquired Sales Corp. (the “Series A Designation”). In connection with the Series A Designation, the Company authorized 400,000 shares of its Series A Preferred Stock. Pursuant to the Series A Designation, each share of Series A Preferred Stock may be converted into 100 shares of common stock. The Series A Preferred Stock pays dividends at the rate of 3% annually. The Series A Preferred Stock dividends are cumulative if the Company does not have the necessary cash to pay the dividend when due. The Series A Preferred Stock dividends shall cease to accrue at such time as the Company’s Common Stock has closed at $3.00 per share or higher for 20 consecutive trading days after the first date that the registration statement is effective, and there have been, on average, at least 25,000 shares traded on each of those 20 consecutive trading days. The Series A Preferred Stock have no voting rights. The holders of the Series A Preferred Stock shall have voluntary conversion rights. Shares of Series A Preferred Stock are subject to Mandatory Conversion (in the discretion of the Company) at such time as the Company’s Common Stock has closed at $5.00 per share or higher for 20 consecutive trading days after the first date that the registration statement is effective, and there have been, on average, at least 50,000 shares traded on each of those 20 consecutive trading days.
The foregoing description of the
Series A Designation
does not purport to be complete and is qualified in its entirety by reference to the full text of the
Series A Designation
, which is attached as Exhibit 4.4 to this Current Report on Form 8-K and incorporated in this Item 5.03 by reference.