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Vineyard National Bancorp Comments on Board Candidates Proposed by Messrs. Morales and Salmanson

SOURCE:

Vineyard National Bancorp

2008-04-02 04:30:00

Vineyard National Bancorp Comments on Board Candidates Proposed by Messrs. Morales and Salmanson

CORONA, CA–( EMWNews – April 1, 2008) – The Board of Directors of Vineyard National

Bancorp (the “Company”) (NASDAQ: VNBC), parent company of Vineyard Bank,

N.A. (“Vineyard”) and other subsidiaries, commented on the candidates that

have been proposed to take over the Company’s Board of Directors (“Board”).

The candidates were announced by the Company’s former Chief Executive

Officer (“CEO”), Norman Morales, and a stock broker, Jon Salmanson. The

pair is seeking shareholders’ consent for a change in the Company’s Bylaws

so they may submit these candidates to a shareholder vote.

The Company’s Board noted that Messrs. Morales and Salmanson may have

inadequately disclosed important information about their candidates.

Although the Company is not aware of all important undisclosed information,

it is aware of the following:


--  Dev Ogle: The public statements by Messrs. Morales and Salmanson

    failed to disclose that, while Mr. Morales was CEO, Vineyard paid fees of

    $257,363 to The Ken Blanchard Companies for Mr. Ogle's services, which

    included acting as Mr. Morales' "executive coach."

    

--  Glen Terry: Mr. Terry was not the President, CEO, or a director of

    SierraWest Bank, as indicated in the public statements by Messrs. Morales

    and Salmanson. The public statements also failed to disclose that, at the

    time of Mr. Morales' termination as CEO of the Company, he was preparing to

    hire Mr. Terry to lead a large expansion of Vineyard's Northern California

    operation.  At the time that Messrs. Morales and Salmanson announced their

    proposed candidates, Mr. Terry was employed at Umpqua Bank -- a competitor

    of Vineyard in Northern California.

    

--  David Hardin:  The public statements did not disclose that Mr. Morales

    and his wife worked with Mr. Hardin at Hawthorne Savings. Mr. Hardin's

    limited board experience was marked by a weak commitment to shareholders:

    on March 16, 2008, he resigned after 11 months from the Board of Pacific

    Premier Bancorp, citing a desire to "help a friend who has a need I cannot

    turn my back on..."

    

--  Lester Strong: The public statements did not disclose that the

    Company's Nominating Committee previously considered Mr. Strong as a Board

    candidate on the recommendation of George Crosby, a stock broker in Santa

    Maria, Calif. Although Mr. Crosby has been involved in soliciting consents

    with Messrs. Morales and Salmanson, he has not been disclosed as a

    "participant" in the Consent Solicitation filings with the U.S. Securities

    and Exchange Commission.

    

--  Cynthia Harriss: The public statements did not disclose that, while

    Mr. Morales was CEO, he was negotiating the potential hire of Ms. Harriss

    to manage a private banking group in Southern California for Vineyard. She

    has no prior banking experience.

    

“The potentially inadequate disclosures are a red flag warning to those who

care about good corporate governance,” said James LeSieur, Chairman and

Interim CEO. “The campaign by Messrs. Morales and Salmanson is not about

shareholder rights — it is a transparent attempt by a former CEO to return

to power with the help of his friends and associates.”

The Company, on Jan. 23, 2008, accepted the resignation of Mr. Morales from

the Board and his employment as President and Chief Executive Officer was

terminated. The Board agreed to make severance payments to Mr. Morales of

more than $1 million.

“The proposed Bylaw change, by allowing prospective Board candidates to

avoid a careful review process before a shareholder vote, would open the

door to a former executive’s entrenchment behind a new Board with weak

qualifications or independence,” Mr. LeSieur added. “In fact, most of the

proposed candidates have personal or business ties to Mr. Morales and lack

the substantive background, ownership stakes or knowledge that one tends to

find among independent, objective and effective stewards for the

shareholders of a publicly traded financial institution. In contrast, five

of the six current Board members are independent of management and together

own approximately 7 percent of the Company’s stock.

“We believe the proposed Bylaw amendments would primarily serve the

personal interests of Messrs. Morales and Salmanson rather than

shareholders generally. The narrow rights in the proposed Bylaw amendments

may be triggered only in the rare occasion that a director, President or

CEO leaves office within a narrow period, as did Mr. Morales,” said Mr.

LeSieur. “The financial issues now facing the Company began well before Mr.

Morales resigned. Before he resigned, the Board considered and rejected his

proposed strategies, deciding instead to emphasize more prudent strategies

in response to the changes in the economic climate and the Company’s

operating environment.”

If you have any questions about giving your consent revocation or require

assistance, please call:


D.F. KING & CO. INC.

48 Wall Street

New York, New York 10005

Shareholders Call Toll-Free at: 800-967-7921

Banks and Brokers Call Collect at: 212-269-5550

Important Additional Information

The Company filed a Definitive Consent Revocation Statement on Schedule 14A

with the SEC on March 13, 2008 (the “Definitive Consent Revocation

Statement”) relating to the solicitation of consent revocations from

shareholders of the Company, and in the future will file a proxy statement

relating to the election of directors of the Company (the “Proxy

Statement”). Investors and security holders are advised to read the

Definitive Consent Revocation Statement, the Proxy Statement and other

materials filed by the Company related to the Definitive Consent Revocation

Statement and Proxy Statement solicitations, when available, because they

contain important information. Investors and security holders may obtain a

free copy of the Definitive Consent Revocation Statement, the Proxy

Statement and all other related materials filed by the Company with the SEC

(when they are filed and become available) free of charge at the SEC’s

website at www.sec.gov or by contacting D.F. King & Co., Inc., 48 Wall

Street, New York, New York 10005, 1-800-967-7921. The Company also will

provide a copy of these materials without charge on its website at

www.vnbcstock.com.

The Company, its Board and one or more of its executive officers may be

deemed to be participants in the Definitive Consent Revocation Statement

and Proxy Statement solicitations. Information regarding the names of the

Company’s Board and executive officers and their respective interests in

the Company is set forth in the Definitive Consent Revocation Statement.

About Vineyard National Bancorp

The Company is a $2.5 billion financial holding company headquartered in

Corona and the parent company of Vineyard, 1031 Exchange Advantage Inc.,

and 1031 Funding & Reverse Corp (collectively, “the exchange companies”).

Vineyard, also headquartered in Corona, operates through 16 full-service

banking centers and three regional financial centers in the counties of Los

Angeles, Marin, Orange, Riverside, San Bernardino, San Diego, Santa Clara

and Ventura, CA. The exchange companies are headquartered in Encinitas, CA.

The Company’s common stock is traded on the NASDAQ Global Market System

under the symbol “VNBC.” For additional information on the Company visit

www.vnbcstock.com or for additional information on Vineyard and to access

internet banking, please visit www.vineyardbank.com. For additional

information on the exchange companies visit www.1031exchangeadvantage.com.

Forward-Looking Statements

Certain matters discussed herein may constitute forward-looking statements

within the meaning of the Private Securities Litigation Reform Act of 1995

and the Federal securities laws. Although the Company believes that the

expectations reflected in such forward-looking statements are based upon

reasonable assumptions it can give no assurance that its expectations will

be achieved. Forward-looking information is subject to certain risks,

trends and uncertainties that could cause actual results to differ

materially from those projected. Many of these factors are beyond the

Company’s ability to control or predict. Important factors that may cause

actual results to differ materially and could impact the Company and the

statements contained herein can be found in the Company’s filings with the

SEC including quarterly reports on Form 10-Q, current reports on Form 8-K,

annual reports on Form 10-K, and the Consent Revocation Statement on

Schedule 14A. For forward-looking statements herein, the Company claims the

protection of the safe harbor for forward-looking statements contained in

the Private Securities Litigation Reform Act of 1995 and other protections

under the Federal securities laws. The Company assumes no obligation to

update or supplement any forward-looking statements whether as a result of

new information, future events or otherwise.

Jordan Taylor

Jordan Taylor is Sr. Editor & writer from San Diego, CA. With over 20 years and 2650+ articles edited rest assured your Press Release will see traction.

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