Over at RB AZNT, eZapata is wondering about Titan Investments. Pugs seems to think they're a great little outfit, though he's never wanted to say very much about 'em in the past. I thought--for Zapata's sake, of course--that it might be useful to repost some stuff I pulled together several months ago:
Now. Back on 2 October, this is what Mike Sylver had to say on direct examination about Andy Mann's request to borrow shares, about Mann's intention to sell 4mm shares, and about the involvement of Titan Investments:
25 Q. Okay. Can you tell us when you first came in contact with
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SYLVER - DIRECT
1 Andy Mann or any of his entities.
2 A. Approximately the beginning of April, 1998.
3 Q. Okay. And what was the purpose of cor~nunication being
4 established between yourself and Mr. Mann or any of his
5 entities?
6 A. We had just undertaken a new investment banking group,
7 Creative Capital Management (phonetic) in New York. And we had
8 a private placement underway for the raising of $5,000,000.
9 Andy Mann contacted us and heard that we had a private
10 placement.
11 Q. Okay. And what did he indicate upon contacting you?
12 A. That he does private placements for companies all the time.
13 And he asked me to send him a copy of our private placement
14 memorandum.
15 Q. Did you do that?
16 A. Yes.
17 Q. Okay. What happened next?
18 A. Then he called up, and he said him and his group in England
19 could go ahead and take 4,000,000 of the shares. Okay. But
20 what he would need ahead of time is to show them, this group in
21 England, that he had some stock.
22 Q. Okay. And how was that accomplished?
23 A. He asked me if we had any free-trading shares. And I said
24 no. Amazon Natural Treasures doesn't have any free-trading
25 shares at all.
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SYLVER - DIRECT
1 Q. Okay. Then what?
2 A. Then he says do you have any friends or relatives or
3 anybody close to the company that has stock? And I said I
4 would check, and I checked. And then I found out that the
5 gentleman who originally when we originally went public and did
6 a reverse merger in with a company in Utah, the company, Titan
7 Investments, was the investment company who raised the initial
8 what they call initial money to pay for the shell corporation
9 and the SCC attorneys to do the transaction. And Titan
10 Investments was paid a certain amount of shares for their
11 consulting fees in order to accomplish that goal.
12 Q. Okay. Were these the shares that were eventually
13 transferred to Mr. Mann?
14 A. Yes. Mr. Mann asked the Titan Investments if he could
15 borrow 180,000 shares and deposit it into an account that had
16 to be opened up with him at First Concorde, and then he sent a
17 letter. He said he would only need the shares for 60 days, and
18 that he would pay $90,000 for the rent, basically, of those
19 shares.
20 Q. Okay. Did you ever receive payment?
21 A. He paid $72,625 towards the rent of those shares. He owes
22 a balance of $17,000 and change.
23 He then asked to borrow -- well, before the 60 days and the
24 money had to come due, he asked -- he said he needed another
25 300,000 shares of stock in order to show the people in England
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SYLVER - DIRECT
1 that he was serious about doing this investment.
2 And then my father -- he wrote a letter, and my father
3 signed it that he borrowed 300,000 shares from my father to be
4 returned in 60 days.
5 Q. Okay. Were those shares ever returned?
6 A. No, they were not.
7 Q. Okay. What happened next?
8 A. Okay. Then he said that he could buy -- after that, he
9 said he could buy 4,000,000 shares for 25 cents a share, and
10 that he would send us $1,000,000.
Note particularly that Mikey says:
1. That it was in April 1998 that Mann asked to borrow shares, first 180,000 from Titan, then 300,000 from Gary Sylver.
2. That he implies that Titan Investments is a company completely independent of AZNT.
3. That the agreement reached by the terms of which Mann would buy and resell 4mm shares of AZNT stock was arrived at subsequent to his request for borrowed stock.
On cross, Mikey altered his story, admitting, after it was pointed out to him that an account had been opened in February with Andy Mann's company, First Concorde, that he might have been in contact with Mann as early as that. But it appears that the First Concorde account was opened in the name of Titan Investments:
1 BY MR. JUDD:
2 Q. You knew that Mr. Mann was associated with First Concorde
3 from the first time you talked to him?
4 A. No.
5 Q. And when did you know that Mr. Mann was associated with
6 First Concorde?
7 A. When he had the Total Concept and Titan open up on account
8 there that we put that borrowed stock.
9 Q. You said that --
10 THE COURT: When what? I'm sorry.
11 THE WITNESS: Oh, your Honor, when -- when we learned
12 about that, he was part of First Concorde when he had the Titan
13 and Total Concept Company open up the account to place the
14 borrowed 180,000 and 300,000 shares.
15 BY MR. JUDD:
16 Q. Now, did you state on direct examination that was in
17 April 19987
18 A. Yes, I think so.
19 Q. That was the first time you knew Mr. Mann was April 19987
20 A. The first time he called me.
21 Q. Ail right.
22 A. I think that was.
23 Q. And you did not engage in a transaction the very first time
24 he talked to you, did you?
25 A. No. The first time that he talked to me, we talked about
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SYLVER - CROSS
1 this. We had to contact Sherwood Cook.
2 Q. So the first time you talked to him was the first part of
3 April 1998, just six months ago?
4 A. Yeah. I could check that, but I have phone records.
5 Q. It's about your recollection today.
6 A. Yes.
7 Q. And then you engaged in a number of negotiations that
8 ultimately led to the purchase of 4,000,000 shares?
9 A. He didn't purchase the 4,000,000 shares --
10 Q. There was --
11 A. -- because he didn't send the money, yet.
12 Q. You had negotiations with Mr. Mann for the acquisition of
13 4,000,000 shares, correct?
14 A. Yes.
15 Q. You also had negotiations with Mr. Mann for the acquisitior
16 in the way you've described it as a loan of 480,000 shares,
17 correct?
18 A. We would lend him 480,000 shares, and he would pay us
19 $90,000.
20 Q. You had negotiations with Mr. Mann for the acquisition by a
21 loan of 480,000 shares; is that right?
22 A. No. We didn't have no negotiations. He sends a letter
23 stating that he needed the stock, and that if anyone -- he
24 asked if me if the company had its stock. The company doesn't
25 have any free-trading stock.
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SYLVER - CROSS
1 Then he asked me if I knew anybody who did have
2 free-trading stock. And that's when Titan and my father came
3 to mind because Titan had 180,000 shares, and my father had
4 300,000 shares.
5 So then he made the agreements to borrow the stock between
6 Titan and himself and my father, Gary Sylver, and himself. And
7 they signed the letters from Gary Sylver, and Titan sent an
8 acknowledgement to Andy Mann.
9 Q. so your first -- let me get back. Your very first meeting,
10 conversation, introduction to Mr. Mann was the first part of
11 April 1998.
12 A. I believe so, yes.
And then:
20 Q. Well, you first talked to him in April, right? That's what
21 you said over and over.
22 A. Well, it could have been. Like I said, it could have been.
23 It was back right after, you know, Christmas and the --
24 after -- right after -- right at the beginning of the year,
25 February, March, April. That's right. But like I said, if you
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SYLVER - CROSS
1 want, we could call the office, and they could give the exact
2 date to you.
3 Q. we've been talking here you under oath telling the Court
4 that it was April. Now, are we talking about other months?
5 Are we talking two months earlier?
6 A. It could -I March, April. Yes, you're right.
7 Q. How about February?
8 A. No. I don't believe so.
9 Q. No way in the world it could be February?
10 THE COURT: He's answered, Counsel. He said I don't
11 believe so.
12 THE WITNESS: I don't -- I got to check it.
13 THE COURT: Let's move on.
14 THE WITNESS: But the phone bills could tell you
15 exactly if you need to know. I could tell you exactly the
16 phone bills.
17 BY MR. JI/DD:
18 Q. Can this tell us where -- is that your signature?
19 A. Yeah. But this doesn't have to do with that. This is
20 opening an account.
21 Q. Right. You opened an account with First Concorde.
22 A. Right.
23 Q. Okay. So you didn't know Mr. Mann had anything to do with
24 First Concorde when you opened up your account.
25 A. Oh, yeah. I'm not -- I'm not even thinking about that. It
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SYLVER - CROSS
1 was talking about the subscription agreement. I completely
2 forgot about that altogether.
3 Q. Right. You opened up an account with Mr. Mann's company or
4 the company that he represented, First Concorde, right?
5 A. Right.
6 Q. You did that back in February.
7 A. Oh, okay. That's when it was. Okay.
8 Q. so at some point, it took you a number of weeks to figure
9 out this acquisition.
10 A. You mean the subscription agreement?
11 Q. Correct.
12 A. Right.
13 Q. February, March, April, some time, right? If we look at
14 your subscription agreement, it said the 15th of March, right?
15 A. Okay.
Mikey seems to be a bit, ah, confused about exactly what Titan is, as well:
6 BY MR. JUDD:
7 Q. So when you referred to Exhibit H in your testimony on
8 direct, it is a document from First Concorde Securities,
9 correct?
10 A. Correct.
11 Q. It is attempting to send 300,000 shares of Amazon to
12 Raymond James Financial; is that correct?
13 A. That is correct.
14 Q. And it is also for the account of Titan Investments --
15 A. Right.
16 Q. -- dba, Total Concept --
17 A. Okay.
18 Q. -- International which is your company, correct?
19 A. No. It's actually Rudy Cal's (phonetic) company.
20 Q. Well, you're president.
21 A. Okay.
22 Q. You're president?
23 A. Not anymore.
24 Q. You were?
25 A. Yeah. Right. He is now.
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SYLVER CROSS
1 Q. You sign the First Concorde --
2 A. That -- that's correct. That's --
3 Q. -- account for this Titan --
4 A. That's correct. Not for Titan, no.
5 Q. Didn't it have --
6 A. Not for Titan. The account is owned by Titan, not Total
7 Concept. If Raymond James -- I mean, Raymond James' account is
8 owned. Amazon, Mike Sylver, has nothing to do with this
9 account at Raymond James.
10 You go look at the records it is signed for by Titan
11 Investments' Rudy Cal only, and not Michael Sylver. This
12 300,000 shares came from Canaccord. He said it was coming from
13 Citibank, but it never came from Citibank.
When was Mike Sylver president of Titan? When did he resign that position, and why? What is his father's role with Titan?
Let us return to what Gary Sylver, testifying on 3 February 1999, has to say about all this.
9 Q. When was the first time you spoke to Andy Mann
10 concerning the purpose of this apparent stock transfer?
11 A. It was during that month, April.
12 Q. Was it before April 30th?
13 A. Yes.
14 Q. Okay. And where did the conversation take place?
15 A. In Amazon's office.
16 Q. In where on Amazon's office?
17 A. Michael Sylver's office.
18 Q. And who was present?
19 A. Charles Kricfalusi, Mike Sylver, and myself.
20 Q. And did you call Andy Mann or did Andy Mann call you?
21 A. They were already talking on the phone on the speaker
22 phone about this.
23 Q. Okay.
24 A. And then when I came in, I was involved in the
25 conversation.
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1 Q. Can you relate the conversation as you recall it?
2 A. Well, like I said, Andy explained to me about the
3 transaction. How he was going to raise money for the
4 company and, you know, told me that I would greatly help the
5 company out if I would lend him my stock.
6 He would give me a note, a 60-day note, and return it,
7 and, also, suggested that I put my stock in a Creative
8 Capital -- the stockbroker firm of Creative Capital.
9 Q. Where did you have your stock previous?
10 A. Wall Street Financial.
11 Q. Did you pay money for the stock that you owned?
12 A. Yes, I did.
13 Q. And what did you do in order to purchase that stock?
14 A. I don't understand the question.
15 Q. I'm sorry. Do you recall what amount of money you paid
16 for the stock?
17 A. I remember what I paid in 1997. It was over $46,000.
18 Q. Okay. And did you obtain any notes from Mr. Mann?
19 A. Yes. I obtained a 60-day note, which I think is filed
20 with the court.
21 Q. Okay. And did you ever get your stock back?
22 A. No, I didn't.
23 Q. Is there a certain time that you became alarmed that
24 the stock was nowhere to be found?
25 A. Yes. About let's say ten days after the 60 days. 70
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1 days later, I confronted Andy Mann on the phone.
So, according to Gary, he transferred 300,000 shares of AZNT stock to Andy Mann before the end of April 1998. It would appear that he first complained about Mann's failure to return the stock some two months later, which is to say at the end of June 1998. Yet hasn't Mike Sylver contended over and over that he began to move against Mann, alerting the DTC and others about the "defective" 4mm shares as early as May? The following is from Mike Sylver's testimony on 2 February 1999:
20 Q. Okay. Now you say you made a series of phone calls to the
21 Depository Trust Company and to their people representing them
22 during May and June of 1998 to discuss the problem with these
23 certificates; is that right?
24 A. Correct.
15 BY MR. LEFEBVRE:
16 Q. According to the pleadings the 480,000 share~ went from
17 Mr. Mann to Citibank and then to Canacord, is that correct?
18 A. Right. And Canaeord was aware not to touch them and to
19 keep them and send them back. They never did. They
20 disseminated the stock.
21 Q. Okay. When do you contend that you first notified
22 Canacord that there was some defect in the stock?
23 A. I believe the day that the stock went there.
24 Q. Okay. It's Canacord's position that it was not notified
25 until July 13, 1998. Do you have any record of any prior
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SYLVER - CROSS 70
1 correspondence or communication to Canacord?
2 A. Not here. I'd have to look on the DTC sheets with my
3 notes.
4 Q. So you can't testify that you did give Canacord any
5 notification before that date of July 13, 1998, as you sit
6 here right now?
7 A. I can't say we did or we didn't, not until I look.
Mike Sylver addresses the issue again, on 3 February 1999:
5 During earlier examination, I asked you to tell us when
6 you first notified Canacord Capital of some defect with
7 regard to this free-trading nature of the certificates. And
8 you had indicated that you'd have to defer to documents.
9 I've culled these documents, and the first is a letter
10 of the 13th of July, and it's signed by you. Is that a true
11 and correct document?
12 A. This is a true and correct document.
13 Q. And the next document in order is a letter which is
14 stamped revised at the top, again, on your stationery dated
15 the 15th of 1998 directed to Canacord and to Mr. Tinherman
16 (phonetic)?
17 A. Correct.
18 Q. Is that a true and correct document?
19 A. That is correct.
20 Q. And attached to that are the postal receipts, again,
21 which I gleaned from your amended complaint. Do you have
22 any reason to believe that those aren't correct?
23 A. They look to be correct.
24 Q. Okay. In the amended complaint, there was another copy
25 of this letter of July 15th, and I simply attached it as a
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1 redundancy to make sure that I was correct in my
2 representations to you. That does seem to be an exact copy,
3 does it not, of the other letter of the 15th --
4 A. Correct.
5 Q. -- to Mr. Tinnerman?
6 A. It seems to be, yes.
7 MR. LEFEBVRE: Okay. I'd move for the admission
8 of 96, your Honor.
9 THE COURT: Any objection?
10 MR. LANDISH: None whatsoever, your Honor.
11 THE COURT: It will be received.
12 (Defendants' Exhibit No. 96 was received into evidence.)
13 (Colloquy not on the record.)
14 BY MR. LEFEBVRE:
15 Q. You indicated that in your prior testimony that
16 sometime after May 4, you started placing calls and
17 notifications to others who might have the stock, that there
18 was some defect in it; is that correct?
19 A. That is correct.
20 Q. Do you have any correspondence, other than what I
21 presented to you here today as of 96 which is any indication
22 to Canacord that there is some defect in the stock?
23 A. Yes.
24 Q. When was that?
25 A. Previous to that. We notified anybody and everybody on
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1 the list of anybody on that DTC sheet list by telephone, by
2 fax, by letter, copies of letters that were sent out.
3 Q. Do you have any proof of notification, other than what
4 I've placed before you as 96?
5 A. Not with me here.
6 Q. Have you given it to your counsel?
7 A. Robert Qualey.
8 Q. But you're telling me it's something copied to somebody
9 at Canacord?
10 A. Correct.
Note that counsel for Canaccord sustains that the company received no notice of any defect in the 480,000 shares until 14 July. This would fit well with Gary Sylver's statement that he didn't call Andy Mann to complain that the shares hadn't been returned until the end of June at the earliest.
Yet Mike continues to insist that he'd notified everyone involved of the problems AZNT was having with Mann in May, which would have been only shortly after the 480,000 shares had been lent, and well before they were due to be returned.
Did Gary Sylver in fact lend MORE than 300,000 shares of AZNT stock to Andy Mann, or to someone else?
23 Q. Why don't we go here to this Exhibit 27. Did Mike
24 Sylver ever tell you that his company, Amazon, was using
25 Creative Capital Management Company?
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1 A. Yes.
2 Q. So you had no problem using that company.
3 A. No. I met George Dumanis personally.
4 Q. Now, on this Exhibit 27, it says received 71,160
5 shares. Do you know what that means?
6 A. No, I don't.
7 Q. It says delivered 300,000 shares. Do you know what
8 that means?
9 A. Delivered -- let me see the account numbers. 155, yes.
10 That's my shares. Well, I better say, no, I don't, because
11 I may -- I may make a mistake. I'm -- I'm not too familiar
12 with this.
13 Q. All right. The next item is 5/13/98 delivered 87,186
14 shares. Do you know what that means?
15 A. Well, this shows loan. I can only assume. No, I don't
16 know what it means, but I can only assume.
17 Q. Did you loan more than 300,000 shares?
18 A. No. No.
19 Q. Do you know why you would have a statement that says
20 you loaned 87,186 shares?
21 A. No, I don't.
22 Q. Did anybody else have access to your account --
23 A. No.
Note: it isn't clear to me whether here the reference is to Gary's account with Wall Street Financial or Creative Capital; as I understand it, both are still open.
And what about Titan? This is getting long; stay tuned for the next post...
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