posted
I would call this bad news why else do you think it is down like 110% in a few days!
NMC, Inc. Provides Update Wednesday December 27, 8:55 am ET Over-Issuance of Common Stock Delays Availability of Audited Financial Statements; Payment Received under Ore Concentrates Purchase Agreement; Civil Litigation against Former Principals Continues
HENDERSON, Nev.--(BUSINESS WIRE)--NMC, Inc. (Pink Sheets:NMCX - News): Over-issuance of Common Stock
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NMC, Inc. (Pink Sheets:NMCX - News) announced today that during the audit of the company's financial statements for the years ended December 31, 2004 and 2005, by the Public Companies Accounting Oversight Board (PCAOB)-registered accounting firm, the Company discovered that the number of shares issued by its in-house transfer agent exceeded the company's authorized shares of common stock. This over-issuance was disclosed in the Company's financial statements. Subsequent to the completion of the audit, the Company discovered a more recent over-issuance by its in-house transfer agent. These over-issuances totaled approximately 1.7 billion shares. Additionally, at the time the Company's prior board of directors created the Class A Preferred Shares in July of 2004, there were not, nor are there currently, a sufficient number of authorized shares of common stock to accommodate conversion of the approximately 400 million outstanding shares of Class A Preferred Stock (each of which converts into 5 shares of common stock), now held in a revocable trust by family members of a former officer, director and current shareholder of the Company.
Prior to the discovery of the greater imbalance between authorized shares and issued and convertible shares, the Company had prepared a letter to all shareholders, then intending to make its audited financial statements for 2004 and 2005 available. However, the aforementioned imbalance may require restatement of the Company's financial statements for the years ended December 31, 2004 and 2005.
Management is conducting an internal investigation of the facts surrounding the over-issuance and related matters. Once the board of directors has evaluated the circumstances and impacts of these issues, it will recommend corrective action. In the meantime, the board is exploring possible alternatives specific to the over-issuance, including without limitation, increasing the number of authorized shares and/or a reverse split, any of which would require a majority vote of the shareholders. Pending final resolution of these issues and subject to limitations under Nevada law, the Company expects to treat outstanding shares held by non-affiliates of the Company as having been validly issued.
The Company expects to make audited financial statements available after the resolution of these matters and completion of its audits, including an audit of 2006, by means of the filing of a Form 10 with the Securities and Exchange Commission (SEC).
Having accepted the resignation of its in-house transfer agent as a result of the aforementioned events and other problems, the Company has engaged the services of an external, independent transfer agent. The new transfer agent is expected to begin transfer duties for the Company in January 2007.
Without giving effect to the over-issuance and related issues that may have an effect, NMC, Inc. had an accumulated deficit of approximately $65.4 million at December 31, 2005, principally attributable to the writing off of acquired assets and operating expenses.
During the audit, three independent geologists and two assayers conducted four geological reviews and full custodial assays on all its properties, although only the Skull Valley property was verified for the purpose of the audit.
Buyer Payment
On December 23, the Company received a payment in the amount of $350,000 pursuant to an agreement for the sale of first-stage precious metals ore concentrates for a total purchase price of $500 million to a privately held entity. Per the agreement, additional installments on the down payment of $11 million are payable over the next 23-month period. After the $11 million down payment has been paid, the customer may begin taking prorated possession of the first-stage concentrated ore, and the remaining $489 million balance of the contract is to be paid over 8 years. There can be no assurances that this contract will be fulfilled in its entirety, and there is no prepayment penalty or limitation on assignability.
Civil Litigation
In March 2003, the SEC filed a civil action against two former officers and original members of the Board of Directors. This action continues, with a court hearing scheduled for March 19, 2007. These former officers and original members of the board of directors have resigned, and the Company is not a party to the litigation but has incurred and may continue to incur some expenses attributable to the litigation.
Form 10 Registration Statement
At the present time, management anticipates that a Form 10 Registration Statement--which is expected to contain audited financial information for the most recent three years ended December 31, 2006--will be submitted to the SEC no earlier than the second quarter of 2007.
Communication with Shareholders
In the interim period and prior to the effectiveness of a Registration Statement, the Company has been advised by its legal counsel to limit its news releases significantly; however, the Company anticipates that it will continue to keep the market informed of critical developments.
About NMC
NMC, Inc. has interests in mining and ore processing. In addition to its Skull Valley claims, the company owns 7 mining claims of 20 acres each in Mesquite, Nev. and 17 mining claims on 340 acres in San Bernardino County, Calif., in all of which it owns 100% of the mineral rights.
This news release is for information purposes only and is neither a solicitation to sell securities nor an offer to buy securities, which solicitation or offer may be made only via prospectus. The registration of the Company under the Securities Exchange Act was revoked in March of 2003. Until the Company has effected a new registration with the SEC, Section 12 under which the Company registration was revoked states: "No member of a national securities exchange, broker, or dealer shall make use of the mails or any means or instrumentality of interstate commerce to effect any transaction in, or to induce the purchase or sale of, any security the registration of which has been and is suspended or revoked pursuant to the preceding sentence."
Statements contained in this release that are not purely historical are intended to be forward-looking statements within the meaning of the Safe Harbor clause of the Private Securities Litigation Reform Act of 1995. These statements are based on information available to the Company as of the date of this news release, and the Company assumes no obligation to update or revise these forward-looking statements. Forward-looking statements are inherently uncertain, and the Company's actual results may differ from management's expectations. Risks and uncertainties associated with forward-looking statements include without limitation, risks associated with the Company's ability to complete an audit and obtain registration of its stock with the SEC in light of the allegations against its prior management; the ability of any customer, including the customer whose payment is reported in this news release, to complete its obligations under any agreements with the company; U.S. and foreign currency fluctuations; changes in environmental and mining regulations; delays in obtaining regulatory approvals; costs associated with processing ore concentrates; fluctuation in precious metals markets; general economic and business conditions; litigation and other factors. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Financial estimates, whenever provided, either by the Company or by third parties, are subject to change and are not intended to be relied upon as predictions of future operating results. NMC, Inc. assumes no obligation to update or disclose revisions to such estimates.
-------------------- "Remember that time is money." Posts: 412 | From: Murfreesboro | Registered: Oct 2006
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posted
oh ****!! LOL It's gonna go look at last year jan and the year before that. I do need to do more research though.
Posts: 69 | Registered: Nov 2006
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