Owner
Post by Franko10 ™ on Mar 3, 2005 7:07:18 GMT -5
Posted By Dr D
Many have asked about some possible scenarios for the upcoming filings we have so impatiently waited for. Most of the questions settle around the O/S and what my “opinion” is and why?
This is a very difficult question as many have speculated along these lines so many times before and we actually have no clue. So many things have happened in and with CMKM Diamonds over the last year (+) that we simply have no knowledge of. From JV partnerships, to Mine purchases in Ecuador, Roger Glenn, Car racing, Bike racing, Truck racing, Saskatchewan Halt, Carolyn difficulties, drilling or not, Melvin is gone, Andy is in, Mr. Williams and Mr. Maheu is in, Roger Glenn is out, UCAD dividend, CIM Dividend, 1st GEMM dividend, still waiting on 2nd GEMM dividend (since Dec 2004) with no explanation, Saskatchewan meetings, Ecuador meetings, Nevada meetings, naked short position with no new announcement concerning it since 2003, who’s on first…I don’t know.
It has been a kind of whirlwind type of an experience with an incredible ride generated by the not knowing, I suppose. But the knowing is at hand and most everyone is bracing for the news of the O/S and financials, one way or the other. Since the company is now reporting and revoked the 15A-12g it filed then all of the above mentioned experiences we have witnessed from afar as CMKX shareholders are due an explanation. I continue to have all of the confidence in CMKX and its management team, and just as Robert Maheu commented, tough situations call for tough decisions and not just wishful thinking. I know filings are due to be compliant with the SEC, but reports and PR’s to the shareholders are also long past due and many of us are going to be glad to get to see them. It’s ironic, I guess, that Mr. Maheu’s words are what most of us have been doing for some time as shareholders, and that is “wishful thinking”. Some say a low O/S is “wishful thinking”. Some say a high asset valuation is “wishful thinking”. Some say that CMKX’s PPS taking off into the pennies is “wishful thinking”. To the faithful of CMKX the “wishful thinking” will soon give way to reality. Either a low, mid, or high O/S with a low, mid, or high asset valuation and financials will soon be fact!
As far as valuation of the mineral rights, mines, equipment, shares in other companies, etc… that CMKX has, I want even try to guess. Your guess is just as good as mine. The only thing that we can try to reason with would be the possible and/or probable share structure scenarios. Don’t get crazy on me as these are just my opinions and possible scenarios.
First a couple of givens:
1. The A/S is 800 billion although the company has never officially told us it is. The Nevada SOS was kind enough to inform us of that decision by the company over the phone.
2. In Feb 2004 the estimated O/S of CMKM Diamonds was 37 billion made known via a paid advertisement at the cost of 1 billion CMKM Diamond shares
3. We were informed by the company IR (Melvin) at various times that retirement of the O/S was continuing as planned.
4. CMKM Diamonds has seen several trading days with over 20 billion shares being traded in a single day confirming that the earlier reported “professional trading position” (NSS position) against the company was legitimate. The immense volume of shares traded over the last 18 months also indicates a huge NSS position. The only other alternative would be to believe that the company has been seriously diluting and inflating the O/S while trying to make us believe that they were retiring and thus reducing the O/S. I personally believe that the company has not been diluting but rather reducing the O/S. JMHO.
With all of that behind us lets see what we have knowledge of.
SCENARIO 1
1. Feb 2004 we have est 37 billion O/S this should have been fairly accurate at the time. 10% more or less would be intolerable according to my attorneys so I would believe that est 37 billion in Feb 2004 is acceptable.
2. Retirement of shares had been occurring prior to this est 37 billion advertisement with word from those in the company, (rumor) with Melvin being the exception, that the retirement was continuing. Thus a reduction should have been taking place to the O/S during the last 13 months reducing the O/S from 37 billion to whatever.
3. In a deal with Nevada Minerals we find we are going to issue 75 billion CMKX shares to them for interest in 500,000 acres of mineral rights in FALC. This would increase the reduced O/S by 75 billion making the O/S supposedly somewhere shy of 112 billion. What we found out was that Urban was going to issue 35 billion new CMKX shares to Nevada Minerals and kick in 40 billion from his private stash to reduce the dilution to share holders. A new Question arrives! Where did Urban get 40 billion shares to kick in? We have no record of those shares ever being issued so we actually are clueless, unless. Unless the 5 million dollars invested in Feb 2004 was from Urban’s private stash too and he received a sizeable amount of CMKX shares for his investment. We know he didn’t have those shares prior to that time as his shares prior to this were placed into somewhat of an “escrow” account and were frozen for an extended period of time. So my “guess” is that Urban’s new shares came from the investment money and one can only guess at the deal he got on them. I believe we bought 75 billion shares back from Nevada Minerals at somewhere near .000029 per share or nearly 1/5th of what they could have sold on the market for if they had not been restricted. If the 5 million dollars invested in CMKX came from Urban and brought nearly twice the .000029, let’s say .00005 in CMKX shares then that would have entitled him to around 100 billion shares. Or if he got a sweeter deal he may have got 50 billion to 200 billion shares of CMKX besides what he previously owned and was still frozen. So we were at est 37 billion and reducing by retirement in Feb 2004 with investment money hitting almost the exact same day. The est 37 billion would not have included any shares issued for this new investment money so the O/S would probably have increased then dramatically. We have no other official report of the true size of the O/S yet we know it was increased to allow the 35 billion to Nevada Minerals and then they along with the 40 billion from Urban were returned (not retired) to treasury per Andrew Hill, our new IR person. Meaning they were available at that time for reissue. Logical guess on this scenario (IMHO) would be 37 billion plus investment dollar shares amounting to somewhere between 75 to 150 billion shares placing the O/S near 112 to 187 billion. Note: This is without taking into consideration that Urban seems to control the company without any need for our approval as shareholders so either he has controlling interest of the shares O/S (meaning possibly over 400 billion) or we have non-voting common shares and he has a preferred share with all voting rights, or some other technique to bypass the obvious norm.
4. Next UCAD/USCA buys in on CMKX and sends 7.5 million shares valued at the time to be near $3 per share (or $22.5 million) for 5% of CMKM Diamonds. Was this paid in shares? If so at what price per share? Another 10% could be purchased by USCA for $15 million dollars of which they exercised some. Any idea how many shares $22.5 million dollars would have bought of CMKX on the open market? Add to that the millions USCA paid CMKX and we need to consider how they received their portion of CMKX. If it was in restricted shares of CMKX then this would raise the O/S considerably as well, but the shares would be held by USCA with more than likely a 2 year restriction. The same would hold true with SGGM that bought in on CMKX with 200 billion SGGM shares and 10 million dollars. Did they receive restricted shares for there 5% ownership? If so that too, would increase the O/S, but both USCA and SGGM would probably be 2 year restricted shares and also more than likely a long term relationship would keep those shares held tight for some time.
(Continued)
