Post by Designer on May 11, 2005 20:11:59 GMT -5
FRIZZELL LAW FIRM
305 S. Broadway, Suite 302
Tyler, Texas 75702
(903)595-1921
Fax (903)595-4383
E-Mail jmartin@cmkxownersgroup.com
May 11, 2005
Greetings Members.
It has been an interesting couple of days. It was nice to finally get to meet some of you. You are to be commended for making arrangements to attend the proceedings. Judge Murray took the time to acknowledge the presence of the shareholders on several occasions during the hearing. I truly believe your participation in this process is very helpful to the company.
I have mixed emotions about the hearing yesterday. I was glad to see the judge referencing the interests of the shareholders in her questions to some of the witnesses. I was disappointed in her refusal to allow any significant evidence about naked shorting. This was somewhat expected in light of her ruling on the pre-trial motions which were handed down last Thursday. Judge Murray apologized to the company, the SEC and our group for not informing us of her rulings last Thursday. Judge Murray read her rulings into the record when she was told that none of the parties had received her rulings which were entered on May 5, 2005.
Please remember that as your representative, I was permitted to participate but only in a limited fashion. I was not allowed to present witnesses or offer evidence of our own because we were not one of the named parties to the proceeding. My intention was to present evidence through the company’s witnesses. I was able to do so through my cross examination of the government witnesses and the individuals put on the stand by the company.
The Court began the hearing by telling the SEC that evidence of naked shorting was not a material issue in the hearing. Mr. Stoecklein advised the Court that certain evidentiary items were tendered to the parties late last week. He informed the Court there may be some responsive exhibits we (the company and the shareholders) may want to offer after the hearing since we received certain items from the SEC just a day or two before the hearing. The Judge informed us that she had a policy of allowing exhibits to be offered until she handed down a ruling in the matter. I made a decision at that time to withhold my offer of the exhibit we put together on the shareholders holdings until after the hearing.
It was frustrating to see the judge exclude Mr. Stoecklein’s offer of evidence of the evaluation of various properties. Ed Dhonau was to testify about the value of the claims in Canada and the value of the gold mining operations in Ecuador. This would have been helpful to you. There was information from Rendall Williams about revenues from mining. Mr. Williams appeared reluctant to answer questions from me and Mr. Stoecklein. I wish I could offer a full and understandable reason Mr. Williams’ testimony.
We learned on Friday before this hearing that Neil Levine, the auditor that had been paid $100,000 in January to work on our audit, had sent Mr. Stoecklein a letter withdrawing as the auditor. A letter of this nature sent two days before a hearing of this significance is unusual to say the least. Mr. Levine testified that he was simply too busy to continue waiting on the necessary underlying documents to continue in his work. This letter came with no warning to Don Stoecklein or Mr. Maheu. Mr. Levine had billed over $70,000 of the company’s retainer and brought an attorney with him to the hearing. He testified that the company would be receiving a bill for his attorney’s fees because that was provided for in the engagement letter with his firm. I expressed my concern about the timing of his actions when I questioned him. I am still bothered by his answers to my questions. It took no time for Mr. Stoecklein and Mr. Maheu to get another auditor lined up. I do not have his name but I have been told another auditor has been engaged and he is an auditor that Mr. Stoecklein has worked with in the past.
I was very impressed with the employees hired by Mr. Stoecklein to continue the work on the financial reports. When the records are accumulated, the staff is in place to finish the bookkeeping for transferral to the auditor.
You have probably heard that Urban took the 5th amendment when asked questions about the company. I wish I knew the underlying problems that caused Urban to have an attorney representing him at this hearing in addition to Mr. Stoecklein. I have no knowledge of the reasons and I will not speculate nor offer any opinion on that matter.
Mr. Maheu’s appearance was well received. He testified that he was there to assist the company in meeting its compliance obligations. The Court was most respectful of Mr. Maheu. The judge very bluntly asked if he had ever considered that the company might be using Mr. Maheu for his good name and remarkable track record.
The Court has established a briefing schedule which tells the parties when legal briefs are due on the various issues raised by the evidence. Any brief I choose to submit on your behalf will be due in the middle of June.
An interesting letter has surfaced in the investigation that we are doing into naked shorting of company stock. I am seeking agreements of the parties to post a copy of that letter. Please remember that I am under a strictly worded confidentiality agreement. I can of course relay what everyone heard in the hearing. There were some discussions about stipulations of certain evidence being offered by the SEC. There is a letter written by the general counsel of Jefferies to the NASD that I think is very interesting. The SEC was seeking some evidence to support their view that CMKX is not naked shorted and apparently made a call to the NASD. This letter was forwarded to the SEC. Please do not speculate on the significance of this letter until you have the opportunity to view it. This is a letter that reveals an explanation of sorts on some trading that occurred in 2004 in CMKX stock. I hope to be able to post this letter in the next few days.
The SEC attorney stated in Court yesterday she did not believe a naked short position existed in our company stock. Mr. Stoecklein had discussed the issue with her prior to the hearing and a meeting was tentatively set while we were all in town for the hearing to discuss the issues of naked shorting. Mr. Maheu, Anthony Demint, Mike Williams, Don Stoecklein and I met at the offices of the SEC this morning. We visited with Ms. Hakala, Mr. Glynn and the regional supervisor. The meeting lasted two hours. There was a full discussion of the issue of naked shorts with the enforcement attorneys. We took the current NOBO list with us and the work we have accumulated based on your faxed in brokers confirmations from last week. Although we have documents that prove a huge naked short statistically speaking, I am insisting that we have stand alone proof of share ownership. The SEC knows we are dedicated to acquiring the information necessary to prove our outstanding stock. We came away with no formal agreements but we have established some dialogue to proceed from this point. When I return to the office I will issue another update suggesting some ways to continue gathering our “facts”. Please believe me when I say this fax campaign is very important.
Sorry about the length of this update but I thought it might be helpful to those of you that did not get to attend the hearing. I have already heard of many rumors and that are being spread by some people not interested in the company’s well being. If you do not hear it from this office or in an official PR from the company, I would ask that you do proper due diligence before accepting something as fact.
We must continue our efforts.
Onward,
Bill
305 S. Broadway, Suite 302
Tyler, Texas 75702
(903)595-1921
Fax (903)595-4383
E-Mail jmartin@cmkxownersgroup.com
May 11, 2005
Greetings Members.
It has been an interesting couple of days. It was nice to finally get to meet some of you. You are to be commended for making arrangements to attend the proceedings. Judge Murray took the time to acknowledge the presence of the shareholders on several occasions during the hearing. I truly believe your participation in this process is very helpful to the company.
I have mixed emotions about the hearing yesterday. I was glad to see the judge referencing the interests of the shareholders in her questions to some of the witnesses. I was disappointed in her refusal to allow any significant evidence about naked shorting. This was somewhat expected in light of her ruling on the pre-trial motions which were handed down last Thursday. Judge Murray apologized to the company, the SEC and our group for not informing us of her rulings last Thursday. Judge Murray read her rulings into the record when she was told that none of the parties had received her rulings which were entered on May 5, 2005.
Please remember that as your representative, I was permitted to participate but only in a limited fashion. I was not allowed to present witnesses or offer evidence of our own because we were not one of the named parties to the proceeding. My intention was to present evidence through the company’s witnesses. I was able to do so through my cross examination of the government witnesses and the individuals put on the stand by the company.
The Court began the hearing by telling the SEC that evidence of naked shorting was not a material issue in the hearing. Mr. Stoecklein advised the Court that certain evidentiary items were tendered to the parties late last week. He informed the Court there may be some responsive exhibits we (the company and the shareholders) may want to offer after the hearing since we received certain items from the SEC just a day or two before the hearing. The Judge informed us that she had a policy of allowing exhibits to be offered until she handed down a ruling in the matter. I made a decision at that time to withhold my offer of the exhibit we put together on the shareholders holdings until after the hearing.
It was frustrating to see the judge exclude Mr. Stoecklein’s offer of evidence of the evaluation of various properties. Ed Dhonau was to testify about the value of the claims in Canada and the value of the gold mining operations in Ecuador. This would have been helpful to you. There was information from Rendall Williams about revenues from mining. Mr. Williams appeared reluctant to answer questions from me and Mr. Stoecklein. I wish I could offer a full and understandable reason Mr. Williams’ testimony.
We learned on Friday before this hearing that Neil Levine, the auditor that had been paid $100,000 in January to work on our audit, had sent Mr. Stoecklein a letter withdrawing as the auditor. A letter of this nature sent two days before a hearing of this significance is unusual to say the least. Mr. Levine testified that he was simply too busy to continue waiting on the necessary underlying documents to continue in his work. This letter came with no warning to Don Stoecklein or Mr. Maheu. Mr. Levine had billed over $70,000 of the company’s retainer and brought an attorney with him to the hearing. He testified that the company would be receiving a bill for his attorney’s fees because that was provided for in the engagement letter with his firm. I expressed my concern about the timing of his actions when I questioned him. I am still bothered by his answers to my questions. It took no time for Mr. Stoecklein and Mr. Maheu to get another auditor lined up. I do not have his name but I have been told another auditor has been engaged and he is an auditor that Mr. Stoecklein has worked with in the past.
I was very impressed with the employees hired by Mr. Stoecklein to continue the work on the financial reports. When the records are accumulated, the staff is in place to finish the bookkeeping for transferral to the auditor.
You have probably heard that Urban took the 5th amendment when asked questions about the company. I wish I knew the underlying problems that caused Urban to have an attorney representing him at this hearing in addition to Mr. Stoecklein. I have no knowledge of the reasons and I will not speculate nor offer any opinion on that matter.
Mr. Maheu’s appearance was well received. He testified that he was there to assist the company in meeting its compliance obligations. The Court was most respectful of Mr. Maheu. The judge very bluntly asked if he had ever considered that the company might be using Mr. Maheu for his good name and remarkable track record.
The Court has established a briefing schedule which tells the parties when legal briefs are due on the various issues raised by the evidence. Any brief I choose to submit on your behalf will be due in the middle of June.
An interesting letter has surfaced in the investigation that we are doing into naked shorting of company stock. I am seeking agreements of the parties to post a copy of that letter. Please remember that I am under a strictly worded confidentiality agreement. I can of course relay what everyone heard in the hearing. There were some discussions about stipulations of certain evidence being offered by the SEC. There is a letter written by the general counsel of Jefferies to the NASD that I think is very interesting. The SEC was seeking some evidence to support their view that CMKX is not naked shorted and apparently made a call to the NASD. This letter was forwarded to the SEC. Please do not speculate on the significance of this letter until you have the opportunity to view it. This is a letter that reveals an explanation of sorts on some trading that occurred in 2004 in CMKX stock. I hope to be able to post this letter in the next few days.
The SEC attorney stated in Court yesterday she did not believe a naked short position existed in our company stock. Mr. Stoecklein had discussed the issue with her prior to the hearing and a meeting was tentatively set while we were all in town for the hearing to discuss the issues of naked shorting. Mr. Maheu, Anthony Demint, Mike Williams, Don Stoecklein and I met at the offices of the SEC this morning. We visited with Ms. Hakala, Mr. Glynn and the regional supervisor. The meeting lasted two hours. There was a full discussion of the issue of naked shorts with the enforcement attorneys. We took the current NOBO list with us and the work we have accumulated based on your faxed in brokers confirmations from last week. Although we have documents that prove a huge naked short statistically speaking, I am insisting that we have stand alone proof of share ownership. The SEC knows we are dedicated to acquiring the information necessary to prove our outstanding stock. We came away with no formal agreements but we have established some dialogue to proceed from this point. When I return to the office I will issue another update suggesting some ways to continue gathering our “facts”. Please believe me when I say this fax campaign is very important.
Sorry about the length of this update but I thought it might be helpful to those of you that did not get to attend the hearing. I have already heard of many rumors and that are being spread by some people not interested in the company’s well being. If you do not hear it from this office or in an official PR from the company, I would ask that you do proper due diligence before accepting something as fact.
We must continue our efforts.
Onward,
Bill
Owner
