Email from CEO of Magnum
From: mdor@magnumresources.net <mdor@magnumresources.net>
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To: xxxxxxxxxx
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Date: Tuesday, January 06, 2009 09:57 pm
Subject: Re: Suip to Mdor
Please find attached my full explanation. Hope this helps clear any and all confusion on the subject. Happy New Years!!
Sincerely,
Joe Glusic
-----Original Message-----
From: xxxxxxxxx
Sent: Tuesday, January 6, 2009 06:36 PM
To: mdor@magnumresources.net
Subject: Suip to Mdor
Attn Mr Glusic:
Hi I am a shareholder and have been buying shares in Magnum being the first quarter of 2009 appears to be a hyper or rapid growth phase for Magnum. I wanted to know if you could explain the history of Magnum? I read some confusing things today about the old company with Suip or Sunrise and how Mdor used to be Magr. If possible I would really appreciate the breakdown.
Thank you for your time,
Your loyal shareholder
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HERE IS THE ATTACHMENT:
Shareholders have called and complained about the money they have lost over the years buying MDOR when it was owned by previous people and want to know what we are doing with their money. They also DEMAND we inform them of every transaction the company makes. I get asked this question a lot so I’m writing this response and sending it to you so that you may better understand the sequence of events and company history. Please feel free to pass it on to other fellow shareholders.
Let me respond by explaining the situation. First of all, the company is restricted as to what projections and financial information can be divulged prior to official quarterly and annual fillings. Hence, the point of being a public company. Press Releases can only speak in generalities. 8-K filings are the official release of public information. PRs only serve to keep the public attuned to events, company direction, and provide market awareness.
Secondly, anyone who has purchased stock in MDOR has not bought stock directly from the company because the company has not sold any treasury stock since it changed hands in 2006. Therefore, investors who have purchased stock have bought it from some other investor that decided to sell his or her shares or from someone that may have shorted the stock. The current MDOR (post 2006) has not benefited from the sale of any company stock.
For those disgruntled shareholders, they need to understand that previous control persons (owners of the preferred share block) like Reno and the Sun brothers may well have lined their pockets with shareholder investments if they were issuing stock to themselves and selling it to the market or distributing it through private placements.
Therefore let me explain the history of the company as I understand it: The company started out in 1999 as an internet golf dot com. It later turned into a junior mining resource company as MAGR under Reno Callebreno (sp). He supposedly entered into some type of Mongolian Copper lease arrangements. He eventually sold controlling interest to the Sun Brothers.
The Sun brothers bought the company for two reasons; the first was to hedge the copper market because they own and operate an electric component manufacturing company (previously Eaglerise Electric, in China) which utilizes huge amounts of copper. Having their own copper supply would give them the advantage of stable commodity price and a reliable source of copper. This happened when copper prices were fling through the roof. Reno made out like a bandit and baled. Somewhere during this time MAGR did a 40-1 reverse split because they had no more authorized shares left (Reno distributed all 190 million available). When the RM was done the symbol changed to MDOR and new stock was issued.
The Sun brother’s intention was to reverse merger their Chinese electric business into MDOR (the old MAGR) to access the American capital markets and expand their company. They formed a wholly owned subsidiary called Sunrise Mining and transferred all the Mongolian lease rights to the subsidiary. In the mean time they changed the name of their electric company to “Sunrise Electric” (which I think it still is today) in anticipation of the reverse merger.
However, during this same time the Mongolian Government went through some significant changes and instituted huge windfall profit taxes on foreign owners of resource companies if they extracted and exported precious and saleable metals. The Suns jumped through many hoops to keep their leaseholds in force by transferring the rights to a Mongolian national and having an agreement with him to allow Sunrise all mineral right profits. Apparently the Suns spent a fair amount of money also cleaning up after Reno to pay the exploration costs and back payments owed to several people.
Then along comes Chad Curtis in 2006 looking for a clean shell to buy so he can pursue a reverse merger with Spreelast. The Suns jump at the chance so that they can recoup their money. So, they cut a deal to sell the controlling interest but retain the copper rights. A sweet deal indeed! But, to keep a public entity for a later reverse merger they had to do a spin-off. The SEC would only approve the spin-off if there was no apparent loss to the shareholders since all the assets were now held by the Sun’s subsidiary (which at that time were the Mongolian leases). So, for MDOR to have no liability and be a clean shell it had to completely divest itself of all the assets, but insure they were still held by the original shareholders.
This is when SUIP was formed. It took 9 months to complete the spin-off to the satisfaction of the SEC. Therefore, anyone who invested in MDOR/MAGR for the purpose of being involved in mining still had full ownership at the time of the spin-off with their equal share percentage in SUIP. If MDOR had kept the leases, they would have sold them or let them expire because they did not fit into the business that MDOR was purchased for.
Since the time of the spin-off, SUIP has let the leases expire and has invested in some type of notes. They have also diluted to raise capital through a private sale of stock (this is all in their filings). SUIP has essentially become worthless and anyone who invested for the mining has lost their entire investment accordingly. So, if any shareholder is disgruntled over any losses they have sustained prior to 2006 they need to contact Reno or Tim Sun.
The current MDOR is up over 400% since the new management took over and is no longer a development or a speculative fortune in the dirt company.
Joseph Glusic, CEO
