Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Spokes ... that's your opinion.
You should have said that.
March 18, 2005 (FinancialWire) The Robert Simpson who U.S. Senator Robert Bennett (R-Utah), Chief Deputy Whip for Senate Republicans, referenced in a recent Senate committee hearing during testimony by U.S. Securities and Exchange Commission Chair William Donaldson as having filed a 13D claiming ownership of 100% of the shares outstanding for Global Links Corp. (OTCBB: GLKCE), has surfaced.
Although the shares were purchased for his personal account, Simpson is also CEO of Zann Corp. (OTCBB: ZANC). As it turns out, Simpson, who has now been subjected to death threats, not only doesn’t have physical certificates in his sock drawer, he is in a fight with his broker, Oppenheimer Holdings (NYSE: OPY) to get delivery on them at all. And while Simpson’s actions may still serve as a poster event for StockGate and the illegal naked short sales fiasco the term represents, Global Links Corp. is hardly a poster for anything. Its assets are highlighted by a proposed real estate purchase from another public company, Diversified Financial Resources, whose share price is so miniscule it shows up as $0.00 on Yahoo’s (NASDAQ: YHOO) Finance site and elsewhere.
Diversified Financial’s (OTCBB: DFLR) trading volume Thursday was the fourth highest on the over the counter bulletin board, but of course in dollar terms, 102.39 million shares priced at $0.000 are only … well, you compute it.
It also turns out that the filing was in error, as Simpson believes he has bought 110% of the outstanding shares of Global Links. The filing is at: http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000949728&owner=include
Actually, 125% of the known outstanding shares are now claimed in filings with the U.S. Securities and Exchange Commission. On March 9, Paul Floto of Dallas said he had acquired 180,000 shares, “constituting a total of 15.45 percent of the issued and outstanding common stock of the Issuer, in the open market.” He paid $6,463.95 for them. Simpson’s 1,158,209 shares were purchased in February for $5,205.
Like Simpson, Floto’s purpose in purchasing another 15% of a company that was already owned 110% by another party, and which continues to trade millions of shares, including 918,540 on Thursday alone, was to make a point, and said he, too, may purchase 100% of the outstanding shares.
Said Floto in his filing:
“The Reporting Person acquired his interest in the Issuer primarily to point out the complete failure of government and exchange regulatory bodies to maintain honest, orderly markets, and the corrupt actions of market makers and securities clearing bodies, which facilitate the sale of unissued, unregistered, counterfeit, or simply nonexistent securities.
“On February 3, 2005 a single investor reportedly purchased all the common shares issued by the company, plus 145 additional unissued shares.
“Subsequent to that date, over 95 million shares, or over 82 times the total shares issued, were reportedly traded, none of which were reportedly sold by the 100% owner of the common stock.
“On March 4 and 7, I purchased a total of 180,000 shares, resulting in my obtaining 15.54% ownership of a stock reportedly already 100% owned by another investor. I assume that there may be additional investors who may also claim ownership of common shares of this company.
“I have requested that certificates be issued to me representing my full 15.54% ownership interest, to protect my right to vote and enforce any other claims that may accrue to an actual documented owner.
“I understand that Reg. SHO was supposed to detect and prevent the fabrication of millions of nonexistent shares. It would appear that my securities purchases prove that Reg. SHO has been systematically violated by market-making brokers and securities-clearing firms.
“From time to time I may continue to purchase additional securities on the open market to increase my ownership interest to up to 100% of the company's common stock to give me an ownership interest equal to that of the current 100% owner,” Floto concluded in his SEC filing.
Simpson told FinancialWire that Oppenheimer has told him, after it sold him the shares, that it can not find shares to deliver to him. He said he has been discussing this with his attorney and plans soon to take action.
Simpson is also considering court action in Nevada, the domicile of Global Links, to prevent the issuance by the company, whose executives he does not know nor seems to be interested in knowing, of any additional shares.
He may also seek to become a director.
Simpson is concerned that there may be a form of preferred shares that could prevent him from taking control of the company, so is exploring all his options.
Simpson also said he received a call from a national reporter with the Dow Jones (NYSE: DJ) News Service, who he said accused him of “insider trading,” and trying to flip his shares, and said she did not seem to know that his filing of the 13D prevents him from selling the shares for a year.
That is not the least of his worries, however. A poster on Raging Bull with the monicker igroup), in post 27429 under the Zann Corp.’s message board, stated, “I would’nt be surprised if someone put bullet in the back of his head ….” The message has been turned over to the Federal Bureau of Investigation.
Also turned over to the FBI was a direct email Simpson received from jgtc01@aol.com that stated just as ominously, “I FOUND YOU JER-S YOU ARE IN A HOTEL ROOM AND I WILL SHUT YOU DOWN WHAT YOU ARE DOING IN ILLEGAL GET READY TO BE ON THE NEWS YOU JER-S.” Executives at Time Warner (NYSE: TWX), which owns AOL Online, have not responded to inquiries from FinancialWire as to the legitimacy of the email address or the identity of the emailer.
Finally, there is the matter of Global Links itself.
The filing that attracted Simpson’s, and later Floto’s attention, stated: “Effective February 1, 2005, the Registrant implemented a one for 350 reverse split of its authorized, issued and outstanding shares of common stock. The number of authorized and outstanding shares of the Registrant's common stock has been reduced in accordance with the one for 350 split ratio to 5,428, 571 and 1,158,064, respectively, following the February 1, 2005 reverse split.”
Another filing, however, on January 3, described a stock incentive plan for employees, non-employee directors and consultants.
It called for the issuance of 500,000,000 options to purchase common stock, and 100,000,000 shares of common stock to be registered.
There may be yet another shoe left to drop, but Simpson isn’t worried. He said his attorneys have assured him that the company can not now issue more than 5 million shares following his filing of the 13D, and he expects to have other actions in place to prevent even that.
A video of the exchange between Bennett and Donaldson is at Investrend Information at http://www.investrendinformation.com
Bennett questioned Donaldson in his appearance before the US Senate Committee on Banking, Housing, and Urban Affairs. The Senator chairs the committee’s Subcommittee on Financial Institutions, and serves on the Subcommittee on Securities and Investment. He also serves on the Senate Small Business Committee and is Vice Chair of the Joint Economic Committee.
“This article in a national publication shows that people are still selling short,” Bennett told Donaldson. “Regulation SHO is clearly not working.”
He told the SEC Chair that short sales under Regulation SHO are not settled in the 13 days allowed because one broker passes off to another, and so on,” inferring that this process can go on indefinitely.
Donaldson said that his staff would be glad to meet with Bennett’s staff to describe what the Commission is doing to resolve these matters under Regulation SHO. The SEC Chief of Market Regulation, Annette Nazareth, in a recent interview with Floyd Norris of the New York Times (NYSE: NYT), dismissed complaints about naked short selling as “people who want their stock to go up.”
With conflicting 13D filings for shares that apparently exceed the issued and outstanding for Global Links, perhaps a seat Senator Bennett’s office when that discussion is held should be put on EBay (NASDAQ: EBAY)?
For up-to-the-minute news, features and links click on http://www.financialwire.net
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. It is not a press release service and receives no compensation for its news or opinions. Other divisions of Investrend, however, provide shareholder empowerment platforms such as forums, independent research and webcasting. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on http://www.investrend.com/contact.asp
The FinancialWire NewsFeed is now available in multiple formats to your site or desktop, free. Click on: http://www.investrend.com/XmlFeeds?level=268
Most of those 750 BILLION shares don't come with certs ... what've you been drinking this early?
A nice movement here ...
http://stockhouse.ca/news/news.asp?tick=GHM&newsid=2690160
SGF underwriters exercised additional stock
A very good sign!
http://stockhouse.com/news/news.asp?tick=SGF&newsid=2688762
More good news from Shore Gold.
Shore Gold announces underwriters exercise option to purchase additional 3 million shares for $16.5 million
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
Stock Symbol: SGF: TSX
SASKATOON, March 16 /CNW/ - Kenneth E. MacNeill, President and Chief Executive Officer of Shore Gold Inc. ("Shore") is pleased to announce that further to its recently announced bought deal financing, the syndicate of underwriters led by Genuity Capital Markets have exercised their option to purchase an additional 3 million Common Shares of Shore at a price of $5.50 per share for additional aggregate gross proceeds of $16.5 million. With the exercise of the option, the aggregate gross proceeds of the offering will be $116.6 million.
Shore intends to use the net proceeds of the offering for the exploration and development of the Star Kimberlite Project and for general corporate purposes.
As previously announced, Newmont Mining Corporation of Canada Limited ("Newmont") is participating in the offering and after the offering will own 9.9% of the issued shares of Shore. Newmont is the world's largest gold producer with significant assets or operations on five continents.
The offering is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals. Closing of the offering is expected to occur on March 22, 2005.
Shore is a Canadian based corporation engaged in the acquisition,
exploration and development of mineral properties. Shares of Shore trade on the TSX Exchange under the trading symbol "SGF".
The securities being offered have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
The information in this news release contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties which are beyond Shore Gold's control, including: the impact of general economic conditions and the price of diamonds. Shore's actual results and performance could differ materially from those expressed in, or implied by, such forward looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits that Shore Gold will derive from them.
Please do your own due diligence.
Both the gentlemen listed below are directors of Glen Hawk Minerals
where they are building a tremendous opportunity for new and old shareholders alike. You will probably find that becoming involved with Glen Hawk your chances for a prosperous future will become enhanced.
The deal is probably that Mr. Marc J. Oppenheimer and Dr. Luca Riccio of Crystallex have plans for Glen Hawk Minerals. And after building a billion dollar company at Crystallex, their talents are blossoming here.
www.glenhawkminerals.com
If you've never been wrong before ... yo are now.
I hold certificates in my SD box endorsed on the back CEDE & Co. They're like cash. LOL
This is a keeper ...
Dr. Patrick Byrne's Summary Of The Naked Shorting Problem
From the Overstock Message Board - 3/13/05
Dear Colleagues,
The issue of “naked shorting” seems to be becoming a news item, and is even (perhaps) a scandal in the making: I have been called by several publications in the last week to discuss the issue, and there is word of a major exposé on a network news program to run soon. This is especially topical, given the issue of Social Security private accounts.
As is known by those who have been regular readers of this board, my involvement with the issue is that of a concerned citizen. However, I figured I would write something here so those who are interested can follow along. Some of this draws together points I have tried to make in earlier threads about “Wall Street Criminals,” but most of this is new. I have tried to explain here the Failure-to-Deliver and Naked Short issue in plain English. You auction sellers in particular will find many parallels between this issue and the issue of auction fraud, albeit it on a grander scale. In any case, I hope that those who are interested may find this a concise and useful précis on the issue.
1. Shorting Stock: This is a legal and honorable method of investing. Suppose a share of IBM stock is trading at $90, but I expect IBM to go down. I “short” it. This means that, through my broker, I borrow a share of IBM, sell it in the open market, and collect $90. Assume that IBM then drops from $90 to $50. That is as low as I think it is going to go, so I “cover” my short: I take $50 of the $90 that I collected, I buy a share out in the market, and return it (through my broker) to the person who loaned me a share in the first place. I am left with $40 profit.
2. Failure-to-Deliver (“FTD”): The American stock market runs on a “T+3” system. This means that when you sell a share of stock, you have 3 days to deliver that share. If you do not deliver within 3 days, you have, “failed to deliver,” or “FTD’ed”. Think of this like someone who posts auctions but does not deliver the goods.
3. DTCC: Depository Trust & Clearing Corporation. This is the back-office of Wall Street. Rather than have people run around with paper stock certificates, the DTCC keeps electronic records of who owns which stock at which brokerages, and settles the trading of stocks. If you “FTD” (“Fail to Deliver”), the DTCC are the folks whose books don’t match.
4. Strategic Failures to Deliver: Not all FTD’s are necessarily illegal. Someone may forget to get shares of stock out of her sock draw and deliver them to her broker within three days of a sale, yet this does not make her a criminal. Also, in the center of Wall Street there exists a job known as a “market maker,” someone who is charged with maintaining an orderly market in a stock by continuously buying and selling to create liquidity. Market makers are allowed (on a good faith basis) to buy and sell stock that does not exist, temporarily, just to keep liquidity in a stock. Again, this is expected and allowed. What is not allowed, however, is for investors to sell and fail-to-deliver purposefully: doing so (through a variety of mechanisms that I will explain below) in an attempt to manipulate the price of a stock, is a “strategic” failure-to-deliver. Some folks believe that Strategic FTD’s played a role in the 1929 meltdown. In any case, there have been regulations against it since 1933 (regulations which provide for criminal and civil penalties). The slang term for “Strategic Failure to Deliver” is, “naked shorting.”
5. The Economics of Naked Shorting: The gist of naked shorting is simply, when a hedge fund pretends to short a stock (I say, “pretends” because it is stock that it does not really own, and which it does not really borrow). It sells those made-up shares into the marketplace, and collects the money just as though it sold real shares (note that this is “counterfeiting,” more or less, though with electrons rather than paper). If it is stock in a small company, and does not trade with much liquidity, then the hedge fund can keep “selling” its made-up shares and drive the stock price down to wherever it wants it to go.
In a healthy market, the check-and-balance on shorting would simply be the number of shares that are available for short sellers to borrow and sell. Since there would only be a finite number of shares to borrow and sell, there would be only a finite amount of pressure the shorts could bring upon a stock (and it would be offset by buying pressure holding that stock up). But if naked shorting is allowed, then there is no limit on how many bogus shares hedge funds can create. Thus means they can drive a stock’s price down close to $0. At the very least, this practice destroys peoples’ savings (remember, the shorts make money by driving the stock down, whereas any stockholders lose that same amount of money as the stock price drops). Some folks believe companies have been driven out of business by this, because they cannot raise new capital once those stocks have cratered badly enough.
The key is this: if given the right to create an unlimited number of new shares, essentially out of thin air, not limited by the number of shares “in the borrow” as legal shorting requires, these hedge funds can always drive the price down and always cover for a profit. That is why it’s, “illegal.”
6. How can Naked Shorting Occur in Our Regulated Markets?
a. The lazy explanation: How can a hedge fund get away with selling shares it neither owns nor borrows? One theory is that the DTCC (and some brokers) look the other way for “favored” clients. “Sell 100,000 shares of XYZ for me.” “Do you have the shares?” “Oh, you know I’m good for it!” Large clients enjoy such favored relationships and, because they have deep pockets, the DTCC and the brokers assume they can trust those clients to operate like this and true things up later. This lackadaisical attitude, however, gives dishonest hedge funds opportunity to “sell” stock that does not exist, and thus create downward pricing pressure that becomes self-fulfilling: as the stock gets driven down it reaches the point that other owners lose confidence and dump their stock, and as it gains downward momentum, the naked shorts can cover their shorts and move on.
b. The sleazy explanation: Believe it or not, there is a more insidious explanation of how this game works. Imagine that a sleazy hedge fund chooses a small, illiquid company to attack. Often that company is in a poorly understood sector, or is a company with some accounting complexities so it will be possible to create “where there’s smoke there’s fire” skepticism about its books. Here is what happens:
i. The hedge fund gets that US firm listed on foreign exchanges.
ii. That hedge fund then “sells” shares it neither has nor borrows.
iii. When the DTCC calls after three days and says, “Where are those shares?” The hedge fund replies, “I borrowed them on the German exchange, they will take a few weeks to show up,” or “I am a market maker for the German Exchanges in that stock, and thus excluded from the no naked shorting rules.”
iv. With a nudge and a wink the DTCC says, “OK, we’ll loan you from our own reserves of that stock.” The DTCC collects a high fee from the hedge fund to do this.
v. The hedge fund has relationships with a few compliant reporters, who are called and told, “Do a hatchet job on Company XYZ.” They do so, perhaps in return for off-shore compensation.
vi. The combination of bad publicity coupled with the selling of an unlimited number of shares drives the stock down to the point either that the hedge fund covers and moves on, making a quick $20 - $50 million, or the company goes bankrupt, or simply remains a penny stock (in which case the hedge fund never has to cover its short, and hence, never pays taxes!)
7. The Regulatory Environment: After years of pressure, in 2004 the SEC promulgated Reg SHO (for “SHORT”), which directs the exchanges (NYSE, NASDAQ, etc.), to start publishing early in 2005 lists of companies whose FTD’s exceed a reasonable amount (“reasonable” = “greater than .5% of the shares in the company”). This list is called, “The Reg SHO Threshold List.” It does not list the amounts of FTD’s, just the names of companies that are experiencing them.
The way Reg SHO is supposed to work is as follows. If a company crosses beyond the threshold of a reasonable amount of FTD’s, and then stays there for 5 days without crossing back under the threshold, its name goes on the Reg SHO list. Then, after 13 more days, if it is still on the list, brokers are supposed to tell those hedge funds that are failing to deliver that they must stop failing to deliver, and those brokers are not supposed to take any more short sale orders from those accounts for those stocks.
8. Reg SHO is flimsy: So flimsy, in fact, it set folks scratching their heads - does the SEC not get it? Here is why it is flimsy:
a. Telling the hedge funds after 13 days, “You are not supposed to do any more naked shorting in this stock,” is meaningless - they weren’t supposed to be naked shorting it in the first place.
b. There are no sanctions for violators.
c. Why grandfather violations that have been illegal for 71 years?
9. Two theories regarding how big a problem this is:
a. Tame theory: This is a problem for a small percent of companies, just those that find themselves on the Reg SHO list. Thus this is not a hard problem to fix. But fixing it is going to cause a lot of hedge funds to lose money. They are well-connected with the SEC, and the SEC is co-opted to the point that they are tightening down on this half-heartedly.
b. Extreme Theory: This problem is so endemic that if the SEC tried to fix it the system would crack. There are so many losses waiting to be realized by the hedge funds, it would be like the failure of Long Term Capital Management, but on a massive scale (see Roger Lowenstein’s, When Genius Failed, for an excellent explanation of the risk that the failure of even one large hedge fund put on our financial system). In this scenario, the reason the SEC is not being suitably aggressive is because they know the problem has gotten beyond what can be solved without a systemic failure.
10. Which theory is correct? I don’t know. No one knows outside the DTCC, SEC, and maybe the NASDAQ and NYSE. And they are not telling. I have asked the DTCC, SEC, and NASDAQ for the size of Overstock’s FTD, but they all refused to disclose it. This amazes me: if I sold 100 shares out the back door of Overstock without registering them I would go to jail, but (per our inclusion on the SHO Threshold list) some hedge funds have sold hundreds of thousands (or millions) of phantom shares, and the SEC and DTCC protect them. When I ask, “By appeal to what law or regulation are you refusing to disclose this to me?” they clam up. This is one of the warnings telling me that this may be a problem of catastrophic proportions.
I hesitate to describe the others, as it sounds like I might be lining my hat with tinfoil. But in the interest of completeness, I shall. In 2004 it became public that one well-known short seller, David Rocker (of Rocker Partners), was shorting our company. In October, 2004 I invited him on a conference call to debate me, and it got pretty nasty (see this transcript for details:
Click here for the transcript
Immediately thereafter some knowledgeable-sounding people got in touch and warned me of four things to come, in this order:
a) Reporters A, B, C, and D would call and do hatchet jobs on me, as they were lackeys to Rocker;
b) I would find Overstock.com listed on innumerable foreign exchange;
c) We would find ourselves on the Reg SHO Threshold list when it came out in January.
d) The SEC would announce they were starting some inquiry on us.
I already knew Reporters A, B, and C, who had gone far out of their way to write uncharitable articles about me, and while I always wondered at their eagerness to do so, I gave the prediction of more such articles little credit. Yet I had never heard of Predicted Reporter D (Elizabeth MacDonald of Forbes): within two days, she (along with A, B, and C) had called with clear intent to write something unpleasant. Elizabeth hunted for a week, then gave up: we are so squeaky clean, the most such reporters can do is write anodyne trivia: e.g., Herb Greenberg actually once devoted a whole column to how quickly or slowly I returned his calls, and how this could be interpreted as a sign of sinister intent (as opposed to, say, whether or not I was getting on and off planes as I synched my emails).
Then over the autumn of 2004 we found ourselves listed on five exchanges in Germany and one in Australia: someone went to all the trouble to get us listed on these exchanges, though hardly any shares have traded since (this confirms the theory that these foreign exchanges are used simply as smoke screens by hedge funds needing an excuse for the DTCC).
On January 27 we appeared on the Reg SHO Threshold list (only about .4% of companies are on this list).
Thus, these “crazies” had made four pretty far out predictions. The first three of them have come true. The test of any theory is its ability to make accurate predictions, and the “crazies” have passed that test. So I started paying a lot more attention to what they had to say.
Incidentally, their fourth prediction (the SEC trying to make trouble for me) has not come true. However, an increasing number of smart people are telling me that, now that I am taking a lead role in this issue, and am the first non-fringe player to do so, the SEC is going to crucify me, for they (according to these sources) are thin-skinned, vindictive, unused to criticism from those whom they regulate, and partly captured by the very hedge funds that benefit from these practices.
11. The “Pay-No-Attention-To-The-Man-Behind-The-Curtain” Responses: A party line has developed within Wall Street that runs like this:
a. “There is no naked shorting”: This used to be the party line, but since 300 companies appeared on Reg SHO since January 2005 it has worn thin.
b. “Reg SHO will address this problem”: As only a handful of those 300 firms have dropped from the Threshold List, this is dubious, too.
c. “CEO’s who make an issue of this are just mad that their stock is down.” I have nothing about which to be mad: our stock is 2-3X where it was in early 2004. I am trying to bring attention to this because there is a risk to the public.
d. “The folks who make a big deal about this are crazies who line their hat with tinfoil.” Could be. I know they sound whacko. I know I sound whacko, too. But the test of a theory is its ability to predict, and these “crazies” make accurate predictions. I have been called by precisely those journalists they predicted would call me. OSTK has appeared on 6 foreign exchanges, none at our own request. On January 27 we appeared on the Reg SHO list (and as we have not come off it since then, I feel the “crazies” are right about the flimsiness of the Reg SHO mechanism, too). The only thing these “crazies” have missed so far is that the SEC has not started any vendetta against me (yet) for bringing attention to this issue.
I hope this gives you, dear reader, a broad enough overview of this problem that it may suggest further inquiry. I repeat, I do not know how deep a problem this is. It could be next to nothing, or it could be an Enron waiting to happen (with far greater ramifications, as the failure could be systemic). I don’t know, but I do know that it would be easy for the SEC to clear up the mystery: all they have to do is publish the size of the FTD’s for the companies on the Reg SHO Threshold List.
This is, I think, a fair question for me to ask: after all, if without registering them I sold 100 shares of Overstock out the back door of the firm I would go to jail. Yet per our inclusion on the Reg SHO Threshold list we know that some hedge funds have done that with hundreds of thousands (or millions) of shares: why won't the SEC reveal who, and how many counterfeit shares they "issued"? The fact that the SEC, the DTCC, and the exchanges refuse to disclose this (though they must have the information every night, else how could the calculate whether or not a company belonged on Reg SHO list?) makes me worried that it might be a bigger problem than they want anyone to know.
On the other hand, if there is really nothing to this issue, then the problem can be cleared up overnight, and myself (and all the other “crazies”) would go away. All we need are the answers to five simple questions, which I write out below in the hopes that some concerned citizens, or an enterprising journalist, can use them to dig a little deeper on her own.
12. Five Questions for the SEC
a. Does SEC receive daily data from the DTCC/NSCC on Fail to Delivers?
i. If not, why not?
ii. How can the SEC regulate without this?
b. How large is the fail to deliver problem? Does the SEC even know?
i. Why won’t the DTCC tell anyone how large the problem is?
ii. Why won’t the DTCC tell the SHO companies how large their FTD problem is?
c. How can firms remain on the threshold list if Reg SHO is enforced?
d. Why grandfather - pardon - all violations prior to January 7, 2005?
i. Wasn’t it against the rules (10(a)2, 15(c)6-1, 17(a)) since 1934?
ii. Why won’t the SEC enforce rules on the books for 71 years?
iii. What logic supports pardoning flagrant, regular violation of rules?
e. Who are the biggest violators of the Failure to Deliver rules?
i. Who benefits the most from the past fails being pardoned?
ii. Why reward these hedge funds for systematically violating the rules?
f. How can private SS accounts be considered while this is going on?
I thank any reader who has stuck with me through this long explanation. I made it as clear and concise as I could, and hope that through these modest efforts some enterprising reader or journalist will have gained the ammunition needed to breech the defenses of Wall Street and get some answers.
And if for my efforts you see me doing the perp walk on TV, remember to send me a cake with a file in it!
Respectfully submitted,
Patrick M. Byrne (Ph.D., Stanford)
CEO, Overstock.com
PS My disclaimers:
- While David Rocker has been public about being short us (and a surprising percentage of other companies on the Reg SHO Threshold List!), I do not mean to claim that he is naked short Overstock. Someone is, but it is not necessarily him. He could simply be short us, and it be some other party who is naked short our stock.
- The Tools of Satan are going to try to claim that this is all some scheme of mine to get people to buy our stock. It is not true. None, and I mean none, of this is intended to get anyone to think about buying Overstock stock. I am doing this because I am convinced enough of the issue to want the public to get some answers. Someone has to do this, and John Wayne is dead. But do not confuse my involvement with this issue with any valuation or other issue regarding Overstock.com. Hey, I get involved in other political issues to (e.g., education reform), and they are not all driven by some secret aspirations to get customers or shareholders.
I'm not Scott, but this is what he posted ...
Thanks for all the contact sites, Gluggo! Here is a text of a letter I sent to ALL of them, including the Committee:
Senator, let me tell you what's really important to me!
http://www.investigatethesec.com/index1.php
I and many other small investors and small over-the-counter companies have lost billions (yes, billions with a 'b') to a very sophisticated new form of organized crime: naked shorting of publicly traded companies. It is very complicated, but in a nutshell works like this:
1) The criminal enterprise shorts (borrows and then sells) millions of dollars in stock in small and medium-cap stocks (the short is not "covered" by a complementary purchase of the same amount of shares, hence it is referred to as a "naked" short).
2) They then use a number of tactics to bash the stock in the press and chat groups and together with crooked market makers drive down the stock price until it is virtually worthless.
3) The companies' directors, employees and investors often have no idea this is happening or why their stock value is plummeting.
4) The company quickly finds itself in deep financial trouble, cannot borrow money and (usually) goes out of business.
5) Thousands of workers are thrown on the street; thousands of investors lose their investments, hundreds of business owners lose their livelihood.
6) The crooks "naked shorting" never has to be paid back and they get away with huge amounts of free cash, ruining lives and small businesses in their wake.
7) They then move on to new business or sector of businesses, parasitically slow-murdering once again. Much of this is done via off-shore "hedge funds".
8) The new SHO rules are insufficient to stop this (sorry, but it just won't work - they make many sells just below the threshold to comply with the letter).
9) Why is no one in Washington or the press talking about this? It's the largest criminal enterprise currently ongoing - and makes Enron and Tyco look like swiping lollypops from a candy store!
10) Many of these "off-shore hedge funds" running naked shorting boiler rooms are actually the financial banking centers for terrorists. If it weren't bad enough, the money they steal is used to bring harm to America.
The solution is to allow companies to decide themselves whether shorting their stock is allowed. I guarantee you that, when given a choice, 98% of these firms will decide against it.
This is an issue that affects people from every stripe in the political spectrum and will be very easy to form bipartisan coalitions around. If you have not already, please educate yourself on this topic as soon as possible and get on board the effort to stop this modern plague on American small business - our country is literally in serious financial trouble because of this scourge. Demand that the SEC and other pertinent regulatory bodies move aggressively against this. It runs much deeper and broader than you might want to imagine.
Regards,
Scott W.
Not only have I written to Senator Bennett thanking him for bringing this issue to the Senate Banking Committee spotlight, but I've bought 10,000 phantom shares of GLKCE and will be asking for my certificate too.
So apropos ... a committee on "URBAN AFFAIRS"
Tune into the video ... Senator Bennett raises issue of naked short selling in Congress and SEC chairman Donaldson feigns incredulity ...
If you missed the discourse in action here it is:
Listen to the Senate Banking hearing from yesterday...
http://banking.senate.gov/index.cfm?Fuseaction=Hearings.Detail&HearingID=140
Click on Video Archive to view hearing.
The key time is 1:19:35
Enjoy ..
I'm sure someone notified CMKX. Read "bkeepa"
http://cmkxdiamond.proboards32.com/index.cgi?board=general
Tune into the video ...
If you missed the discourse in action here it is:
Listen to the Senate Banking hearing from yesterday...
http://banking.senate.gov/index.cfm?Fuseaction=Hearings.Detail&HearingID=140
Go to the Video Archive
The key time is 1:19:35
Listen to the Senate Banking hearing today!
http://banking.senate.gov/index.cfm?Fuseaction=Hearings.Detail&HearingID=140
Go to the Video Archive
The key time is shortly after 1:19:00
Donaldson fielded complaints from Sen. Robert Bennett, R-Utah, who said new SEC rules to combat short-selling abuses aren't working. Short-selling, which involves the sale of borrowed stock, is legal, the SEC chief noted. But Bennett said it appears the SEC has failed to stop abusive "naked" short sales, in which sellers don't borrow stock and have no intention of borrowing it. He also raised concerns about stock-option accounting.
Listen to the Senate Banking hearing today!
http://banking.senate.gov/index.cfm?Fuseaction=Hearings.Detail&HearingID=140
Go to the Video Archive
The key time is shortly after 1:19:00
Donaldson fielded complaints from Sen. Robert Bennett, R-Utah, who said new SEC rules to combat short-selling abuses aren't working. Short-selling, which involves the sale of borrowed stock, is legal, the SEC chief noted. But Bennett said it appears the SEC has failed to stop abusive "naked" short sales, in which sellers don't borrow stock and have no intention of borrowing it. He also raised concerns about stock-option accounting.
The claims are held under a holding company named, "101047025 Saskatchewan LTD,"
http://www.noboxtrading.com/cmkm.htm
Why the Shorts Have Long Faces- Business Week Magazine February 28, 2005.
This one paragraph I found interesting. Not only do MMs rip off investors, they rip off fellow MMs. LMAO, check out this small excerpt from the article:
Since early January major stock exchanges have had to publish daily lists of companies for which sellers have failed to deliver sizable amounts of stock to buyers in a timely fashion.
That situation often arises when traders engage in what is known as "naked shorting". Normally short-sellers have to borrow stock before they sell it. But sometimes brokers execute a short sale without having a firm arrangement to borrow shares-and then find they can't locate the necessary stock.
The new regulation is prompting brokers who can't deliver stock within thirteen trading days to close out customers' short positions.
The daily lists signal to other traders that they can pluck profits by mounting a short squeeze in stocks, such as Martha Stewart Living Omnimedia, that are already moving up on positive news.
For example, ParkerVision, Inc., a Jacksonville maker of wireless devices has seen its shares soar 62% since it appeared on the list in early January.
"If you have a small cap stock with a huge short position on a list, you just raised a red flag for potential manipulation," says Jeffrey Meyerson, a vice-president at Crown Financial Group, a Jersey City (NJ) brokerage firm. [LMAO, these guys are out of business from it probably so they'd know]
Some short-sellers contend that brokerage firms are already trying to profiteer from the new rules by slapping extra fees on hard-to-borrow stocks. At HarrisDirect, a division of Chicago-based Harris Bank LLC, investors who want to short Internet travel-offer publisher Travelzoo, Inc. must pay an extra fee of $31.40 a month per 100 shares they want to short!! [LMAO the peeps even rip each other off]
For Cal-Maine Foods, Inc., an egg producer that rode the Atkins Diet craze to new heights, the cost of shorting has risen to $3.00 a month per 100 shares on the $10.00 stock. Harrisdirect's chief operating officer, Michael Hogan, says the company is simply passing along the fees it's now being charged by large Wall Street firms.--- this was only an excerpt.
Original article written by Dean Foust in Atlanta
http://www.keepmedia.com/pubs/BusinessWeek/2005/02/28/730430?extID=10026
You wouldn't be here unless you had an interest in CMKX.
Obviously you're not a shareholder.
Your interest is in seeing CMKX go out of business so the naked short sellers dont have to deliver. I think you're either one of them or you work for them.
Euthy IMO you are naive or a player in the NSS game.
Euthy, I thought you could figure that out on your own.
Try.
In the ten years since the Lac de Gras discovery, Canada has yielded some very high grade diamond deposits. Five of the highest value per tonne deposits in the world are now in Canada, including the three richest in the world. By revenue, Canada is rapidly climbing the world diamond production ranking. From zero production in 1998, Canada has now overtaken Australia and become the world’s sixth largest diamond producer by revenue, accounting for about 6 % of world diamond production by revenue.It is estimated that Canada will be producing approximately 15 million carats per year by 2007, which will be almost 12% of world carat production. Canada’s projected diamond production looks even better by revenue. Based on three mines in Canada, revenue production will peak at about 19% of world diamond production by 2008. With commencement of full production at Diavik in 2003, Canada will be jockeying for third position with South Africa. There are more commercial diamond deposits yet to be confirmed throughout Canada. Canada’s statistics are impressive, but potential exists for these numbers to grow even further. There are other prospective diamond exploration regions in Canada. A few projects have emerged from the first decade or more of diamond exploration in Canada. These projects do not yet host advanced exploration or development stage projects. If all of them were developed, these discoveries could allow Canada to overtake Russia in second place of world revenue production rankings.
This forum is for News Analysis, Fundamental Analysis, Technical Analysis and Broad Diamond Mining Market Analysis. I am confident this forum will prove to be a valuable exchange of information, ideas and insight. Professional/Polite debates are encouraged. Please respect fellow members. The forum will be moderated. "Information on this discussion board may contain certain forward-looking statements. Statements may address future events and conditions, by their very nature; they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements and may be subject to significant risks. This is a stock discussion forum and all investment decisions made by you, are your sole responsibility. In no event will I or any of the members of this discussion board be responsible or liable to you or anyone else, for any decision made or action taken, based on the contents posted on this board. Any trade or investment made in part or in whole by reference to information posted on this board is & will be the sole responsibility of each and every individual investor. Always conduct your own Due Diligence. No statement or expression of opinion, or any other matter herein, directly or indirectly, is an offer to buy or sell the securities mentioned.
As of this month, Feb 2005, the diamond sector has shown signs of coming out of coma. Moving forward, there are signs the resource sector will continue to show high increase in market caps, specifically in diamond stocks. 2005/2006 can generate major interest in the resource sector.
The company knows who didn't get their divvys ... that's really all that counts. Don't worry yourself about such things ... concentrate on bashing.
Did the company tell you every one of the "70,000" shareholders get their divy's?
Share with us were you received this information.
Get with it Janice!!
"All the stock issued is accounted for."
Naked shorts are NOT ISSUED!!! ... They're created out of thin air and if they're never bought back by the MM that created them they stay in the float and get traded. Since the issued shares are converted to electronic credits and the phantom naked shorts are electronic credits, only the DTC knows which is which ... they have the certs to confirm which are not the fakes.
NOT issued stock that is sold and never delivered is illegal stock.
The following are Kaisers thoughts as spoken at the PDAC. He spent 20 minutes reviewing the diamond industry and where he thinks it's going. He expects rough prices will double in the next 6 years. Both Russia and DeBeers have run down their stock piles and we now have a supply shortage. DeBeers needs new supplies of diamonds. Then, as time was running out he fired off in no particular order some of his recommendations. TSD,MTP both venture exchange and related to a Nambian project.TSX-V, HUD-V,AAD as a play with the Russian gangsters. KRT as a best buy aand could be $5.00 by this weekend due to the valuation placed on Shore.He doesn't see any news coming from SGF for some time as they now have the money to be spent proving up the resource. He then flipped up a chart of MPV and said "a $5.00 bill" because of the high quality of its diamonds which will only be known when the study resulys are known. Unfortunately Doug Scott of DeBeers was not there, because he was up at Snap Lake. I did see the egg that Capt referred too. That's the notebook. Nice having a fiver in the bank !!!
From those without certs ... those who bought electronic credits and wish to sell them. They may be phantoms .. who knows but the DTC?
Who would be holding NSS shares?
If the DTC disclosed the NSS figure we'd know. They won't.
CMKM VOLUME AND KEY DATES
http://www.noboxtrading.com/cmkm/volume.htm
CMKM VOLUME AND KEY DATES
http://www.noboxtrading.com/cmkm/volume.htm
All figures in US$ unless otherwise noted
Newmont Canada has agreed to purchase 8.95 million shares of Shore Gold’s 18.2 million share equity offering for Cdn$49.2 million ($39.6 million). Shore Gold is a diamond exploration company whose main asset is the advanced Star Diamond project in central Saskatchewan. If a 3.0 million share overallotment is exercised Newmont will subscribe for an additional 297,000 shares and will then own 9.9% of Shore Gold’s outstanding 90.5 million shares (after completion of the offering).
We are surprised to see Newmont take this equity interest given the early stage nature of the Star Diamond project; however, the company (i.e., the merchant bank division) has been diversifying away from gold sector. They recently bought a stake in the Canadian Oil Sands Trust as a hedge on oil prices and on the gold front took a 10.2% equity interest in Gabriel Resources.
Newmont (through Franco Nevada) had previously been exposed to diamonds through its equity interest in Aber Diamond Corporation.
This news does not change our valuation or rating of the company. We continue to rate Newmont a Sector Perform with a US$51.00 per share target.
March 4, 2005 (FinancialWire) CMKM Diamonds, Inc. (OTC: CMKX), better be careful or it could suffer a case of the bends, said StockPatrol.com, which has been covering the company said to have the world’s largest number of shares outstanding rather unmercifully for months.
“Sales of the Company's shares – which often topped 20 billion shares a day in 2004 – came to a sudden halt today when the Securities and Exchange Commission issued an order suspending trading of CMKM securities from March 3, 2005 until 11:59 on March 16, 2005. The SEC says that CMKM has been delinquent in its public filings since the fiscal year ending Dec. 31, 2002,” said StockPatrol.
StockPatrol.com partners with Investrend Information’s (http://www.investrendinformation.com) Investors Resource Center.
“CMKM has maintained a relatively high-profile over the past year, despite its failure to file public reports with the SEC. That lack of public information has made it virtually impossible for shareholders and investors to ascertain vital information, including the state of the Company's business, its financial condition, the number of shares now outstanding, or the identity of principal shareholders.
“As we recently learned, CMKM (also known as Casavant Mining Kimberlite International, Inc.) should have been filing those public reports all along,” said StockPatrol, adding:
Instead, it attempted to terminate its reporting obligations by filing an inaccurate Form 15 with the SEC on July 22, 2003 – claiming to have fewer than 300 shareholders. The Company had approximately 698 shareholders at the time – and consequently was not entitled to stop reporting.
In issuing the suspension, the SEC noted the lack of accurate and current public information about CMKM, and cited questions concerning the adequacy of publicly available information concerning, among other things, CMKM's assets and liabilities, mining and other business activities, share structure and stock issuances, and corporate management.
The SEC also expressed concern about possible improper stock sales by CMKM and/or its shareholders since the Company stopped filing financial reports. The Commission expressed concern that CMKM may have unjustifiably relied on a Form S-8 to issue unrestricted securities and that the Company and/or certain of its shareholders may have unjustifiably relied on Rule 144(k) of the Securities Act of 1933 in conducting an unlawful distribution of its securities.
At the time of the suspension, CMKM shares were trading at virtually zero.
“If any broker, dealer or other person has any information that may relate to this matter, please contact the CMKM Diamonds Investor Line of the Pacific Regional Office of the Securities and Exchange Commission at (323) 965-4519 or by email at cmkmdiamonds@sec.gov ,” stated the SEC.
For up-to-the-minute news, features and links click on http://www.financialwire.net
FinancialWire is an independent, proprietary news service of Investrend Information, a division of Investrend Communications, Inc. It is not a press release service and receives no compensation for its news or opinions. Other divisions of Investrend, however, provide shareholder empowerment platforms such as forums, independent research and webcasting. For more information or to receive the FirstAlert daily summary of news, commentary, research reports, webcasts, events and conference calls, click on http://www.investrend.com/contact.asp
The FinancialWire NewsFeed is now available in multiple formats to your site or desktop, free.
Click on: http://www.investrend.com/XmlFeeds?level=268
Demanding justice ...
Depository Trust And Clearing Corporation Ordered To Produce Trading Documents
Friday March 4, 5:38 pm ET
NEW YORK, March 4 /PR Newswire-FirstCall/ -- Eagletech Communications Inc. (OTC Bulletin Board: EATC - News), announced today that it has obtained a ruling of a New York court directing the Depository Trust and Clearing Corporation (DTCC) to produce trading records for Eagletech shares. Eagletech was represented in the motion by the law firms of Christian Smith & Jewell of Houston, Texas and Koerner Silberberg & Weiner, LLP, of New York City.
Eagletech is a plaintiff in a stock manipulation action pending in the state of Florida. It commenced a special proceeding in the Supreme Court of the State of New York to obtain certain trading reports from the Depository Trust and Clearing Corporation. Subsequently it filed motions to compel the DTCC to comply with the subpoena.
Attorney Wes Christian commented: "This is a significant victory in our on going battle to bring restitution to our clients for the brazen manipulations that were perpetrated against them. Our ability to obtain these records is essential. The judge's clear ruling takes us further down that road."
" ... has reveled the shorted position & it's huge!"
http://ragingbull.lycos.com/mboard/boards.cgi?board=CMKX&read=822188
STOCKGATE TODAY
An online newspaper reporting the issues of Securities Fraud
NASD Links Naked Shorting to the Sale of Unregistered Securities in Complaint – March 3, 2005
Dave Patch
On a normal day in December 2004 the NASD filed a complaint that has received little fanfare by way of media attention. Part of the reason that there is little fanfare is because the NASD removed the complaint from their web site as quickly as it was put up leaving little to know it even exists. But this complaint exists under NASD Disciplinary Proceeding number CMS040208 and this complaint links naked shorting to the Sale of Unregistered Securities.
The Complaint; NASD Department of Market Regulation vs. Hilary L. Shane is about a Hedge Fund Manager that traded off inside information regarding a pending PIPE (Private Investment in a Public Entity) financing agreement with CompuDyne. In this case however the NASD also claims that Ms. Shane traded illegally when she sold short hundreds of thousands of shares she did not own nor attempted or had access to borrow, for delivery. In recent months/years this has become the street definition of a “naked short”. Naked Shorting: the selling short of stocks without borrowing for delivery as required for settlement. For her actions the NASD seeks sanctions against Ms. Shane for the Sale of Unregistered Securities in Cause 3 of the complaint.
The implications of this should be deafening to Wall Street and the media yet it has been just the opposite. Wall Street, the Regulators, Congressional Oversight Committees, and especially the media are almost…comatose! Have we suddenly become so expectant of fraud on Wall Street that it deserves no voice for concern?
The NASD has just linked naked shorting to the sale of unregistered securities all the while the SEC passes a reform package (Regulation SHO) that “grandfathered” all prior naked shorting sales from mandatory close-out provisions. Where is the consistency? One regulator calls it fraud and our top regulator gives a hall pass to the illegal practices.
While the first question to ask is, is this an isolated event? A spokesman for the NASD indicated confidentially that it is not. The trading activities of Ms. Shane are not isolated to her specifically or to this single PIPE arrangement. It happens far more frequently. Beyond that no further comments would be made other than to “Stay Tuned”.
Okay, so there are more occurrences of fraud. We already knew that because hundreds of companies are listed on the SEC’s Regulation SHO threshold list with excessive trade failures from sell side delinquencies in delivery (naked shorts). We also know that no illegal act on Wall Street is isolated or without awareness for others to reap similar illegal benefits.
The second question most frequently asked is – how does this affect the average person? Let’s take Ms. Shane’s trading to use as an example.
According to the NASD complaint Hilary Shane executed a total of 975 Short Sale transactions, totally 475,000 shares, into the market with shares she never delivered. Presumably, with that volume of trading more than one buyer and more than one firm representing that buyer was involved on the buy side. Since Ms. Shane only settled these fails with shares she received in the PIPE deal later in time, none of the buying firms represented their clients engaged in forcing Ms. Shane to deliver securities for settlement to remain in compliance to the contract entered into by Securities Rule 15c6-1. The standard requirement for delivery on settlement is 3-days. By virtue of the illegal trades identified, buy side brokerage and clearing firms acted in the same negligent manner with regards to their client as Ms. Shane did allowing us to leap to a conclusion that this settlement failure acceptance is pretty standard within the industry. They colluded together to defraud the buy-side client.
Now consider the sales themselves. Ms. Shane dumped 475,000 shares of illegal shares (naked shorts) into the market place and on to unsuspecting buyers. Her profit in doing this was over $1 Million. If she profited from short selling, somebody had to lose. But more than those that lost from these 475,000 trades are those shareholders who traded this stock alongside Ms. Shane unaware of her actions. Then there are those who merely held on to a stock manipulated by excessive selling. All CompuDyne shareholders lost due to her illegal trading as overall market capitalization was reduced in the Company. Shane manipulated the stock by adding 475,000 illegal shares into the market. If you were not acting as a short seller you could not have benefited to the excess dilution of illegal shares.
Now, if this is not an isolated case how many more Companies and investors have fallen victim to this?
Again I reference the SEC’s Regulation SHO threshold list. On that list are hundreds of companies who maintain excessive unsettled trades on the books of these Wall Street firms. With preliminary lists of NYSE companies being published as early as December 2004, there are many companies that have been oversold with unsettled trades since before December 3, 2004 and remain oversold today. Companies like TASER, Martha Stewart Living, Novastar, and Delta Airlines. Similar actions are happening on the NASDAQ where their preliminary lists date back to October 2004 and still listed today. Nearly 5 months later.
So where have the regulators been in cracking down on the Sale of Unregistered Securities? Really Counterfeit Stocks if you think about it. If you believe the General Counsel of Bear Stearns, they have been watching it all happen and doing nothing about it. At least nothing by way of prompt regulatory enforcement. Statements made in a December 13, 2004 dial-up call to members and clients reveal the deep-rooted complacency, I call it corruption, of our Regulatory bodies. Make your own conclusions:
"To give you that brief introduction in Reg SHO the history how we got to where we are today. For the past few years we have been hearing from many different regulators regarding their concerns about the increase in the level of fails that they are seeing. They believe, and they have stated on numerous occasions, that one of the primary causes of the high level of fails was that various participants in the short sale process, prime brokers, executing brokers, clients were not following already established rules."
These statements, in conjunction with the existence of the “threshold list” of securities, the admittance by the SEC that naked shorting exists, and in basis on the NASD complaint that naked shorting is the sale of unregistered securities it paint a very ugly picture of Chairman Donaldson’s Organization and our Congressional Oversight Committees. These statements theoretically imply that our Securities Regulators aided and abetted in the manipulation of our investments through the act of naked shorting. Instead of taking enforcement actions, they made casual conversation about the fraud. This theory the SEC staunchly denies but they will not explain the circumstantial events either.
Where is Congressional Oversight in this? To my personal knowledge many members of Congress received Constituent Complaints. Several Members, including Senate Banking member Senator Paul Sarbanes and House Financial Services member Rep. Barney Frank even responded on behalf of the constituents by asking the Chairman of the SEC for answers. Where these Congressional members dropped the ball, as they so often do, was with the follow-up validations on the SEC responses. Senator Sarbanes was actually misled, a lesser man would say lied to, by the SEC and the Senator never raised an eyebrow. His staff was provided the documentation to support these claims of misdirection yet the Senator chose to ignore the slight indiscretion of the SEC. Oversight by ignorance is far from valued oversight.
I guess that leaves the means of solving this problem to those comatose media personalities and the rest of the investing public. It is our duty to connect the dots and start asking the tough questions about how we are being protected by the “standard” practice of the sale of unregistered securities. After all, how do any of us know where we fall with respect to investments safeties if Wall Street will settle trades in an arbitrary manner?
They say you can either be part of the problem or part of the solution. Courage comes with being part of the solution. Our Federal Oversights appear more willing to be part of the problem.
For more on this issue please visit the Host site at www.investigatethesec.com .
Copyright 2005
Keep chartn' girl ... I'm with yer.
17th's gonna be one h3ll of a good Paddy's Day.
IMHO
SGF 7.20 +1.20 4,751,947 3:27:56 PM EST
Shore Gold RT 7.09 +1.09 4,702,167 3:26:11 PM EST
Shore Gold stock jumps on Newmont investment
TORONTO, March 4 (Reuters) - Shares of Shore Gold Inc.
rose as much as 17.5 percent on Friday, hitting a
record high, after Shore said Newmont Mining Corp. , the
world's biggest gold producer, would invest about C$50 million
in it.
The stock was up 83 Canadian cents, or 13.83 percent, at
C$6.83 on Friday afternoon after hitting C$7.05 earlier in the
session on volumes that were more than seven times its 90-day
average.
Shore Gold said it would issue 18.2 million common shares
at C$5.50 each and that Newmont Mining Corp. of Canada Ltd., a
division of U.S.-based Newmont Mining, would buy 8.95 million
of those shares, a major boost for the tiny Saskatoon,
Saskatchewan-based diamond miner.
Newmont will buy another 297,000 shares if the underwriters
exercise an option to purchase another 3 million shares at the
same price.
"We are extremely pleased with Newmont's vote of confidence
through its participation in this financing. Following this
offering, Shore will be well-positioned to pursue an aggressive
path to advance the Star Diamond Project," said Shore Gold's
president and chief executive, Ken MacNeill.
The Star Diamond Project is located roughly 60 kilometres
east of Prince Albert, Saskatchewan, and consists of 123 claims
covering 27,734 hectares. The project contains diamond-bearing
kimberlite that is 100 percent owned by the company.
Newmont will own 9.9 percent of Shore Gold as a result of
this investment.
($1=$1.23 Canadian)
(C) Reuters 2005. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of
the Reuters group of companies around the world.
Shore Gold announces $100 million bought equity financing and strategic investment by Newmont 3/4/05
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.
Stock Symbol: SGF: TSX
SASKATOON, SK, Mar 04, 2005 (Canada NewsWire via COMTEX) --
Kenneth E. MacNeill, President and Chief Executive Officer of Shore Gold Inc. ("Shore") is pleased to announce that Shore has entered into an agreement with a syndicate of underwriters, led by Genuity Capital Markets, under which the underwriters have agreed to buy and to sell to the public 18.2 million Common Shares of Shore from treasury, at a price of $5.50 per Common Share for gross proceeds of $100.1 million. Shore has granted the underwriters an option to purchase an additional 3.0 million shares at the same price up to 48 hours prior to closing.
Shore intends to use the net proceeds of the offering for the exploration and development of the Star Kimberlite Project and for general corporate purposes.
Shore is also pleased to announce that Newmont Mining Corporation of Canada Limited ("Newmont") will subscribe for 8.95 million common shares under this offering. If the underwriters' option is exercised, Newmont will subscribe for a further 297,000 common shares. After this offering, Newmont will own 9.9% of the issued shares of Shore. Newmont is the world's largest gold producer with significant assets or operations on five continents.
Ken MacNeill, President and CEO of Shore said, "We are extremely pleased with Newmont's vote of confidence through its participation in this financing. Following this offering, Shore will be well positioned to pursue an aggressive path to advance the Star Diamond Project. "
Pierre Lassonde, President of Newmont commented, "Newmont's technical mining expertise as well as the size and quality of the Star Deposit creates value-generating opportunities for both Newmont's and Shore's shareholders".
The offering is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory approvals, including the approval of the Toronto Stock Exchange.
Shore is a Canadian based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of Shore trade on the TSX Exchange under the trading symbol "SGF".
The securities being offered have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
The information in this news release contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties which are beyond Shore Gold's control, including: the impact of general economic conditions and the price of diamonds. Shore's actual results and performance could differ materially from those expressed in, or implied by, such forward looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits that Shore Gold will derive from them.
VIEW ADDITIONAL COMPANY-SPECIFIC INFORMATION: http://www.newswire.ca/en/releases/orgDisplay.cgi?okey=14555
For further information: Kenneth E. MacNeill, President & C.E.O. or Harvey Bay, C.F.O. at (306) 664-2202. News release via Canada NewsWire, Calgary 403-269-7605 -MC-
Copyright (C) 2005 CNW, All rights reserved
© 2005 Stockgroup Media Inc. / Disclaimer