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Al, google FNRC OTC. Then click on the FNRC page at OTC. The quarterly report and the financial update are under the filings section. Cropduster
Bad, I think the damage may have been done to the share price for now and maybe we'll consolidate here before moving to the upside again, if we are lucky.
A couple of years ago I thoroughly researched and watched this company and concluded that the company has possibilities, but that it had been very heavily diluted in order to survive. And now the dilution continues, even though I do think we are at the bottom at .0004.
The company has $7,560,000 in shareholder value, while maintaining $14,400,000 in restricted cash. So there is cash in the company. In my opinion, what has pushed us down to this level is the pending conversion of the Series E shares. There are 183,969 Series E shares that convert to 100,000 common shares for each Series E share. That comes out to over 18 billion common shares. However, my guess is that only about half will be converted in the short term. We also have the directors and a consultant holding 5 billion restricted shares, so it is easy to see that FRNC could easily bump up against its 20 billion shares authorized. Plus, there are a couple of other categories of shares that could eventually be converted.
So my point is that if you take the $7,600,00 in shareholder value and divide it by 20 billion, you get .0004, which is where we are now. In my mind, the market is simply looking ahead to the share conversion. What would counteract the share conversion would be good news that FNRC's oil and gas production is coming back on line. This good news will likely send us up. How far up is a question for the technical and momentum traders. My guess would be .0015, but that would only be a guess based on possible future performance of the oil and gas production. (Could go much higher than that, with the right exposure, as you say.)
Anyway, I think the operational loan for $2 to $5 million, which we are waiting for, and the actual Series E conversion, which we are also waiting for, are very much linked. Apparently FNRC can't or won't pay the transfer agent until it gets the loan. So I hope we get positive news on the loan soon.
Good luck,
Cropduster
Rod, I should have said transfer agent instead of broker. I think sometimes in this situation folks just say broker instead of transfer agent, when they really meant the transfer agent.
In any event, here is FNRC's transfer agent from the quarterly report:
Transfer Agent
Name:
Continental Stock Transfer & Trust Co.
Address 1:
17 Battery
Place
Address 2:
8
th
Floor
Address 3:
New York, NY 10004
Phone:
212.509.4000
Good luck (and I think we may be about to get some),
Cropduster
Hey Bad, thanks for that tip on ICBU. I quickly researched it a little bit and my conclusion is that if ICBU can jump on good news, FNRC can also. Both companies have about 4 or 500 million shares in the float, according to e-trade. Plus, ICBU has been trading below 1 cent every day over the past year, very similar to FNRC over the past month or so. On Friday ICBU opened at .0005, below where FNRC is now, and spiked to .006 today. I think you are right that anything is possible in penny land if you can get the momentum on your side. We may get that momentum with a shot of good news from FNRC.
My take is that we are slightly undervalued today at .0009, when you compare book value to market value. I calculate book value at about .0014, which is above the current market value of .0009, by dividing the shareholder value in the last quarterly report of $7,560,842 by the shares outstanding of about 5.41 billion. Even with 5.41 billion outstanding, only about 409 million are in the float. The point here is that based on book value, we have room to run to the upside.
As I said before, I think the short term trading range is .0002 on the downside to .004 on the upside. I think the upside range will go much higher with the good news that FNRC got its required financing and can proceed with bringing its oil and gas assets on line.
I like your enthusiasm and I have tried to show here that FNRC, based on its current financial situation and its potential for the future, could definitely break out to the upside. It will be entertaining when the mob of penny traders shows up. I'm really looking forward to the show. A lot of profitable trades will be made, no doubt, until we hit the top, sink back down some, and then start consolidating again.
All the above is just my opinion and may or may not happen.
Good luck,
Cropduster
You are more than welcome, Al. Concerning the upcoming election, I just hope everyone gets out and votes for the candidate that best represents their views on the issues. They are both flawed candidates, no doubt. So we therefore need to look very carefully at their positions on the issues that are important to us. I am hoping we can avoid political discussions on this board.
I just reread my latest post and I need to make a disclaimer for those that don't know me. I think I have had almost 50 posts on this board since 2014, but haven't posted for about the last year. In any event, I am an amateur investor and don't have any direct or indirect links to FNRC or to its management. When I get motivated, like I am at the moment, I do lots of research, with most of it being over the internet and some in other ways. Any statements I make are as a result of my research and are speculative conclusions at best. Any facts I use come mostly out of the quarterly report or other documents published by the company. I just want to make clear that I don't know anything for sure and I am just guessing most of the time. It is basically all in my opinion.
Concerning the money FNRC may owe the broker, I am sure it is included in what we already know from the last quarterly report. At that time, FNRC had $142,655 in accounts receivable and $629,899 in accounts payable. The same thing applies to the financing FNRC is looking to secure. It was mentioned in a recent press release to that effect. The actual numbers were apparently confirmed by investor relations.
So that's it. I just don't want to mislead anyone in any way or write as if I know what I am talking about, because most of the time I don't :) But I do enjoy researching, writing, and posting, so I'll keep doing that for awhile.
Cropduster
Al, I got a call this morning and found out what the issue is concerning converting the Series E shares to common shares. Apparently there is a billing issue between the company and the broker. The broker is the one, of course, that is actually going to convert and issue the new shares. It seems that once the broker gets paid for its services it will convert and issue the new shares. Apparently it is as simple as that.
This confirms what I mentioned last week, that there might be a link between the problem of getting the shares issued and FNRC's attempt to get the $2-5 million in financing to bring the oil and gas assets on line.
For anyone looking at FNRC for the first time, I believe it is important to realize that the company is not really broke, or even close to it. It simply will have a cash flow problem until it starts producing, which we know it likely coming in the next few months. FNRC has $14 million in restricted cash, for those that didn't know, which I assume it can borrow against.
In any event, my source says the best thing we can do is try to bring a little gentle pressure on the company to go ahead and pay its bill to the broker so we can get our shares. I still plan to call Brad at investor relations tomorrow to see if he can pass the message to the company to please go ahead and pay its bill. Anyone else that can also call Brad on this issue would be helpful, or maybe try to call Mr. Norris, the CEO, directly. Maybe call him after I call Brad.
Good luck,
Cropduster
Hey Al, yes, I will call Brad at FNRC investor relations next week to see if he can shed any light on what is going on with the share conversion. Actually, I don't mind waiting maybe a few weeks or even a couple of months, but anything beyond Christmas would be a case of them going back on their word, especially after the very specific June 9th announcement concerning the conversion of the Series E to the common. They said it would be done immediately, if requested. OK, so let's get going FNRC and do what we say. I like FNRC and trust management, but they need to get off the dime on this one. Integrity is really important and once it is gone it is very difficult to get back.
I would be very surprised if the CEO, Mr. Norris, does not read this board from time to time, even if for nothing more than entertainment. If I were CEO, I would read this board to keep up with what is being said on the public message boards about my company, although I would not post anything here. What we say here may not be important, but it gives a flavor of how folks view FNRC. Maybe that's why I'm not a CEO :)
New Zealand? Wow, you are way down there in the southwest Pacific. Are you on North Island or South Island? I've been to Hawaii, South Korea, Japan, Thailand, Hong Kong, but never ventured way down there to New Zealand. When I was in the U.S. Army I knew a guy in the Australian Army. He really had one of those accents :)
Anyway, I ramble sometimes because I like to write. I will try, however, to stay on topic with FNRC.
Have a good one way down under,
Cropduster
Nighttrain and Alsteps, I contacted E-trade last night about converting my Series E shares and they told me today that I can do that. However, they said there appears to be some issue between the transfer agent and the company that is holding up the process. I told E-trade to go ahead and get my conversion started and we'll just see where this takes us and how long it takes us. E-trade said they are handling the same issue for other clients so they are familiar with what is going on. They said they could not give a time estimate on how long it might take.
Based on how long it took to get the Series E shares into my account in the first place after the shares dividend in 2014, I would say it could take months. I hope I am wrong and we can get our shares by Thanksgiving, if that is not asking too much. Maybe someone should call Brad at investor relations and see what is holding things up. If I don't get my shares pretty soon, I may give him a call.
Steaks said he talked to Brad recently. Brad said FNRC is in the process of getting $2 to $5 million in funding to bring the oil and gas assets on line, but that the process is dragging on longer than management would like. Hopefully they can make it happen soon. Somehow I would not be surprised if the Series E conversion issue and the operational funding issue are related in so far as the delays are concerned.
The good news is that if management can make it happen, we should be producing oil and gas very soon. I noticed oil is now over $50 and natural gas is above $3. We are definitely getting into the profitable range.
Cropduster
Hey Steaks (that's what I am going to call you if its all right), I can see you are motivated about this stock and so am I after my great awakening yesterday. Still have trouble believing that things can change so quickly and that it is real. One day I was a poor man and today I'm not. I'm exaggerating a little, but that is the feeling I got yesterday when I realized what is going on.
I am basically in the same boat that you are. I didn't realize it at the time, but prior to the reverse split I was one of FNRC's major shareholders. Now, thanks to the Preferred Series E shares, I am getting back the same number of common shares I had before. Incredible. I can't believe I would have sold those Series E shares if they had not been restricted. So if I make money here, I will be doing it despite myself. Thanks goodness I don't control things. I want the Lord to run my life, not me. It is so much better that way.
Have a great one, Steaks, and please keep us informed what you find out about FNRC.
Cropduster
Oops, one correction. The trading range for the last month has been between .0002 and .0045, which is between something less than 1/10th of a penny and something more than 4/10th of a penny, not 4 cents, as I said. Sometimes it is hard to keep all these fractions of a penny straight :)
Anyway, it is within this range that a lot of money can be made in the short term, in my opinion. Longer term, if full production comes in on schedule and if the price of oil continues to rise, then my wild guess would be that 10 cents or even higher is possible. But don't count on it, as I'm only making an educated guess here...or maybe an uneducated guess :)
Cropduster
Alsteps, I want to thank you, Nighttrain, Bad, and Phicour for your recent posts, plus the others that posted before you guys. Thanks to your posts I woke up and realized what I had with my Series E shares and I am now fully motivated once again to support and follow FNRC. I was a big supporter in 2013/2014 and posted often, but lost interest after the 1 for 20,000 reverse split and wrote off my Series E shares as worthless. Luckily they remained in my e-trade account where they are today. Like Nighttrain and some of the others I am going to request conversion by e-trade this afternoon. I hope everybody keeps posting and we can ride all ride the share price up together as the price of oil starts to rise above the point where companies will start to revive shut-in production, like FNRC is planning to do.
I clicked on the OTC link above on this site and caught up on my research with FNRC. For anyone that hasn't done so, I highly recommend reading the last quarterly report. It pretty much explains where we are. FNRC is a company that nearly went bankrupt, but did not, thanks to creative financing, and is now poised to start earning money from production and continuing to grow. It has confirmed gas production in Wyoming and an oil well in Ohio that has been tested and is ready to start production for the first time. The company has debt and little cash, but continues to operate by fund raising through limited dilution as the need for cash arises. Brilliant, in my opinion, as long as there is light at the end of the tunnel, which there is in FNRC's case.
Concerning potential, since the press release of 9 June concerning the Series E shares, the trading range has been between .0002 and .10 or between about a penny (or less) and 10 cents. Over the last month, the trading range has been between .0002 and .0045, or between about a penny (or less) and about 4 cents. Based on news that production is about to come on line any month now and the fact that the price of oil is going up and is now over $50, I would feel confident that FNRC will likely trade in the .0002 to .0045 range until production is confirmed. At this low price and with a significant number of shares, it will not take much to double or triple your investment. Just my opinion. Don't take it to the bank until it happens.
I'm a Christian and I believe in the Lord Jesus Christ as Lord and Savior and give all credit to Him. FNRC is a case in point. Two days ago I thought my small Series E stake in FNRC was worthless and now my family is blessed by the potential success of FNRC. To management, I also say thank you and ask that you keep up the good work. I'll be praying for your continued success.
Trade well,
Cropduster
I take what I said back about a 5 for 1 exchange ratio being a decent chunk of change. I don't know what I was thinking. Currently at 1/10th of a penny per share, even a 5 for 1 ratio would be almost worthless.
I like your 100,000 for 1 ratio much better, of course, but I fear it is not going to happen that way. Keep in mind there are only about 1 million shares currently outstanding. I don't think they ever intended to hand out 100,000 new shares for every 1 old dividend share. But I'll take it if they do.
Cropduster
Alsteps, I think you are correct about the 100,000 for 1 ratio, at least that's what it was in the original press release. But then we had the reverse split of 1 for 20,000, which I think probably reduced the ratio to 5 for 1, not 100,000 for 1.
I looked back at some of my posts from 2 years ago on this subject and here is some of what I found:
"Keep in mind that the $2.5 million, or 1 million series B shares, has the same specifications as the dividend shares that we just received. They both convert to 100,000 shares of the old common per original share in 6 to 12 months. Of course, everything is being restructured by a factor of 1 for 20,000 due to the reverse split, so the 100,000 share ratio would go to 5, best I can tell."
Anyway, depending on how many of the special dividend shares you have, 5 for 1 could still be a decent chunk of money. I am curious now to see if anyone else has actually been able to convert their special dividend shares (I think they were called Series E shares, but can't say for sure).
Good luck,
Cropduster
Phicor, it has been awhile since I posted, but I read the article you posted and it got my attention (a little bit). My advice would be to be careful with this stock. It may have a low outstanding share count, but that is only because of the huge reverse split it did some time ago. I think it was 1 for 20,000. Not good. At 1/10 of a cent per share, it might be fun to play around with, but keep in mind that it has no income at the moment. Only possibilities. It lost $222k in the first quarter and only sees a very slight possibility of $160k in revenue by the end of the year. I'll believe that when I see it. In the meantime, it is loaded with debt. I'm surprised it hasn't gone bankrupt by now.
Actually, I like FNRC, but lost a bundle on it already and would wait to reinvest until it is actually producing something. The gas is good, but it is all shut-in. The oil well could be good, but it is also not producing anything, best I can remember. I know there is no pipeline to get any oil to market. Someone correct me if it actually has some production. Maybe they are trucking it out, but I doubt it.
Also Nighttrain, I still have some of those "special" shares in my e-trade account also. They are unconverted. How many new shares was each one supposed to be worth? Can't remember off the top of my head. Also, please let us know if e-trade comes through for you. Then maybe I'll try the same thing.
Cropduster
I researched it before and the conclusion I came to is that everything that has to do with shares was affected by the reverse split. But I suppose I could be wrong. In fact, it would be nice if I am wrong, but I just don't think that is the case.
Just think about it. Suppose you have 50 of the series E dividend shares, for example. That would equal 5 million of the common once converted if we actually get 100,000 for 1. Five million shares at today's price would be around $1 million, plus or minus. Gee, that would be nice, but I don't see it happening.
We'll be lucky if we even get the series E shares in the first place and even luckier if they convert at 5 for 1 (the conversion rate after the reverse split is applied).
We need the Ohio test well core samples to show that it is worth going for production. A press release from management to that effect would be very helpful.
Good luck,
Cropduster
I just found and read the update you are talking about. Thanks for mentioning it.
FNRC confirms the well got drilled in Ohio, but says the core samples are still being evaluated. We knew this already. The new information from the company is that they are encouraged by the pressure in the test well. This is good news, but we aren't there yet.
The lawsuit you are talking about concerns the lease agreement for the methane wells in Wyoming. Looks like the operator is not paying the owner of the land like he is supposed to. Anyway, looks like FNRC joined with a suit of their own against the operator to get the ball rolling. Hopefully this will resolve itself soon.
In the meantime, Ohio is where the potential action is. It is good to hear about the pressure in the test well, but I still don't understand what is taking them so long to make a decision about what the core samples mean. No doubt the current low price of oil is a factor being considered.
Good luck. Because we're going to need it. Drilling for oil is about good luck, to a large degree. Its also about money and geology, just to name a couple of other factors.
Cropduster
OK, thanks for that info about the series E shares showing up in your Scottrade account.
That will give me something to talk to e-trade about. I had the shares in the beginning, but they disappeared when FNRC had to change agents for the distribution.
I'll probably give them another month and then do an inquiry.
Thanks again and good luck. We'll need it with this stock right now, but I'm holding for now, as I said earlier.
Cropduster
The series "E" shares do not convert into 100,000 common for each series "E" share, due to the 1 for 20,000 reverse split. It is now 5 common for every 1 series "E" shares once they start converting, and if they start converting.
I still have not seen my series "E" shares reappear in my e-trade account since they disappeared some months ago. Has anyone actually seen their series "E" shares reappear in their account and, if so, who is your broker? I have seen nothing in e-trade yet.
The drilling in the Utica took place as planned, but we have heard nothing from the company as to the outcome of the drilling, except to say that the core samples were being analyzed. Even with no producing well in the Utica, I think the company is probably worth more than the price it is currently trading for. I'll just hold my shares and wait to see what happens.
A merger or acquisition of some kind would definitely be a possibility at this level, in my opinion.
Cropduster
I'm still here. Just watching and waiting. Still haven't seen my dividend shares show back up in my e-trade account. Maybe if I get around to it I'll send a message to e-trade and ask them what's up. Has anyone else that has e-trade actually seen their dividend shares show back up? Or any of the other brokerages?
The last quarterly filing with OTC was pretty revealing. FNRC finished drilling the test well in September as expected. It was over 7000 feet, as I recall. The quarterly report also gave the name of the operator. The report is worth a read if anyone is still interested. They are currently testing the core samples to see if it is worth going horizontal, at least that was my take.
I would say that we should get a press release any day now, but I have been expecting that for several months now. The CEO said he realizes that the lack of press releases is not helping the stock any, but he said FNRC can not make any announcements yet due to confidentiality concerns with the operator, or words to that effect.
It is possible that we may not get any additional information for several more months until the annual filing comes out after the first of the year.
It seems to me that the stock is worth more than the current 35 cents per share, considering the fact that the company has $14 million in restricted cash in the bank and a stream of income from the Wyoming methane wells.
If the test well turns out to be worth further drilling and if FNRC and the operator can get some level of decent production, then this stock goes to at least $2.50, in my opinion, or maybe higher. Just a waiting game at the moment. I would encourage management to release some kind of drilling update before the end of the year.
Cropduster
Deception, what I realize is that FNRC can still issue up to 20 billion shares if it wants to, but not an unlimited amount, as you say. Maybe some folks would say 20 billion is unlimited. In any event, I have never said FNRC is not a hugely risky company. It is very risky, at least at this point. The difference between you and me is that you think it is a scam. I think it is a failed company that is trying to give it one last shot. They know it is their last shot, so I would expect bankruptcy if they don't get a producing well in the Utica of Ohio pretty soon.
You say they have had no successes since the company began in 1988. This is a misleading statement as the company has been reorganized since then and has had some success with their methane production in Wyoming. However, it wasn't enough to overcome the depressed price of natural gas over the past several years.
The Utica venture is probably their last chance at survival. My take is that we should hear something by the end of the year, if not any day now. Anybody holding this stock at the moment who has done any research at all is probably betting that FRNC ends up with a producing well.
Why do you dislike FNRC with such a vengence? Did you lose money on them by investing in them at some point? Or maybe they fired you and you are a disgruntled ex-employee. Tell us what your problem is. You would probably get some sympathy here.
Cropduster
Deception, you say reputable companies don't do this. Do what? We already know that FNRC is a candidate for bankruptcy. What will save it is a producing oil and gas well in the Utica Shale of Ohio. This is what the market is waiting for. No well, next stop possible bankruptcy. Get a well and the company will start to recover. Actually, it is pretty simple. We are in the window now where we should hear something any day now. The longer we go without hearing anything, the less likely we will be getting good news. This is all common knowledge for anyone who has been following this stock.
In your case, just posting a lot of cut and paste verbage in not really doing good research. If you were trying to make FNRC look bad, you did not succeed with anyone who has an eye for detail. Most of what you posted talked about the fact that FNRC is in good standing in many areas. Yes, we know that their financial reports are not audited. They stopped auditing their reports around the time they stopped filing with the SEC. At the time, my take was that the auditing was stopped so they would not have to include a "going concern" statement in their reports. We all know that creative financing has gotten them this far without filing for bankruptcy.
Concerning your "deregistered" statements, we also know this was from 2011 and likely had to do with the reorganization of the company that took place at that time.
I am not saying FNRC is for everybody. At this point, it is only for investors who understand and accept the risks involved. The big risk is that they will not get a producing well and be forced into bankruptcy. However, if they do get a well, which we should hear about soon, then the share price may go to $5 or $10, depending on how good the press release is.
It is obvious you have an agenda. And don't tell me your agenda is to protect other clueless investors. For the most part, they can think for themselves.
Cropduster
Thanks for posting that e-mail from 1st NRG, Rodnocker, concerning the dividend shares. You are right. It is a positive sign. In fact, I find it very encouraging. Sounds like a company that plans on being around for awhile.
All we need now is a press release about actually drilling in the Utica. That might get us to $5.
Then finding oil and/or gas will likely take us to $10, if all goes well.
The market at 35 cents is currently telling us no drilling and no oil/gas well. Markets are wrong sometimes. Like MrDecember said, when and if the market corrects itself, it could be swift and breathtaking. That should be one heck of a day and worth the wait.
Cropduster
Deception, I think it is pretty obvious that I have done a fair amount of research on FNRC since I found this stock last year. You say you have researched it since 2008. Great, but tell me why anyone would hang around for 6 years after concluding it is a scam and then continue to post the same thing time after time. I really don't get that part. Maybe you can explain it to me. And how about the LOLzzzzz you like to use. What's up with that? Not that I am really concerned.
Anyway, good research on the 137 promotions. I bookmarked the website as I may want to use it again. But I think your conclusions are wrong. If you look at each of the 137 entries, like I just did, you will see that they all occurred from October 2012 through January 2014, or a period of about 15 months. Maybe the CEO did pay for them with company funds. What is wrong with that? As far as I know it is not illegal for a company to hire a firm to promote the company and its stock. Plus, my take is that FNRC probably hired one or two firms that then hired all the other ones. It was likely part of a marketing campaign.
From what I can see, that campaign was designed to raise money for the company. Check their SEC filings as your next research project, Deception, and you will see that the company raised around $100,000 during that time period through private placements. This is a good thing. That money likely went to help fund the Utica drilling that we are all now waiting for.
Try to be objective in your research before you put your scam hat on. By the way, at least you are posting. I wish more folks would post like they used to.
Cropduster
Deception, I don't think this stock is actually a scam, as you suggest, but rather an oil and gas company that almost went bankrupt due to the low price of natural gas for the past number of years. As you know, FNRC has specialized in methane gas up to this point. Creative financing has been able to keep them afloat, even though they should have probably already gone bankrupt, and now the company is being put at further risk by a joint drilling operation in the Utica Shale of Ohio.
We should know something on the Utica drilling operation any day now, but certainly by the end of the year. If they don't hit oil and/or gas, then the company will likely crash and burn financially, from which there will likely be no recovery. If they do hit, however, then we should see a pop in the share price and a recovery for the company financially. It is that simple at this point and is why I'm still here. My expectation is that they will likely come in with a producing horizontal well.
The average share price now is $1.00, not the $.19 that you emphasized. The low was $.10 at one point. But with only 167,000 shares in the float now, I can see a pop to $5 a share on good news from a press release. Maybe even $10 or higher. If there is no press release, we eventually drift back down to less than $.01 again. Anyway, $5 now is the same as $.00025 before the reverse split. $10 is $.0005 before the split. I had determined when I first got into this stock that it was worth $.0005. This was based on using the shareholder value listed in their quarterly report. With the addition of a producing well, $5 to $10 a share is definitely likely.
I understand that you would like this stock to be a scam. I am sure you have your reasons. Maybe you were burned before or maybe you are somehow shorting this stock. I don't know. In any event, if you are ever able to actually do any research on this stock, I would appreciate seeing what you come up with.
Cropduster
Did a little more research today and my guess is that FNRC is partnered with Magnum Hunter Resources. I say this because on FNRC's website they use graphics from MHR to talk about what is going on in the Utica Shale. Maybe it is just a coincidence or it could mean that MHR is FNRC's partner. Take a good look at MHR's website and their latest investor presentation. All very interesting and lots of good information about drilling in the Utica.
MHR is currently drilling 3 wells in the Utica that are supposed to to go into production by the end of this year. Could one of them be the one FNRC is waiting on? I don't know, but it certainly looks like it could be possible. And even if it isn't, you should check out MHR's website and investor presentation for a good overview of what is going on in the Utica.
If what MHR is doing is any indicator, I would say FNRC has a good shot at bringing in a well, or wells, and eventually getting the 20% working interest in their agreement. I also noticed that MHR only has a 50% interest on the 3 wells that are supposed to go into production by the end of the year, so there must be another investor out there also.
Anyway, I wouldn't hold my breath that we will necessarily hear anything this month, but I would definitely expect something by the end of the year. I may buy some more shares at $.56 if I can find somebody willing to sell.
Good luck,
Cropduster
From what I have been able to piece together, the agent for the preferred share distribution was having some sort of difficulty and a new agent was going to be employed to make the distribution. Like you, I had the dividend shares and then I didn't.
Whether using a new agent is actually happening or not remains to be seen. In any event, the new preferred dividend shares were not going to be tradeable for at least 6 to 12 months. E-trade may be right that FNRC simply backed out on the distribution. At this point, that would be consistent with what I said above.
To be honest, I'm not too concerned about the dividend shares right now, because I think the drilling in the Utica Shale has the potential to send current shares up to $5 a share and maybe even $10 if they actually strike oil. This is supposed to happen this month, according to the last update from the company.
My strategy is to sell my current shares, if they spike, to new buyers who may become interested in the company as a result of the potential drilling, and then keep the dividend shares, if we ever get them, as a bonus for the longer term.
Good luck and lets hope the drilling goes well this month. I'll have my finger on the sell button once we get above $5, if we do. Keep in mind that if there is no drilling or if it is a dry hole, the current share price could go south fast also.
It is also interesting to note the low volume of shares traded each day. Seems to be in the several hundred to several thousand range, but yet there are 167,000 shares in the float. This tells me that current holders have not really tried to sell yet and new buyers haven't really shown up yet either. Kind of like a stalemate. Ask yourself what could happen to the share price if there is true interest generated in the company as a result of successful drilling. In the meantime, $.80 to $1.00 seems like a comfortable resting place.
Cropduster
Yes, my dividend shares disappeared also about a week ago.
I have e-trade, but have not bothered to ask them about it, because of what I have been able to piece together from this board and other places.
Seems the agency that issued the shares in the first place to the brokers simply reversed what they had previously done. Seems like there was some kind of a problem with the issuing procedure. Now apparently a different agency will be issuing the dividend shares. But, keep in mind that they are not really shares yet, but rather reference number units, so to speak, to claim actual shares in 6 to 12 months. So that's my story and I'm sticking to it, at least for now :)
The real action should take place in the next 45 days. My guess is that we will get a press release announcing that drilling on the test well has begun at the Ohio site. That should get some reaction from the market and could send the share price to $5. We should eventually get a second press release about production, which could send the share price on up to $10. These are just estimates I am using based on some research I did earlier.
Keep in mind that there are only 167,000 shares in the float and slightly less than 1 million outstanding. With such a small float it shouldn't take much buying to greatly move the share price. What if we get a buyer who wants 50,000 shares, or maybe 100,000? Say we get several buyers like that on news. Do the math and you can see the potential.
But it all depends on actually starting to drill and then actually getting a normal rate of production for that area. If that happens, FNRC will get a new lease on life. If it doesn't, it could be lights out sooner rather than later.
Good luck,
Cropduster
Rod, my impression is that you should not have to do anything and the new dividend shares will appear in your account, similar to what happened with the reverse split. For the reverse split, your pre-split shares disappeared, you got a reference number in your account, and then your new post-split shares appeared.
So in 6 to 12 months you should see the reference number dividend shares currently in your account change to actual shares once your broker gets the shares from the dealer for FNRC.
The current ratio is 5 new dividend shares for each reference number dividend share you currently have in your account. This is because you initially got 1 reference number dividend share for each original 100,000 shares you owned. Then take that number and multiply it by 100,000 for the conversion, but divide it by 20,000 for the reverse split. Pretty complicated, but you should get 5 new shares for every 1 reference number share that currently shows in your account. The reference number shares are not tradeable and show no value.
I may sell my current actual shares at $5, if we actually start drilling and if the share price spikes, and keep the dividend shares for a longer term investment. I tripled my current shares since the reverse split. Just couldn't resist buying more shares for under $1 that I expect to sell for $5 in a few months. I would give the current shares $10 if we actually strike oil, but $5 is a safer selling point for me.
I guess you saw the press release from yesterday. There was a press release in addition to the quarterly report yesterday, both of which talked about drilling being imminent.
Again, the above is mostly my opinion and don't take it to the bank.
Good luck,
Cropduster
McMoon, thanks for that link to the quarterly report that came out this morning. I took a quick read and it is mostly old stuff with the exception of the new quarterly numbers and new information on the drilling in the Utica Shale. The Utica info really got my attention.
Here is the new stuff about the Utica from today's quarterly report:
"Utica Shale–Eastern Ohio
In Ohio, the initial due diligence and cure periods have concluded with the Company and its operating partner purchasing the initial 40 acre drill site for the vertical test well. The permit has been issued for a vertical test of approximately 7,800 feet. At this time construction has begun on the drill site and we anticipate the drilling to begin September 2014. 1st NRG Corp holds a 20% working interest in the development and is carried in the vertical test well."
I know a lot of folks have been waiting for the drilling in the Utica and it looks like it may finally be likely to happen within the next 45 days. This confirms that they have a permit, which is a huge indicator, and that construction on the site has begun, which is another huge indicator.
This is purely a guess, but I would say that confirmation that drilling has begun will push up the current share price to $5 a share, which is comparable to $.00025 from before the split.
Then if they hit oil and get decent production, I would be looking for $10 a share, comparable to $.0005 from before the split.
Good luck and it looks like things may finally start to pay off a little and reward us for holding. Again, my numbers are purely speculative, so don't take them to the bank quite yet.
Cropduster
Good couple of posts, MrDecember, and I agree with you about the importance of the very small float and what could happen if we get a hit in the Utica.
I have a sell order in for $6, but I think I'll go ahead and take it off. At this point, I think I'll just wait for the Utica update news and then make a decision about when and at what level to sell.
Based on what you said, I can easily see this thing spiking up to $14 or even higher once the news hits. On second thought, maybe I'll change that sell order to $14, just in case it spikes and I'm not here to pull the trigger. I can always adjust it down later if I need to.
Have a good weekend,
Cropduster
Jayben, if the reverse split didn't affect ALL common shares that were in effect at the time AND future common shares that were promised, that would probably mean that you would be an instant millionaire when the shares converted, providing you could sell them quick enough before they went back down to the $.0001 and up range.
I would like it also if the split doesn't apply to the promised 100,000 for 1 future common, but I just don't think it is going to happen that way. My take is that it is going to be 5 for 1, due to the 1 for 20,000 reverse split.
Look at it this way. The previous outstanding share count was almost 20 billion, but would have been 140 billion if you added in the 20 billion more for the dividend shares and the 100 billion more for the $2.5 million in preferred shares.
Now take the whole shooting match and divide it by 20,000. You get 7 million shares max, if everything is converted. If only the dividend shares are converted, then you get 2 million shares outstanding. Right now we have 1 million shares outstanding, with less than 200,000 in the float.
Maybe I am assuming too much here and I could definitely be wrong, but I just can't see FNRC being able to hand out hundreds of thousands of shares to folks who currently only have maybe hundreds of shares, or less.
Anyway, good luck to all. What we really need now is to get going with our drilling program in the Utica.
Cropduster
On the dividend shares, the way I took it is that FNRC was effectively doubling your share count from April 28th, and that you would receive your additional shares in 6 to 12 months.
You got 1 preferred share for each 100,000 common shares, which are later convertible back into additional common shares at 100,000 common shares (now 5 shares) for each 1 preferred shares. Go back and read the press release if you want the exact words.
The reverse split applied to the common shares, but did not apply to your new preferred shares. But my assumption is that when the preferred are converted back into common, the reverse split applies.
So, for example, if you had 1 million common shares before the split, you would have gotten 10 preferred shares (1 preferred for 100,000 common). Then after the reverse split, you would have 50 new common and the 10 original preferred (1 new common for 20,000 old common).
Then in 6 to 12 months you get another 50 common (5 common for each preferred), giving you a new total of 100 common, effectively doubling your original 50 common.
Sorry, none of us is going to become a millionaire from the dividend shares. All the dividend shares do is double the share count we had on April 28th.
Buying shares now at around $1 is like buying at $.00005 before the split.
If you thought FNRC was going to $.0005, for example, before the split, that equals $10 now, due to the 1 for 20,000 reverse split.
At the moment, my personal objective for this stock is $6, which I think we could hit if we get news that drilling in the Utica has begun.
Cropduster
Whatsnext, I don't want to lead you in the wrong direction, since you are new, but let me clarify what I said about the float.
The float on this stock went from about 3 to 4 billion to 167,000 as a result of the reverse split. With the previous very high float, it took massive amounts of trading to move the share price even a little bit. Now, with the new very low float, the opposite is true. Small amounts of trading can move the share price a great deal.
Today is the perfect example. I think the final count on shares traded was only about 12,000, but we saw an 88 cent rise in the share price from 32 cents to $1.20.
So if you want volatility, a low float is good. If you want stability, then a low float could work against you, I suppose.
In any event, most investors in FNRC at the moment want the extreme volatility that a low float can bring so that the share price has a better chance of shooting up on good news. Then folks could get their money back and maybe some profit to boot.
Good luck on this stock and in your future trading of other stocks. Never invest more than you can afford to lose.
Cropduster
You are very welcome, Gemmerling. Sorry to hear that you sold out, but I definitely wish you the best elsewhere. I didn't mean to buy your shares, but it looks like I probably did. I was trying to double my share count today and put in a bid for $.32, which didn't take, then I tried $.50, which also didn't take, so I said what the heck and bought additional shares at $.99. Actually, I bid $1, but the execution price came in at $.99.
You may be the smart one here, especially if there is no successful well. However, I have concluded that I am a born risk taker, so I jumped in again with both feet. Sooner or later I've got to get one right :) Plus, I like the oil and gas business and enjoy the risk/reward of drilling. But you have to get more right than wrong.
Anyway, best of luck to you and let us know if you decide to jump back in. I expect this stock to have extreme volatility, especially with the low float, if we start to see some progress in the Utica.
Cropduster
Gemmerling, I'm not sure the stock was "supposed" to open with a $2.00 bid. $2 was simply the equivalent of $.0001 with a reverse split of 1 for 20,000. Basically the market sets the bid and the ask, along with some help from the market maker when needed.
I simply took the open of $.25 as the market saying they thought it was worth quite a bit less than the $.0001 it was trading for before the reverse split.
The good news is that we are starting to move up now and the market has shown that it doesn't take much to go from $.25 to the current $.99 over just a few days with only a few thousand shares traded.
Imagine what this stock can now do if it gets good news on the drilling in Ohio, with only 167,000 shares in the float.
If you get a bunch of investors trying to get in all of a sudden at this level, then my take is that the stock will really start to rock.
After today's trading, I can't see it taking much to get us up to $5, as a good starting point for a possible well in the Utica.
Keep in mind that if there is no well, then down we likely go.
What does your gut tell you? Mine says drill, baby, drill :)
Cropduster
Deception, I'm not sure what you are laughing at. Many folks have lost money on this stock up to this point. Some folks have lost quite a bit of money. I really don't see that as a laughing matter, no matter what the circumstances or how many times they were warned.
The good news from your post is that the float is now down to 167,000 shares. This is quite impressive when I think about it. It wouldn't take much good news to send the share price up to $10 or higher, in my opinion.
No more good news and this company has really had it. That is probably true. But a little good news, like starting to drill in the Utica, and up we go.
No doubt it is a gamble, but most folks who invest in stocks that trade at less than a penny, like FNRC did before the reverse split, understand the nature of the gamble and are willing to take the risk at that level.
Now that we are above a penny, this stock could be a traders dream if Mr. Norris could just get the ball rolling with his first big oil well.
Cropduster
MrDecember, I agree completely that it is all about hitting oil in the Utica at the moment. That is why I am here also and why I'll stay here to see what happens.
The share price should have gone to $2 with the reverse split, but what we have is $.33. This tells me that the market doesn't think there will be a productive well for FNRC in the Utica. But markets can be wrong, especially when you are talking about whether any particular well is going to hit or not. I assume that the market is simply assigning FNRC's track record, which isn't that great, to future operations, like the well in Utica. This is the type of situation that can create a huge imbalance in the share price, which is likely to correct itself if a well actually comes in.
I would be satisfied with $4 a share, which would be more than break even for me, but my guess is that we could see $8 a share on news that drilling has commenced in the Utica and $12 to $14 if we get a good well of 400 to 500 barrels a day. Horizontal wells can and often do produce that much oil, especially in the first couple of years before depletion sets in. I know of a horizontal well that Clayton Williams drilled in the Eagleford Shale around Caldwell, Texas, earlier this year that came in at 40,000 barrels in the first 2 months, or about 600 plus barrels a day.
Anyway, at 33 cents I am trying to double my share count right now. So if anyone is interested in selling, please come up on the net and I will gladly buy your shares for 33 cents each, in any amount up to what you see on the bid.
Cropduster
Tjl5030, I finally got my new shares also in my e-trade account this morning.
The .99 where it is supposedly trading now is equal to $.00005 from before the reverse split. The previous $.0001 would have been equal to $2 now. I think you may be right that there won't be much trading for a couple of more weeks until they switch the symbol back over to FNRC from the current FNRCD.
I don't get the impression that the market maker is doing much at the moment with only a few shares trading here and a few there, if there is even a market maker at this point.
My take is that we will hover at this level or maybe drift down some until we get news. I think this was all set up to take maximum advantage of good news out of Wyoming or Ohio, with Ohio being the main squeeze at this point.
This is a complete guess, but I would say once we start drilling in Ohio, the share price will go to around $8 a share. And then once we get production confirmed after a few more months, I would say maybe $14 is possible. This is because a producing well in Ohio would mean survival of the company. The $14 comes from the $14 million in restricted cash the company currently has divided by the 1 million current shares, even though 75% of the current shares are restricted and not in the float.
It is all about hitting oil in Ohio now. Pretty simple. So keep your fingers crossed for FNRC's horizontal well in Ohio to strike oil. 500 barrels a day would be a good starting point, which would mean about 100 barrels to FNRC. 100 barrels a day at $80 (after expenses), would give FNRC a daily revenue of $8000 or about $3 million a year.
It can happen. I just hope Mr. Norris has all the details worked out and that he gets lucky with his first big well. Then we will get lucky too.
Have a great 4th of July weekend and thanks to all the veterans, past and present, who purchased our freedom on the battlefield with their sweat and blood. Freedom is never free. Somebody has to pay for it.
Cropduster
Thanks for that link, Sastolfi.
I sent a message to e-trade this morning about when I could see the new shares in my account and this is the response they sent me:
"Dear Mr. xxxxxxx,
Thank you for your message regarding your account.
When a company does a reverse stock split, new shares are issued. We are currently awaiting the new shares to be delivered from the agent. We will update your account immediately when we receive the shares. In the meantime, if you need to sell please contact us so we can look into an accommodation to let you sell the position you have not yet received. We currently do not have an anticipated delivery date from the agent. If you have any questions, please respond to this message or call us at 1-800-xxx-xxxx.
Sincerely,
xxxxxxxx"
I'll give them a few more days.
I noticed that the bid is now 5000 at $0.12 and the ask is 100 at $4.56. I'm tempted to buy those 100 at $4.56 just to get the ball rolling, but decided to just wait.
Good luck,
Cropduster
McMoon, that is very good information that you just posted about the shares outstanding, the float, and the shares authorized.
This confirms what we have been talking about concerning the new very low float. If you can, I would appreciate it if you would post a link to the information you just posted. Just copy the address from the bar at the top of the page and paste it to your post, if you are not sure how to post a link.
This new 919,000 shares outstanding number confirms the 1 for 20 reverse split and makes sense. This number includes the restricted shares that were issued to Mr. Norris and the other director (15 billion shares divided by 20,000 equals 750,000.)
A float of 167,000 is great news for us, in my opinion, because it means the share price will be very sensitive to any news that comes out this summer. With only 167,000 shares trading, the share price could easily fluctuate up and down by the dollars, not just pennies or fractions of pennies. But we need that well in Ohio to come in.
If authorized shares are still 20 billion, then, yes, that means that management could still dilute the current 919,000 shares to raise capital. I hope they don't do that until after the Ohio wells goes into production, but it is a possibility.
For the moment, hopefully we are through diluting and splitting. Now that FNRC has survived the threat of bankruptcy, especially if we get good news out of Wyoming and Ohio, maybe we can shut down the creative financing and get back to the job of making money for the shareholders.
Keep in mind that in 6 to 12 months we potentially have up to 6 million common shares coming into the float from the series B conversion, if it happens, and the share dividend, which will happen.
But for now we appear to be golden, at least in my opinion.
Cropduster