NMC Inc. (fka NMCX)

[albacora]

HCCA/NMCX Securities:

NMC, INC. (“NMCX”)
PINK SHEETS DISCLOSURE
PURSUANT TO 15C2-11 GUIDELINES
Revised February 14, 2005
ITEM (i)
The exact name of the issuer is NMC, INC. The issuer was formerly known as Hexagon
Consolidated Companies of America. Peeples Mining Company, the wholly owned
subsidiary of the issuer, was merged into the issuer on September 9, 2003. The issuer has
one wholly owned subsidiary, namely, Peeples, Inc.
ITEM (ii)</B>
The address of the issuer’s principal executive offices is
2711 Cool Lilac Ave
Henderson, NV 89052-3835
ITEM (iii)
State of incorporation:NEVADA
Date of incorporation: 1984 (under the name of Carleton
Enterprises, Ltd.)
ITEM (iv) ITEM (v) ITEM (vi)
Exact title and class of securities outstanding:
Common Stock Par Value $0.001 600,000,000
Preferred Stock $0.001 600,000,000
Preferred Stock A $0.001 500,000,000
Equity/Options issued in lieu of cash:
2004
Class Date/Issued to Reason Trading Status
None
2003
Class/Underlying Date/Issued to Reason Trading Status
Security
600,000,000 Pfd
Stock/
Common 3/1/2000 – M. Furlong operational 300 million shares
Funding See below
150,000 shs common
Buy Option 6/2/2003 – Ore Buyer Closing terms not exercised – expired
Preferred Class A(a)
500,000,000 shares/ 1/6/2005—M. Furlong anti-takeover R-- 2-year Rule 144
Common See below.
----------------------
2
(a) On January 6, 2005, the Company filed with the Secretary of State for the
State of Nevada a Certificate of Amendment to its Articles of Incorporation, providing
for the establishment of 500 million shares of Preferred Class A Stock (with voting
rights of one Preferred Class A share equaling 5 votes of Common). The Preferred Class
A is convertible into Common; provided, however, that under Rule 144, there can be no
conversion and sales for two years. Following the two-year restriction, the Preferred
Class A is convertible 5-to-1 into Common shares, at the maximum rate of one percent
(1%) per quarter of the Company’s then outstanding Common shares, and 100%
convertible over 100 fiscal quarters. In order to accommodate, possible but not probable
conversion, it was necessary to proportionately increase the number of authorized
Common shares (to 4.5 billion) so that the Preferred may be considered valid in every
respect.
Conversion rights not exercised in any given quarter do not carry over into
subsequent quarters. Unconverted Preferred Stock is durable, and rights not exercised
may be appended to the end of the original 27-year conversion schedule, which includes
the two-year Rule 144 restriction period, thereby giving the Company continued
durability of its protection against hostile takeover. Each Preferred Class A share has
voting rights of 5-to-1 relative to the Common in order to prevent a hostile takeover
attempt on the Company, such as occurred in the 1990s.
b) On March 1, 2000, the Company filed with the Secretary of State for the State
of Nevada an Amendment to its Articles of Incorporation providing for the establishment
of 600 million shares of Preferred Stock. This class of Preferred Stock has 4 votes per
share as compared to 1 vote per share of Common Stock. When converted to Common
Stock each share has 1 vote. The conversion ratio is 1 share of Preferred Stock for 1 share
of Common Stock. There is no preferential dividend distribution for the Preferred Stock.
Of the 600 million shares issued, 300 million shares are destined to be used for the
purpose of securing revenue for the Company (not in the form of selling said shares). To
the extent that any of the 300 million shares are used in a revenue generating transaction
the voting rights of those shares will be suspended until the transaction has been
completed.
ITEM (vii)
Transfer Agent: NMC Transfer Dept., ATTN: Tricia Smith, 2711 Cool Lilac,
Henderson, NV 89052-3835, phone [phone]
ITEM (viii)
1. Form of organization – Corporation
2. Year organized – 1984
3. Fiscal year-end – 12/31
4. See below
5. NMC, Inc. (f/k/a Hexagon Consolidated Companies of America, Inc., was
incorporated under the name Carleton Enterprises, Ltd. On November 13, 1984,
the Company changed its name to SCN, Ltd. On December 15, 1986, an
involuntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy
Code, was filed against SCN, Ltd. In December 1988, the Company became
3
debtor in possession of its assets under a voluntary proceeding. The Company
was dormant until September 10, 1993, at which time the bankruptcy was
ordered dismissed. On November 19, 1993 the Company again changed its
name to Health Care Centers of America, Inc. On August 31, 1999, the
Company changed its name to Hexagon Consolidated Companies of America,
Inc. On September 9, 2003 the changed its name to NMC, Inc., also Peeples
Mining Company and MedAway International, Inc., wholly owned subsidiaries
of the Company were merged into the parent, NMC, Inc. In April 2004, the
Company registered the trademark NMC, Inc. and the trade name Nevada
Mining Company with the State of Nevada. The Company has one subsidiary,
Peeples Mining.
6. Default – N/A
7. Change in Control – N/A
8. On December 28, 1993 the company amended its Articles of Incorporation to
increase the authorized capitalization from 80,000,000 shares of common stock
to 900,000,000 shares of common stock. The par value of its common stock was
changed from $0.02 to $0.001 per share. By an Amendment on March 1, 2000,
the Company provided for 600 million in Preferred Stock. An Amendment filed
Jan 6, 2005 increased Common to 4.5 billion and provided for 500 million of
Class A Preferred.
9. In January 1994, the company declared a one-for-three (1:3) reverse stock split.
On June 30, 1998, the Company authorized a one-for-one thousand (1:1000)
reverse stock split. The par value remained at $0.001 per share See Items
(viii)A(5), (8).
10. Delisting by an exchange: The Company was previously quoted on the Over
The Counter Bulletin Board (OTCBB). At the time, the Company had not
cleared all of the SEC comments regarding its Form 10-SB filing, which filing
was effective in February of 1977. The SEC comments were sent to the
Company more than 90 days after the Form 10-SB was filed, by rule, the Form
10-SB was effective. Nevertheless, OTCBB stop quoting the Company’s stock.
11. Contingencies
Various actions and legal proceedings may arise against the Company during the
normal course of business. However, management and in-house legal counsel are
aware of only the following:
U.S. Securities and Exchange Commission (SEC)
There are three (3) separate but related matters.
(a) SEC v. Hexagon Consolidated Companies of America, Inc. (HCCA)
On March 10, 2003 the SEC instituted an administrative law action against the
Company to the registration of its stock for failure to timely file certain required
reports. The Company had attempted to voluntarily withdraw the registration
statement, however, it was not successful. Therefore, the Company agreed to a
court order that revoked the registration statement.
4
(b) SEC v. Michael J. Pietrzak, Maurice W. Furlong, Donald Jordan
On February 28, 2003, the SEC filed a civil action against the above individuals in
Federal Court in Chicago, Illinois. The allegation against Pietrzak and Furlong include:
Attempts to fraudulently increase the stock price, fraudulent sale of stock, overstatement of
value of the Company, improper valuation, misleading press releases and letters to the
shareholders and failure to timely file reports on behalf of the Company. The allegations
against Jordan include: fraudulent sale of stock and that, as an assayer, he could not
opine as to the total economic value of the mining assets.
(c) Grand Jury Investigation of Michael J. Pietrzak
By letter dated October 28, 2003, Michael J. Pietrzak, Company Secretary,
was informed that he was a target of a Federal Grand Jury investigation regarding
possible securities law violations and possible violations of the Internal Revenue
Code.
LITIGATION
State of Arizona v. Peeples, Inc.
On or about October 20, 2000, the Arizona State Land Department (ASLD) issued
a Notice of Default and Denial of Mining Plan of Operation (MPO). The ASLD
attempted to terminate the lease between the Company’s wholly owned
subsidiary, Peeples, Inc. (Peeples) and the ASLD. After a five-day hearing, an
Administrative Law Judge (ALJ) found in favor of Peeples on seven of eight
issues. Peeples appeared that one issue to the Superior Court. The Superior Court
ruled against Peeples. Peeples then appealed that ruling to the Appellate Court
and were successful. Therefore, Peeples was successful on all issues. The
Company was also awarded its Attorney fees and costs which were paid by the
State of Arizona.
Health Care Centers of America, Inc. vs. The RK Company, et.al.
During the first quarter of 1997 the Company filed the above action in the 18th
Judical Circuit, DuPage County, Illinois. The defendants had entered into certain
stock exchange agreements. The agreements provided for the transfer of
Company Common stock for title and control of certain real estate. The Company
fully performed, however, the defendants refused to perform. In 2001, the
defendants agreed to settle the matter for 5 million dollars. The Company agreed
and received this amount. The defendants also returned any and all stock
previously issued for the real estate.
5
ITEM (viii)
B. The Company is focused on the development, management and exploitation of
one (1) primary industry segment. This is the development of mining interests and
exploitation of existing inventories of ore concentrate.
1. SIC Codes: 1090 (primary) 3339 (secondary)
2. The issuer is currently conducting operations in mining and ore processing.
3. Subsidiary – Peeples Inc. ; results included in consolidated financial statements.
4. Several regulatory agencies could have an effect on the conduct of the Company’s
business. These include, environmental, mining, occupational health and safety, and
employment regulations on the federal and state levels. The Company works diligently
to keep abreast of regulations, to conform with all applicable regulations, and to
minimize any adverse effects to its operations these regulations might have.
5. Approximate cost of research and development borne by the Company in the past
two years: approximately $450,000.00 to $500,000.00
6. Mining and ore processing are highly regulated business activities. The cost of
compliance is an ordinary cost of doing business, included in the Company’s
Income Statements primarily under the headings of Professional Fees ($284,103 in
2003) and Licenses and Permits ($9,333 in 2003), with other miscellaneous costs
included in Insurance and Taxes. The cost of compliance has not heretofore
established a specific line item for “Compliance.”
7. Employees – The Company has no employees. All operations, services, etc. are
performed and provided through a series of third party independent contractors.
Currently there are 13 such contracts.
8. Investments – The Company’s investments consist primarily of mineral inventories,
properties, leases and claims toward its primary purpose of mineral property
development and exploitation. As of year-end 2003, these included the following:
MINERAL INVENTORIES 2003
(a) Purchased mineral inventory 200,000,000
(b) Acquisition cost 69,375,000
-------------------
$269,375,000
===========
Mineral properties include:
a) An inventory of concentrated precious metals ore located on land leased from the
State of Arizona through the year 2003. Recent assay reports commissioned by the
Company indicate there is a combination of precious metals, rare earth and common
6
elements. These concentrates were purchased in exchange for 100,000 shares (after
given effect of reverse split (see Note 1 to the Company’s 2003 financial statements))
of the Company’s common stock. Such stock was valued at $200,000,000 based on
the stock price on the date of the agreement discounted by 50% due to restrictions on
transferability, applicable to such stock. A subsequent independent valuation
indicated a fair-market value in excess of the recorded amount.
The concentrated precious metals ore stored on the property have been previously
mined and initially processed to gather the visible nuggets of gold. The Company
further concentrates this material through the already established milling operation.
Some of the ore concentrates have been sold in their current concentrated state and
other ore concentrates will be processed into multi-layered metallic Dore’ bars using
the on-site facilities, including the high temperature furnaces.
b) The San Bernardino, California site consists of the purchase of 17 mining
claims covering a 340-acre site. These claims were purchased in exchange
for 375,000 shares (after given effect of reverse split (see Note 1)) of the
Company’s common stock. The shares were valued at $69,375,000 based
on the stock price on the date of the agreement discounted by 50% for
restriction. Assay reports obtained by an independent assayer indicate a
value in excess of this value. There has been no activity on this property
for several years.
c) The seven claims covering 140 acres are located near Mesquite in Nevada.
These were acquired through a stock exchange agreement with F & H
Mining dated March 25, 1994 involving 12,000,000 common stock shares.
The Company does not otherwise engage in ordinary industrial, commercial, or
residential real estate investment.
ITEM (ix)
1. NMC, Inc. has interests in mining and ore processing. It is currently engaged
in the processing of precious metals ore concentrates, consisting of platinum,
gold and other precious and noble metals. Aside from commodity markets, the
market and potential buyers of the Company’s product includes institutional
buyers of ore, including banks, insurance companies and other business
enterprises for which reserves are a major concern. In June 2003, the
Company entered into an agreement with one such company for the sale of
137,939 tons of such ore concentrate (approx. 26% of its Skull Valley, Ariz.
tonnage) in a transaction valued at $500,000,000 over its 10-year term. Other
conditions of the sale are discussed more fully in the Company’s financial
statements. The Company has an ongoing business development effort aimed
at the identification of additional buyers.
2. In the aforementioned sale, concentrated ore was sold as-is, on site, in the pits,
with the buyer remaining responsible for any additional processing and
transportation.
3. N/A
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4. Mining is a regulated business activity, and the market for precious metals is
somewhat volatile. NMC must compete with companies that possess greater
financial, technical and marketing resources than we do. These advantages
may enable them to identify customers more readily and respond more
quickly to customers’ needs, and our competition may possess newer or more
effective technologies that allow them to mine and process ore more
economically. These advantages may also allow them to engage in more
extensive research and development, undertake extensive far-reaching
marketing campaigns, adopt more aggressive pricing policies and make
more attractive offers to potential employees and strategic partners. As we
progress to other properties, where core-drilling and hard-rock mining must be
undertaken, we may not be able to find suitable strategic partners according to
acceptable terms. Thus far in its operations, the Company has had to satisfy
the regulatory requirements of the Arizona State Land Department (ASLD),
the Arizona Department of Environmental Quality (ADEQ), the Army Corps
of Engineers, the Arizona Division of Mines and the Federal Bureau of Land
Management (BLM). All of these agencies have been satisfied with the
Company’s Skull Valley operations. However, future environmental and
regulatory issues may prove problematic and may make it more costly for the
Company to develop its properties. As a result of these pressures, we may not
be able to fully exploit our properties to our fullest advantage. These
competitive pressures may adversely affect our business, results of
operations and financial condition.
5. Raw materials necessary for the Company’s ore processing are readily
available to it on site.
6. Prior to 2003, the Company was in the development stage since June 29,
1993. At December 31, 2003, it had a cumulative deficit of $59,058,316. The
Company no longer is considered a development stage Company. A major
portion of its assets includes mineral inventories valued on a cost basis at
approximately $370,000 in the aggregate. On June 2, 2003, the Company
entered into an irrevocable contract for the sale of 137,939 tons of the
precious metals concentrates located in Arizona. The total purchase price is
$500,000,000 payable over a ten (10) year period. The buyer has paid the
Company the amount of $720,860 as the first payment. The continuity of the
Company is dependent upon the successful realization of this contractual
arrangement and/or sale of additional amounts of ore.
7. The process developed by the Company for concentrating ore is proprietary,
but it is not patented. There are no plans to patent its process. In April 2004,
the Company registered the trademark NMC, Inc. and the trade name Nevada
Mining Company with the State of Nevada. The Company has no royalty
income. In 2003, the royalty paid to the State of Arizona was $43,252.00.
8. N/A
ITEM (x): Nature and extent of issuer’s facilities
1, 2. The Company’s assets consist primarily of mineral inventories, properties, leases
and claims toward its primary purpose of mineral property development and exploitation.
As of year-end 2003, these included the following, valued at cost:
8
MINERAL INVENTORIES
2003
(a) Purchased mineral inventory 200,000,000
(b) Acquisition cost 69,375,000
-------------------
$269,375,000
===========
Mineral properties include:
a) An inventory of concentrated precious metals ore located on land leased
from the State of Arizona through the year 2003. Recent assay reports
commissioned by the Company indicate there is a combination of precious
metals, rare earth and common elements. These concentrates were
purchased in exchange for 100,000 shares (after given effect of reverse
split (see Note 1 of the Company’s 2003 financial statements) of the
Company’s common stock. Such stock was valued at $200,000,000
based on the stock price on the date of the agreement discounted by 50%
due to restrictions on transferability, applicable to such stock. A
subsequent independent valuation indicated a fair-market value in excess
of the recorded amount.
The concentrated precious metals ore stored on the property have been previously
mined and initially processed to gather the visible nuggets of gold. The Company
further concentrates this material through the already established milling operation.
Some of the ore concentrates have been sold in their current concentrated state and
other ore concentrates will be processed into multi-layered metallic Dore’ bars using
the on-site facilities, including the high temperature furnaces.
b) The San Bernardino, California site consists of the purchase of 17 mining
claims covering a 340-acre site. These claims were purchased in exchange
for 375,000 shares (after given effect of reverse split (see Note 1)) of the
Company’s common stock. The shares were valued at $69,375,000 based
on the stock price on the date of the agreement discounted by 50% for
restriction. Assay reports obtained by an independent assayer indicate a
value in excess of this value. There has been no activity on this property
for several years.
c) The seven claims covering 140 acres are located near Mesquite in Nevada.
These were acquired through a stock exchange agreement with F & H
Mining dated March 25, 1994 involving 12,000,000 common stock shares.
9
3. The Company leases its Skull Valley site from the State of Arizona. Though the
original lease expired in 2003, the Company was timely in its application for renewal of
the lease, which according to the ASLD can take more than a year. The company
received professional guidance in the preparation and filing of its renewal for application
with the ASLD. NMC/Peeples has made royalty payments, annual assessment payments
and payment of other fees required by the ASLD to keep the lease current. The Arizona
Revised Statutes (ARS) provide for a preference for lessee’s who have applied for a
renewal and the Company does not consider the lead time for determination of
continuance of its lease to be extraordinary, given information available to it from
professional advisors and the ASLD. Furthermore, the Company owns all of the
concentrated precious metals stored on the property.
4. As an obligation of its lease with the ASLD, the Company must “reclaim” the
property. The reclamation required covers an area 750 feet by 1,500 feet. The Company
has to remove all structures, equipment, etc., then grade the land to its original contours
and replant native vegetation. To ensure completion of the restoration, the ASLD has
required that the Company provide a bond in the amount of $15,000.00. The Company
has provided this bond.
5, 6, 7. N/A
ITEM (xi)
Chairman, Chief Executive Officer, Director—Michael D. Sheppard.
September 2004, CEO and Chairman of the Board. Formerly associated
with Atkinson Technologies (CEO, 2003-2004); New Life Corporation of
America (President), National Community Foundation (President), 1997-
2003; Kidpower (CEO, 1996-1997); Thomas Nelson Publishers
(President-Mass Market Div., VP-Gifts, 1991-1996), Ph. 702-837-
1162; Email, [e-mail].
President, Director – Maurice W. Furlong. Past 10 years, officer and
director of NMC, Inc., and its predecessors Hexagon Consolidated
Companies of America, Inc. and Health Care Centers of America, Inc.
Address: 2711 Cool Lilac Ave, Las Vegas, NV 90052-3835, PH 702-837-
1162. See below for legal information.
Email, [e-mail].
Executive Vice President, General Counsel, Secretary, Director –
Michael J. Pietrzak, licensed attorney in the State of Illinois. Past 10 years,
officer and director of NMC, Inc. and its predecessors Hexagon
Consolidated Companies of America, Inc. and Health Care Centers of
America, Inc. Address: 1565 Star Way, Reno NV 89511, PH 928-308-
3180. See below for legal information. Email,
[e-mail].
Director—Travis Mayhan, 1986 – present, mining consultant for NMC,
Inc. (f/k/a Hexagon Consolidated Companies of America), engaged
10
in site evaluation, exploration processing, equipment construction and
safety compliance.
c. General Partners – N/A
d. Promoters – N/A
e. Control Persons – Maurice W. Furlong. See above.
f. Counsel – Chief Counsel, Michael J. Pietrzak. See above.
Attorney—Jerry L. Haggard: Jerry L. Haggard, P.C. 1248 E. Victor
Hugo Ave., Phoenix, AZ 85022, PH 602-863-1119. Prior to 2003 with the
Phoenix law firm of Gust Rosenfeld. 2003 to present, private practice as
Jerry L. Haggard, P. C.; email, [e-mail].
g. Accountant or Auditor – PKF (Pannell, Kerr, Forster), Wilbur A.
Harrigan, Chartered Accountant, P.O. Box 159, 41 Redcliffe Street, St.
John’s, “Antigua, West Indies, Ph 268-462-0827; fax [phone];
email, [e-mail].
h. Public Relations Consultant – Madeleine Franco, Jordan Richard
Assoc. LLC, P. O. Box 522102, Salt Lake City, UT 84152-2102 801-463-
0300. President/CEO of Jordan Richard Assoc. LLC and its predecessor
Jordan Richard Assoc. since 1985. Email, [e-mail],
[e-mail].
i. Other Advisors who assisted with this report – N/A
Legal Information
Various actions and legal proceedings may arise against the Company
during the normal course of business. However, management and in-house legal
counsel are aware of only the following:
U.S. Securities and Exchange Commission (SEC)
There are three (3) separate but related matters.
11
(a) SEC v. Hexagon Consolidated Companies of America, Inc. (HCCA)
On March 10, 2003 the SEC instituted an administrative law action against the
Company to the registration of its stock for failure to file certain required reports.
The Company had attempted to voluntarily withdraw the registration statement,
however, it was not successful. Therefore, the Company agreed to a court order
that revoked the registration statement.
(b) SEC v. Michael J. Pietrzak, Maurice W. Furlong, Donald Jordan
On February 28, 2003, the SEC filed a civil action against the above individuals
in Federal Court in Chicago, Illinois. The allegation against Pietrzak and Furlong
include: Attempts to fraudulently increase the stock price, fraudulent sale of
stock, overstatement of value of the Company, improper valuation, misleading
press releases and letters to the shareholders and failure to timely file reports on
behalf of the Company. The allegations against Jordan include: fraudulent sale
of stock and that, as an assayer, he could not opine as to the total economic value
of the mining assets.
(c) Grand Jury Investigation of Michael J. Pietrzak
By letter dated October 28, 2003, Michael J. Pietrzak, Company Secretary,
was informed that he was a target of a Federal Grand Jury investigation
regarding possible securities law violations and possible violations of the
Internal Revenue Code.
LITIGATION
State of Arizona v. Peeples, Inc.
On or about October 20, 2000, the Arizona State Land Department (ASLD) issued
a Notice of Default and Denial of Mining Plan of Operation (MPO). The ASLD
attempted to terminate the lease between the Company’s wholly owned
subsidiary, Peeples, Inc. (Peeples) and the ASLD. After a five-day hearing, an
Administrative Law Judge (ALJ) found in favor of Peeples on seven of eight
issues. Peeples appeared that one issue to the Superior Court. The Superior Court
ruled against Peeples. Peeples then appealed that ruling to the Appellate Court
and were successful. Therefore, Peeples was successful on all issues. The
Company was also awarded its Attorney fees and costs which were paid by the
State of Arizona.
12
Health Care Centers of America, Inc. vs. The RK Company, et.al.
During the first quarter of 1997 the Company filed the above action in the 18th
Judical Circuit, DuPage County, Illinois. The defendants had entered into certain
stock exchange agreements. The agreements provided for the transfer of
Company Common stock for title and control of certain real estate. The Company
fully performed, however, the defendants refused to perform. In 2001, the
defendants agreed to settle the matter for 5 million dollars. The Company agreed
and received this amount. The defendants also returned any and all stock
previously issued for the real estate.
ITEM (xii)
Company’s most recent financial Statements – through third quarter of 2004
– will be made available separately.
ITEM (xiiI)
Financial statements for 2002 and 2003 – Available separately
2/11/2005