Post by kenshin7 on Jun 25, 2010 16:35:19 GMT -5
June 25, 2010
Dear shareholders,
I am very aware that shareholders are exhausted, frustrated and some are even angry that so much time has elapsed and nothing has come from their original investment in this Company. I understand that many of you are even under extended pressures from friends and relatives because you also talked them into investing and now they are looking to you for answers. I too have many friends and family members that are shareholders of CMKM and they are also looking for resolution.
When Mr. Casavant turned this Company over to me and resigned in March of 2007, I still believed that there were stones left unturned that would allow for a quick resolution and turnabout of the circumstances for the benefit of the shareholders. I made promises to you with full intention to keep you updated and fully aware of the current activities of the Company on a continual basis. To all of our dismay, the unturned stones that were found did not show anything that promised a quick resolution to the benefit of the shareholders. In fact, the information that we became in possession of showed anything but the promises of a quick resolution. Working daily in the atmosphere of ongoing litigation is not anything remotely close to what I had hoped was waiting for shareholders just around the corner in March of 2007.
In an April 20, 2007 press release I had the most unpleasant duty of telling shareholders what was uncovered just days before when several boxes of documents arrived at the Frizzell Law Firm. What was in those boxes foretold just the beginning of the heartbreaking story that we eventually uncovered that told us what really happened with our investments. Once this occurred, CMKM was forced into litigation mode that required extreme amounts of time to be dedicated to investigation and discovery of the facts which has led to the possession of several hundred thousand pages of documents. Because of those events, the Company was not left with many new things to report to shareholders on a daily, weekly or even monthly basis. I can no longer discuss matters that may end up being part of litigation and wish to thank Bill Frizzell for his recent update to the Company that he allowed us to post on the website last month for all of you to see.
Just one week before Mr. Casavant resigned we were advised by then corporate counsel J.T. Moran III to put the Company into bankruptcy. However, we did not take that advice and the Company is still alive today and has a fighting chance to succeed in some way. It is the belief of current management that through our diligent efforts of seeking restitution through the courts that CMKM will have its most reasonable chance to once again become a publicly trading company. Management is making every realistic effort possible to set up the foundation of the Company so that it is ready to move forward once the larger recoveries are made. Currently, there have been a few small settlements won by CMKM that have enabled the Company the ability to continue forward with litigation, budget the initial and monthly fees of hiring the new transfer agent, corporate overhead, agreed upon reduced salaries for officers, the payment of property taxes along with the upkeep on two properties obtained in one settlement (see corporate updates 4.21.2009 & 5.11.2009) and the engagement of a CPA firm that is currently and diligently working to reconstruct financial records from 2002 forward with the intention of fully audited financials.
I still believe that CMKM Diamonds, Inc. was a victim of naked shorting or at the very least had one of, if not THE, largest failure to deliver problems that ever existed in the U.S. markets. I recently visited personally with attorney Al Hodges at his office in Pasadena. Most of you are already aware that Mr. Hodges is seeking the release of funds that he believes were collected on behalf of the CMKM shareholders. I have known and remained friends with Al Hodges ever since that fateful day in March of 2007 within an hour or so after Urban Casavant turned the Company over to me. I find Al Hodges to be extremely forthright, honest and fully believe he is working only for the best possible outcome and benefit of all shareholders of this Company. I was not privileged to the evidence that he maintains; However, after my visit with him early this month it is my personal opinion that he is 100% committed to his current actions and that he firmly believes, without any room for doubt, that he has irrefutable evidence of funds being held for eventual distribution to the CMKM shareholders and that he believes that the release of those funds is imminent.
Moving forward, while the current paths of CMKM and attorney Al Hodges are not exactly the same, both can coexist independently with each one working towards an outcome that is intended to be of the best possible benefit for all shareholders. Mr. Frizzell stated in his last litigation update, “I personally think Al Hodges is a very capable and experienced attorney. I am hopeful that his litigation is successful but CMKM management does not have the luxury of waiting to see what will come of that lawsuit. Based on the recovery sought in the Hodge’s suit, if it is successful, the matters being litigated by the Company will pale in significance”.
In past updates, the Company has requested that anyone with direct knowledge of anything that may be of financial benefit to the Company and its shareholders to step forward with your information and the Company will investigate it fully. I want to once again extend this offer to everyone. A new email address has been set up specifically for this purpose: NewInformation@cmkmdiamondsinc.com. Please note that any email submissions to this address that do not have to do specifically with providing new information that can be of help to the Company will be promptly deleted. No emails will be answered or forwarded from this address. It is my sincerest hope that this new attempt to allow for usable information to come directly to the Company will not be abused and can be maintained for the sole purpose for which it is being provided.
Because the Company is not in the possession of any materials, documents or knowledge of any kind that points to a trust or any other means of monies or assets having been gathered, demanded or put aside for the Company and/or its shareholders we have had to move forward with the information that we do have available to us which is one of the reasons for our current litigation.
I want to commend Transfer Online for doing a fantastic job to get the initial onslaught of shareholders taken care of with their requests for account s to be set up. Most people will probably not ever be able to comprehend the enormous task that was undertaken by the new transfer agent to get this under control and taken care of. To add to the scope of the task, there were several problems that were reported to them by shareholders that had to be fully researched and eventually led to only a few inaccuracies from the records of our former transfer agents that had to be corrected. As per the shareholder list created with the new transfer agent on April 7, 2010 there are: 800,000,000,000 common shares authorized; 703,514,957,466 common shares issued and outstanding; zero preferred shares authorized or issued and 48,679 shareholders of record. Currently there are only 8,862 security account holders that have registered with Transfer Online for access to their accounts.
There are still a large number of shareholders that have electronic shares being held in brokerage houses both foreign and domestic. Since these shareholders do not have physical certificates, they are not included in the current number of shareholders of record listed above. Brokerage houses and clearing firms holding bulk certificates that are theoretically used to back up all electronic shares held by their firms are each counted as one shareholder but each of them may be representing tens, hundreds or even thousands of account holders (CMKM shareholders) and these are shareholders that we do not have all of the names or current addresses for. To give you an example of most but not all of the brokerage houses/clearing firms and their holdings as per the shareholder list of 4.7.2010 represented in bulk certificates: **
A.G. Edwards & Sons LLC 229+ Million shares
ADP Clearing & Outsourcing Services 486+ Million shares
Ameritrade, Inc. 21+ Billion shares
Banc of America Securities LLC 3+ Million shares
Bear Stearns Security Corp. 73+ Million shares
Brown Brothers Harriman Co. 914+ Million shares
Brownco LLC Zero shares
CEDE & Co 17+ Million shares
Citigroup Global Markets, Inc. 2+ Billion shares
Etrade Clearing LLC 27+ Million shares
First Clearing LLC 42+ Million shares
Gerlach & Co. 131+ Million shares
Goldman Sachs & Co. 410+ Million shares
H & R Block Financial Advisors 2 Million shares
Hare & Co. 212+ Million shares
HSBS Securities 34+ Million shares
Janney Montgomery Scott LLC 49+ Million shares
Larko c/o Emmett A Larkin Co., Inc. 120,000 shares
Merrill Lynch Pierce Fenner & Smith 192+ Million shares
Morgan Keegan Co., Inc. 42+ Million shares
Morgan Stanley & Co., Inc. 416+ Million shares
National Financial Services Inc 4+ Billion shares
NBCN Clearing, Inc. 11+ Million shares
North American Clearing, Inc. 17+ Million shares
Pension Financial Services Inc. Zero shares
Pershing LLC 2+ Billion shares
Piper Jaffray & Co. 3 Million shares
Raymond James Associates, Inc. 700+ Thousand shares
RBC Dominion Securities 2+ Billion shares
Rush & Co. c/o Swiss American Securities, Inc. 298+ Million shares
Scotia Capital, Inc. 1+ Million shares
Scottrade, Inc. Zero shares
Sterne Agee and Leach, Inc. 1+ Million shares
UBS Securities LLC 594+ Million shares
Vanguard Brokerage Services 104+ Thousand shares
Wells Fargo Investments LLC 8+ Million shares
** Please note that these figures represent bulk holdings. Some of the firms represented are holding certificates for individual accounts as the custodian. These custodian accounts are generally representing IRA type accounts and the figures above do NOT include those certificates. (For example: Scottrade, Inc. has zero shares in bulk but they have several individual certificates held as custodian for IRA type accounts of individuals)
As you can see, there are many shareholders not yet fully accounted for because their shares are held in electronic form and not held in physical certificates. If you have not signed up for your account yet at www.TransferOnLine.com, it would be of benefit to you and the Company to do so. This account is completely free of cost to each shareholder. By signing up for your free account you will be able to make address changes which in turn will enable the Company to have your most current mailing address so that it is available for any possible needed communications to include a future shareholder’s meeting.
CMKM intends to hold its first ever official shareholder’s meeting within the next 12 months. As you could imagine, this event will be an extremely large undertaking with a great deal of organizational and monetary requirements to make it happen correctly. To begin preparing for this event now, it will be necessary to have current information for as many shareholders as possible. If you intend to be able to vote via proxy you will need to have a certificate in your name and have a current address on file with the transfer agent. If you have electronic shares only, then your vote(s) will be held by the brokerage or clearing firm that is theoretically holding the bulk certificate for your position.
In closing, I know that some shareholders are hurting very badly due to economic times and/or health conditions that could possibly be helped with any kind of return from their investment in this Company. I wish there was a quick and simple resolution. I can assure you that the management team is dedicated and that we will continue to work diligently towards the best possible outcome for the Company and its shareholders in as short of time as possible with the resources that are available to us. Thank you once again for your patience and ongoing support.
Very sincerely,
Kevin M West
Chairman, CEO & President
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Dear shareholders,
I am very aware that shareholders are exhausted, frustrated and some are even angry that so much time has elapsed and nothing has come from their original investment in this Company. I understand that many of you are even under extended pressures from friends and relatives because you also talked them into investing and now they are looking to you for answers. I too have many friends and family members that are shareholders of CMKM and they are also looking for resolution.
When Mr. Casavant turned this Company over to me and resigned in March of 2007, I still believed that there were stones left unturned that would allow for a quick resolution and turnabout of the circumstances for the benefit of the shareholders. I made promises to you with full intention to keep you updated and fully aware of the current activities of the Company on a continual basis. To all of our dismay, the unturned stones that were found did not show anything that promised a quick resolution to the benefit of the shareholders. In fact, the information that we became in possession of showed anything but the promises of a quick resolution. Working daily in the atmosphere of ongoing litigation is not anything remotely close to what I had hoped was waiting for shareholders just around the corner in March of 2007.
In an April 20, 2007 press release I had the most unpleasant duty of telling shareholders what was uncovered just days before when several boxes of documents arrived at the Frizzell Law Firm. What was in those boxes foretold just the beginning of the heartbreaking story that we eventually uncovered that told us what really happened with our investments. Once this occurred, CMKM was forced into litigation mode that required extreme amounts of time to be dedicated to investigation and discovery of the facts which has led to the possession of several hundred thousand pages of documents. Because of those events, the Company was not left with many new things to report to shareholders on a daily, weekly or even monthly basis. I can no longer discuss matters that may end up being part of litigation and wish to thank Bill Frizzell for his recent update to the Company that he allowed us to post on the website last month for all of you to see.
Just one week before Mr. Casavant resigned we were advised by then corporate counsel J.T. Moran III to put the Company into bankruptcy. However, we did not take that advice and the Company is still alive today and has a fighting chance to succeed in some way. It is the belief of current management that through our diligent efforts of seeking restitution through the courts that CMKM will have its most reasonable chance to once again become a publicly trading company. Management is making every realistic effort possible to set up the foundation of the Company so that it is ready to move forward once the larger recoveries are made. Currently, there have been a few small settlements won by CMKM that have enabled the Company the ability to continue forward with litigation, budget the initial and monthly fees of hiring the new transfer agent, corporate overhead, agreed upon reduced salaries for officers, the payment of property taxes along with the upkeep on two properties obtained in one settlement (see corporate updates 4.21.2009 & 5.11.2009) and the engagement of a CPA firm that is currently and diligently working to reconstruct financial records from 2002 forward with the intention of fully audited financials.
I still believe that CMKM Diamonds, Inc. was a victim of naked shorting or at the very least had one of, if not THE, largest failure to deliver problems that ever existed in the U.S. markets. I recently visited personally with attorney Al Hodges at his office in Pasadena. Most of you are already aware that Mr. Hodges is seeking the release of funds that he believes were collected on behalf of the CMKM shareholders. I have known and remained friends with Al Hodges ever since that fateful day in March of 2007 within an hour or so after Urban Casavant turned the Company over to me. I find Al Hodges to be extremely forthright, honest and fully believe he is working only for the best possible outcome and benefit of all shareholders of this Company. I was not privileged to the evidence that he maintains; However, after my visit with him early this month it is my personal opinion that he is 100% committed to his current actions and that he firmly believes, without any room for doubt, that he has irrefutable evidence of funds being held for eventual distribution to the CMKM shareholders and that he believes that the release of those funds is imminent.
Moving forward, while the current paths of CMKM and attorney Al Hodges are not exactly the same, both can coexist independently with each one working towards an outcome that is intended to be of the best possible benefit for all shareholders. Mr. Frizzell stated in his last litigation update, “I personally think Al Hodges is a very capable and experienced attorney. I am hopeful that his litigation is successful but CMKM management does not have the luxury of waiting to see what will come of that lawsuit. Based on the recovery sought in the Hodge’s suit, if it is successful, the matters being litigated by the Company will pale in significance”.
In past updates, the Company has requested that anyone with direct knowledge of anything that may be of financial benefit to the Company and its shareholders to step forward with your information and the Company will investigate it fully. I want to once again extend this offer to everyone. A new email address has been set up specifically for this purpose: NewInformation@cmkmdiamondsinc.com. Please note that any email submissions to this address that do not have to do specifically with providing new information that can be of help to the Company will be promptly deleted. No emails will be answered or forwarded from this address. It is my sincerest hope that this new attempt to allow for usable information to come directly to the Company will not be abused and can be maintained for the sole purpose for which it is being provided.
Because the Company is not in the possession of any materials, documents or knowledge of any kind that points to a trust or any other means of monies or assets having been gathered, demanded or put aside for the Company and/or its shareholders we have had to move forward with the information that we do have available to us which is one of the reasons for our current litigation.
I want to commend Transfer Online for doing a fantastic job to get the initial onslaught of shareholders taken care of with their requests for account s to be set up. Most people will probably not ever be able to comprehend the enormous task that was undertaken by the new transfer agent to get this under control and taken care of. To add to the scope of the task, there were several problems that were reported to them by shareholders that had to be fully researched and eventually led to only a few inaccuracies from the records of our former transfer agents that had to be corrected. As per the shareholder list created with the new transfer agent on April 7, 2010 there are: 800,000,000,000 common shares authorized; 703,514,957,466 common shares issued and outstanding; zero preferred shares authorized or issued and 48,679 shareholders of record. Currently there are only 8,862 security account holders that have registered with Transfer Online for access to their accounts.
There are still a large number of shareholders that have electronic shares being held in brokerage houses both foreign and domestic. Since these shareholders do not have physical certificates, they are not included in the current number of shareholders of record listed above. Brokerage houses and clearing firms holding bulk certificates that are theoretically used to back up all electronic shares held by their firms are each counted as one shareholder but each of them may be representing tens, hundreds or even thousands of account holders (CMKM shareholders) and these are shareholders that we do not have all of the names or current addresses for. To give you an example of most but not all of the brokerage houses/clearing firms and their holdings as per the shareholder list of 4.7.2010 represented in bulk certificates: **
A.G. Edwards & Sons LLC 229+ Million shares
ADP Clearing & Outsourcing Services 486+ Million shares
Ameritrade, Inc. 21+ Billion shares
Banc of America Securities LLC 3+ Million shares
Bear Stearns Security Corp. 73+ Million shares
Brown Brothers Harriman Co. 914+ Million shares
Brownco LLC Zero shares
CEDE & Co 17+ Million shares
Citigroup Global Markets, Inc. 2+ Billion shares
Etrade Clearing LLC 27+ Million shares
First Clearing LLC 42+ Million shares
Gerlach & Co. 131+ Million shares
Goldman Sachs & Co. 410+ Million shares
H & R Block Financial Advisors 2 Million shares
Hare & Co. 212+ Million shares
HSBS Securities 34+ Million shares
Janney Montgomery Scott LLC 49+ Million shares
Larko c/o Emmett A Larkin Co., Inc. 120,000 shares
Merrill Lynch Pierce Fenner & Smith 192+ Million shares
Morgan Keegan Co., Inc. 42+ Million shares
Morgan Stanley & Co., Inc. 416+ Million shares
National Financial Services Inc 4+ Billion shares
NBCN Clearing, Inc. 11+ Million shares
North American Clearing, Inc. 17+ Million shares
Pension Financial Services Inc. Zero shares
Pershing LLC 2+ Billion shares
Piper Jaffray & Co. 3 Million shares
Raymond James Associates, Inc. 700+ Thousand shares
RBC Dominion Securities 2+ Billion shares
Rush & Co. c/o Swiss American Securities, Inc. 298+ Million shares
Scotia Capital, Inc. 1+ Million shares
Scottrade, Inc. Zero shares
Sterne Agee and Leach, Inc. 1+ Million shares
UBS Securities LLC 594+ Million shares
Vanguard Brokerage Services 104+ Thousand shares
Wells Fargo Investments LLC 8+ Million shares
** Please note that these figures represent bulk holdings. Some of the firms represented are holding certificates for individual accounts as the custodian. These custodian accounts are generally representing IRA type accounts and the figures above do NOT include those certificates. (For example: Scottrade, Inc. has zero shares in bulk but they have several individual certificates held as custodian for IRA type accounts of individuals)
As you can see, there are many shareholders not yet fully accounted for because their shares are held in electronic form and not held in physical certificates. If you have not signed up for your account yet at www.TransferOnLine.com, it would be of benefit to you and the Company to do so. This account is completely free of cost to each shareholder. By signing up for your free account you will be able to make address changes which in turn will enable the Company to have your most current mailing address so that it is available for any possible needed communications to include a future shareholder’s meeting.
CMKM intends to hold its first ever official shareholder’s meeting within the next 12 months. As you could imagine, this event will be an extremely large undertaking with a great deal of organizational and monetary requirements to make it happen correctly. To begin preparing for this event now, it will be necessary to have current information for as many shareholders as possible. If you intend to be able to vote via proxy you will need to have a certificate in your name and have a current address on file with the transfer agent. If you have electronic shares only, then your vote(s) will be held by the brokerage or clearing firm that is theoretically holding the bulk certificate for your position.
In closing, I know that some shareholders are hurting very badly due to economic times and/or health conditions that could possibly be helped with any kind of return from their investment in this Company. I wish there was a quick and simple resolution. I can assure you that the management team is dedicated and that we will continue to work diligently towards the best possible outcome for the Company and its shareholders in as short of time as possible with the resources that are available to us. Thank you once again for your patience and ongoing support.
Very sincerely,
Kevin M West
Chairman, CEO & President
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