RE:GMXX->A TANGLED WEB FOR REBELLIOUS SMALL COMPANIES
Several of the OTCBB companies engaged in a war of words with Dow Jones (NYSE: DJ) columnist Carol Remond – GeneMax Corp. (OTCBB: GMXX), Hadro Resources (OTCBB: HDRS), Vega Atlantic Corp. (OTCBB: VATL, Ten Stix, Inc. (OTCBB: TNTI) and Intergold Corp. (OTCBB: IGCO) – have a tangled interlocking web of relationships, according to public filings.
Sionix (OTCBB: SINX) and FreeStar Technologies (OTCBB: FSTI) had joined the rebellion but do not appear to be connected to the others.
FreeStar has accused Vfinance (OTCBB: VFIN) or its associates of shorting its stock, and most of the companies have announced they are exiting the Depository Trust Corp. electronic system and have signed on with Global Securities Stock Transfer, of Denver, CO., for physical transfer of their certificates to combat what they claim has been “illegal naked short selling trade abuses.”
Several of the companies, GeneMax, Hadro Resources and Vega Atlantic Corp. have a single president, Grant Atkins, 41, who also serves as secretary, treasurer and director for several. Two of the companies’ largest shareholder is ICI Communications International, Inc., an investor relations firm which shares offices with the companies.
Brent Pierce, who has been described in media reports as a “stock promoter” banned from trading activities in British Columbia under a 15-year penalty, reportedly signed a Securities and Exchange Commission document two years ago that he was sole shareholder of ICI.
The holdings were mainly acquired through the exchange of debt, apparently for investor relations services, in exchange for stock. It would appear that any depressed prices in the shares of the companies at the time would have worked to the benefit of ICI in the number of shares it was able to acquire for the companies’ indebtedness to it.
In the case of Vega Atlantic, it discontinued coverage by an Investrend analyst prior to the transaction, and in the case of Hadro Resources, Atkins sought to repress the issuance of a report by Investrend analyst Jonathan Kolb, CFA, prior to the report’s issuance, resulting in a suspension of coverage. Shortly afterwards, the transaction transferring majority control to ICI and affiliates occurred, and Kolb had insufficient access to the company to comment.
Atkins has refused to issue an 8-K to announce the suspension, and Hadro Resources has not removed the misleading statements on its website at hadroresources.com, that it is covered by Investrend Research.
Another name that shows up on several of the companies as a significant shareholder is Alexander W. Cox, who is also the principal shareholder of Intergold, where Atkins serves as Secretary and Treasurer. It is not known what Atkins’ relationship to ICI is, or whether he is a principal, but he and several of the companies list their offices at the same address as ICI.
Most of the companies in which ICI and Atkins are directly involved show little or no revenues and heavy debt. According to MarketGuide regarding GeneMax, “For the nine months ended 9/30/02, revenue fell 89% to $125. Net loss totaled $1.1 million, up from $438 thousand.” Despite this, GeneMax has twice in the past three months experienced meteoric price gains, and traded Friday at over $10, a gain from $6 this month alone, giving it a current market capitalization of $143m. Uniquely, GeneMax is 98% owned by insiders, with only 368,254 shares of 15.8m in the public float. Despite this, the daily trading volume is 74,000. Considerable confusion reigns over the ICI shareholdings and options, with the company giving one version last month and Remond and her Dow Jones colleague Steven D. Jones reporting another. Last month, GeneMax revealed that Pierce acquired 102,000 shares at 50-cents each by exercising options he had received as a consultant to ICI.
A similar meteoric price gain was achieved by Edgetech Services, Inc. (OTCBB: EDGH) since it announced last Tuesday its “alliance” with ICI, noting its decision was driven by a desire to join in combating short-selling and facilitating “certificated trading compliance with the market makers and clearing houses.”
CLICK ON 'ATTACHMENT' above to see text of Professor Angel's 'Upday Rule.'
Clickable links relevant to FinancialWire dispatches are accessible at financialwire.net. |
