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Post by fastwalker on Apr 11, 2005 23:34:44 GMT -5
That was basically where I was going with the "statement" alleged NSS...I am in agreement with that post, it was an aggressive response and a very well worded one. It hints at the notion that are Ducks may be in a row and further, we have established the basis for an appeal, if it is required.... At this point , it appears to be a matter of saving face, it appears that given the investigation, the SEC is acting a manner consistent with "guilty until pr oven Innocent," which is not the way the "system is suppose to work....
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Post by fastwalker on Apr 11, 2005 23:35:51 GMT -5
What did RG do, maybe we will find out one day? Reply... (7). June 4, 2004 R.Glenn, Esq to” assist in preparing the required SEC reports in anticipation of requesting a MM to resubmit the Company to the “OTCBB” Mr. Glenn said” We have been retained by the Company to “resolve the problems it has been facing, and we expect to devote significant efforts immediately toward that goal.”<br> Important note….RG said…. “the Company has advised us that it is dedicated to complying fully with all requirements on it, and we are pleased to act as counsel to it on that basis.
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Post by fastwalker on Apr 11, 2005 23:36:20 GMT -5
WE MAY NOT HAVE THE sec SHAKING IN THEIR BOOTIES but have certainly gave them something to think about. I think RM and company have tabled a very realistic defense. There should be little or no reason why the sec would not be reasonable under the circumstances. If the SEC is not careful they may get asked in court what makes CMKX so special. Why the hardline approach against a company making every effort to correct past mistakes and initiating a professional management team to establish proper corporate procedures. I am still cautiously opptomistic but I think this reply has me feeling we are far more likely to continue as CMKX then rolling us into a new company. I think our chances have grown from dismal to good in favour of contiuing as CMKX. Yes, I guess this means I liked the response. CIP
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Post by fastwalker on Apr 11, 2005 23:36:43 GMT -5
That is the real question "There should be little or no reason why the sec would not be reasonable under the circumstances. Why the hardline approach against a company making every effort to correct past mistakes and initiating a professional management team to establish proper corporate procedures." I'm reading the complaint again!
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Post by fastwalker on Apr 11, 2005 23:47:35 GMT -5
These say a lot.....
FIRST AFFIRMATIVE DEFENSE
Respondent CMXM Diamonds alleges and believes that the Commission lacks authority to conduct the proceedings herein.
SECOND AFFIRMATIVE DEFENSE
The allegations of the Office of the Division of Enforcement fail to state a claim upon which the Commission can rend sanctions as requested in Section III B of the Order Instituting Administrative Proceeding.
THIRD AFFIRMATIVE DEFENSE
Allegations of the Office of the Division of Enforcement are barred by laches
FOURTH AFFIRMATIVE DEFENSE
In light of the allegations contained in Section II, paragraph 1 and paragraph 2, of theDivision of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public a administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds’ securities is inconsistent with Section 13(a) of the Exchange Act and Rules 13a-l and 13a-13 thereunder.
FIFTH AFFIRMATIVE DEFENSE
In light of the Statement of Facts as enunciated by Respondent. Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive remedies against and indispensable parties who have not had an opportunity for appearance herein, and on that basis it would be unconstitutional for the Commission to take any disciplinary action based thereon.
SIXTH AFFIRMATIVE DEFENSE
In light of the Statement at Facts as enunciated by Respondent, Respondent deems the sanctions as proposed by the Division of Enforcement to be punitive in nature against the Respondent CMXM Diamonds for the following reasons:
a. Respondent, pursuant to Rule 12g-4(b), had 60 days after the filing of the amended Form 15 on February 17, 2005, which would be on or about April 17,2005, to file its reports.
Respondent’s actions lack egregiousness, in that its obligations did not occur until after the filing by the Commission of the Order at hand.
b. Respondent’s actions were isolated and not recurrent in that once the respondent learned of the requirement for filing the amended Form 15 on February 13, 2005, the Respondent immediately commenced setting into motion the preparation of financial statements, setting meetings with the Company’s auditors, and counsel for the Company in anticipation of the preparation of the periodic reports.
c. Respondent lacked the scienter required for willful misconduct, in that Respondent relied on the advice of counsel indicating that reports were required after the filing of the Form 15 on July 22, 2003.
d. Respondent has demonstrated the sincerity of Respondent’s assurances against future violations by nominating an additional board member for purposes of conducting an internal investigation of the Respondent’s corporate matters, setting up procedural internal controls, and setting into motion the coordination of bringing current the outstanding periodic reports. As a result, significant dollars have been spent by Respondent to assure its corporate compliance with the reporting requirements of the Act.
e. Respondent recognizes that it was of the mistaken belief that Respondent was not required to file periodic reports as of July 22, 2003, and has recognized the wrongful nature of its failure, and has taken corrective action.
f. Respondent has established significant reporting controls to provide assurances that Respondent will not either mistakenly, or intentionally violate the reporting requirements, once such reports are brought up to date and current.
g. Respondent’s financial position is such that Respondent is able to incur the coats associated with its reporting obligation.
h. Respondent has retained professionals specializing in federal securities and public company reporting requirements and is sincere in its desire to continue with its reporting requirements under the Act.
more..
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Post by fastwalker on Apr 11, 2005 23:49:39 GMT -5
SEVENTH AFFIRMATIVE DEFENSE That the relief sought in Section II B is vague and ambiguous. EIGHTH AFFIRMATIVE DEFENSE In Section II, paragraph 3, the Division of Enforcement alleges that CMXM Diamond has not filed an Annual Report on either Form 10-K or Form l0-KSB since May 9, 2002, or quarterly reports on either Form I0-Q or Form I O-QSB since November 18, 200Z Respondents first missed filing of a periodic report was on March 31, 2003, when the Respondent’s did not file its Form 10-KSB for the period ending December 31, 2002. In Section II, paragraph 4, the Division of Enforcement alleges that CMKM Diamonds filed a Form 15 on or about July 22, 2003. Respondent was under the belief mistaken or otherwise, that its duties as an issuer were suspended immediately upon filing its Form 15 certification pursuant to 12g-4(b). Therefore, Respondents failure to comply, if at all, with Section 13(a) was not known until February 15, 2005, when counsel for the Respondent discovered the error, and filed the amended Form 15, thereby subjecting the Respondent to its reporting obligations. Respondent alleges as an Fight’ Affirmative Defense that pursuant to 12g-4(b), Respondent was entitled to a 60 day period, expiring on April 17, 2005, following the filing of the Form 15/A to bring its missing reports current Therefore, any proceeding to revoke or suspend the registration of the Respondents securities is premature. NINTH AFFIRMATIVE DEFENSE In light of the allegations contained in Section II, paragraph 1 and paragraph 2, by the Division of Enforcement, the allegations that the Commission deems it necessary and appropriate for the protection of investors that a public administrative proceeding be instituted against Respondent CMKM Diamonds, Inc. to suspend for a period not exceeding twelve months, or revoke the registration of each class of CMKM Diamonds’ securities is inconsistent with the allegations contained in such paragraphs. The purpose of the sanction imposed is intended to be remedial in nature, not to punish the Respondent or its stockholders but to protect the public, to achieve voluntary compliance with the law and to deter the respondent from future violations. As an affirmative defense to the proposed sanctions. Respondent proposes that Respondent (i) has no prior record of non-compliance with SEC regulations; (ii) has voluntarily taken corrective action by contacting the Commission itself prior to the issuance of an Order Instituting Administrative Proceeding (iii) has demonstrated to the Commission a willingness to take corrective action; (iv) has cooperated with the commission; (v) the alleged violations are not fraudulent in nature; (vi) there was no intent by Respondent to not comply with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder; (vii) Respondent’s management was inexperienced in operating a public company (viii) respondent’s sole officer and director suffered serious health issues during a portion of the time period referenced; (ix) Respondent relied upon the professional advice of prior counsel in filing the original Form 15; and (x) Respondent brought to the attention of the Commission, the very issue for which tie Commission has instituted the Administrative Hearing.
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Post by Warren on Apr 11, 2005 23:50:49 GMT -5
I came home exhausted from work, but had time to read through CMKX's response. I am now wired from the few cups of coffee I drank while reading.
I am shocked at how well the response was. I feared we would see something like our PRs as of recent. To the contrary, this response was contrice and to the point in our defense, along with raising several alligations againsst the SEC. suddle, but very direct.
These are just some quick observations and opinions.
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Post by fastwalker on Apr 11, 2005 23:51:09 GMT -5
This sections answers, or should answer for some...those "pesky" questions,".... vi) there was no intent by Respondent to not comply with Section 13(a) of the Exchange Act and Rules 13a-1 and 13a-13 thereunder; (vii) Respondent’s management was inexperienced in operating a public company (viii) respondent’s sole officer and director suffered serious health issues during a portion of the time period referenced; (ix) Respondent relied upon the professional advice of prior counsel in filing the original Form 15; and (x) Respondent brought to the attention of the Commission, the very issue for which tie Commission has instituted the Administrative Hearing.
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