StockPatrol.com Story - June 23, 2004

[Dj Hemp]

stockpatrol.com/schlock/articles/cmkm.html

[CRXified]

nice read, makes u think, and makes you want to ask sooo many questions.... maybe like W5?

[TenaciousC]

best read to date regarding this stock

[Phoenix1]

Greetings Mr. Hemp,
A few questions for you, if I may.
Are you an insider, or do you have connections with an insider?
May people ask questions here without bieng torn apart by a pack of hyenas? (i.e. labeled a "basher")

There is an imposter board (the UNofficial CMKX board) that is run by insiders pumping the stock BAD!

Sorry, just need to know if this board is run by real investors willing (wanting) to put all of the facts together in order to make the wisest decisions.

TIA

[inkling]

UPDATE: CMKM DIAMONDS, INC. (Pink Sheets: CMKX) - LESS AND MORE
June 22, 2004
CMKM Diamonds, Inc. (Pink Sheets: CMKX) continues its reign as the most actively traded stock on the Pink Sheets. The Company, which says it is exploring for diamonds in Saskatchewan, Canada, continues to attract curious investors, despite the absence of current public information concerning its financial state, management team, and outstanding shares. See CMKM Diamonds, Inc. - A Familiar Drill. As we have discovered, there is considerably less, and monumentally more, to CMKM than immediately meets the eye.


First the less.



Diamond Lite


A June 10, 2004 press release from CMKM proclaimed that samples recovered from the Company's "Carolyn Pipe" drilling project had been confirmed to be "diamondiferous" by an independent laboratory.


What was the extent of "diamond content?" The CMKM press release did not elaborate, although it did offer a routine disclaimer that "[t]here is no guarantee that further exploration or drilling will produce any economic benefit to the company or the shareholders of the company."


Fortunately, other participants in the project eventually were more forthcoming.


As the Company noted in its press release, the "Carolyn Pipe" is located on property in Smeaton, Saskatchewan that is jointly owned by CMKM and three other companies listed on U.S. and Canadian exchanges - United Carina Resources Corp. (CDNX: UCA), Consolidated Pine Channel Gold Corp. (CDNX: KPG); and U.S. Canadian Minerals Inc. (OTCBB: UCAD).


The diamondiferous announcement may have fueled investor interest in CMKM, but it had a decidedly different effect on two of its partners, United Carina Resources and Consolidated Pine Channel Gold. The CMKM press release was issued at 6:26pm on Thursday June 10th, after the U.S. markets had closed for a long weekend that included an unusual Friday closing in honor of President Ronald Reagan's funeral.


Canadian markets were opened for business as usual on Friday June 11th, which might have allowed CMKM's Canadian-listed joint-venture partners to profit from the diamondiferous disclosure. Instead, trading in the two stocks was suspended by the Toronto Stock Exchange (TSE) on June 11th before the market opened. The TSE said that the suspension had been requested by United Carina Resources and Consolidated Pine Channel Gold "pending an announcement." All trades prior to the halt were cancelled because of an imbalance of material information.


Four days later, a press release from United Carina Resources balanced the available information and removed the luster from CMKM's diamondiferous find. The June 15th press release indicated that the samples were only marginally "diamondiferous." Indeed, one 40.01 kilogram sample contained two diamonds having a combined weight of less than .000005 carats. No diamonds were recovered from eleven other samples.


The United Carina press release shed further light on some earlier statements from CMKM. In a March 29, 2004 press release, CMKM announced a new kimberlite discovery on the Smeaton property, which it said would be named "The Carolyn Pipe" after the wife of CMKM's President Urban Casavant. According to United Carina, however, the kimberlite at "The Carolyn Pipe" was hardly new. It said that kimberlite had first been intersected on the Smeaton property in 1996, but was not fully tested at that time. Since that time it had been referred to as the Smeaton kimberlite.


Investors who have been relying upon news emanating from CMKM may not be aware of these details; CMKM has not yet issued a press release revealing the minimal nature of its diamondiferous discovery.


And now for the more.



BILLION SHARE POPULATION GROWTH


As we have noted here, and in our earlier article on CMKM, investors have been trading billions of shares of the Company's stock each day, so many shares in fact that the reporting systems are unable to record the total number.


Considering that massive volume we could not help but wonder just how many shares CMKM is authorized to issue. That information is not easy to obtain since CMKM has elected not to file regular reports with the SEC. It is, however, available from the Office of the Nevada Secretary of State.


When we contacted the Nevada Secretary of State's Office to find that number we were initially greeted with a chuckle from a representative who then explained that her office had been swamped with requests for information about CMKM. When we then asked how one might obtain copies of all amendments to the CMKM Certificate of Incorporation, we were told that, at a price of 20 cents per page, it could be costly since there had been multiple amendments and the material was "voluminous." We also were advised that it could take days to receive the material because of the numerous pending requests.


Fortunately, the Nevada Secretary of State's Office was kind enough to send the information we were requesting, quickly and free of charge. What we learned was startling. As of March 1, 2004, CMKM was authorized to issue 500 billion shares! To place that in some perspective, it means there is enough CMKM stock to give every one on earth (approximately 6.4 billion people according to the U.S. Census Bureau) about 78 shares of CMKM common stock.


Imagine that, everyone in China could share a piece of those two diamond fragments.


In February 2003, shortly before the Company ceased filing public reports, it indicated that it had recently decided to increase its authorized stock from 500 million to 10 billion shares - a healthy bump. In fact, the records we have now reviewed indicate that the Company had increased its authorized shares to 100 billion shares by December 2003.


It was just getting started. As we have now learned, the Company increased its authorized shares from 200 billion to 500 billion on March 1, 2004. That, however, was only the latest in a series of amendments increasing the Company's authorized capital on the way to 500 billion shares.


How many of these shares have been issued? That remains a mystery, but as a rule companies do not tend to dramatically increase their authorized capital unless they have issued all, or nearly all, of the available stock.


At this rate, the prospect of a trillion shares does not seem that far away.



©2004 Stock Patrol.com. All rights reserved.

WE'RE BACK ON PATROL

[inkling]

UPDATE: CMKM DIAMONDS, INC. (Pink Sheets: CMKX) - SHARING SHARES
July 23, 2004
There seems to be no shortage of entities bearing the Casavant name, and no end to their intramural transactions. CMKM Diamonds, Inc. (Pink Sheets: CMKX), was known as Casavant Mining Kimberlite International, Inc. until March 2004. Casavant Mining Kimberlite International, Inc. had operated as a private entity until its shareholders secured control of a public company by virtue of a reverse-merger with Cybermark International Corporation in January 2003.


The President and CEO of CMKM is Urban Casavant.


On July 19, 2004, CMKM announced that it had agreed to invest $1 million in a company called Casavant International Mining (CIM) – that Casavant name again. CMKM stated that, in return for its investment, it would receive “a 10% lifetime royalty on all mineral claims of CIM, specifically including the George Lake Zinc Deposit.” According to the press release, in addition to the royalty, CMKM will receive 40 billion shares of CIM stock, which will be distributed to CMKM shareholders.


The July 19th press release leaves several critical questions unanswered. Does CMKM actually have $1 million in cash, and if not, how does it plan to raise the funds? As we noted in our initial article on CMKM, the Company no longer files regular reports with the Securities and Exchange Commission, so its financial condition is a mystery. See CMKM Diamonds, Inc. - A Familiar Drill.


Equally mysterious is the number of outstanding CMKM shares. The Company is authorized to issue 500 billion shares but, here again, the absence of public filings leaves investors guessing how many shares have actually been issued. Update: CMKM Diamonds, Inc. - Less and More. In any event, billions of CMKM shares have been traded virtually every day since at least March 2004.


The number of outstanding shares is significant since it will dictate how many of those 40 billion CIM shares each CMKM stockholder will receive. On the other hand, it may ultimately make little difference; CMI is a private company and consequently there is no liquid market for those shares – and no assurance that CIM, like CMKM, will not simply issue more shares and dilute its shareholders.


Investors may also be curious about the relationship between CMKM and CIM. The July 19th press release certainly implies that CMKM and CIM are separate entities – that CMKM does not already own CIM. After all, CMKM would not have to acquire a 10% interest in CIM royalties if it already controlled those rights.


So what relationship does exist between CMKM and CIM? According to the press release, the President of CIM is Ron Casavant and the Treasurer/Secretary is Dave Desormeau. While Mr. Desormeau does not share the Casavant name, both he and Ron Casavant have had prior relationships with CMKM. A Schedule 14c Information Statement filed with the SEC at the time of the reverse-merger (before the Company ceased to file reports) disclosed that Ron Casavant owned 30 million shares of CMKI common stock (the Casavant family, including Urban Casavant, owned a total of 770 million shares at that time – which was before the Company expanded its treasury to 500 billion shares); and that Dave Desormeau had been elected as a director of CMKM.


Again, absent more recent public filings, there is no public information indicating whether Mr. Desormeau remains a director of CMKM, or how many shares of CMKM are now owned by Ron Casavant and all of the other Casavants (23 of them were listed as CMKM shareholders in that Form 14c).


On the other hand, we were able to learn some information about Casavant International Mining from Nevada’s corporate records. Those files reveal that Casavant International Mining Corporation was formed in January 2003, and that its President is Urban Casavant. Those records also indicate that the corporate secretary is Carolyn Casavant and the treasurer is Emmerson Koch.


So which Casavant really does run Casavant International Mining – and does it really matter?


And then there is this – a disquieting sense of déjà vu for those who have been following events at CMKM.


On December 8, 2003, CMKM announced


the spin-out of corporate zinc deposits at George Lake, Saskatchewan, its wholly owned subsidiary Casavant Mining International, Inc. (CMI). CMKM shareholders received a dividend of one share of CMI stock on October 3, 2003.


While the language is somewhat confusing, it suggests that (i) CMI was a wholly owned subsidiary of CMKM; and (ii) CMKM shareholders will receive CMI stock.


The December 8, 2003 press release also stated that CMI was a private company that would become public within two weeks. Apparently, CMKM intended to merge CMI with another Pink Sheet company, Mirador Corporation. That transaction, however, was later aborted.


We have found no indication that CMI ever became a public company.


Sounds confusing – Casavant Mining International and Casavant International Mining – both mining for zinc in the same vicinity. Aren’t all of these Casavants tripping over one another?


So what, if anything, is the relationship between CIM and CMI – aside from their obvious relationships with some or all of the Casavants? Based upon the Company’s announcements it would seem that both CIM and CMI are involved in the search for zinc deposits in the same area - Lake George, Saskatchewan. Why were two different companies created – and where was CMI incorporated? Is it possible that each company controls different zinc deposits at the same location? If those zinc deposits were owned and controlled by CMI, a wholly-owned subsidiary of CMKM, how were they transferred to CIM?


CMKM shareholders should be interested in the status of CMI and its zinc deposits. After all, they received CMI shares in late 2003, didn’t they?


What ever happened to CMI?



More Shares to Spare


Interestingly enough, CMKM has promised its shareholders another dividend as well – this time in shares of one of its joint venture partners. On July 18, 2004, CMKM issued a press release to announce that U.S. Canadian Minerals, Inc. (OTCBB: UCAD) had agreed to purchase 5% of CMKM’s mineral claims in exchange for 7.5 million shares of U.S. Canadian stock.


In recent days, U.S. Canadian stock has been trading at about $4.80 a share, meaning that the 7.5 million shares would be valued at more than $36 million - assuming there is a market for the stock when it eventually can be sold. It is difficult to conceive how 5% of CMKM’s royalties could possibly be worth that kingly sum. In the absence of audited financial information about CMKM, investors may be understandably skeptical about any of these valuations.


Here, again, CMKM says it plans to distribute those shares to its stockholders as a dividend. Once again, the number of outstanding CMKM shares will be critical since it will determine how many U.S. Canadian shares each CMKM investor will receive. For example, if CMKM has issued all 500 billion shares, the owner of 1 million CMKM shares would receive 15 U.S. Canadian shares.


There is a catch, however. The shares will not be registered, and the agreement between CMKM and U.S. Canadian suggests that there are impediments to their future sale. Here is what the agreement provides:


Purchase Price. Seller will sell 5% of all current and future claim holdings and mineral interests in exchange for 7.5 million shares of common stock of U. S. Canadian. The shares exchanged hereunder shall be newly issued restricted shares under Rule 144 with a holding period of at least one year from the date of their issuance by UCAD and shall not have the holding period thereunder shortened by means of a dividend. Such shares may be distributed by means of a dividend but shall not take the holding or tacking periods of the underlying shares. By this agreement between both parties, in the event such transfer is initiated, the shares shall be deemed cancelled and void and this Agreement is deemed authorizated (sic) by both parties for such cancellation (sic).


These sale restrictions are vague and somewhat confusing. At what point can the shares be cancelled, and how will that affect the CMKM shareholders who receive the dividend?


The agreement also gives U.S. Canadian a one year option to acquire an additional 10% of CMKM’s mineral claims for $15 million in cash.


While all of these numbers sound impressive, it is difficult to understand the valuations afforded to either company. Unlike CMKM, U.S. Canadian does file regular reports with the SEC – and its financial statements do not paint a pretty or promising picture. As of March 31, 2004, U.S. Canadian had $408 in cash. It claims to have an additional 6.9 million in assets based upon the value of stock it contributed to a joint venture.


As of March 31st, U.S. Canadian had issued approximately 7.6 million shares – making the Company worth more than $35 million on paper based upon the current share price. That also means that CMKM will be acquiring 50% of U.S. Canadian.


The current price of U.S. Canada shares defies logic. U.S. Canadian had no revenues for the first three months of 2004. The Company has incurred cumulative net losses of more than $18 million since its inception in December 2000.


With $408 in the bank, and no revenues, it is difficult to see how U.S. Canadian will be able to pay $15 million to CMKM within the next year. It appears unlikely that the money will come from one joint venture already being pursued by the two companies – the Carolyn Pipe. So far, that project has produced two microscopic diamond particles weighing a total of .000005 carats.


In the end, investors can only wonder why CMKM is suddenly on a binge – issuing illiquid shares of other companies as dividends. Who knows? Maybe they ran out of their own.



©2004 Stock Patrol.com. All rights reserved.

WE'RE BACK ON PATROL