The following is an e-mail sent to me by Keith answering questions I had about financials and uplisting. Obviously, he is considering the possibility of all of this now in order to get a fair PPS from the market. However, Keith is building a company valuable by O&G industry standards which in time will pay off. From Keith:The Transfer Agent does not have a gag order on them as far as I know... I think this is possibly an internal rule they have? I really dont know where this originates. I do know any investor that has an inquiry I have to call the TA and tell them xxxxx xxxxxx is ok to release this information. I dont mind calling them and letting you ask any question you may have.
Our CPA is hesitant to allow the numbers to be released, because of the risks this CPA would incur, for one they are not SEC approved and the Oxley Sarbanes criteria is not something this firm wants to contend with, nor are they insured for their work. You want me to put out "unaduted stuff drawn up by management"? Thats worst than saying nothing at all.
Sure we could uplist, we would have to go find a SEC aproved auditor and we pony up $xxx,xxx annually for that. I am not going to do that with out a true CFO... so kick in another $xxx,xxx and perks for the CFO, Craig and myself are paying ourselves $36k a year to do this... do you really think we are going to run the Oxley Sarbanes legal guantlet for $36g a year? I will flat tell you I am not going to take on those risks and reponsiblities for $36 a year. Then more $$$ for legal opinions and compliance... and time consuming quarterly and annual audits... its a gigantic time and money drain on the company... with no real tangible results to the company... Unless we were to uplist and do an IPO to afford all this... then of course the shareholders will start screaming they are being "diluted". It doesnt take long for a vicious circle form... and if I had my preferences we would get bought or merge at by an industry partner (no pink sheet or OTCBB) or engage an investment banking firm buy out the shareholders (at audited book values not quoted price) and go back private before we considered uplisting.
I dont mean to be short with my answers, regarding uplisting/auditing/disclosure, but every company that uplists... does it in order to raise funds, you would be hard pressed to show me one that has up listed... that didnt sell shares, debt or something else. People wonder why I am conservative with projections and do not promote? Simply put we are working to hard to end up with a huge SEC, inquiry, lawsuit or worse, coming along. These are the real and honest reasons to your questions.
Keith A.
