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NMC, Inc.
NMC Shareholder's Frequently Asked Questions/CEO’s Answers and Status Update
March 17, 2012

 

Since our 10,000 or so shareholders have direct access to me, you can imagine just how many calls and emails I receive as we have not had an Investor Relations staff person for several years.Therefore, I have decided with my Director's input and approval, to share with you the most frequently asked questions and to answer them as candidly as I can within legal and potential partner constraints.

 


 

Question: "I don't understand with Gold prices at record highs why you cannot  sell our Gold Mining Company as the timing seems to be perfect?"

Answer: Please understand that because a reported 8000 oz of Gold was removed and sold from 1983-1994, our ore concentrates/tailings are now comprised of approximately 25% Gold and Silver and 75% Platinum Group Metals. While Gold had reached record levels some time ago, the PGMs are a different story and, most especially, Rhodium which we have in abundance.

See below the approximate present spot prices/ their highs:

Gold $1700/1900
Silver $35/46
Platinum $1700/2200
Palladium $700/850
Rhodium $1500/10,000
The market for PGMs, especially Platinum, Palladium and Rhodium, is down approximately 70% which are directly related to automobile production and emission control systems. In addition, there is presently little capacity and expertise in America available for refining of PGMs except at the Stillwater Mining Co. which is now privately controlled by a foreign country, and have rejected our requests to work with them. Please know that we received our first offer acceptable to all your Directors in March, 2008 and several since; however, not one has yet been able to secure the financing sufficient to close the transaction.

 


 

Question: "I read on a chat board that NMC's assets are worth over $3 billion, is that correct?

Answer: YES and NO
YES, however any gross value can be very misleading without knowing all the facts. When The Blackstone Group (Broker Division) was engaged to assist us in our marketing efforts, they commissioned one of the top  labs in the country to conduct independent, exhaustive custodial assays including all 78 elements over 15 separate samples across both tailings pits. Once those values were known, they were converted to oz./tons and each metal's spot price was multiplied by the minimum 279,000 tons supported by the Geosyntech analysis which did in fact yield an estimated $3B Gross Value BEFORE milling, extraction and refining.
NO, in that one cannot establish a true net value until our assayed ore is further processed (milled) into final stage concentrate and then induction hardened  in to Dore Bars and only then refined to obtain salable metal.

 


 

Question: "I have read that we have “proven reserves”, is that true?

Answer: NO, we have what is known in the mining industry as an “Inferred or probable resource.” The cost for us to "prove" our tailings would be a minimum of $400,000 and to prove our 377 leased acres in Skull Valley is estimated to be $1,500,000 and another $1,500,000 for our 17 mining claims in Ca.

 


 

Question: "Is it true that you are holding out for a better deal and have not accepted some lowball offers. Why not as we shareholders would accept almost anything at this point?"

Answer: First let me say that particular chat board rumor is categorically FALSE. While I cannot discuss details of past or present negotiations and offers, I can share with you that my Directors and I have NOT turned down any offers; but rather, demanded that each proposal be accompanied with Proof of Funds or at the very least the ability to "complete the transaction." We have come close on several transactions and yet, financing has not yet come through on any. In 2009, we actually received, after over a year of negotiating, a Purchase Agreement from a Chinese group who had the funds and yet they walked away without any notice or explanation. Several times, I have lowered our expectations and even agreed to accept a good faith deposit with payments over time. In addition, we have negotiated several potential Joint Ventures and all, to date, have failed to produce a minimum earnest deposit or to demonstrate to the Director's satisfaction, proof of financial capability. Since the spring of 2008, the ability to finance the sale or joint venture of an unproven mining asset has become progressively worse. Those potential Joint Venture partners are still very much interested should their financing ever come through.

 


 

Question: What kinds of offers would our Directors be willing to consider?

Answer:

 


 

Question: What caused the Depository Trust Corporation to stop us from trading and what needs to happen to get trading again?

Answer: On 5-23-08, DTC placed a “Chill” on NMCX trading as a result of concern directed to our transfer agent regarding the dumping of vast amounts of shares by a certain group of shareholders and the possibility that some of those shares may not have been properly registered.  Integrity Stock Transfer contacted the DTC who then took what they considered to be appropriate corrective action which was to place a formal “Chill” to protect NMC’s shareholders from further dilution. Each broker makes their own decision as to which shares they want to trade from a risk/reward perspective. Ameritrade, for example, decided to not trade NMCX, then changed their minds when they realized just how many clients they were losing to allow their clients to sell NMCX but not buy. They later changed their minds again to halt all trading.  I have communicated directly with the office of the President of the DTC and their General Counsel,  as has our law firm;  however, the DTC will not even let us know what they believe is our outstanding share count.

When our assets are sold or when we enter into a joint venture and achieve a revenue stream, we will then issue a dividend to our shareholders and, for the first time, certify the exact number of outstanding shares. Our Transfer Agent will then submit to the DTC and request that the “Chill” be lifted. I hope this increases your understanding as to why we are presently not trading and why our Price per share has been driven to this extremely low level.

 


 

Question: Why don’t we receive updates more frequently?

Answer: NMC is not and has not been a “Reporting Company” since it was involuntarily “Delisted” by the SEC before 2004; however, the primary reason the Directors and I don’t provide more frequent updates is because there is nothing significant to report. While I could state that I am still actively negotiating and presenting those offers to our board, until one potential partner actually provides the financial capability and/or earnest money to back up their offer, it should not be discussed. You can understand why potential buyers or JV partners do not want any information disseminated to the public as other competitors would be privy to that same information. I am also required to sign a Non-Disclosure Agreement.

 


 

Updated Status

Every Director is still committed to maximizing the return on our shareholder's investments. Your directors are still very active and regularly receive detailed status reports on all pending transactions, as I am presently involved in multiple negotiations. The Directors and I negotiated a revised Employment Agreement in which I agreed to reduce my accruing salary by 55% until I could begin producing revenue so no one could be more motivated than me to get this mission accomplished as soon as possible. In addition, all Directors, including myself, surrendered all our stock warrants back to the Company to enable stock sales to generate operating funds in exchange for receiving non-voting shares for our service once a year.

While we still have creditors that have not yet been paid in full, it is important to note that I have successfully negotiated long term agreements with all of them and we continue to make minimum payments each month to avoid potential bankruptcy. I am responsible to raise funds every month to cover those payments and current cost of operations such as accounting, transfer agent, legal, travel, insurance, Business Licenses, maintaining claims cost, etc. I am presently selling Rule 144b Restricted shares for one half cent per share in order to continue to operate and to minimize shareholder dilution. Our present outstanding share count is approximately 6 billion.

While I do not know when the Lord will bless us with the harvest of  NMC, what I do know is that we are doing everything we know to do and we are doing the right things the right way. I believe in the promise, not unlike a farmer,  that if we persistently sow good seeds, we will reap a good harvest.

I do expect that an outright sell or, more than likely, a joint venture or some hybrid will occur. I do believe that it will happen. I do not know when it may happen and I cannot make it happen.

It is my hope and prayer that you understand and please know that your continued support, patience, and prayers are greatly appreciated.
 
In Your Service,
Michael Sheppard, CEO
/s/