Thresher Addressing Stock Irregularities

Oct. 18, 2007
Says some decisions have not been in best interest of company, shareholders
In an "Open Letter to Investors and Shareholders," Thresher Industries revealed that it has run into problems with its stock price and shorting of its stock, which it relates to its shares being traded on the Pink Sheets, a stock-trading network with less rigorous regulatory methods than standard exchanges. "We have made gains in sales and acquired new customers," Thresher stated, but "we have made some decisions based on data provided by persons not concerned with the best interest of our company or shareholders which in turn have hurt our organization and its credibility," the company announced. Thresher, based in Hanford, CA, produces cast aluminum components as well as reinforced metal-matrix composite aluminum alloys. It also markets proprietary casting technologies, including the Nautilus core technology, a bio-degradable, recyclable process that uses neither sand nor binders. Recently, Thresher signed a "memorandum of understanding" for a joint-venture operation with a consortium of South Korean companies, which will be the basis of a joint-venture contract to establish a manufacturing plant at Busan, South Korea. Thresher also claims to be planning an additional casting operation in the Midwest. Generally, public stocks trade on well-recognized exchanges, such as the New York Stock Exchange or Nasdaq exchange. Less widely held shares may trade as over-the-counter stocks, which generally means that trades are conducted between individual holders using telephone or computer networks. Such companies may have been delisted for regulatory or financial reasons, or they may be unable to meet the initial listing requirements. Companies that trade on Pink Sheets — an electronic quotation system that displays quotes from broker-dealers — fit this category, too, but they are not required to meet minimum requirements or file with the Securities Exchange Commission. In most cases, companies traded on Pink Sheets are too small to be listed on a national exchange, or they prefer not to release their budgets and accounting statements. It is not uncommon for companies that list this way to be targets of price manipulation. Thresher states it has taken action "based on board input to correct errors made, to make our company profitable, and to focus on future growth." Referring to last Decembers acquisition of Talon Composites, which shifted the company's focus from its cast products division to Talon and the nuclear industry, the Open Letter says "This has proven to be an ill-timed decision but one we have rectified. "We have begun the reorganization of Talon and the pursuit of work for the cast division beginning in July of this year, those efforts have paid off as significant new orders are in queue and additional new orders will be received shortly," Thresher states. "In the Talon Group," the statement continues, "we have begun to fill orders that have been in the pipeline since November 2006 and early 2007. Talon will continue to pursue the nuclear industry with contracts and joint venture opportunities in the Pacific Rim but not at the expense of current or on going business. We have added additional resources to support the anticipated orders and will make announcements shortly regarding these changes."