CHICAGO, IL--(Marketwired - Sep 24, 2013) - Veltex Corporation -- OTC Markets symbol (OTC Pink: VLXC) -- Veltex Corporation ("Veltex") announced today that the corporation and Sassetti LLC, an outside independent accounting firm, have completed the income tax basis of accounting for the year ended December 31, 2012. Veltex has also released financials and balance sheet data for the fiscal year 2012 bringing the corporations accounting into full compliance.
Veltex ("The Company") ended 2012 with $100,094,013 in shareholder equity with 37,681,265 shares issued and outstanding of which 2,005,534 shares are held as treasury stock by the corporation. Total liabilities and accounts payable amounted to $52,394.00 primary consisting of management contracts and outstanding property leases. Veltex further recorded an accumulated net operating loss deficit of $1,050.968 from previous operations going back to fiscal 2003. Loss from operations in 2012 totaled $122,467.00 primarily related to legal and accounting expenses. Book value closed the year at $2.66 per common share.
The Company's legal settlement receivables relate to various lawsuits. On March 26, 2012, the United States District Court for the Central District of California entered a judgment in the amount of $100,078,621 in favor of Veltex in suit titled Veltex Corporation v. Javeed Azziz Matin, et. al., Case No. CV 10 1746 ABC (PJWs). This suit was brought against the former management of the Company and others. It arose from a scheme to fraudulently convey the shares of the Company to another entity for little or no consideration to Veltex. The proceeds from the sale of the shares were converted by the defendants to their own personal use. The judgment was classified as fraudulent conveyance and transfer of assets, or corporate theft, by the United States District Court.
The Federal judgment also included $2,005,072 in damages to reimburse the Company for legal expenses. This amount was not recorded. In 2013, the California legal counsel that supported the Company in the federal case accepted 500,000 (five hundred thousand) shares of the Company's restricted common stock as full payment for all services.
On November 7, 2011, the District Court of the Third Judicial District, Salt Lake County, Utah found in matter of Fletcher v. Javeed Matin, Case No. 080907145 that the interim receiver which it had appointed in July 2008 to protect the Company's assets until a new Board of Directors was elected had breached his fiduciary duties to the Company. A judgment in the amount of $57,167.00 was entered against the receiver on January 12, 2012, by the United States Federal Court in California.
All judgments are accruing interest at applicable State and Federal interest rates. The Company has not addressed the collectability of these receivables, because these financial statements are reported under the income tax basis of accounting. However, the Company has recently retained and contracted with a foremost California collection service, based in Los Angeles, to begin the process of collection. Other judgments in locations such as Clark County Nevada and those in Canada are currently being investigated by the corporation for collection purposes also. Some defendants have settled the litigation with the Company under strict confidentiality agreements.
The Company has net operating loss carry forwards of approximately $1,060,000 from previous operations, as of December 31, 2012. Annual utilization of the Company's net operating loss carry forwards or NOLs, may be limited due to changes in ownership control of the company's common stock under federal tax law, should such exist. Net operating losses for the company, will expire in 2013 through 2022. The Company has filed or amended all federal or state income tax forms for the years ending December 31, 2004 through 2012, for Federal and for the states of California and Illinois.
Jim Jacob, President and CEO of Veltex, continued in a statement, "Veltex management is pleased to announce that with the assistance and counsel of Dale & Gensburg, PC, our tax attorneys, we have begun the process of exploring ways to maximize the values and to capitalize on the judgments awarded the corporation in various forums across the country and also in Canada. As we have stated before, this is and has been a complex and time consuming legal and accounting process needed to insure the protection of these valuable deferred assets. Veltex is in full compliance with all accounting and tax filings to date. Sassetti LLC has now finished the massive accounting and tax work that has taken nearly a year to complete. Moreover, the corporation continues to work closely with federal law enforcement to recover assets stolen from us and restore them to the company. Management and the Board are working diligently to protect and maximize shareholder value as we now progress to the next phase in our corporate plans."
Veltex will update shareholders with developments as progress warrants on legal, tax and accounting matters. Veltex Corporation seeks to update new and potential shareholders on the immediate future of the company as developments warrant.
Veltex Corporation, incorporated in Utah September 17, 1987, is a public holding corporation, which maintains its corporate headquarters in Chicago, Illinois. The company's common shares trade OTC Markets under the symbol VLXC.
Safe Harbor and Forward-Looking Statement
Safe Harbor Statement; Certain of the above statements contained in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. This press release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as Veltex or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe Veltex's business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. Any statements made in this press release which are not historical facts contain certain forward-looking statements; as such term is defined in the Private Security Litigation Reform Act of 1995, concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. All financials reported are a tax compilation compiled by an independent accounting firm. Although such statements are based upon the best judgments of management of the company, Veltex, as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. The company disclaims any obligation to update information contained in any forward-looking statement. This press release shall not be deemed a general solicitation.