2014-11-05 SEC Press pdf 25 KB 8,088 chars

In re MineralRite Corporation

Exhibit of SEC Sanctions 10 Companies for Disclosure Failures Surrounding Financing Deals and Stock Dilution

summary

MineralRite Corporation violated Section 13(a) and Rule 13a-11 by failing to disclose a material financing agreement and the unregistered issuance of over 171 million shares between December 2013 and June 2014, leading to a SEC-imposed cease-and-desist order and a $25,000 civil penalty.

paragraph

MineralRite Corporation, a Nevada-based reporting company quoted on OTC Link, failed to file required Form 8-K disclosures regarding a material financing agreement entered on April 4, 2014, and the unregistered sale of more than 171 million shares between December 2013 and June 2014. These unregistered issuances exceeded 135% of its outstanding shares as of November 2013 and later 15% of its shares as of May 2014, violating SEC reporting thresholds under Items 1.01 and 3.02 of Form 8-K. Without admitting or denying the findings, MineralRite consented to a cease-and-desist order and agreed to pay a $25,000 civil penalty in nine installments through July 15, 2015.

narrative

MineralRite Corporation, a Nevada-based smaller reporting company registered with the SEC and quoted on OTC Link under the symbol RITE, violated Section 13(a) of the Securities Exchange Act and Rule 13a-11 by failing to file timely Form 8-K disclosures. Between December 11, 2013, and June 10, 2014, MineralRite issued over 171 million unregistered shares of common stock to a financing company and other parties, with cumulative issuances exceeding 135% of its outstanding shares as reported in its November 19, 2013 Form 10-Q and later 15% of its shares as of its May 21, 2014 Form 10-K. The company also failed to disclose a material financing agreement entered on April 4, 2014, which required disclosure under Item 1.01 of Form 8-K. These omissions occurred across multiple reporting periods, with no Form 8-K filed between December 2013 and July 2014 despite clear regulatory thresholds being breached. The SEC found that these failures constituted repeated and material violations of its reporting obligations. Without admitting or denying the findings, MineralRite consented to a cease-and-desist order and agreed to pay a $25,000 civil penalty, payable in nine installments through July 15, 2015, directed to the SEC’s Division of Enforcement in Atlanta under File No. 3-16256.

Enriched metadata

Scheme: unregistered-securities (100%)
Outcome: settled
Civil penalty: $25,000

Classified unregistered-securities(confidence 100%). EDGAR detection: forms Form D/S-1· recall 41% / precision 30%. detection rule →

Extracted insights

Dollar amounts 4

$25K $25,000 $10K–$100K
$10K $10,000 $10K–$100K
$2K $2,000 <$10K
$1K $1,000 <$10K

Entities 3

company MineralRite Corporation
company OTC Markets Group Inc
agency Securities and Exchange Commission

Triples 5

Securities and Exchange Commission deems appropriate cease-and-desist proceedings be instituted
MineralRite entered into an agreement with a financing company on April 4, 2014
MineralRite failed to file a Form 8‑K with the Commission on or before April 10, 2014
MineralRite sold more than 145 million shares of its common stock to the financing company and other parties between December 11, 2013 and May 14, 2014
Commission determined to accept Respondent's Offer of Settlement

PDF

In re MineralRite Corporation · Source

Text layers

Extracted body text (8,088c)

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934
Release No. 73525 / November 5, 2014

ADMINISTRATIVE PROCEEDING
File No. 3-16256

In the Matter of

MineralRite Corporation

Respondent.

ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO
SECTION 21C OF THE SECURITIES
EXCHANGE ACT OF 1934, MAKING
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER

The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities
Exchange Act of 1934 (“Exchange Act”), against MineralRite Corporation (“ MineralRite” or
“Respondent”).

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer
of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the
purpose of these proceedings and any other proceedings brought by or on behalf of the
Commission, or to which the Commission is a party, and without admitting or denying the findings
herein, except as to the Commission’s jurisdiction over MineralRite and the subject matter of these
proceedings, which are admitted, Respondent consents to the entry of this Order Instituting Cease-
and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making
Findings, and Imposing a C ease-and-Desist Order (“Order”), as set forth below.

III.

On the basis of this Order and Respondent’s Offer, the Commission finds
1
that:

Company Background

1. MineralRite is a Nevada corporation headquartered in Ferndale, Washington.
MineralRite is a smaller reporting company under Rule 12b-2 of the Exchange Act and has been
registered with the Commission under Section 12(g) of the Exchange Act since December 19,
1999. MineralRite’s last-filed periodic report was the Form 10-Q/A for the period ended March 31,
2014. Its shares are quoted on OTC Link (formerly “pink sheets”) operated by OTC Markets
Group Inc. under the symbol RITE.
Applicable Reporting Requirements Concerning the Issuance of Unregistered Shares

2. Under Item 1.01 of Form 8-K, a registrant must disclose its entry into a material
definitive agreement that provides for obligations that are material to and enforceable against the
registrant. Under Item 3.02 of Form 8-K, a smaller reporting company must disclose the
unregistered sales of equity securities unless such sales, in aggregate since its last report filed under
Item 3.02 or its last periodic report, whichever is more recent, constitute less than five percent of
the number of shares outstanding of the class of equity securities sold. For both items, the
registrant must file within four business days of the date of the occurrence or when such agreement
becomes enforceable against the registrant.

MineralRite Failed to Disclose the Issuance of Unregistered Shares
and the Existence of the Related Financing Agreement

3. On April 4, 2014, MineralRite entered into an agreement with a financing company
(“financing agreement”) pursuant to which MineralRite issued shares of common stock to the
financing company purportedly in reliance on a registration exemption found in Section 3(a)(10) of
the Securities Act of 1933 (“Securities Act”). The financing agreement provided for obligations
that were material to and enforceable against MineralRite.

4. MineralRite failed to file a Form 8-K with the Commission, on or before April 10,
2014, or thereafter, disclosing the financing agreement.

5. Between December 11, 2013 and May 14, 2014, MineralRite sold more than 145
million shares of its common stock to the financing company and other parties in transactions that
were not registered under the Securities Act. By December 11, 2013, the common stock sold, in
the aggregate, exceeded five percent of the number of shares of common stock outstanding

1
The findings herein are made pursuant to Respondent’s Offer of Settlement and are not
binding on any other person or entity in this or any other proceeding.

3
reported on MineralRite’s November 19, 2013 Form 10-Q, and ultimately, the common stock sold
exceeded 135 percent of the number of shares of common stock outstanding reported on
MineralRite’s November 19, 2013, Form 10-Q.

6. MineralRite failed to file a Form 8-K with the Commission between December 17,
2013 and May 20, 2014, disclosing the unregistered sales of equity securities.

7. Between May 21, 2014 and June 10, 2014, MineralRite sold more than 26 million
shares of its common stock to the financing company in transactions that were not registered under
the Securities Act. By May 27, 2014, the common stock sold, in the aggregate, exceeded five
percent of the number of shares of common stock outstanding reported on MineralRite’s May 21,
2014 Form 10-K, and ultimately, the common stock sold exceeded 15 percent of the number of
shares of common stock outstanding reported on MineralRite’s May 21, 2014 Form 10-K.

8. MineralRite failed to file a Form 8-K with the Commission between May 21, 2014
and July 8, 2014, disclosing the unregistered sales of equity securities.

9. As a result of the conduct described above, MineralRite violated Section 13(a) of
the Exchange Act and Rule 13a-11 thereunder, which require every issuer of a security registered
pursuant to Section 12 of the Exchange Act to file with the Commission information as the
Commission may require, including current reports on Form 8-K to disclose the occurrence of
certain events.

IV.

In view of the foregoing, the Commission deems it appropriate to impose the sanctions
agreed to in Respondent MineralRite’s Offer.

Accordingly, it is hereby ORDERED that:

A. Pursuant to Section 21C of the Exchange Act, Respondent MineralRite cease and
desist from committing or causing any violations and any future violations of Section 13(a) of the
Exchange Act and Rule 13a-11 thereunder.

B. Respondent shall pay civil penalties of $25,000 to the Securities and Exchange
Commission. Payment shall be made in the following installments: $10,000 on or before
November 15, 2014; $2,000 on or before December 15, 2014; $2,000 on or before January 15,
2015; $2,000 on or before February 15, 2015; $2,000 on or before March 15, 2015; $2,000 on or
before April 15, 2015; $2,000 on or before May 15, 2015; $2,000 on or before June 15, 2015; and
$1,000 on or before July 15, 2015. If any payment is not made by the date the payment is required
by this Order, the entire outstanding balance of civil penalties, plus any additional interest accrued
pursuant to 31 U.S.C. 3717, shall be due and payable immediately, without further application.
Payment must be made in one of the following ways:

4
(1) Respondent may transmit payment electronically to the Commission, which
will provide detailed ACH transfer/Fedwire instructions upon request;

(2) Respondent may make direct payment from a bank account via Pay.gov
through the SEC website at http://www.sec.gov/about/offices/ofm.htm
; or

(3) Respondent may pay by certified check, bank cashier’s check, or United
States postal money order, made payable to the Securities and Exchange
Commission and hand-delivered or mailed to:

Enterprise Services Center
Accounts Receivable Branch
HQ Bldg., Room 181, AMZ-341
6500 South MacArthur Boulevard
Oklahoma City, OK 73169

Payments by check or money order must be accompanied by a cover letter identifying
MineralRite as a Respondent in these proceedings, and the file number of these proceedings; a
copy of the cover letter and check or money order must be sent to William P. Hicks, Division of
Enforcement, Securities and Exchange Commission, 950 East Paces Ferry Rd. N.E., Suite 900,
Atlanta, Georgia 30326.

By the Commission.

Brent J. Fields
Secretary

OCR text (8,092c · tika · 95% conf)

UNITED STATES OF AMERICA

Before the
SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934
Release No. 73525 / November 5, 2014

ADMINISTRATIVE PROCEEDING
File No. 3-16256

In the Matter of

MineralRite Corporation

Respondent.

ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO
SECTION 21C OF THE SECURITIES
EXCHANGE ACT OF 1934, MAKING
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer
of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the
purpose of these proceedings and any other proceedings brought by or on behalf of the
Commission, or to which the Commission is a party, and without admitting or denying the findings
herein, except as to the Commission’s jurisdiction over MineralRite and the subject matter of these
proceedings, which are admitted, Respondent consents to the entry of this Order Instituting Cease-
and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making
Findings, and Imposing a Cease-and-Desist Order (“Order”), as set forth below.

III.

On the basis of this Order and Respondent’s Offer, the Commission finds1 that:

Company Background

Applicable Reporting Requirements Concerning the Issuance of Unregistered Shares

MineralRite Failed to Disclose the Issuance of Unregistered Shares
and the Existence of the Related Financing Agreement

4. MineralRite failed to file a Form 8-K with the Commission, on or before April 10,
2014, or thereafter, disclosing the financing agreement.

1 The findings herein are made pursuant to Respondent’s Offer of Settlement and are not
binding on any other person or entity in this or any other proceeding.

reported on MineralRite’s November 19, 2013 Form 10-Q, and ultimately, the common stock sold
exceeded 135 percent of the number of shares of common stock outstanding reported on
MineralRite’s November 19, 2013, Form 10-Q.

6. MineralRite failed to file a Form 8-K with the Commission between December 17,
2013 and May 20, 2014, disclosing the unregistered sales of equity securities.

8. MineralRite failed to file a Form 8-K with the Commission between May 21, 2014
and July 8, 2014, disclosing the unregistered sales of equity securities.

IV.

In view of the foregoing, the Commission deems it appropriate to impose the sanctions
agreed to in Respondent MineralRite’s Offer.

Accordingly, it is hereby ORDERED that:

(1) Respondent may transmit payment electronically to the Commission, which
will provide detailed ACH transfer/Fedwire instructions upon request;

(2) Respondent may make direct payment from a bank account via Pay.gov

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or

(3) Respondent may pay by certified check, bank cashier’s check, or United

States postal money order, made payable to the Securities and Exchange
Commission and hand-delivered or mailed to:

Enterprise Services Center
Accounts Receivable Branch
HQ Bldg., Room 181, AMZ-341
6500 South MacArthur Boulevard
Oklahoma City, OK 73169

Payments by check or money order must be accompanied by a cover letter identifying

MineralRite as a Respondent in these proceedings, and the file number of these proceedings; a
copy of the cover letter and check or money order must be sent to William P. Hicks, Division of
Enforcement, Securities and Exchange Commission, 950 East Paces Ferry Rd. N.E., Suite 900,
Atlanta, Georgia 30326.

By the Commission.

Brent J. Fields
Secretary