History
NXT, a Calgary company selling its SFD survey technology, funded itself through small private raisings and secured its rights from its CEO, until its auditor's 2006 exit left a key question open.
2003-2004: A new plan for selling SFD
In July 2003 the company, then called Energy Exploration Technologies (NXT), set out to sell its SFD (Stress Field Detector) airborne survey technology differently. Instead of granting regional exclusive exploration agreements, it would market each SFD project individually, starting with South Adsett. To diversify its assets in Canada and abroad, it planned a series of private placements over 12 to 18 months, hoping to net about US$10,000,000.
In November 2004 it signed two agreements with its CEO and President, George Liszicasz. One confirmed NXT's title to four operating sensors. The other gave NXT an exclusive worldwide licence to the technology until January 2011 and employed him as CEO. He received 10,000,000 convertible preferred shares, with conversion beyond the first 2,000,000 tied to annual revenue targets of $50 million to $500 million. Half of them would be cancelled if shareholders did not approve them.
2005-2006: Small raisings and an auditor departs
The record then shows money being raised in smaller amounts. In November 2005 NXT sold convertible notes, first reported as going to three investors. A December correction said there were 27 investors and that total notes sold had reached US$1,975,000, including $213,600 of earlier loans from the CEO and a director. The notes could convert at the lesser of $0.70 or 85% of the lowest later issue price. Full conversion would add 4,797,257 shares, or 22.5% of the 21,359,104 then outstanding, so potential dilution was larger than first reported.
In April 2006 NXT closed a first private placement of 1,685,000 units at US$1.00. Each unit was a share plus a two-year warrant to buy another share at US$2.00. It also agreed to pay commission of 131,200 units. The money was for marketing survey services, surveys, survey capacity, investor relations and general costs.
On June 23, 2006 auditor Deloitte & Touche said it would not stand for reappointment for 2006. Its 2004 and 2005 reports had raised going-concern doubts, though it reported no disagreements. As of the latest record, in mid-August 2006, no new auditor had been engaged. The company had signed a survey contract in June 2006 with a Canadian intermediate producer, though the terms were not disclosed. The record is silent on the years after 2006.
Written from the 6 story beats below (2003 to 29 June 2006), which come from the company's own announcements and filings.