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Hi,

Before I got on the Fool, I had a momentary lapse of judgment in the world of quick trade sub-penny stocks. I bought many shares of North Star Diamonds--a stock that was going for half a penny a share when I bought it. I figured I could use the small cost to learn something about something. And I learned quite a bit about what not to invest in...small money well-spent.

Anyhow, the company has been engaged in a series of spinoffs, which look no better than the parent company...including a company based on a partnership that the partner company denies entering into. At this point, I have significant shares in the restricted, not-yet-listed stock of companies that I expect to be worthless.

I am relatively new to the stock market, and to spinoffs as well. I am wondering if someone could tell me (if any companies that are involved were reputable), where relevant information about the spinoffs would be. Also, are there government filings anywhere that one could look up?

Also, this may be a question more appropriate to the Quicken board, but, when I updated my account, the system read the "price" of the restricted stocks at $55.10 a share! I KNOW that my $50-ish investment is not going to make me a millionaire, but I like seeing those numbers in the account...does anyone know where Quicken gets its update numbers, and why do they have these shares priced so high? Thanks in advance!
--Erik
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Wow, out of curiosity I dug into this for a few minutes and quickly realized I'm not going to be much help...

Here's the best information I could find...

http://www.pinksheets.com/quote/quote.jsp?symbol=NSDM

If this wasn't an OTC stock (or if it was an OTC stock that filed with the SEC), you could normally find information regarding the company and/or spinoffs on the SEC EDGAR site (http://www.sec.gov/edgar.shtml). Oftentimes, the company will file a form S-1 or a Form 10 prior to a spinoff. Here's an example of a Form 10 that Hanesbrands (HBI) filed prior to their spinoff from Sara Lee (SLE). They later updated it several times.

If you're interested in spinoffs, I'd read through Joel Greenblatt's "You Can Be a Stock Market Genius". It's a great book about spinoffs (amongst other things) and investing in general. He's also got some recommended books for furthering your education. You could do a lot worse than starting with his book as an intro to spinoffs and investing in general. I've also found the articles at www.spinoffadvisors.com to be good sources of additional examples of spinoff investing in practice.

I have no clue on the restricted stocks and why they are priced at $55.10. Outside my realm of experience. Sorry!

Jim
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Thanks for the help.

I realized that the $55.10 price is probably some kind of ghost in the Quicken program (unless there is a legitimate value to the company that nobody is telling anybody about). I basically have had several opportunities to learn what to look for in a company by looking for the opposite of what these guys do...

Thanks for those sources...I will check out the book, and try and learn more about the good kind of spinoff investing.

--Erik
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