Exhibit 99.2
PRESS RELEASE
Contacts:
John P. Leighton Michael T. Dorsey
Chairman & CEO EVP & General Counsel
201-459-9500 800-888-8118
FOR IMMEDIATE RELEASE October 17, 2003
CROWN FINANCIAL DISCOVERS OVERSTATEMENT OF CERTAIN BALANCE SHEET ITEMS, TAKES
IMMEDIATE ACTION TO RECTIFY STOCKHOLDERS' EQUITY SHORTFALL BY SECURING CAPITAL
INFUSION OF $1.7 MILLION AND ANNOUNCES RESULTS OF ANNUAL SHAREHOLDER MEETING
JERSEY CITY, N.J., October 17, 2003 /PRNewswire-FirstCall/ - Crown
Financial Group, Inc. (formerly M.H. Meyerson & Co., Inc., Nasdaq: MHMY) today
announced that it discovered an overstatement of certain balance sheet items
included in its unaudited financial results for the second fiscal quarter ended
July 31, 2003. The Company took immediate action to rectify the shortfalls by
securing a capital infusion of $1.7 million, offsetting the shortfall from the
amounts previously reported. The overstatement was discovered in the process of
the Accounting Department's close of the Company's books for the month of
September. This close was the first close implemented by the Company's new
accounting staff under the direction of Robert Turner, who joined the Company as
chief financial officer in the month of September.
Our preliminary assessment is that the overstatement had the effect of
inflating the value of the Company's total assets and total stockholders' equity
as reported on July 31, 2003 Statements of Financial Condition by approximately
$1.7 million. Currently, the Company is in the process of inquiring into the
nature and effects the overstatement may have had on its prior public reports.
Due to the ongoing nature of this inquiry, the Company is unable to assess
definitively the impact of the July 31, 2003 overstatement upon such prior
reports. Nor is the Company in a position to quantify the effect of the
overstatement upon the Company's stated income for the second fiscal quarter or
any prior periods at this juncture. Once the ongoing inquiry is completed and
the results finalized, the Company will restate its financial results for the
affected fiscal periods. The Company's management is conducting the inquiry,
subject to the oversight of the Audit Committee. In addition, the Company at the
direction of its Audit Committee, has engaged its new outside auditor to assist
in the inquiry in an effort to assure that there are no other financial
reporting or disclosure control items that may be of concern.
Additional Capital Infusion
On October 17, 2003, certain significant stockholders transferred assets,
consisting of certain municipal securities, to the Company in the amount of $1.7
million. The asset transfer did not involve any compensation from the Company;
nor did it create any liability on behalf of the Company to the stockholders
transferring the assets to the Company. Crown Financial intends to use the
proceeds of this capital infusion for the Company's regulatory capital purposes,
to increase its level of stockholders' equity and to rectify the balance sheet
deficiency resulted from the overstatement.
In addition to the previously discussed capital infusion and as part of a
continuing effort to increase the Company's stockholders' equity, the Company is
in the process of converting $1,000,000 in subordinated indebtedness into
non-voting convertible preferred stock. While the specific terms of the
preferred stock are still being negotiated, the preferred stock will by its
terms not be convertible into $1,000,000 of common stock until shareholders
approve the
terms of the conversion feature. Upon consummation of the conversion of the
indebtedness, the Company's stockholders' equity will be increased, and its
liabilities will be decreased, by the amount of the indebtedness converted. The
conversion of the subordinated indebtedness into equity is subject to regulatory
approvals.
Annual Shareholder Meeting
Crown Financial also announced the results of its Annual Meeting of
Stockholders, which was held on Thursday, October 16, 2003 at 8:00 a.m. EST in
Jersey City, New Jersey. Of 9,921,166 shares of common stock outstanding and
entitled to vote as of the record date, 9,086,308 shares voted at the meeting
either in person or by proxy. Stockholders approved all of management's
proposals and recommended slate of directors. Specifically, the proposals and
the final voting results were as follows:
Proposal 1 - name change amendment from M.H. Meyerson & Co., Inc. to Crown
Financial Group, Inc. - 8,950,808 shares were voted For this proposal,
representing 98.50% of the votes cast, and 135,500 shares were voted Against
this proposal or Abstained from voting, representing 1.49% of the votes cast.
Proposal 2 - elimination of the staggered Board of Directors provision in
the Company's Certificate of Incorporation - 8,941,308 shares were voted For
this proposal, representing 98.4% of the votes cast, and 145,000 shares were
voted Against this proposal or Abstained from voting, representing 1.59% of the
votes cast.
Proposal 3 - election of directors (John P. Leighton, Robert I. Turner and
Andrew Wimpfheimer as a Director for a one year term):
For Withheld
John P. Leighton 8,534,475 551,833
Robert I. Turner 8,648,808 437,500
Andrew Wimpfheimer 8,647,758 438,550
Proposal 4 - approval of the 2003 Equity Incentive Plan - 5,368,597 shares
were voted For this proposal, representing 90.27% of the votes cast, and 578,526
shares were voted Against this proposal or Abstained from voting, representing
9.72% of the votes cast.
Proposal 5 - ratification of the Company's independent accountants for the
next fiscal year - 8,953,308 shares were voted For this proposal, representing
98.53% of the votes cast, and 133,000 shares were voted Against this proposal or
Abstained from voting, representing 1.46% of the votes cast.
The record date for shareholders to have voted at the Annual Meeting was
August 20, 2003. A formal meeting notice, proxy statement and annual report were
mailed on September 24, 2003. At the close of business on August 20, 2003, the
Company had outstanding and entitled to vote 9,921,166 shares of common stock.
About the Company
Crown Financial Group, Inc. is an international financial services firm,
with five separate divisions: Wholesale Market Making, including Foreign Trading
Desk, Correspondent Services, Fixed Income Services, Institutional Sales, and
Investment Banking. Crown meets the liquidity needs of brokers, dealers,
institutions, and asset managers by making markets in over 7,300 Nasdaq and
non-Nasdaq OTC securities. Crown has particular expertise trading Nasdaq
SmallCap, OTC Bulletin Board, and Pink Sheet securities
Forward-looking statements
Certain statements contained herein constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are based on current expectations, estimates
and projections about the Company's industry, management's beliefs and certain
assumptions made by
management. Readers are cautioned that any such forward-looking statements are
not guarantees of future performance and are subject to certain risks,
uncertainties and assumptions that are difficult to predict. Because such
statements involve risks and uncertainties, the actual results and performance
of the Company may differ materially from the results expressed or implied by
such forward-looking statements. Given these uncertainties, readers are
cautioned not to place undue reliance on such forward-looking statements. Unless
otherwise required by law, the Company also disclaims any obligation to update
its view of any such risks or uncertainties or to announce publicly the result
of any revisions to the forward-looking statements made here; however, readers
should review carefully reports or documents the Company files periodically with
the Securities and Exchange Commission.
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