Since the last update, we have had made significant progress with regard to Rapid Fire Marketing’s business both on the corporate and the business side. I know for shareholders not privy to our efforts, it may not seem like it. Right now, I am devoting all of my time and effort to getting the corporate side done with respect to getting fully reporting and removing the DTCC chill. At the same time, development of our new dry herbal vaporizer is moving along on schedule.
So, using the same format as the last update, I have put together the following comprehensive update on our strategy going forward with respect to products and corporate structure. Points to be Covered:
- Raise in Authorized
- Fully Reporting Status
- Removal of the DTC Chill
- Dry Vaporizer
- Growth Strategy as a Fully Reporting Company
- Management Team/BOD
Raise in Authorized Shares
As you know, we were nearing the number of authorized shares which were set at 2 billion shares. We raised this number to 5 billion shares so that we could execute on our funding once we are fully reporting and to execute our strategy of acquisitions and purchases of immediately accretive businesses and, essentially, becoming a holding company. We had a choice of doing a reverse split or raising the authorized limit and we opted for the latter so that shareholder value would be maintained.
Fully Reporting Status
The order of events that we have to go through to become a fully reporting Company is as follows:
- Complete the 10K to file with the SEC
- Audited financials to accompany 10K
- File the Form 10 with the SEC
- File a 15c211 with a market maker to move to the OTCBB
As in the last update: We have put a lot of time and effort into the “getting fully reporting” process because this is the single biggest thing that we can do to add substantial shareholder value to this Company in the short term.
The holdup on everything is the audit. We hired one of the best firms in the business to essentially “build the books” for Rapid Fire Marketing shortly after I took over as CEO last year. The records for Rapid Fire Marketing were very incomplete or, in many cases, non-existent. It took many months of forensic accounting to bring everything up to date. The primary problem in getting through the audit is how we have classified expenses and income. As was noted in our annual report for 2011, there were a significant number of transactions by prior management which were deemed non-business related in 2010 and 2011.
I can tell you there is good communications between our auditing firm and our CFO firm. We will get the audit completed. When will the audit be completed and the 10K filed? Again, I am hopeful it will be very soon.
The 10K is complete; the Form 10 is well under way with our legal firm in New York. We just need the audited financials for the 10K and some minor work on the Form 10 to submit to the SEC.
Removal of the DTC Chill
Background: On February 17, 2012, Rapid Fire Marketing was designated Trade for Trade and exited from the DTCC’s Continuous Net Settlement System (CNS). Additionally, a few trading firms restrict the purchase of our stock and only allow sales.
The same firm that is working on our Form 10 is now working our DTC Chill issue. There has been excellent communications between our legal firm and the DTCC regarding this issue. Legal opinions regarding transactions that occurred in 2011 will be submitted within the next week or two. At that time, the DTCC will respond. Our legal firm has an excellent track record with regard to removal of DTC chills so we are hopeful that this issue will be resolved soon.
We have raised the amount of shares authorized in order to tap into our funding agreement with IronRidge Global which was announced on 25 September last year. Our immediate goal is to obtain the capital to build RFMK into a profitable and self sustaining business. Shareholders should be reassured that funding will be done periodically—and not done all at once. We intend to build the company with initial funding drawdowns.
Excellent progress is being made on the development of the new vaporizer. We expect to have new graphics and a working prototype within the next two weeks. We will update investors via our website once we have received these items.
Growth Strategy as a Fully Reporting Company
As discussed in the last shareholder update, we have made the decision that, in addition to creating our own products, we are going to be aggressive to acquire products from other companies and, in some cases, acquire part of or all of those companies that will be immediately accretive to revenues and profits. Organic growth is one strategy, but adding acquisition targets to the mix, if completed successfully, could show immediate gains in all of the financial key indicators for Rapid Fire Marketing. Raising the authorized share limit will enable us to make acquisitions and purchases that will be immediately beneficial to our bottom line.
Once the audit is complete, we will be able to file the 10K and the Form 10. At that point, we will announce management additions and BOD appointments. We are getting high quality and accomplished business people for these positions and, as such, they understandably want to see the audit completed before committing to Rapid Fire Marketing. The business veterans involved have a great deal of expertise and experience in mergers, acquisitions, and other growth strategies.
I, personally, would like to say that I appreciate the patience and understanding exhibited by many shareholders. We have had some unforeseen hurdles that we were required to overcome, but our path to enhancing shareholder value is, in my opinion, clearly before us. Between accretive acquisitions, lifting the DTC chill and finally filing the past two years 10Ks, we will be well on our way to taking the next step up on listing at a higher exchange.