The promoting e-mail that came in our database contains a disclaimer, which says that this is only an initial and brief alert. The coverage is yet to begin shortly and the promoter states that compensation is expected to be received at some time in the future. That information should be enough for traders to see RPID bounce off its trading range today, and probably keep surging for a while as soon as the true campaign begins. Yesterday, the stock closed the market at $0.49 with a 22.50% increase in the share price.
As already mentioned, the fundamentals of Spot Mobile did not look very promising throughout the past year. Sales have declined from $4.4 million in the three months ended April 2010 to less than $2.9 million for the three months ended January 2011. Operating loss has more than doubled comparing the same periods and the company has plenty of debts and a working capital deficit. At the end of January 2011, current assets were $1.43 million against current liabilities of $3.47 million. In addition, some of the outstanding notes are secured by all of the company’s assets and the rest are convertible into shares of common stock.
Despite of that unfavorable facts, management is aimed to seek expansion in the prepaid cellular products and services market. At the end of last month, RPID completed the final closing of a Private Placement for total proceeds of $2.3 million, whereby the largest portion of the offering was closed by the end of January. The company sold an aggregate of 4.6 million shares of common stock and warrants to purchase another 4.6 million shares.
