Frozen Food Gift Group, Inc. (OTCMKTS:FROZ) Crashes After News Of Toxic Financing
Frozen Food Gift Group, Inc. (OTCMKTS:FROZ) stock crashed 20.9% yesterday, dragged down by the news of the company’s latest funding misadventure.
FROZ has been in rapid decline for no less than four sessions now. The most likely reason for this latest catastrophic descent that has brought it all the way down to $0.0106 is the obscurity of the company’s filings or lack thereof.
In elaboration – 15 days ago, it was announced that the company had reverse-merged with APT Group, Inc., a private company who was “going public due to popular demand”. The hype that followed the news died quickly enough, because no relevant filing on the subject was made. Now, more than two weeks after the merger took place, there are still no consolidated balance sheets in sight.
True, the company announced that it “retained the services of a professional services firm” – Malone Bailey, LLP. Although welcomed as a step forward, this announcement begs an important question – why is FROZ hiring an audit firm just now?
As a direct result of the lack of crucial financial filings, all that diligent investors have to go on currently are the horrible annual financials for 2013 FROZ published on April 15 and the obscure 8-K that came out yesterday. The later made public the results of FROZ‘s financing agreement with Ironridge Global IV, Ltd. – an offshore company notorious for its toxic financing agreements with other OTC stocks. Examples of its endeavors that result in massive dilution include its dealings with companies such as Amarantus Bioscience Holdings Inc. (OTCBB:AMBS) and East Coast Diversified Corp. (NDA) (OTCMKTS:ECDC).
Under the current circumstances, investors might want to wait until some reliable due diligence material hits the web before committing to FROZ stock, because, as it is now, the company’s filings are ambiguous if not nonexistent. This can be taken as a sign of the dubious nature of the stock or the company’s lack of interest in the market – and the fact that FROZ averages a press release in three days for the last month excludes the latter option.
Furthermore, the company’s association with Ironridge, a well known toxic financier, should also be considered very carefully. Presently FROZ has 3.9 billion shares outstanding, but its authorized amount is capped at 20 billion, so investors should keep in mind that there’s still much room for dilution.
As it is, it’s no wonder that the ticker is plummeting to the ground – FROZ has given diligent investors nothing but bad news lately, and it’s unlikely that the ticker will halt its descent unless this state of developments changes.
