13 Feb VaporBrand International Inc (VAPR) – research report
The Vaporbrands International Inc (VAPR) shell recently came to life with its first volume in over 2 years. Over the past 2 weeks the volume has been growing and the share price has been slowly started to climb. Many want to know if a possible future paid promotion might be in the works. To figure this out we have to first sort through the vague, shady, complicated past of the VAPR shell.
Early History as Quadrax Corp
Back in 2000, the VAPR shell (then known as Quadrax Corp) stopped doing any SEC filings. They had filed for Bankruptcy in 1998 and judging by the last financial report in 2000, they were still struggling with debts when the shell went dark. It appears that in 2001, the ticker was abandoned probably because the previous owners couldn't even afford to keep paying the business taxes with the state of Delaware.
Shell Hijacking #1
Whether via a hijacking or a legitimate purchase of control, the ticker was taken over by Jiqun Wang and Won-Gil Choe in late-2004. Wang changed the name of the shell to TTCM China Inc in January of 2005. The group put out a whole slew of press releases claiming large purchase orders and a booming business but did no filings for the shell except for a Form 15 filed by Won-Gil Choe in July of 2006 to terminate the registration of the stock and make the VAPR shell a non-SEC reporting company. Since the shell was six years removed from having done any required SEC filings, it was technically illegal to file a Form 15, but the SEC (as it does so often) let the Form 15 slide and the VAPR shell avoided an SEC suspension.
Even after de-registering the stock, Won-Gil Choe did no OTC filings either so it is hard to sort out exactly what happened to all the old debts, the share structure, and management team between 2000 and 2011.
The last press release from TTCM China Inc came on January 8, 2007. The company announced the signing of a $15.4 million contract for future sales of waste management pipelines and the expansion of business in China. I'm not even going to pretend for a second that I believed anything that TTCM China Inc was putting in its press releases. 99.999% of the time when an abandoned penny stock gets hijacked and the new owners do no filings whatsoever but pays for a ridiculous amount of press releases touting a bunch of forward looking, unrealistic business achievements then it is all just a scam to fool investors into buying the stock. The last filing that Wang and Choe ever did with the Delaware SOS was an amendment on June 25, 2007 to raise the authorized share count to 200,000,000. The website went dead in April of 2008. The last archived version can be seen here.
It seems obvious that the shell was once again abandoned.
Shell Hijacking #2
Some time in 2009 or 2010 the VAPR shell probably got revoked again by the state of Delaware which means that it probably got hijacked a second time some time in early 2011, this time by Fred Rackers of Dallas, Texas took control of the shell then did a 1:1000 reverse split on 9/27/11 wiping out all the previous shareholders of the shell.
More on Fred Rackers
This wasn't Fred Racker's only involvement in a publicly traded shell. Fred Rackers is now the CEO of Globalgroup Investment Holdings Inc (GIHI). Working with him with GIHI is Scott Owen. Globalgroup Investment Holdings Inc was a Florida business entity that never did any SEC filings in its history. The shell got briefly hijacked in 2005 after being abandoned in 2000. No annual report was ever done for the shell after it was hijacked in 2005 and the entity got revoked by the state of Florida again in 2007. In 2012, Fred Rackers hijacked the Florida business entity. According to information in a recent quarterly filing, on April 20, 2012 Fred Rackers allegedly moved the Florida shell to a new entity by the same name he had just created in Nevada. A rundown of the filings available at the Florida SOS shows no merger filing ever done with the Florida SOS. GIHI became a ridiculous dilution vehicle that included dirty debt Notes with Edward Bronson of Fairhills Capital. The share price dropped from $.05/share when Fred Rackers first took over to $.0004/share as of today's close.
The Complicated Process of Hiding the shell Hijacking through changes of domiciles and mergers
After Fred Rackers took over control of the VAPR shell he performed a similar act of moving the shell out of its original state. This is a common act of shell hijackers to make it more difficult to track the hijacking.
A bunch of corporate actions took place after the 1:1000 reverse split:
1) A new Nevada business entity was incorporated by Donald Sullivan and Jennifer Powers called Vapor Brands Inc on January 31, 2012.
2) A new Nevada business entity was incorporated by Fred Rackers and Scott Owen called PayTech Solutions Inc on February 28, 2012 with 500,000,000 authorized shares.
3) Fred Rackers filed to convert the shell out of Delaware and into the new Nevada business entity he created called PayTech Solutions Inc on February 28, 2012. The conversion was completed on March 12, 2012. On April 2, 2012, Rackers changed the name of the Nevada entity to TCM China Inc so that it would match the name of the publicly traded shell.
4) Wendy Haviland became the CEO/treasurer/secretary and Donald Sullivan became a director of the TCM China Inc Nevada Entity
5) A new Nevada business entity called VaporBrands International Inc was incorporated in Nevada by Jason Torres on September 6, 2012
6) Wendy Haviland and Jason Torres merged the VaporBrands Interntional Inc entity with the TCM China Inc Nevada entity on October 4, 2012.
7) VaporBrands International Inc became a marketing partner with Vapor Brands Inc
Sorting out the Financials and Share Count prior to the merger
In July of 2012, VAPR filed an annual report that covered the years of 2010 and 2011. In that report we find out that all previous assets, liabilities, and business operations no longer exist. When the shell was hijacked it became an empty shell again with no cash, no revenues, no business operations, and $14,961 in debt that was created by the shell hijackers but back dated to 2009.
The outstanding share count following the 1:1000 reverse split became 225,606 with 125,606 free trading shares of stock.
Sorting out the merger and new business operations
We find out in the initial company information and disclosure statement filed in July of 2012 that following the merger between VaporBrands International Inc and TCMM China Inc, Wendy Haviland was replaced by Jason Torres as the new CEO of the VAPR shell. When the merger occurred with the brand new VaporBrands International Inc entity, 45,000,000 newly created shares of stock were issued in the exchange.
27,000,000 of those shares went to Donald Sullivan and the other 18,000,000 shares went to Scott Burnett and David Naylor (through an entity called Balon Bleu Holdings Inc.
Another 14,961,000 free trading shares of stock were issued to an undisclosed individual in exchange for the old $14,961 debt Note that was put on the book after the shell was hijacked in 2011 by Frank Rackers (a conversion ratio of $.001/share).
VaporBrands International Inc then signed a marketing agreement with Vapor Brands Inc (the other new Nevada entity formed by Donald Sullivan).
VaporBrands International Inc then signed a distribution agreement with Safe Cig, LLC to be able to eventually sell e-cigs pruduced by Safe Cig LLC. Safe Cig LLC was controlled by John Cameron.
See the VAPR website here.
More on Safe Cig LLC
Safe Cig LLC is a California business entity that was established by John Deak, Robert Deak, and John Cameron, brother of famous Hollywood director James Cameron.
Safe Cig LLC did have a real product, but after receiving more than 100 complaints to the BBB, Safe Cig LLC was given an 'F' rating by the BBB. See the BBB page for Safe Cig LLC here.
A newspaper article written just last week alleges that the company may no longer be in business. Read that article here. The Safe Cig website (recently included in some VAPR press releases in January) is now no longer active.
More on Donald Sullivan (owner of 27,000,000 shares)
Donald Sullivan is also an officer with Wendy Haviland for a Nevada business entity called Oxalis Energy Group Inc.
Oxalis Energy Group Inc was incorporated in 2008 by Donald Sullivan and Phil Kueber.
If Phil Kueber sounds familiar it is because he was involved in WRIT, AMWI, RICP, and PERP (among many others). AMWI was an APS promotion in late 2011. WRIT was an old school APS promo in early 2011. PEPR was an old school APS promotion in 2010. RICP now trades under the symbol ZYRX.
Back when Phil Kueber was listed as an officer with Donald Sullivan, Oxalis Energy Group Inc was involved in an elaborate scam that involved William Scott Marshall. Together the group passed some oil&gas claims in Texas that once belonged to Jim Dial (who is now in prison), John Jarvis, and Claude Eldridge called the Adams Ranch property to more than a dozen different publicly traded shells.
More on Wendy Haviland
Besides the connection to Phil Kueber through Oxalis Energy Group Inc, Wendy Haviland can also be connected to Phil Kueber through Writer's Group (WRIT) which was a big pump&dump scam that included an old school APS promotion.
Wendy Haviland was the long time secretary of WRIT.
Wendy Haviland recently incorporated an entity called Personality Software Systems, Inc which filed an S-1 to go public on July 28, 2012. At the time of incorporation, Personality Software Systems Inc used the same address as WRIT, AMWI, RICP, and PEPR. (Yes all Phil Kueber shells). I'm thinking now that Personality Systems Inc which got its S-1 approved but is still waiting for a trading symbol needs some research and probably belongs on our list of stocks to watch for a future paid promotion.
More on Scott Burnett and David Naylor (owners of 18,000,000 shares)
Scott Burnett and David Naylor are yet two more Phil Kueber/William Scott Marshall associates.
Going back to this post about Phil Kueber's past companies, we find David Naylor's name mentioned often.
David Naylor was a former officer of Fidelis Energy (FDEI) with William Scott Marshall, Caliber Energy (CLBN) with William Scott Marshall, and former CEO of High Plains Gas (HPGS) [fka Northern Exploration (NXPN)] which made a deal with William Scott Marshall for the Adams Ranch property (linked to Phil Kueber and Donald Sullivan).
David Naylor was also once an officer of Bancroft Uranium Inc with P. Leslie Hammond and a former officer of California Gold Corp (CLGL) with Robert McIntosh (another close associate in the past with William Scott Marshall and Phil Kueber).
Scott Burnett and David Naylor's entity, Balon Blue Holdings LLC, is also involved in Global Resource Energy Inc (GBEN) having signed a letter of intent to acquire products from GBEN. GBEN also had links to two former APS associates, Harry Lappa and Douglas Roe. GBEN became a paid promotion (Global Market Media) on July 23, 2012 within days of signing that letter of intent with Burnett and Naylor.
Authorized - 500,000,000 shares
Outstanding - 60,086,606 shares
Float - 15,086,606 shares
Donald Sullivan - 27,000,000 shares (restricted at least until February 28, 2013)
David Naylor and Sean Burnett - 18,000,000 shares (restricted at least until February 28, 2013)
Undisclosed debt Note holder - 14,961,000 shares (free trading)
The VAPR shell was hijacked
A 1:1000 reverse split was used to wipe out previous shareholders
The VAPR shell was moved out of Delaware into Nevada
A bogus debt Note created by the hijackers for $14,961 was converted into 14,961,000 free trading shares of stock
The VAPR shell was merged into a brand new Nevada business entity in exchange for 45,000,000 newly issued shares of stock split up between Donald Sullivan, David Naylor, and Sean Burnett
We have no less than 3 Phil Kueber associates involved in the VAPR shell (Donald Sullivan, David Naylor, and Wendy Haviland).
The VAPR shell signed a distribution agreement with a failed California business entity called Safe Cig LLC that may not even be in business any more after receiving over 100 customer complaints to the BBB.
After digging up the shady insiders and shady past of the VaporBrands International Inc (VAPR) shell, I am very much convinced that the shell was set up as nothing more than an insider enrichment scam. We have a group of insiders that go back more than 5 years working together in a variety of dirty penny stocks that got promoted, pump&dumped, and abused. The number of stock promoters and scam artists linked to this group is too many to count.
I doubt that VAPR will end up selling any products ever - only shares. VAPR has 14,961,000 newly created free trading shares issued for a bogus debt Note at $.001/share and I'm confident that some type of promotion will get used at some point to help facilitate the dumping of those free trading shares. I do not, however, feel real confident that it will be a big name promoter used to help with the dumping of those shares.