History

The conceptual framework for Rapid Ratings' FHR™ technology was created in 1991 by Dr. Patrick Caragata (PhD University of Toronto, 1981) who has worked extensively as an economist at senior levels in Canada and New Zealand, and is a much-published author. He led the design and implementation of the models and initial software during the period 1998-2001 in New Zealand and then shifted the head office to Australia as new investment capital was needed.

From the start, Rapid Ratings avoided the conflicts of interest and inherent biases that have characterized the S&P, Moody's and Fitch revenue model. Rapid Ratings charges users of its products, rather than the companies being rated. This important distinction allows users access to the most accurate, unbiased and timely ratings information available. The combination of the completely quantitative Rapid Ratings methodology and its "user pays" business model ensures more accurate, timely and unbiased ratings results. These results have typically led trends in share prices, bond spreads, credit default swaps, and predictions from Merton structural models and the large rating agencies; and have provided clear early warnings on problems at companies like Enron, WorldCom, Parmalat, US Steel, the US homebuilders and others - enabling more informed investment, lending and trading decisions concerning these names.

In 2007, Rapid Ratings was brought to the United States by James H. Gellert and Douglas M. Cameron, U.S. bankers and entrepreneurs with substantial experience in the Financial and Business Information Services Markets. Dr. Caragata was their partner in acquiring the business from its then parent company in Australia. With Mr. Gellert as Chairman, CEO and President, Mr. Cameron as COO and Dr. Caragata as Executive Vice Chairman and Head of Research and Development, the new team has moved the business to New York, launched a variety of new products and positioned Rapid Ratings just in time to assist the markets in recovering from the void in high-quality, actionable ratings.

Mr. Gellert and Dr. Caragata have both been involved at the SEC level discussing changes in the ratings market and the need for changes to the framework currently governing the rating agencies.