VinCompass Corp (OTCMKTS:VCPS), the developer of the VinCompass app, has been assessed extensively over the past two month, not only because the volume registered recently was impressive, i.e. more than 200 million shares exchanged hands on some days in July, but because something relevant happened. There was an interesting story regarding a change of control announced on June 23, 2017, which was some days later denied. It seems that big shareholders are trying to gain the control of the company. In this piece, we will provide all the details. Have a look at the most recent share price action:
Although the false change of control drew our attention, we discovered that the business of VCPS seems quite valuable. According to the annual report, the company developed a “platform built on patent pending technology that takes the guess work out of the wine buying equation for the consumer“. The most interesting feature of the App is that it is able to determine an individual’s VinPrint® (wine DNA preference), thus users buy wine according to their profile with alluring value, and availability. The following two videos explain the features included in the App:
The Change of Control – Fighting to acquire the company
On June 23, 2017, the market received the following information:
“The control block of voting stock of Vincompass Corporation (the “Company”) represented by 1,000,000 shares of preferred stock [“Shares”] representing an ownership interest of approximately 70% has been obtained by Ms. Ya-Ping Chang from Mr. Peter Lachapelle as a result of a default in a loan agreement dated November 23, 2015 and a breach of a Memorandum of Understanding dated January 6, 2017, As a result a change of control of the Company has occurred. “ Source
According to that information, Ms. Ya-Ping obtained 70% of the total outstanding shares of the company. Thus, a change of control had occurred. The market reacted positively to the information, have a look at it. Check the volume and the spike on June 23, 2017.
Some days later, on June 30, 2017, the company put out an update explaining the following:
“On or about June 23, 2017, Ya-Ping Chang (“Chang”) fraudulently obtained EDGAR codes for VinCompass Corp. and prepared a false Form 8-K filing libelously stating that, Ya-Ping Chang was the 70% majority shareholder and that, “Peter Lachapelle had been removed as Chief Executive Officer and Chairman of the Board of Directors from the Company.” Chang’s statements completely contradict 18 months of filings, including audited financial statements by our auditor MaloneBailey. In January 2016, Chang resigned as a director of the Company. Chang executed a waiver of all claims against VinCompass Corp., and confirmed as follows: “ I confirm that I have no claim against the Corporation in respect of remuneration, severance, payments, pensions, expenses or compensation for the loss of office or in any other respect whatsoever. ” Source
The company noted that it had filed a lawsuit against Chang for what happened on June 23, 2017. Is the situation good for the shareholders of VCPS? In our opinion, the situation shows that the directors want to obtain control, thus they appreciate the business being developed. The share price did not react the same day to the new information, but some days later, the share price increased, as everybody commenced to comprehend what had happened. On top of it, the market got to know in these filings, here and here, that the CEO, Peter Lachapelle, had acquired preferred stock and common stock.
|1.Title of Security|
|2. Trans. Date||2A. Deemed Execution Date, if any||3. Trans. Code|
|4. Securities Acquired (A) or Disposed of (D)|
(Instr. 3, 4 and 5)
|5. Amount of Securities Beneficially Owned Following Reported Transaction(s)|
(Instr. 3 and 4)
|6. Ownership Form: Direct (D) or Indirect (I)|
|7. Nature of Indirect Beneficial Ownership|
|Amount||(A) or (D)||Price|
|Preferred Stock||12/1/2016 (1)||A||4000000||A||$40000||5000000||D|
On July 21, 2017, the company put out its 10-Q Quarterly Report. You can have a look at the press release here. Additionally, the company released some new information regarding its operating activities. It was put out that “VinCompass® continues to invest heavily in its core IP with the company’s development expense growth of 102% having $79,978 as of period ending May 31, 2017 as compared to $39,530 for the same period ending May 31, 2016.” Regarding its VinPrint® (wine DNA preferences) pending Patent technology, the company explained that it will receive a formal update later in the year from the Patent Trademark Office. Hence, we need to be alert on it. It is a clear catalyst for the stock.
Regarding the capital raising, it was noted that “a total of $178,500 was secured from third parties convertible notes and common stock purchases.” CEO Peter Lachapelle explained in following words:
“We are looking forward to participating in these events as a platform to build investor awareness of the VinCompass® opportunity. There is significant leverage, because many potential investors are wine consumers who we can help to enjoy more wine. Creating a combined synergy of VinCompass’ go-to-market plan for both Investor and member acquisition.” Source
Recent Decline in the Stock
After the upward trend that we saw at the end of July, the share price declined on August 1, 2017. No news was put out, thus it is difficult to explain what is happening. In our opinion, those market participants who made a lot of money in the month of July decided to book profits. They are causing the share price decline. That’s the only explanation that we can find. The fact that the company did not release news means that the intrinsic value of the shares is still the same. The situation is interesting, as it is the same company, but the price is cheaper. Hence, we can imagine that some market participants may be thinking of buying the dip.
VinCompass Corp. has recently drew the attention of the market, as there was a dispute with a director who wanted to gain the control of the company. In our opinion, the company reacted very well explaining the situation. We believe that the market appreciated that directors in the company are willing to fight for the control of the firm. It shows that they appreciate the business that they have built. We also saw that the CEO recently acquired shares. Finally, the investment in R&D is very significant and the company is about to receive an update from the Patent Trademark Office. We need to be alert on it.
We will be updating our subscribers as soon as we know more. For the latest updates on VCPS, sign up below!
Image courtesy of Brennan Clark via Flickr
Disclosure: We have no position in VCPS and have not been compensated for this article.