Hey gang, how the heck are you doing. I recently took a modest stake here and being one that does DD digging it seems that some here don't get why the buyback is taking place.
Look at who is helping with financing. Capital whoever. Check their website. They do PIPE financing. Not the best to say the least. There were some people with deep pockets that bought stock at a deep discount. Sometimes, but not always these are warrants that have a strike price or point at which the private party can sell. With that in mind, it is the companies "responsibility" to get the stock price to that point as quickly as possible. PIPE financers are not long term investors. They want in and out fast, usually within 6-12 months, sometimes less.
What does happen with these discounted shares in many cases, maybe not here, but many times is that when the price reaches the strike price, they short the daylights out of the stock because they know that excersizing their warrants will cause dilution lowering the value/share. Since they have the "physical" shares, they can do what is called block shorting or in other words, shorting against shares they already own. Taking a wild guess, at this point I would say maybe .10 is strike price for the warrants.
Short term PIPE financing is not desirable, but it is a quick way to get some base financing to attract better terms in the long run and that seems at least to be what QASP has done. I have not seen a pinksheet company in a long time even hint that they had secured financing through banks and considering todays credit crunch, that says something about this company.
You might want to go to stockguru and checkout their company profile for QASP. They have something that they acquired that has already saved them $50MM. About another $10MM and they have a product no other company has. Hell, when it get's to the market, I might even learn to fly and get me one. Hint, 5.5 gal/hr. Frackin' amazing.
If you think about it, they already put together a logistical infrastructure that is prepared to go to market. Their development to market schedule is extremely aggressive and it seems that their product will fill an important niche in the aviation industry. I love the idea of the 2 seater VLJ. You can virtually take off and land on runways designed for Piper Cubs!!!! Now if it uses NAV 1 fuel, match set!!
The stock is what the stock is. Don't confuse the stock with the company. So far it's a great company with solid plans that IMO will get done what they say. I work with people that have been in the military and they are VERY focused on outcome.
Bottom Line get ready to sell at around .10-.12, wait for a pullback and then re-evaluate. To bad they don't file an 8K with the info about the warrants.
All of the above JIMHO
AI
