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Elite Pharmaceuticals, Inc. Message Board

  • meifud meifud Apr 23, 2013 10:54 AM Flag

    elite's latest financing fiasco

    at first glance we were pleased to see that between the $10 million from Lincoln and $1,4 million from the pfd, elite was finally raising approximately the $12 million we have long said they needed

    but when we read the SEC filing (something we always encourage everyone to do) we discovered much different numbers, and now take a dim view of this arrangement

    because elite is desperate for cash they will be drawing the maximum $80k every third business day which will result in elite getting $160k per week while issuing about 2 million shares per week

    what this means is that, within six months, elite will have issued 40 million shares which will put Lincoln at the limit of shares they can hold -- 10% of outstanding shares

    but, unfortunately, that will mean that elite will have only netted about $3 million from this deal, not $10 million -- and they would have paid the equivalent of $400k as represented by the gratis shares given Lincoln to close the deal

    all in all, not a very good deal at all but that really didn't matter because it will get them the money needed to pay off the 10% loans from their ceo in july -- and some thought the ceo was going out on a limb making an unsecured loan to his own company
    footnote: elite has NOTHING, no assets whatsoever, to secure any loan of any amount

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