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Lotus Pharmaceuticals, Inc. Message Board

  • guildcrantz guildcrantz Feb 1, 2011 8:08 AM Flag

    Response from LTUS about land rights

    I didn't think it fair that Maj could make accusations without rebuttal from LTUS so I emailed and asked the for a response to some of the questions.

    Here is what I got back.

    Here are the answer to your questions:

    1) We currently do not have the certificate of the land yet. It is not uncommon for situation like this given the tightening of land policy in China over the past two years. But we can still sell the land as long as we make appropriate disclosure.

    2) We have no relation with Mengxin before this transaction. After the land purchase from Mengxin, we ask the President of Mengxin, Mr. Zhao, to take care of the business related to the land in Cha You, and Mr. Zhao is not employed by Lotus and does not receive compensation from us. The report of related party transaction is simply wrong.

    3) There are ongoing discussions regarding selling the land, but when we will be able to finalize the transaction is hard to predict.

    4) The potential full refund is still an option as disclosed in our 10-k.

    Thank your for your interest and support, and let me know if you have any further questions.

    Regards,

    Xing

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    • Hi Guild, I like to step in here and let you know that i am a commercial/industrial real estate appraiser by trade and have been for over 20 years. Just based on what i saw from the video this appears to have been ag. land (see the trees were planted - in a row). This is definitely rural and not suburban or within an established industrial park like i thought (not sure where i got that idea). With vacant land the value depends on a few things:

      1. Physical - is it a level lot, not in a flood plain, can the soils support development, etc.

      2. Are utilities at or near the site - this can be a BIG expense. Elec., water, gas, sewer need to be considred.

      3. Access - are there public roads?

      4. Zoning - What is it allowed for. Since its rural there are probably not a lot of restrictions.

      5. Good source of labor pool. Not sure if this would be a problem given the pop. of china but you never know.



      Anyways, just a few things to consider

      (cut and paste from previous topic, just wanted to make sure Guild read the message)

    • Guild,

      Thanks for your good research. However, the LTUS PR release and responses to your email are at odds.

      They (LTUS) do not have the land use rights, as they admit.

      If the previous owner already got the money, why is this guy taking the time to convince RedChip about Lotus's ownership stake. Looks the previous owner did not get the land use rights either but got 32 mil USD from Lotus. Something is amiss.

      Kavdiv

      • 1 Reply to kavdiv98
      • Only one problem, this land is in China and the government owns everything. If the land was in the U.S. what you have said would make sense. We Americans, think that everyhting should be done like it is in our country. There are different cultures and different forms of government. China and the US are still worlds apart. There has never been a individual owner of this land only government owership and therefore a hard concept for us to understand.

    • Guild,

      Those statements are unsettling: No certificate? We can still sell with disclosure? Potential full refund? From who?

      I think this land can be written off. Paid 32 mil USD without papers or right of use.

      Who are they kidding? Sounds like a related part transaction and an inside deal.

      Disprove the doubters by a sale. Tough to do as they say without the papers. What do think a buyer will get from Lotus when they buy. A handshake for parting with 60 mil? I doubt this can happen.

      Sounds like the Mel Brooks statement from Blazing Saddles "The only thing between this land and me are the rightful owners".

      Kavdiv

    • amirstern@ymail.com amirstern Feb 1, 2011 11:53 AM Flag

      Hi Guild,

      This is another great opportunity to thank you for your valuable contributions to us all here.

      The dichotomy between LTUS fundamental value and its market valuation is highly indicative of the overall trashed sentiment with respect to this entire Chinese small cap RM sector.

      So no need for us to be frustrated as to why the price does not reflect the great news and the huge prospects.

      The correct order of event would be first to remove clouds over the broader markets and then have both time and good conduct on part of the Chinese companies, repair and rebuild the sentiment here and then the market will show 'respect' for LTUS and many other gems from the big rabbit...

      We shall endure...;-))

      • 1 Reply to amirstern
      • Thanks for the kind words.

        I believe that as far as Yahoo message boards go, this is among the best I have had the pleasure to enjoy.

        For me, it is the perfect place to test my theories. Instead of keeping them in a bubble, I release them where anyone can refute them.

        The Socratic method I guess. "Questions and answers. Questions & answers."

        Best,

    • Thanks Guildcrantz for the information.

      Xing's response about the land certificate is consistent with everything I've read on the subject.

      Selling the land will provide so much cash that there will be little need for any dilutive stock offerings for a long time.

      This stock has tremendous upside potential.

      Jim

 
LTUS
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