Lotus Pharmaceuticals (LTUS) announced today that it has entered into a termination agreement with Yorkville Global Master SPV Ltd. ("Yorkville") whereby the parties agreed to mutually terminate the Standby Equity Distribution Agreement, dated March 3, 2010, between the company and Yorkville (the "SEDA") with no further obligations.
CEO, Dr. Zhongyi Liu, commented, "We appreciate the capital commitment from Yorkville, but we won't utilize the SEDA. The reason is that currently we have sufficient working capital and growth capital to carry out the construction and outfitting of our new building complex in Beijing, which is expected to open in 2010. We will consider alternative funding options and structures only when our stock valuation improves, in order to protect against stock dilution."
Lotus is a stock that is deeply undervalued, that is why it is in our China Investor King's Portfolio. The step they have taken we admire and will help them to increase shareholder's value. Maybe this can be the trigger for some price appreciation. Also we are optimistic that their cash flow is sufficient for the time being.
POSITION: LONG
For more information: http://www.lotuspharma.com/
Thursday, July 22, 2010
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