NewGen BioPharma Corp. (NEWG)

[Big Brother]

I think it's safe to say that the market makers are not going to be short on this stock as they have been getting their boats loaded these past few trading sessions.

It's unfortunate to see this much dilution this early on, and this cheap, however, it's probably due to the amount of money Greenwind will owe at closing, they have to raise the money somehow, selling shares appears to be it.

IMO If shareholders are going to experience $500K worth of dilution, each quarter for the next 4 quarters, then I will have to temper my expectations for this stock.

Pursuant to the LOI, the Company agreed to make an advance in the amount of $100,000 (the “LOI Advance”) to NewGen, subject to the terms and conditions set forth in a promissory note (the “Note”), within three (3) business days following the execution of the LOI. If the Closing does not occur, the principal amount of the LOI Advance, together with accrued interest at the rate of five percent (5%) per annum, shall become due and payable upon the earlier of (i) receipt by NewGen of proceeds from a financing in an amount not less than $1,000,000, (ii) an event of default, or (iii) a change in control of NewGen. If the Closing occurs, the Note shall be cancelled as an intercompany loan in connection with the transaction.

Additionally, the Definitive Agreement will contemplate additional advances by the Company to NewGen in the amounts of $400,000 upon Closing and $500,000 per quarter thereafter, with total advances (including the LOI Advance) of not more than $2,000,000.