GENEX PHARMACEUTICAL (GENX)

[littlefish]

Digi, I'm wondering about the concern regarding the ownership structure as far as a couple things: one- the PRC doesn't allow foreign ownership right now in TZBD, correct? So theoretically the CEO could walk away with investor money and legally we couldn't take action against him IMO. Not that it would help him to do so of course since he owns so many shares.

However, he's getting to borrow the $ out of cash and invest it while paying the compay 6%. So if he takes a bunch of $ (as he has been doing with available cash from what I can tell) and uses it to invest and he makes 30% return on the $, GENX only sees 6% on that and all the risk is on GENX because of the lack of legal ownership by foreign entities and majority stake CEO has correct? If he is investing the $ in higher risk instruments and LOSES it all or in some part and decides he doesn't want to pay back the loan, he could just set up a vote with a majority of shares that he's not accountable to pay back the loan. And we'd have no say or legal entitlement as far as I can tell because of the PRC laws and his majority ownership. I don't mind throwing a couple pennies at this one but just wanted to throw a little dose of caution. Especially with the CEO owning such a large portion of shares (what he says goes) and coupled with his apparent activity of using the cash to use for himself (he isn't reporting how he is using the $ from what I see in the financials. I'd be curious what he's doing with that $). Good luck! Hope the earnings for 2008 work out and this can become more legitimate with time but for now I'm a bit cautious based on the lack of foreign ownership rights for TZBD and the CEO's majority position and use of cash. All IMO only, just trying to put it out there for debate. I have some shares (not much though). Good luck!