Elite Pharmaceuticals Inc (ELTP)

[Hike]

Some stuff about the Bond...


From 2005
http://www.neptunecompany.com/img/bonds/series/1815/MS76409-MS26565-MD51084.pdf


About Refunded Bonds
http://financial-dictionary.thefreedictionary.com/Refunded+Bond


From 1999:

http://web.ebscohost.com/ehost/detail?sid=3fd59c07-4028-4a26-8769-5cfa0e02e0a9%40sessionmgr10&vid=1&hid=12&bdata=JmF1dGh0eXBlPWdlbyZnZW9jdXN0aWQ9Y2pybGMwODUmc2l0ZT1laG9zdC1saXZl#db=bsh&AN=2280948

Section: Washington
High-Yield Focus

N.J. DRUG COMPANY GIVES MARKET A NONRATED PRESCRIPTION

Eager for a dose of high-yield paper, a handful of sophisticated retail investors and one large institutional account snapped up a $3 million nonrated offering last week from a pharmaceutical company.
The deal, sold last Tuesday through the New Jersey Economic Development Authority, will finance the construction of a new manufacturing plant in Northvale on behalf of Elite Pharmaceutical Inc., whose stock market ticker is ELIP.
In this instance, as it has in others, the EDA serves as a conduit issuer for manufacturing companies if their bond proceeds finance New Jersey-based projects.
Elite decided to tap the municipal market for its financing as an alternative to paying in excess of 12% for a conventional bank loan.
As a result, the issue brought to the tax-exempt market a much-needed prescription for high-yield paper at a time when the supply of nonrated offerings is on the light side, according to Dean Myerow, managing partner and trader at Bergen Capital Inc. in Hasbrouck Heights, N.J.
The firm placed the entire deal in just one day after it was oversubscribed by one and half times, said Charlie Gilbride, president of the six-month-old investment firm.
But high-net-worth retail investors and a large New York money manager bought the issue for several reasons besides the 7 3/4% coupon due in 2014 priced at par.
Investors were also comfortable with the fact that Elite is a $52 million, publicly traded company that can be easily tracked on the Internet, Myerow pointed out.
Among the other selling points, he cited a first mortgage pledge on the property, the manufacturing plant, and its equipment -- a total asset value of $4.3 million which more than adequately covers the principle amount of the issue.
In addition, the bonds offer six years of call protection and are considered a general obligation of the company.
Elite specializes in the formation and development of controlled, delayed-release tablets and capsules, and recently obtained a patent for a pulse release form of methylphenidate, which is widely marketed under the name Ritalin.
The company is seeking approval from the Food & Drug Administration on six different drugs -- including products for treating cardiovascular disease, arthritis, and diabetes -- and has assisted in developing similar products for such well-known companies as Smithkline-Beecham and Novo-Nordisk.
GRAPH: N.J. Economic Development Authority: Recent Issuance

Source: Securities Data Co.