Well, in this case, moving 3-steps back to go 100-steps forward is worth the risk. In business, no company has ever been successful without taking and managing risks. ELTP is a growth stock and I expect management to take on calculated risks that would benefit shareholders in the long-term. Cheers!
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"...The Company has agreed to file a registration statement with the U.S. Securities & Exchange Commission ("SEC") covering the shares that may be issued to Lincoln Park Capital under the terms of the common stock purchase agreement. After the SEC has declared the registration statement related to the transaction effective, the Company has the right, at its sole discretion over a period of three years to sell up to $10 million of its common stock to LPC under the terms set forth in the agreement. Proceeds from the transaction will be used to develop the Company's pipeline of products, including the abuse resistant opioids, and for general corporate purposes.
Commenting on the new financing, Elite's Chairman and CEO, Jerry Treppel said, "We are pleased to have Lincoln Park as an investor in Elite. Since the fall of 2011, Elite has demonstrated its ability to add new products, having eight new products approved or launched since then. We intend to use some of the proceeds from this financing to help develop and advance our pipeline of products, including the abuse resistant opioids."
Under the terms of the agreement, there are no upper limits to the price that LPC may pay to purchase Elite's common stock. Elite will control the timing and the amount of shares to be sold. LPC has no right to require any sales and is obligated to purchase common stock as directed by Elite. Under the terms of the agreement, LPC has agreed not to cause or engage in any manner whatsoever, any direct or indirect short selling or hedging of Elite's shares of common stock. In consideration for entering into the agreement, Elite has issued shares of common stock to LPC as a commitment fee and will issue additional commitment fee shares in proportion to the amount of shares purchased by LPC under the agreement..."
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