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Shareholder Opposes ADLS New Issue
By: Justin Kuepper   Thursday, February 26, 2009 2:11 PM

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Advanced Life Sciences (NDAQ: ADLS) wants to issue millions of new shares that could significantly dilute existing shareholders. Groundworks of Palm Beach, which owns approximately 5.74% of the firm, opposed this proposal in letter to the board found in a Schedule 13D filing with the SEC. Here's a copy of that letter:
As a material stockholder of Advanced Life Sciences Holdings, Inc. (the “Company”), I am requesting that you either amend or withdraw your unwarranted proposal to increase by 300% the authorized common stock of the Company. I currently beneficially own, directly and indirectly through my corporation Groundworks of Palm Beach County, Inc. (“Groundworks”), approximately 5.74% of the common stock of the Company, and have, therefore, made a significant financial investment in the survival and eventual growth of the Company. Consequently, it was with dismay that I reviewed the Company’s request to increase by 300% the authorized common stock.

As disclosed in the Schedule 13D I filed today with the SEC, I acquired my Company shares over a period of approximately ten months for investment purposes. However, upon review of the Company’s preliminary proxy statement filed with the SEC on February 6, 2009 (the “Preliminary Proxy Statement”), I have significant objections to the proposal pursuant to which the Company intends to seek approval of an amendment to its Amended and Restated Articles of Incorporation to increase the number of authorized shares from 65,000,000 to 185,000,000, including an increase in the number of authorized shares of common stock from 60,000,000 to 180,000,000 (the “Proposal”). Based on the objections that I fully explain in this letter, I, on behalf of myself and Groundworks, hereby request that the Company remove or amend the proposal.

I have significant concerns regarding this proposal stemming from both the size of the increase and the fact that the Board has not provided sufficient information as to how it intends to use this exorbitant amount of shares. I believe that a proposal seeking an increase of 120,000,000 additional new shares underlies the problematic issues that the Company is facing. While I understand that the current economic conditions, combined with delays in the NDA filing, have placed the Company in a difficult liquidity situation, I do not believe that you have justified the necessity of increasing by 300% the Company’s authorized common stock.

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The above story is the opinion of the author only and it does not reflect iStockAnalyst opinion. Further, the author is not personally advising you regarding the suitability of the story for your investment needs. In no event iStockAnalyst will be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from or arising out of, or in connection with the use of this information. Please consult your investment advisor before making any investment decision.
  
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