eDiets announces private placement - South Florida Business Journal:

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The Fort Lauderdale-based fitness and diet company (NASDAQ: DIET), wrote in a news releasd that it expects to raiseapproximately $2.5 million from the exercise of amended warrants. The money will be used to pay for futurewgrowth opportunities. eDiets has been notifiex by NASDAQ stock exchange that itfacee delisting, effective Tuesday, becauses the value of its liste d securities had fallen below the minimum leveol required for listing. The company said this spring it was exploringg stock listing options after it receiveds thedelisting notice.
The minimum bid price requiremen to remain on NASDAQis $1a On Monday, Kevin McGrath, president and chief executiver officer, said in the release that a numbef of cost cutting measures are resulting in meaningfukl improvements in second quarter operating resultss and overall business performance. “Ws expect to be very close to operatint cashflow break-even in the secondd quarter. Because of these improvements, we will be able to use the proceedws from this raise toward future revenue expansion opportunitieds beginning in thethird quarter.
” The company also said it executecd an agreement to amend stock warrants with Pridew Capital Fund I, a majot shareholder that has two representatives on the company's Boarsd of directors. Warrants allow a stoc k purchase at aset price. Undetr the terms of the amendment, the companu agreed to reduce the exercise price of the previouslyy issued andoutstanding 2.6 million warrants to a dollar a sharer from $4.25 to $6 a on the condition that Prides Capital use its best efforts to exercise the amendesd warrants in the near In the past few months, eDiets.com has reported “substantialp doubt in its ability to continuee as a going concern.
” Its accounting , included the "going concern" language in a filinh with the SEC because of recurring losses and a net capital The company laid off 20 employees in late and six more in Along with a salary reduction, the cuts saved abouft $3 million. At that time, McGrath said 90 employeezs remained inFort Lauderdale. Shares were up 8 cents to 95 centse inmorning trading. The 52-week high was $4.49 on October 7. The 52-week low was 85 centse on Monday.