LUMM - Lumenon Innovative Lightwave Technology Inc. Message Board

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Technology Stocks : LUMM - Lumenon Innovative Lightwave Technology Inc.

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To: Don Johnstone who wrote (1929)	7/30/2000 1:54:34 PM
From: P. Ramamoorthy	Read Replies (1) of 2484

Don, My first experience with Castle Creek's MO was in VLNC and WSTL investments, last year. VLNC thread on SI last year (Jul-Oct period) gives a detailed discussion of the floorless conversion financing and the "orchestrated" short sales of VLNC. The "longs" felt that the short sales and Castle Creek were somehow connected. They closely monitored short sales, Castle Creek's conversion price according to the formula, etc. Conversions took place as longs expected. Castle Creek does not go long. They get their $ out fast and move on to the next deal. Too much information to summarize here. You will get more information on Castle Creek if you post a question in the VLNC thread (SI). For LUMM's case, this poster hit the nail on the head. ragingbull.altavista.com WSTL went through a similar financing deal but they did not experience the heavy short attack like VLNC did. Both companies had good technologies and were desperately in need of financing. VLNC was trying to commence commercial production and needed Purchase Orders to convince the Street. LUMM is in a similar situation: they need to commence production, get products accepted, and get Purchase Orders, besides Molex. If LUMM meets the production deadlines and generates purchase orders/revenues, the longs may turn out to be OK in the end. I do wonder why LUMM management chose this source of financing. The best proof for Castle Creek's MO will show in LUMM share price in the next 18 months and short interest. I'll not be surprised it the price dives to the floor conversion price $10 or whatever, giving time to cover the shorts later. It does present some opportunities in shrewd investing in LUMM if the Castle Creek's history repeats. The LUMM Board will become more active. Ram

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