CINEMASTAR LUXURY THEATERS (LUXY) Message Board

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Microcap & Penny Stocks : CINEMASTAR LUXURY THEATERS (LUXY)

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To: Candle stick who wrote ()	11/15/1997 2:43:00 PM
From: Brad Zelnick	Read Replies (1) of 85

I'm assuming that you are still interested in this stock. I have been trying to make sense of the company. I have talked with one of their employees who is enthusiastic. I have a THX system with a 9 X 12 big screen. Have spent some time with Lucas engineers and toured Sky Walker Ranch - the stuff is great.... However, this company is real sketchy. I have looked at EDGAR and find what appears to be a typical boiler shop operation. Apparently set up by some dentist-doctor and run by supposed movie theater types. They appear have been putting high end operations into ? low-end locations at a time when the real estate market had sagged badly, and theater chains were blanketing the landscape, and not many block-buster films are being released. It appears that the company was about to go bust when they got last minute funding. The price for that funding is massive stock dilution for existing shareholders, loss of control of the company, and a guaranteed stock price of $.50-80 for the near term. I have many questions: - Lots of previous posters on this thread exclaimed about what an under-valued asset this company represented. Was this simply ignorance? How could they not see signs of impending bankruptcy? Or was management covering up the true situation? - It appears that the terms of the refinancing include removal of the dentist-doctor from the board, and another guy from BOD-management. Were these people responsible for the problems? Or are they simply the fall guys? If they are the fall guys, shouldn't the remaining people be canned? - Many questions were raised about insider selling during the past year. No poster ever answered the questions. I see that the dentist shares went from ~1.4 million shares to ~700K. Were these sales? A net search seems to indicate a divorce. Was this it? What were the posts about margin calls? Are there funny leasebacks and loans and other trashy interconnects that frequently occur in these penny-stock companies. - This was a product of the Boston Company. Isn't it one of those "notorious" cold-calling boiler shops? Are they still involved? _ My understanding is that movie complexes profit on the concession stands. They appear to have an outside concessioneer. Is their deal industry standard? Is it good? - It looked to me like they had downpayments and lease obligations on disaster-zone places like San Bernardino. Are they hobbled by this sort of thing? - How many of their theater and equipment leases are insider owned? - Do they have an equity investment by Lucas? (I was told by the employee that he had a significant interest, but can find no record.) Can anyone set up THX operations? How about DTS, and the Sony stuff? - Do they have reasonable deals with the studios? - Delisting by NASDAQ is terrible for the small investor. But not so bad for someone who controls the operation. They really don't care about spreads and broker costs, etc. The small guy gets hosed. Is it likely that the company will be recapitalized and a reverse split contemplated? _ There were warrants and other paper garbage hanging around. Will the capital structure be cleaned up? Is it possible at this time to actually calculate what you would buy when you buy a share of stock? - This is tax selling season, I would expect the price to stay down, and even decline some. But will it come back? - Will you be going to their shareholder meeting December 4?

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