If it were options related, it should happen at the close, not the open.

Pre-arranged block trade. The buyer and seller agreed on the price yesterday

I’ll be concerned if Marcelli fires all of their new hires. They were hired for specific purposes. Peer reviewed publications have proven the technology. Packaging partners and foundries are plural words throughout the 10-K.

Reliability and stability concerns may be a stall tactic to give their existing suppliers a chance to launch their latest and improved optical engines. After all, these are billion dollar relationships that are being disrupted. But, the value proposition is far too superior over the incumbent performance. The need is too great.

Perhaps a private room dinner at Ruth’s Chris to break the news would be appropriate!

Let’s hope we stay independent as long as OLED.

The ASM longs will have boots on the ground at OFC. You won’t read what he finds out here though. But Walter will pass along all of his OFC due diligence.

Yes the index funds are forced to sell a little bit of everything they own when the owners of the index funds sell.

I much prefer to collect time premium rather than pay extra for the leverage. Buying options is risky, selling options is the opposite.

I only add shares nowadays by selling naked puts. I have posted that I will be adding 8,500 shares at a net cost of $3.88 on Friday. Sometimes I want to get put and sometimes I want them to expire worthless. Now is a good time to add because things are about to happen.

Investors like Ted prefer to wait until after a big deal is announced even if he has to pay more. He doesn’t trust Lebby at all. At $50, it isn’t going to make too much difference whether your cost basis is $4.20 or $6.00.

In my opinion, a buyout will not happen until after many deals have been signed and LW starts to crowd out the incumbents. The deals will happen this year, but any financial impact won’t be felt by the incumbents until next year. I don’t see any buyout risk for at least a year.

I suppose it is possible. If a cash buyout were announced today at $50, the shorts may have to pay more than $50 to get people to sell to them. How much more? Probably just a few bucks unless the offer gets a cold reception and needs to be a higher number.

For this very reason, I have purchased more shares than I originally intended. My long term price target has always been $300, but I fear a nearer term buyout price to be near $50. The best protection against a buyout is to sign multiple agreements throughout the ecosystem.

X, at one time shorts were paying close to 50% to borrow shares. Now the cost at Schwab is zero. That is because institutions flooded the market with availability as they acquired more shares and lent them out.

X,

Please post the quarterly ownership numbers that I sent you. That shows when the short interest skyrocketed and the best price was about $9. The average short position today was put on around $6.

I have been meaning to write this post for a very long time. Those who post on this board and short the stock will know this information quite well. I just have one caveat. I don’t think the rules have changed since I was a licensed stockbroker from 1982 to 1986. This example assumes the brokerage account is large and approved for all trading levels.

When one wishes to purchase 1,000 shares of Lightwave Logic at $4.20 per share, they must put up $4,200 in cash. Presumably this cash was in a money market fund earning 5.19% at Schwab. The opportunity cost on a monthly basis is therefore $18.16. After one year, this cost is $217.98.

When a short seller sells 1,000 of Lightwave Logic at $4.20 and holds the $4,200 proceeds in the same money market fund at Schwab earning 5.19%, they earn $18.16 in interest per month or $217.98 per year. The margin requirements state that the short seller must maintain 110% of the value of the short position on a daily basis. Therefore, in theory, the short seller must add $420 to the account. Now the short seller has $4,620 in the money market fund earning $19.98 per month and $239.78 per year. There are two ways to look at this scenario:

1) As I stated in the first paragraph, this is a large account with hundreds of thousands of dollars in the money market fund at all times and so this specific trade does not require any daily transfer of funds to maintain the margin requirement. Assuming the stock is at $4.20 after one year, the short seller has made $239.78 in interest income and the buyer has lost $217.98 in opportunity cost. Therefore, the short seller is ahead of the long buyer by $457.76 or roughly 10.9%.

2) The account is very small and can only afford to short 1,000 shares at $4.20. While this scenario is not possible, it is the scenario that X writes about when referring to margin calls. In this case, there is no excess balance in the account’s money market fund. The short seller was able to come up with the 10% margin requirement or $420, but has no other funds available to him. After the sale, the account has $4,620 in cash. If there were to be the PR that most of us believe is coming soon and the stock shot up to $9.20 per share, the margin requirement would jump to $10,120. That would require this broke ass short seller to deposit $5,500 within 24 hours or Schwab would buy back his short position at $9.20, close the account, and sue the short seller for the balance owed.

In both scenarios, the short seller would lose the same amount of money if the stock were to gap open, but the large account would simply absorb the loss and the small account would be in trouble. In reality, no brokerage firm would authorize the small account to participate in short selling activities. Short selling is a very risky business, but it can also be a very lucrative business. Certainly, the short seller lobby dominates the SEC to maintain the margin requirement rules skewed in their favor.

Actually one of the listing criteria was that the stock needed to trade above $4.00 for (I think 30 days consecutively). The company did nothing to meet this requirement. Shareholders, including myself contributed in moving the stock above $2.00

I am going to put together a full explanation of your point later today. It is 68 degrees in Chicago and I am outside!

It is a good thing people don’t judge other’s intelligence based on their grammar and punctuation. That universal forgiveness happened a long time ago.

I intend to do nothing with my short puts that expire on Friday. I thought about taking a $.35 profit on these and rolling them out to a future date and pick up an extra $.70 time premium. However, with so many potential milestones that are supposed to happen in the next couple of months, I think my best choice is to add 8,500 shares for the long haul. After all, a tax cost basis of $3.88 is pretty good. I have plenty more short puts for September and January with net cost numbers just below $3.00 and just above $3.20. I expect those will expire worthless. By September, I expect the stock will be trading in double digits.

It won’t be very long before this board becomes irrelevant. Perhaps the occasional post to say, “I told you so!”

We will get analyst coverage after a tier one deal has been signed. It would not surprise anyone if Roth was the first firm to cover LW.

Dr Lebby spoke about the 2024 catalysts which included a lot more reliability data, prototypes, and product demonstrations. Yes, there will be more presentations because Lebby gets a lot of invitations to speak at the largest industry conferences.

For those who email and/or telephone the MZ Group and management, please feel free to suggest Lightwave Logic conduct a product demonstration at the ASM. I am not sure if that can be done at the Hilton Hotel or if they would invite shareholders to tour their facilities and see a demonstration there.

The due diligence being conducted by the major players today is all about high volume supply. It doesn’t matter which sales prong gets the order. “They” are interested in tens of millions of transceivers to retrofit their data centers.

Earlier this evening I was watching “The Wheel of Fortune” and the first puzzle was:

TIME IS MONEY

That made me think about the urgent need for 3x improvement in bandwidth, a 90% reduction in power consumption, and a small footprint that leaves plenty of physical space for more value added features within the transceiver.

I haven’t attempted to calculate the cost per day of a delayed decision to retrofit ALL of the world’s data centers, but I bet there are plenty of accountants who are banging away at their calculators.

For those trading Lightwave Logic stock, I would like to advise you to check your account settings. The default setting is FIFO (first in first out). This means that your oldest shares are sold first. You can change your settings for future trades to LIFO (last in first out).

The reason this is important is the difference in tax rates between long term profits and short term profits. This may or may not be important to you. It is to me!

As the risk of being bought out sooner than desired increases as reliability data proves out, it makes sense to be aware of the tax differences between long term and short term rates.

Yes! Those protesters over nuclear power caused a surge in coal fired power plants. Environmentalists at work!

Now the environmentalists want to shut down nuclear and coal plants plus they want everyone to drive electric cars. Causing one disaster after another.

That’s where the “loser pays” law would help. But the fox is guarding the henhouse.

All four of your NO statements are obsolete

Don’t leave out the input from The Advisory Board as well as the BOD. One of the strengths of Michael Lebby is that he seeks input from close advisors. It only appears that he is doing most of the work.

X,

I have made a few changes to the spreadsheet and I will send you the latest version. Some did not like the way I maintained the 6.2% cost of goods sold in all years. I changed that number to 20%, then 25%, then 30% and kept it at 30% in the out years. However, I had decreased the ASP of the 800G by 20% per year as a way to reflect the change in product mix from 100% material sales (which will continue to be 6.2%) to a combination of PIC sales (much higher cost of goods sold) and royalties (almost no cost of goods sold). As noted many times, the hyperscalers want to commoditize the transceivers to $1/gbps. ($800/800G transceiver). I started at $800 and decreased it to $377 by 2030. Since that is not really mix related, I changed the initial revenue per transceiver to 75% of the $800 and the price erosion to 15% per year instead of 20%. Another nugget of information that I found in the 10-K was the indefinite tax loss carryforward number of $79,710,000. I had been just using the accumulated deficit number. In other words, the first $79.7 million in earnings will be tax free instead of the $120 million I had been using. These changes reduced the EPS numbers by a significant amount. However, one must remember that the top line unit sales numbers are for only two products out of many and reflect the obtainable sales given the resources available as of May 2023. Unit sales in 2027 were projected to be 742,000 back in May. Those numbers could quadruple with the addition of a large foundry. When that happens, the spreadsheet will be adjusted. Actually, shortly after that happens, the company should get coverage by Wall Street.

The due diligence being conducted by the major players today is all about high volume supply. It doesn’t matter which sales prong gets the order. “They” are interested in tens of millions of transceivers to retrofit their data centers.

If the stock closes below $5.00 on 3/15/24 I will be buying 8,500 shares at $3.88 net of option premium.

I gave you a chance, but it just isn’t worth my time to read and/or respond to your viewpoints.

Back on ignore!

Ted, you are stuck in a rut. You think you have uncovered some hidden bit of information, but it is nothing. I personally did not bother to ask anyone at the company if the word change meant anything, but KCCO did. He was told both are correct. With most people, that would end the discussion. The fact that you are the only one still bringing it up as if it is GIANT NEWS, says it all. As my daughter might have said twenty years ago, “that is so yesterday!”

It doesn’t matter what your motives are for posting on this board or how one wishes to read between the lines, one thing is extremely clear:

The due diligence being conducted by the major players today is all about high volume supply. It doesn’t matter which sales prong gets the order. “They” are interested in tens of millions of transceivers to retrofit their data centers.

Reading between the lines is a difficult thing to do when lawyers, especially LW’s lawyer, want to create vagueness because that was their training. I do agree with Ted on the topic of vague wording, but his motives are to get the stock price as low as he possibly can by interpreting everything in a negative light.

My interpretation (correct or not) is that Lebby made an effort to explain what is going on with the licensing agreement discussions. He brought up three topics that are areas of interest in the due diligence process being conducted by the largest potential customers. He did make the point that they are currently talking with very small interested parties as well. The boxes that need to be checked are different depending on what part of the ecosystem a potential customer sits. A foundry wants to be assured they can get all the Perkinamine they could ever require. They also need to be assured the polymer can maintain its performance level for at least as long as the incumbent technology. After all, if a foundry sells one million transceivers to a hyperscaler’s data center and the transceivers start to fail after a year, who is responsible and what is the corrective course of action. These are due diligence topics.

The foundry needs to understand the economics of producing millions of PICs on their 200mm wafers. This knowledge comes from trial runs and test results. These trials have been ongoing for at least a year with multiple foundries. Some foundries are ahead of others. We know Dr Lebby has been very pleased with the test results on the PICs that have been produced on 200mm wafers. These terrific results need to be verified from run to run from multiple foundries. All of these production statistics are put into formulas to arrive at an agreeable price and royalty arrangement. These are due diligence topics.

The third area about financial stability was really not a concern, in my opinion. I think it was an opportunity for Dr Lebby to reiterate the financial strength of the company. The cash position and shelf offer assurance. Think of it this way from the customer’s viewpoint: “I see your balance sheet today and I am about to give you a $200 million order so should I be concerned if your company will survive long term?”

Dr Lebby gave the shareholders some insight into the topics being discussed currently with major multi-billion dollar potential customers. These topics are rather obvious to me and I think Dr Lebby has anticipated them for years. He has been working with multiple foundries and packaging partners to be ready to address these topics. For the most part, Lightwave Logic is able to check off these boxes today. What remains is all related to continuity of supply.

It doesn’t matter what your motives are for posting on this board or how one wishes to read between the lines, one thing is extremely clear:

The due diligence being conducted by the major players today is all about high volume supply. It doesn’t matter which sales prong gets the order. “They” are interested in tens of millions of transceivers to retrofit their data centers.

That is correct. Lebby was referring to the optics and said they could amount to as much as 80% of the selling price of the transceivers.

The question was asked because the slide that shows the projected market size of all the verticals used $40 to $60 billion for transceivers.

Thank you for that valuable input. If you go back and listen to the 2022 ASM Q&A, Lebby addresses a question from me about what portion of the transceiver revenue is represented by the modulators. It was a value added response.

I guess you are the one who emailed Luke to find out if I was lying or not. Glad you got your confirmation. Luke is very careful not to say anything that is in addition to anything the company has made public.

The spreadsheet is based on very little information from the company. Only the PIC unit sales numbers are from the company. The royalty income and average selling prices are unknown, but derived from the end user goal of getting the cost per G down to $1 ($800 for an 800g PIC) which is discussed in the 10-k.

The purpose of putting the spreadsheet out here is to stimulate discussion PERIOD! Until the company inks additional agreements and provides financial guidance, there will be no analysts willing to follow the company, in my opinion.

There is no claim of accuracy from me. As information becomes available, the numbers will be changed accordingly.

Net Sales in Q4 was $40,502. That level of sales reduced the deferred revenue liability by $10,125 to $39,875.

$40,502/$10,125 = 4.000

The deferred revenue liability will be reduced to zero after the cumulative Net Sales reaches $162,000.