Lightwave Logic Inc (LWLG)

[KCCO7913]

Gates,

From the link Inversor posted, here is how they might be effectively shorting the stock:

"With the execution of the “Purchase Agreement” Anavex agreed to issue LPC 179,958 newly issued shares for free. LPC can now use these free shares in their account as a “float” to sell shares in the market in advance of the shares they will purchase later at a discounted price(the lowest quoted price of the day), effectively engaging in a transaction akin to shorting the shares they will cover via purchase later, while on paper it can be claimed that LPC is transacting from a long position.

One can imagine a scenario like this, LPC starts the day with the full balance of the 179,958 free shares, during that day they sell in the open market at various price points 50,000 shares, end with a balance of 129,958 shares; at the end of the day they go to Anavex that issue them 50,000 new shares at the lowest quoted price of the day and the balance is replenished to 179,958 shares, LPC can now repeat the same transaction the next day, effectively shorting the stock with the appearance of being a long seller.

Using the same scenario example, that same day AVXL stock fluctuates between $10 and $11 and LPC manages to sell the 50,000 shares in the open market at an average price of $10.50, at the end of the day they purchase 50,000 shares directly from Anavex at $10.00 the lowest price of the day, pocketing $0.50 per share, a $25,000 completely risk-free profit and delivering $500,000 of fresh cash extracted from the marketplace to Anavex bank account, basically, in this example, a 5% commission to transfer funds from retail investors to Anavex."

They would be using the 600,000 or so free shares from the last agreement to perform this.

Now, I'm not sure if LWLG would issue new shares at LPC's request. I believe LWLG has done a decent job of controlling this "issue" by only tapping LPC when they actually need the cash.

Speaking of...anyone else hear that LWLG doesn't plan on doing a private placement this fall? I know the new LPC agreement doesn't have that dollar floor price anymore. I sure hope LWLG doesn't plan on tapping LPC for all their cash needs once the well runs dry. Ideally our device prototype will attract a partner/NRE fees.