The Golden Lounge

[matrix]

IMO it's a deceptive PR. Highgate House Funds Ltd is a relatively new Cornell Capital Partners' PIPE fund.

http://www.forrelease.com/D20050118/nytu153.P1.01182005113227.16735.html

http://www.twst.com/conferences/reverse/sponsorsreverse.html

http://www.cornellcapital.com/contact_us/index.asp?Section=6,0,0

Looks like CIRT is being charged a lower rate because the "new" holder will be able to convert the debenture into common stock at any time once their registration is filed and deemed effective by the SEC.

CIRT's authorized is 750 million right now. According to their 10K, as of 8 April 2005 the o/s was ~564.9 million. The difference is enough to cover the entire debenture at today's price. Once Highgate decides to start selling, IMO this will put downward pressure on the stock causing the price to go flat to down. If the price drops, Highgate will get more shares causing the pressure to increase. If it drops too much, the company will be faced w/ either having to raise the a/s or r/s the stock.

To me, PIPE deals are never good news for outside shareholders. The company may do a pump campaign to try and counter the effect. This in turn may or may not give a good short-term play. These usually are not good long-term holds.