$LWLG (copy) walterc - Special thanks for this summary to Herman Sleegers , in a previous life my portfolio manager at my investment bank; A very competent analist .
This is computertranslated and sent in Flemish ( Dutch)to several hundreds of investors
UPDATE LIGHTWAVE LOGIC AFTER THE GENERAL MEETING DD 14/5/2020
This report is my personal interpretation after listening to the presentation after the general meeting of shareholders.
I also use a number of additional statements from fellow shareholders for which I am grateful. Of course, only the effective statements of CEO Michael Lebby in the presentation are objective (see website www.lightwavelogic.com) and my personal interpretation may be a little more colourful.
First of all, we were given an overview of the influence of COVID-19 on the activities and that seemed to be quite easy.
During the lock down it was possible to continue working to a limited extent and even 4 new patents were launched. The IP portfolio of Lightwave Logic was thus expanded to 50 patents. Michael Lebby did warn that an additional lock down could never be ruled out and that this would always involve the closure of the production facilities.
Michael Lebby also stressed the good cooperation with MZ Group as responsible for marketing and investor relations. Until now, little was visible of this to the shareholder, but apparently a detailed plan has been worked out.
After contact with MZ Group, there seems to be a lot on the way, namely presentations for industry and investors, contacts with sell- side analysts, actions via social media, contacts with retail and institutional investors and contacts with the financial media.
The design of an improved website is also in the pipeline.
Financially, Lightwave Logic was granted a PPP loan from the government that generated cash until mid-June and is still funded through Lincoln Partners Capital.
1.Data to show to the community: Check
This took most of the year and it was important to demonstrate through a mass of data that polymers are the solution to the major challenges facing the industry.
The aim was to dispel the industry's scepticism towards polymers.
This was clearly achieved and Lightwave Logic was not only able to continue its ongoing NDA's but was also able to attract new ones. The growing interest in the company obviously significantly improves the negotiating position with potential partners.
2.Packaged Modulator 100gbaud <3v: in development
In March 2019 a material was announced with the potential above 80ghz equivalent of 100gbaud or more. It is currently being further perfected to meet the required targets. One of the working points is to reach a modulator that does not need an external drive and is working at 1V or less. The external "drivers" are very expensive and energy consuming, so direct drive is very important for data centers because of a huge saving in costs and energy.
Elements such as size and capacity are inversely proportional to each other. In other words, a smaller size can handle higher capacity but requires more energy.
The only correctable factor is the R33 electro-optical sensitivity of the material. An R33 above 200 Pmv is necessary for "direct drive".
Currently the prototype is on wavelength 1550nm at 165Pmv with a strong improvement over the last year. The recently announced new material at wavelength 1310nm, which has been tested for several months now, reaches the R33 of 200Pmv and meets all parameters.
Michael Lebby was very happy with this realization. However, this material is not yet available in a prototype.
The wavelength 1550nm is especially important for telecommunications, the 1310 for data centers. Lightwave Logic will therefore be able to serve both, we are talking about a total approachable market (TAM) of 20 billion usd.
3.Polymer devices that are stable and reliable @85°c: check
Stability and reliability of the material were tested in various prototypes and sometimes in combination with other classical technologies. The number of hours of testing is difficult to indicate given the multitude of ongoing NDA's with specific questions from potential customers each time. These tests take place on the Lightwave Logic platform with complete integration of the acquired BRphotonics.
4.Packaged prototype for potential partners: check
This procedure is in progress and Lightwave Logic is, as mentioned earlier, committed to various potential partners among NDAs. This is obviously a very intensive process that requires a lot of effort from both parties. The longer this process takes, the more time and money potential partners have already invested and therefore the greater the chance that they will continue.
The fact that the NDA's continue to go through is proof that the discussions are already well advanced and new NDA's show that interest is growing. Hereby, such a process is described by a fellow shareholder, for which I thank him. There are a lot of resources going into such a process from both sides.
Each business team ( per customer) consists of two parties ( LWLG / customer) with Marketing ( Karin Liu) is lead function, then a team of both sides consists of product engineering, process engineering, procurement, product planning, finance, production, perhaps logistics. This team is responsible for the design in process with progress meetings, toll gate meetings.
If there are multiple NDA's there are probably as many of these teams. So this also indicates that Karin Liu has more than one day job (especially if you also travel within the USA, maybe also to other continents). It speaks for itself that this procedure is extremely intensive for a small company like Lightwave Logic.
5.Product feedback from potential partners at 50gbaud: check
This process as described in the previous point is ongoing and means that Lightwave Logic is no longer in the R&D phase but in the prototyping and piloting phase.
Let's look at the course of the design-in cycle. As mentioned before, we are already in the optimisation phase and therefore close to the first design-in. In Michael Lebby's presentation there is a slide with the various phases and there too we see that we close to the design-in and ultimately the commercialisation phase.
- NDA
- Initial specifications
- prototype specification
- Prototype testing with potential partners
- Optimizing the prototype parameters
- Inclusion in the vendors list
- Limited " sampling "
- First design-in
- Sell product
6.Demonstrate 100gbaud packaged prototype: in progress
It is therefore mainly a question of optimising the prototype to meet all the required parameters. Apparently there is a lot of response from potential partners and about the next step of commercialisation Michael Lebby was clear "and that will come".
7.Achieve specifications for design-in phase
This step was further included in the 2020/2021 project and will be communicated at the right time.
8. Potential Partnering
Here, too, we have to wait until one of the parties with whom Lightwave Logic works proceeds to the ultimate step of collaboration. This collaboration can go in various areas, from licensing the technology, to a technical transfer combining the use of Lightwave Logic's IP with the partner's IP in combination with advice and assistance from Lightwave Logic to make the technology operational.
Ultimately, of course, a complete takeover may be possible, but given the multitude of markets that Lightwave Logic has solutions for, this makes it difficult to valuate the company.
Lightwave Logic not only has solutions for telecom and data centres but can also be an added value for Lidar or the miniaturisation of diagnostic devices in healthcare.
A big advantage is that Lightwave Logic can enter in every compartment of the supply chain. Lightwave Logic is part of the group of optical component suppliers and can partner with high-speed optical manufacturers (e.g. lumentum) as well as network equipment manufacturers (e.g. Cisco) and the ultimate consumer internet service providers (e.g. facebook).
Technical evaluation
Commercialization and production
For commercialization and initial income, management has internal models running but it is too early to make them public?
CONCLUSION: the road to commercialisation is long and requires a great deal of patience on the part of shareholders. It seems that CEO Michael Lebby is increasing his grip on the industry step by step by building a solidly shielded IP portfolio.
The step from a sceptical industry to great interest is huge, it is now waiting for a potential partner to find the courage to take further steps.
The pressure on potential partners is clearly increased by the multitude of NDA's and Lightwave Logic's ability to step into any segment of the supply chain.
The current Covid-19 crisis has made the importance of the digital economy even more important. Streaming, homeworking, on-line shopping ensure that the networks run against its maximum capacity. Companies like netflix, facebook, youtube need to downsize their service because the networks are filling up.
Good for old Lightwave Logic yet with more capacity 100gbaud one line , less energy "direct drive" and small and ecological devices.
Who is the first to dare to make the drastic change that is needed?
Translated with www.DeepL.com/Translator
This is computertranslated and sent in Flemish ( Dutch)to several hundreds of investors
UPDATE LIGHTWAVE LOGIC AFTER THE GENERAL MEETING DD 14/5/2020
This report is my personal interpretation after listening to the presentation after the general meeting of shareholders.
I also use a number of additional statements from fellow shareholders for which I am grateful. Of course, only the effective statements of CEO Michael Lebby in the presentation are objective (see website www.lightwavelogic.com) and my personal interpretation may be a little more colourful.
First of all, we were given an overview of the influence of COVID-19 on the activities and that seemed to be quite easy.
During the lock down it was possible to continue working to a limited extent and even 4 new patents were launched. The IP portfolio of Lightwave Logic was thus expanded to 50 patents. Michael Lebby did warn that an additional lock down could never be ruled out and that this would always involve the closure of the production facilities.
Michael Lebby also stressed the good cooperation with MZ Group as responsible for marketing and investor relations. Until now, little was visible of this to the shareholder, but apparently a detailed plan has been worked out.
After contact with MZ Group, there seems to be a lot on the way, namely presentations for industry and investors, contacts with sell- side analysts, actions via social media, contacts with retail and institutional investors and contacts with the financial media.
The design of an improved website is also in the pipeline.
Financially, Lightwave Logic was granted a PPP loan from the government that generated cash until mid-June and is still funded through Lincoln Partners Capital.
1.Data to show to the community: Check
This took most of the year and it was important to demonstrate through a mass of data that polymers are the solution to the major challenges facing the industry.
The aim was to dispel the industry's scepticism towards polymers.
This was clearly achieved and Lightwave Logic was not only able to continue its ongoing NDA's but was also able to attract new ones. The growing interest in the company obviously significantly improves the negotiating position with potential partners.
2.Packaged Modulator 100gbaud <3v: in development
In March 2019 a material was announced with the potential above 80ghz equivalent of 100gbaud or more. It is currently being further perfected to meet the required targets. One of the working points is to reach a modulator that does not need an external drive and is working at 1V or less. The external "drivers" are very expensive and energy consuming, so direct drive is very important for data centers because of a huge saving in costs and energy.
Elements such as size and capacity are inversely proportional to each other. In other words, a smaller size can handle higher capacity but requires more energy.
The only correctable factor is the R33 electro-optical sensitivity of the material. An R33 above 200 Pmv is necessary for "direct drive".
Currently the prototype is on wavelength 1550nm at 165Pmv with a strong improvement over the last year. The recently announced new material at wavelength 1310nm, which has been tested for several months now, reaches the R33 of 200Pmv and meets all parameters.
Michael Lebby was very happy with this realization. However, this material is not yet available in a prototype.
The wavelength 1550nm is especially important for telecommunications, the 1310 for data centers. Lightwave Logic will therefore be able to serve both, we are talking about a total approachable market (TAM) of 20 billion usd.
3.Polymer devices that are stable and reliable @85°c: check
Stability and reliability of the material were tested in various prototypes and sometimes in combination with other classical technologies. The number of hours of testing is difficult to indicate given the multitude of ongoing NDA's with specific questions from potential customers each time. These tests take place on the Lightwave Logic platform with complete integration of the acquired BRphotonics.
4.Packaged prototype for potential partners: check
This procedure is in progress and Lightwave Logic is, as mentioned earlier, committed to various potential partners among NDAs. This is obviously a very intensive process that requires a lot of effort from both parties. The longer this process takes, the more time and money potential partners have already invested and therefore the greater the chance that they will continue.
The fact that the NDA's continue to go through is proof that the discussions are already well advanced and new NDA's show that interest is growing. Hereby, such a process is described by a fellow shareholder, for which I thank him. There are a lot of resources going into such a process from both sides.
Each business team ( per customer) consists of two parties ( LWLG / customer) with Marketing ( Karin Liu) is lead function, then a team of both sides consists of product engineering, process engineering, procurement, product planning, finance, production, perhaps logistics. This team is responsible for the design in process with progress meetings, toll gate meetings.
If there are multiple NDA's there are probably as many of these teams. So this also indicates that Karin Liu has more than one day job (especially if you also travel within the USA, maybe also to other continents). It speaks for itself that this procedure is extremely intensive for a small company like Lightwave Logic.
5.Product feedback from potential partners at 50gbaud: check
This process as described in the previous point is ongoing and means that Lightwave Logic is no longer in the R&D phase but in the prototyping and piloting phase.
Let's look at the course of the design-in cycle. As mentioned before, we are already in the optimisation phase and therefore close to the first design-in. In Michael Lebby's presentation there is a slide with the various phases and there too we see that we close to the design-in and ultimately the commercialisation phase.
- NDA
- Initial specifications
- prototype specification
- Prototype testing with potential partners
- Optimizing the prototype parameters
- Inclusion in the vendors list
- Limited " sampling "
- First design-in
- Sell product
6.Demonstrate 100gbaud packaged prototype: in progress
It is therefore mainly a question of optimising the prototype to meet all the required parameters. Apparently there is a lot of response from potential partners and about the next step of commercialisation Michael Lebby was clear "and that will come".
7.Achieve specifications for design-in phase
This step was further included in the 2020/2021 project and will be communicated at the right time.
8. Potential Partnering
Here, too, we have to wait until one of the parties with whom Lightwave Logic works proceeds to the ultimate step of collaboration. This collaboration can go in various areas, from licensing the technology, to a technical transfer combining the use of Lightwave Logic's IP with the partner's IP in combination with advice and assistance from Lightwave Logic to make the technology operational.
Ultimately, of course, a complete takeover may be possible, but given the multitude of markets that Lightwave Logic has solutions for, this makes it difficult to valuate the company.
Lightwave Logic not only has solutions for telecom and data centres but can also be an added value for Lidar or the miniaturisation of diagnostic devices in healthcare.
A big advantage is that Lightwave Logic can enter in every compartment of the supply chain. Lightwave Logic is part of the group of optical component suppliers and can partner with high-speed optical manufacturers (e.g. lumentum) as well as network equipment manufacturers (e.g. Cisco) and the ultimate consumer internet service providers (e.g. facebook).
Technical evaluation
Commercialization and production
For commercialization and initial income, management has internal models running but it is too early to make them public?
CONCLUSION: the road to commercialisation is long and requires a great deal of patience on the part of shareholders. It seems that CEO Michael Lebby is increasing his grip on the industry step by step by building a solidly shielded IP portfolio.
The step from a sceptical industry to great interest is huge, it is now waiting for a potential partner to find the courage to take further steps.
The pressure on potential partners is clearly increased by the multitude of NDA's and Lightwave Logic's ability to step into any segment of the supply chain.
The current Covid-19 crisis has made the importance of the digital economy even more important. Streaming, homeworking, on-line shopping ensure that the networks run against its maximum capacity. Companies like netflix, facebook, youtube need to downsize their service because the networks are filling up.
Good for old Lightwave Logic yet with more capacity 100gbaud one line , less energy "direct drive" and small and ecological devices.
Who is the first to dare to make the drastic change that is needed?
Translated with www.DeepL.com/Translator
Lightwave Logic Inc (LWLG) Stock Research Links
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