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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 232.88

-0.8%

Nov 17 3:59 PM EST

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To: Gulliver who wrote (1596)	2/17/1998 1:40:00 PM
From: Oeconomicus	Read Replies (1) of 164684

Traveler, the debt is structured to encourage an early repayment, the source of which could only be a secondary. Six months from closing, the interest rate on the loan goes up by half a point. Also, all or some of the warrants (the amount declining over time) can be cancelled upon prepayment. If memory serves, all are cancelled if they repay within one year of closing. To prepay, they'd need to issue about 1.25mm shares at current prices, but it wouldn't surprise me to see some "selling shareholders" in there too. After all, the "primary" reason for the offering would be to retire debt which would generally be seen as a good thing. This allows them to play down the significance of any selling by Kleiner Perkins, Bezos, etc. (you know, the size of the offering would be too small without their shares; they are just meeting the demand from public investors for shares; blah blah blah). Call me a cynic, but...

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