Wade Ramey,
Thanks for the clarification. I didn't mean to muddy the waters. I put a large chunk of my portfolio into TSQD Friday at 4 5/8. I want to make sure I (and others looking to buy) understand this.
Here is the Tech Squared section of DRIV's S-1/A: (the S-1/A is something all should read, I agree with Wade)
45<PAGE>
CERTAIN TRANSACTIONS
TRANSACTIONS WITH TECH SQUARED, INC.
Joel A. Ronning is currently the Chairman of the Board of Directors of Tech Squared, Inc. and owns approximately 49% of Tech Squared's outstanding Common Stock as of June 30, 1998. In December 1995, Mr. Ronning issued an option to MacUSA, Inc., a wholly owned subsidiary of Tech Squared, to purchase 3,200,000 shares of the Company's Common Stock held by him for $1.00. The option is not
transferable and is exercisable at any time through December 31, 2000. During the term of the option, Mr. Ronning has agreed to vote the 3,200,000 shares as directed by the Board of Directors of MacUSA, Inc. In addition, MacUSA, Inc. has agreed to reimburse Mr. Ronning for any tax liability that he may incur in connection with the transfer of the option or the shares of Digital River stock
issuable upon exercise thereunder. If MacUSA, Inc. exercises its option to purchase Mr. Ronning's interest in Digital River, it will own approximately 18.92% of the outstanding capital stock of the Company after the completion of this offering. In addition, some of Mr. Ronning's time is spent fulfilling his duties as Chairman of the Board of Directors of Tech Squared.
Mr. Reese, a director of the Company, is also President and Chief Operating Officer of Tech Squared.
Tech Squared currently provides office and warehouse space and certain administrative, financial and software product fulfillment services for the Company. Charges for these services totalled approximately $168,000 and $171,000 for fiscal 1997 and the six months ended June 30, 1998, respectively.
Wade, OK I've got it now. To perhaps make it clearer to others who didn't understand your math right away. Here is how you get to 1 share of TSQD = 0.3 DRIV share value (leaving out value of TSQD as its own company and any market discount).
TSQD will own 3.2M of 16,913,715 DRIV shares (barring further dilution of DRIV). That is 18.9% of DRIV. Total DRIV shares 16.9 M, total TSQD shares 10.55 M. 16.9/10.55 = 1.6
0.189 * 1.6 = .3024
A thing of beauty. Thank-you very much Wade and Kimberly. |
