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Microcap & Penny Stocks : CAVR (Carver Corporation),Book at 1.28,price 0.25. -- Ignore unavailable to you. Want to Upgrade?

To: TARIQ STOCKS who wrote (94)	4/10/1998 9:57:00 PM
From: Randi	Read Replies (1) \| Respond to of 319

Tariq, I received a letter by snail mail today passed on to my broker from Carver Corp. The letter is dated March 24, 1998. However, I did not receive it until today. I will attempt to type it in word for word..... Memorandum: March 24, 1998 To Our Shareholders: Carver Corporation ("Carver" or the "Company") has entered into an agreement in principal with an investor (the "Proposed Sale") which, if consumated, would provide for an immediate infusion of working capital into the Company. The Company is currently developing a new business plan to assist the Company in a return to profitability. Development of the plan requires an immediate infusion of working capital to allow the Company to meet its most pressing financial obligations and continue to develop this plan. As you know, an extended period of losses has eroded the Company's working capital and without an immediate infusion of capital, the Company believes that it is unlikely that it will be able to satisfy a number of its financial obligations in March 1998. The Proposed Sale contemplates that the Company will issue up to 3 million shares of the Company's Common Stock to the Renwick Special Situations Fund ("Renwick") at a price of $0.125 per share, providing the Company with an immediate infusion of up to $375,000. Renwick and its affiliates currently hold 1,411,754 shares of the Company's Preferred stock and 361,443 shares of its Common Stock. Two of the Company's directors, Raj Bhatia and James McCullough, are each general partners of Renwick. Because the Company's Common Stock is traded on the Nasdaq National Market, it is subject to the NASD's Marketplace Rules. Persuant to these rules, the Company is required to seek shareholder approval prior to the sale of shares of Common Stock equal to 20% or more of its outstanding Common Stock at a price less than market value. However, the rules provide that the NASD may grant an exemption from this shareholder approval requirement if (i) the delay in ecuring shareholder approval would seriously jeopardize the financial viability of a Company, (ii) the Company's audit committee expressly approves the Company's reliance on such an exception and (iii) the Company mails to its shareholders not later than 10 days before issuance of the new securities a letter alerting them to its omission to seek shareholder approval that would otherwise be required. On March 3, 1998, the Company's Board expressly approved reliance on the exception to the shareholder approval requirements of the NASD Marketplace Rules and Nasdaq has also approved the Company's relance on the exception. The Company believes that, if it is able to refine and begin implementation of its new business plan, it will be in a much better position to obtain additional financing and be successful on a long term basis. While the Board is well aware of the extent of the dilution to existing shareholders associated with the Proposed Sale. However, at this time the Company is not aware of any other viable alternatives to generate an equivalent amount of working capital within the time period required. Without a timely infusion of funds, the Company would not be able to satisfy its immediate obligations and its continued development of the new plan would be impossible. This letter serves as notice of the Company's omission to seek shareholder approval in connection with the proposed issuance of securities to the Investors. We believe that the Proposed Sale is in the best interests of the Company and its shareholders. Carver Corporation Signed by: John P. World Executive Vice President & General Manager end of letter. So, what do you guys make of this? I have my own opinions, but am new at this, so I could very well be wrong..... Randi L.