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Non-Tech : Bill Wexler's Dog Pound -- Ignore unavailable to you. Want to Upgrade?

To: Mama Bear who wrote (496)	3/30/1999 1:10:00 AM
From: Larry Brubaker	Read Replies (1) \| Respond to of 10293

VLNC "floorless" financing. To set the record straight, VLNC has issued two tranches of convertible preferred shares to Castle Creek. The first was issued on July 27 for $7.5 million. The preferred shares were convertible to common at a fixed rate of ~$6.03 until January 27, when they became convertible at a floorless variable rate. In late December, Castle Creek purchased a second tranche of convertible preferred shares for another $7.5 million. The terms of the second tranche were similar to the first in that they convert at a fixed rate of ~$6 until the end of June when the conversion becomes a floorless variable rate. When the deal for the 2nd tranche was done, Castle Creek waived the variable rate conversion option on the first tranche. So now the variable conversion option only exists for the 2nd tranche. The VLNC bulls suggest Castle Creek's waiver of the variable rate conversion option on the first tranche means they believe VLNC will prove successful. The skeptics point out that Castle Creek had ample opportunity to short against the first tranche at a price well above the fixed conversion price of $6, and they still have a floorless variable conversion option on the 2nd tranche. A couple of other points. Castle Creek agreed to restrictions on how much VLNC stock they can sell in a day (mitigates, somewhat, the death-spiral scenario), but also received a "most favored nation" clause (i.e., if VLNC has to secure new financing on less favorable terms than the current deal with Castle Creek, the Castle Creek financing assumes the same terms). Personally, I think Yoest's characterization of the financing as "very favorable terms" is ludicrous. But on the other hand, it is not an immediate floorless and therefore gives VLNC a window of opportunity to perform and get the stock price to a level that eliminates the possibility of a death spiral. So it is not the worst junk that is out there either.

To: Mama Bear who wrote (496)	3/30/1999 11:37:00 PM
From: golden_tee	Read Replies (3) \| Respond to of 10293

They did not issue junk equity no matter what you'd love to believe. I knock your lie accusations for a loop regarding Zeev's opinion, and you duck the issue, and come back with this BS? Even Doomsayer, BS "Master B" (Larry) states: The funding "is not an immediate floorless and therefore gives VLNC a window of opportunity to perform and get the stock price to a level that eliminates the possibility of a death spiral. So it is not the worst junk that is out there either." Incidentally, Larry was also convinced that CC would death spiral VLNC after the first phase of financing, and pissed his pants (he likes to do that) when they moved the dates to July, and advanced to the second stage. VLNC had/has many funding opportunities and chose Castle Creek because the terms were favorable for a company about to produce serious revenue. They did not issue "junk equity" where do you get this crap? What dishonesty are you referring too? I make about 100 points, you attack one, (erroneously I might add), and I'm labeled "dishonest"? You wouldn't be short VLNC would you?