SmithBarney in no rush to collect cash

Posts: 476 · Posted: Wed May 31, 2006 11:40 am Post subject:

Several of the news articles reference the amended SEC filing regarding Vonage's promise to pay the underwriters in the case that DSP participants failed to pay. It seems like this shouldn't be news for anyone and Vonage is [maybe] just doing what it said it would do in the amended SEC filing.

Posts: 243 · Vonage Forum Master Joined: Jan 18, 2004 Posts: 243

I belive the amended prospectus that is being referenced was issued after the allocations were made. I'd have to go back and read all of the admendments to be sure...

Posts: 476 · Posted: Wed May 31, 2006 12:07 pm Post subject:

I see. The first reference I can see in any filing with the SEC relating to the indemnification of the underwriters in the event that DSP participants fail to pay is in this filing dated 5/24 so it looks as if you are correct: http://www.sec.gov/Archives/edgar/data/1272830/000104746906007592/0001047469-06-007592-index.htm

Posts: 11 · Vonage Forum Associate Joined: May 22, 2006 Posts: 11

blakadher wrote:

I see. The first reference I can see in any filing with the SEC relating to the indemnification of the underwriters in the event that DSP participants fail to pay is in this filing dated 5/24 so it looks as if you are correct: http://www.sec.gov/Archives/edgar/data/1272830/000104746906007592/0001047469-06-007592-index.htm

So does this also stipulate that no legal action will be taken to collect money from those who participated but did not pay? Sounds like people who haven't paid will simply be "off the hook"?

Posts: 16 · Posted: Wed May 31, 2006 12:53 pm Post subject:

After having consulted my "Investing for Dummies" book, which apparently many people failed to read, I have been somewhat astounded how some statements in these Forums have indicated that the centuries old capitalist system should be completely disregarded. If Vonage disclosed all matters in their prospectus, and if weblogs can show that all allocations were made and posted before trading began, how can one possibly renege on a contractual agreement? I should certainly hope that Vonage, if they make whole the underwriters, would pursue the non-paying shareholders to the full extent of the law. What kind of publicly traded company would be able to issue any further stock if they let people buy and hold the stock for a "test" period before they decide to pay for it?

You bought a lottery ticket and lost for the present. If the stock shoots up to $25 in a year on a buyout proposal will Vonage have to sell it back to you for $17? I would consider the absurdity of some of the statements before you post them where thinking people have to read them.[B]

Posts: 243 · Vonage Forum Master Joined: Jan 18, 2004 Posts: 243

luckycat wrote:

blakadher wrote:

I see. The first reference I can see in any filing with the SEC relating to the indemnification of the underwriters in the event that DSP participants fail to pay is in this filing dated 5/24 so it looks as if you are correct: http://www.sec.gov/Archives/edgar/data/1272830/000104746906007592/0001047469-06-007592-index.htm

So does this also stipulate that no legal action will be taken to collect money from those who participated but did not pay? Sounds like people who haven't paid will simply be "off the hook"?

No it says that Vonage will not hold liable those underwriters who have returned shares. This is my entire argument that Vonage if Vonage stated that DSP members could walk-away without penalty then I wouldn't have a problem. But instead Vonage said in a statement that they would not alienate their customers by pressing charges for not paying for share commitments.

As a share holder this is WRONG! and it is not fair to those who did pay for their obligations.

Posts: 3 · New Forum Member Joined: May 31, 2006 Posts: 3

One option to "make whole" the customers who really paid for the shares would be to issue a credit to their Vonage account for the difference in $17 and the current share price...maybe $5 per share (assuming you are still holding the stock at least...maybe less if you already sold)....so if you bought 200 shares of stock, you get a $1000 credit to your Vonage account. The credit can't be refunded in cash, but can be used to purchase Vonage services for as long as it takes you to use up the money....or maybe some limit like 10 years....That might be a realistic option for the company because they could probably book it as some type of marketing expense, and it wouldn't hit their revenues at all...I think Vonage should definitely consider such a plan IF THEY INTEND TO LET THE BUMS OFF THE HOOK WHO DIDN'T PAY. I don't feel they are obligated to "make me whole", but I do believe they should do something for me if they "make the bums whole", or they will lose me as a customer.

Posts: 8 · New Forum Member Joined: May 24, 2006 Posts: 8

I don't think their letting anyone off the hook that didn't pay. I know my credit is too important to ruin over this. I guess if you have bad credit and don't care then your free and clear.

Posts: 9 · New Forum Member Joined: May 31, 2006 Posts: 9

You think some people are sleazy for not paying? How about changed to the last minute filings and notification of my acceptance while I was asleep and Smith barney calling me an hour before the market closed to make their introduction and remind me that I owed them money...losses are part of the process kids, but this is just beginning to unwind and dont pat yourself on the back for running to pay. I have been promoting Vonage for years and have less of an issue with losing money than how poorly executed the IPO was and how poorly my new Citi/SmitBarney team took care of things.

Posts: 17 · Vonage Forum Associate Joined: May 23, 2006 Posts: 17

Amen