New Email from Smith Barney

Posts: 6 · New Forum Member Joined: May 23, 2006 Posts: 6

Guys, pay up. You are fighting a battle you won't win. I also participated and to the max. I also thought of not paying, because it almost seemed that I would not have too and VG would cover me.

But, I concluded that if I did not pay, I would be violating an agreement, that that would be used against me in an arbitration/lawsuit. And, I'd possibly have my credit rating harmed, and have to spend a lot of time fending off phone calls/emails/mail demanding payment.

Yet, by paying, I'll still benefit from any class action lawsuit and nothing can be held against me.

If you don't pay, they have the upper hand in many ways. Okay, it may not get on your credit report right way--I don't even think brokers share data with the agencies. Yet, they'll pass the claim to VG, who has agreed to indemnify them, and VG will pass it to their credit collection agency. Then, it will get on your credit report.

Save yourself some real hassle--the game is tilted against you. Pay up. I did.

Posts: 33 · Vonage Forum Junior Joined: Jun 01, 2006 Posts: 33

First of all it will not show up on your "Credit report." This is not a credit issue. This is a breach of contract issue. It is like any other typical contract dispute that will be decided by a third party.

Second of all, have you read these class action lawsuits. Assume their claims to be true (which is what a court of law will do), it seems as if VG also broke the law and why would you pay money for something that was illegal in the first place?

It seems to me that there are alot of unanswered questions and anyone that feels morally required to pay, then by all means do that. But I truley believe there is a question of fact and contract and I intend to defend this. These lawsuits suggest that VG did some prety bad things. If they are true (and again, I dont suggest they are or are not-- THAT IS FOR THE COURT TO DETERMINE), then would you pay?

Just sit back and wait to see how this plays out. If it goes bad, then you can always pay. but to pay now before this is settled is foolish.

Posts: 7 · New Forum Member Joined: May 31, 2006 Posts: 7

I totally agree with audiotron. I am not paying a penny until the court of law come up with a decision.

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

I too, could not agree more. Also, how can UBS sell my shares against my will? They did that on the 6th for 12.10 !!! If I have to pay I should decide when they're sold !!!!!!!!!

Posts: 88 · Posted: Mon Jun 12, 2006 2:28 pm Post subject:

They aren't your shares if you failed to pay for them. Maybe now you only owe $490 per 100 shares that you offered to purchase.

Posts: 29 · Vonage Forum Junior Joined: May 30, 2006 Posts: 29

Vonage underwriters extend deadline for investors

(Updates with comments from a Vonage spokeswoman in third paragraph.)
NEW YORK (MarketWatch) -- Vonage Holdings Corp.'s (VG) underwriters are giving investors more time to pay for the initial public offering shares they ordered.
Underwriters Smith Barney, a unit of Citigroup Inc. (C), Deutsche Bank AG (DB) and UBS AG (UBS) are giving investors until June 13 to pay for the stock they ordered, according to Karina Byrne, a spokeswoman for UBS.
A spokeswoman for Vonage later confirmed that underwriters have extended certain shareholders an additional week to settle their trades.
Vonage's May 23 IPO was among the worst performing in history. Shares, which recently changed hands at $11.90, are down 30% from the IPO price of $17 a share.
The poor performance was exacerbated by Vonage's unusual move of reserving some of the IPO shares for its customers. Many balked at the idea of paying the IPO price after watching the shares drop 13% in the first day and sink further over the next few days.
The company faces class-action lawsuits related to the IPO but said it would "vigorously defend itself."
A pioneer in the Internet phone business, the Holmdel, N.J., company has been plagued by concerns over a highly competitive environment and continued losses. The company has said that it is sacrificing near-term profit to expand its market share.

Posts: 62 · Full Forum Member Joined: Apr 29, 2005 Posts: 62

i am still not paying.

On another note, what is the estimated cost of litigation on Vonages part? I would assume that with a host of class action suits and possible SEC inquirys that Vonage would be paying out tens of millions of dollars in legal fees. If they go after every single person who did not pay, it is costing the company a ton of time and money, time and money they could be devoting to building the business (or more realistically, trying to sell the company to a telco or cable company).

This entire process was fouled up by Vonage. it goes way beyond just the underwriters, and now includes all of management and their complete lack of foresight.

Posts: 6 · New Forum Member Joined: Jun 09, 2006 Posts: 6

ckudrna wrote:

i am still not paying.

This entire process was fouled up by Vonage. it goes way beyond just the underwriters, and now includes all of management and their complete lack of foresight.

Good point. They should have foreseen that if the stock price went down, they would be dealing with a bunch of excuse-making deadbeats. Unfortunately, chasing riff-raff is a cost of doing business.

Posts: 33 · Vonage Forum Junior Joined: Jun 01, 2006 Posts: 33

keithr: Not sure what country you live in, but in america sometimes when things do not go right the courts get involved.

If everything was so black and white, there would be no need for lawyers or courts.

If everything was so simple as "you signed an agreement so you must pay" there would be not need for lawyers or courts.

The plain and simple fact is that there was an agreement that is currently in dispute.

All of your arguments are based solely in morality and not in business and law. If I were a priest, then maybe things owuld be different. But the fact is that I am a business perosn just like everyone else. And from time to time agreements are not so black and white and sometimes there are two sides to every story and the right story.

Posts: 12 · Vonage Forum Associate Joined: Jun 01, 2006 Posts: 12

It's generally known as false pretenses. The often cited hypothetical is as follows. I sign a contract to purchase a million-dollar piece of artwork from a dealer who represents to me that the art is actually an original Van Gogh. I believe him, and I sign a contract to buy the "Van Gogh" thinking that it is real and thinking that I'm getting this at a steal of a price. Turns out, the "art dealer" is an ex-con and I'm just his next victim. However, I find out that the artwork is a fake just before I sign my check. We have a contract, but the contract is made under false pretenses and is therefore unenforceable by the crook dealer.

I DO NOT HAVE TO PAY.

Same situation here. So, if there are material questions about the pricing of the IPO, I certainly would have a legitimate right in withholding my payment until such time as a court of law makes that determination. This will come after an extensive process called DISCOVERY. Wherein, the attorneys will have access to witnesses to be deposed, documents and other records. If a jury finds that there was no material misrepresentation, I will have a duty to uphold my end of this "bargain." Until then, hold on to your checks folks.

So if you do intend to still pay, I really do have a nice bridge to sell you.