VA Linux community IPO

From: valinux@db.com
To:
Subject: A message from VA Linux Systems (Mostly in English)
Date: Tue, 23 Nov 1999 21:41:33 -0500
X-Mailer: Internet Mail Service (5.0.1460.8)

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FUER ANLEGER IN DEUTSCHLAND IST DIES KEIN ZEICHNUNGSANGEBOT, SONDERN EINE ALLGEMEINE INFORMATION. EINE ZEICHNUNG FUER ANLEGER IN DEUTSCHLAND IST NOCH NICHT MOEGLICH. DER VERKAUFSPROSPEKT WIRD IN DEUTSCHLAND NACH DER GESTATTUNG DURCH DAS BUNDESAUFSICHTSAMT FUER DEN WERTPAPIERHANDEL UND MINDESTENS EINEN WERKTAG VOR DEM VORGESEHENEN OEFFENTLICHEN ANGEBOT DER AKTIEN IN DEUTSCHLAND VEROEFFENTLICHT WERDEN.

THIS IS NOT A PUBLIC OFFERING TO INVESTORS IN GERMANY, BUT MERELY GENERAL INFORMATION. GERMAN INVESTORS CANNOT SUBMIT APPLICATIONS FOR SECURITIES AT THIS TIME. THE PROSPECTUS WILL BE PUBLISHED IN GERMANY, AT LEAST ONE WORKING DAY BEFORE THE PLANNED PUBLIC OFFERING OF THE SECURITIES IN GERMANY, ONCE IT IS APPROVED BY THE FEDERAL SUPERVISORY AUTHORITY FOR SECURITIES TRADING.
Hello Open Source Community Member

First, forgive us for the impersonal nature of this email. It is impossible to email each of you personally.

If you have received this letter, you have been selected to receive the attached materials which detail our directed share program.

How we selected you

You were selected in one of three ways:

1...Contributor lists from major Linux or related open source projects. These projects included Debian, KDE, GNOME, GTK+, Python the GIMP and many others.

2...VA has a number of Linux Community members in it's ranks, they were asked for their input.

3...To fill in the remainder of the slots for Linux developers, we reviewed a number of online source code archives, a complete running system, and all of the HowTos (11 gigabytes total reviewed). By measuring how many times an email occurred in these files, we graded the "prolifacy" of any one contributor and just worked from the top down based on how much work any one person had done until we exhausted the number of shares available for the program.

Limitations on Participants in Countries other than the United States

If you have received this email and live outside the United States, please read this section -very- carefully. We have done our best to include developers in as many foreign countries as possible, however, the securities laws vary from country to country and there were many countries in which we understand that applicable local securities laws would prohibit sales of these securities. Developers in those countries could not be included as a result.

We understand that there is no restriction on the number of residents of the following countries included in the directed share program:

• United States
• Taiwan
• Germany--See the legend up above on restrictions related to Germany.
• Czech Republic
• Spain

For residents of the following countries, we understand that we can only include a limited number of people in the directed share program, due to securities law restrictions of the listed countries:

• Country Limit
• Japan 50
• Finland 100
• Norway 50
• UK 50
• Italy 200
• Poland 300

What this means is that for these countries we have a first come/first serve situation. If x is the limit for the country, once x people have completed and returned the attached materials pursuant to the instructions and requirements set forth therein that country's allotment will be considered full.

This number is determined according to securities laws in the noted countries. We cannot change them. We felt it was better to accept the attached materials on a first come/first serve method rather than to completely exclude developers in those countries.

For those countries not listed:

I'm afraid we had to exclude you. For this we are very sorry. There are a number of reasons that we had to exclude countries. Some countries had securities law requirements which we could not meet.
Paperwork

This directed share program is completely described in the attachments from one of our underwriters Deutsche Banc Alex. Brown. Please read this and the prospectus very carefully, including the risk factors starting on page 7. It is a pdf file, readers for Linux are available from the adobe web site at: http://www.adobe.com/products/acrobat/readstep.htm

Again, VA thanks you for doing your part in making Linux what it is today.

As noted above, please read the prospectus.
Chris DiBona
Linux Community Evangelist
VA Linux Systems

A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This communication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there by any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

No offer to buy the securities can be accepted and no part of the purchase price can be received until the registration statement has become effective, and any such offer may be withdrawn or revoked, without obligation or commitment of any kind, at any time prior to notice of its acceptance given after the effective date. An indication of interest in response to this letter will involve no obligation or commitment of any kind.

Overall, I'd have to say that the VA friends & family deal is being handled much more professionally than the RHAT one. However, unfortunately this is not true across the board.

In particular, it seems that the letter they sent out was Bcc: 'ed to the recipient list. Now, since many free software developers have several email addresses (there are well over a dozen for this cat), it can be quite a puzzle to figure out which one they actually used. And, it appears, they're using exactly these email addresses to do their authentication.

So, if you got the letter: take a careful look at the headers, and see if you can deduce which email address it was sent to. This will save you and them needless time and stress.

Of course, in the not-to-distant future, this problem will just go away. Benevolent companies wishing to share some of their IPO wealth will be able to simply use the Advogato database.

Meow!

Everyone seems to have gotten confirmation; has anyone gotten an account number yet?

It seems that everyone who participated got their account number today.

Oh, after I received that nice phone call from "Deutsche Bank Alex Brown" yesterday asking me to confirm my address I thougth everything was up and running smoothly. I had already organized the money. I had informed myself how on earth one could send money to an US account in 3 days if it even takes some days to transfer it to another bank in the same town. Everything was fine, until this letter appeared in my inbox:

Unfortunately we have bad news. We are unable to meet all of the necessary regulatory requirements in Germany in order to extend the VA Linux offer there. Therefore, German residents will not be able to purchase shares at the IPO price through the VA Linux Directed Share Program. We apologize for any inconvenience. We really wanted it to work out, but it is just not possible.

Arghh! It did happen again! Same shit as happened with the RedHat IPO letter, only they made me hope it could eventually work this time....

What can I say? It feels good to be recognized as a member of the community and I think that companies like RedHat and VALinux are doing well at returning some value to the community that they live from. But this community is not only living in the states, it's global! I'm not very much into financial stuff and therefore I don't understand what "regulatory requirements" stopped them here (and in other countries like Canada for example). Could they have tried harder? What do you think?

I just got off the phone with Deutshe Banc Alex. Brown, and found out the following information:

• They seem to be pulling an all nighter. Give them a call! The 415 number seems to be more responsive than the toll-free one.
• The price is expected to be $30.
• You now have the choice between taking 50, 100, or 140 shares. Thus, if you have trouble raising the money for 100 shares at the price hike, you still have a chance.

Personally, I'd prefer it if they didn't keep changing the rules. But such is the nature of the business.

Good luck all!