Wave Systems Corp. (fka WAVXQ)

[SPIN]

“Effectiveness Date” ...

"means, with respect to the Registration Statement registering for resale the Registrable Securities, the 90th calendar day following the Closing Date; provided, however, in the event that the Company is notified by the Commission that the above Registration Statement will not be reviewed or is no longer subject to further review and comments, the Effectiveness Date as to the Registration Statement shall be the fifth Trading Day following the date on which the Company is so notified if such date precedes the dates required above."

http://pinksheets.com/quote/print_filings.jsp?url=%2Fredirect.asp%3Ffilename%3D0001104659%252D04%252....

so, Rach, if the Effective Date isn't 90 days from the Closing Date (11/18/03), then what day is the Effective Date?

you wrote:

"...there is a 2% per month liquidation payment - so that would be 2% times the amount of sales or roughly $140,000."

the Liquidated Damages provision states:

equal to 2.0% per month of (i) the Subscription Amount paid by such Holder pursuant to the Purchase Agreement for Registrable Securities then held by such Holder and covered (or to be covered) by the Registration Statement..."

my read on this clause is that if the S-3 is not approved w/in 90 days of the Closing Date, Wave must pay the PPers 2% per month (which is 24% Annual Percentage Rate (APR)) of the total subscription ($7.1M x .02 = $142,000/month). nevermind the fact that prime is 1/6 of this rate. i translate the language of the agreement to require Wave to pay the PPers an amount not less than $426K & not later than 02/24/04.

only if those payment obligations should go into default (failure to pay the $142K (x3) after 7 days) does the additional 15% APR kick in (1.25% monthly, or $88,750, or $230,750 per month (for 3 months) if in default). If Wave fails to make the $426K payment in a timely manner, an additional $266,250 would arguably be due for the 3 months, for a total of $692,250. my interpretation might be wrong & the terms might be construed far more leniently...

you wrote:

"...we know that not everybody's allotment was satisified and that this funding met wave's needs."

we "know" this from Zen's posts. PPers are locked in for 24% annual return if the shares aren't liquid & are effectively entitled to a cognovit note for an additional 15% in the event of default after 7 days. maybe Zen would be willing to inquire w/his source to help shed light on the contractual terms & what his source expects as an outcome if the shares are not approved.

as for Wave's "needs," the prospectus clearly states that Wave "needs" another $8.5M to remain a going concern for the next 12 months (which may only be 9 calendar months as it dates back to November). considering the problems currently encountered, obtaining the next round of inevitable dilutive financing might prove to be even more difficult than this round.

you wrote:

"You also have concluded that waves filings are deficient in that they are not keeping up with the daily PR's from the leech law firms."

yes, Rach, i do consider a second class action complaint for numerous alleged securities violations filed in a different forum (New Jersey) to be a material event which would require an amended filing IMO.

don't know what a "liquidation clause" is relative to a PP, i've heard of acceleration clauses which militate liquidation where one party is insolvent & has not been excused from performance, is that what you meant?

as for the X-FIles... i was only responding to what seemed like a conspiracy theorist. Dean bashes Bush on the campaign trail for months - Trippi worked for Dean as his chief campaign strategist - Trippi worked for Wave - Wave provided Dean some tech - Bush (exec branch) oversees SEC.

FTR i seriously doubt the White House thinks much about Wave (if at all) & presumably has much more important things to devote their energy towards... but hey, maybe that is the reason the DoD has not accepted Wave's products yet & that the "software errors" basis is just some smokescreen!?! Maybe GW called Rumsfeld & told him to put the kabosh on the so-called "smart-safe."

Zen - thanks fer awknowledging that the Imclone analogy is apt as it relates to Doma's questions.

do you think when Peter defaulted on his "loan" & Wave took a 100% charge for the $1.1M b/c wavx was "too cheap to sell" in late March & then he dumped into the Intel hype that was, ahem, kosher?!? assuming, of course, as you posted, that Wave insiders knew what would hauppen to the price.

he told Smart Money in the August "Wave of Delusion" article something to the effect of, "there was so much volume that it just didn't seem like selling 100K would matter."

does it matter?