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The Low Down on Down Rounds

BY ALM Staff
June 01, 2003

The following is an excerpt from a conference call hosted by VCExperts.com, of which Advising Start-Up & Emerging Companies Editor-in-Chief Joe Bartlett is Chairman. Participants included Joe Bartlett, Mike Halloran, senior partner in Pillsbury Winthrop LLP's 341-lawyer corporate and securities practice group, and Tom Gump, Senior Associate in the corporate and securities group in the San Francisco office of Pillsbury Winthrop.

To purchase the full transcript of the conference call at a 20% discount go to http://invitation.vcexperts.com/ and use the access code “buzz”. Offer expires July 15th.

Mike Halloran: We're talking about down round financings, which seems to be the order of the day and has been the order of the day perhaps for the last year and a half in venture capital finance, at least where you have a company with existing rounds. And we – Tom and I wrote a chapter which appears in this venture capital book that we edit, and I would encourage anybody to perhaps get a copy of the chapter which I think is basically on [the VCExpert.com] Web site. Why don't we have Tom go ahead and talk about the legal structures for implementing down rounds and sort of the terms and terminology that we use in this down round era.

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