Subject: Re: OPIS
Author: Randall S Bickham at KPMG_Silicon_Valley2
Date: 6/7/98 3:34 PM
Knowing that everyone is as excited as I am about finally reaching closure with DPP on the OPIS product, I have updated the slides that we used in Dallas so that they can be used an an interim basis in marketing presentations. I will work witn Jeff Zysik this week in finalizing a presentation to be housed in our CaTS KMAN Toolkit.
The slides are quite detailed in terms of technical explanation. Should a potential buyer wish to discuss the technical aspects at a greater depth, you should consider suggesting conference call with me to make the best use of your time, effectively to maximize your marketing time versus having to waste time on technical stuff.
Finally, Gregg had some kind words in the attached as to my efforts in getting OPIS to market. Everyone should be aware of the masterful efforts expended by Gregg in effectively managing the KPMG organization as to receive the required siqn-offs that we were seeking both at a product level and as to policy.
Author: Gregg W Ritchie at KPMG_Warner_Center
Date: 6/4/98 10:41 PM
I am pleased to tell you that the technical conclusions of the OPIS product have been approved by DPP Tax. The strategy bas been approved based on virtually tbe same facts we presented to you in our technical session on April 20th. I plan to hold a 1 hour conference call next week to remind all of us of the details of the strategy and key points that we must communicate to prospective investors. I encourage you to review the material that Randy gave you at our meeting in Dallas prior to making contact with clients.
Jeff Zysik has led the effort in making our case for NOT registering the product as a tax shelter. Based on a memo prepared by Mark Ely, Eve Elgin, and Jeff Z. I expect that Larry will agree that the product does not meet the requirements of section 6111 to its registration. Assuming this news comes tomorrow, we should be immediately able to begin our marketing efforts.
The product tool kit is almost ready to go. I am working with Larry on the final touches of the engagement letter. You should note that Larry's current thinking is that all engagement letters must be sent to him for apporval prior to execution to clients. I will post the new engagement letter on KMAN as soon as it is ready. We must not vary from the language in the sample letter (especially with respect to indemnification, etc) without advance approval from DPP.
You should also note the newest version of the Nondisclosure Agreement which will be posted on KMAN this weekend. You must ensure that all clients and targets execute this agreement prior to presenting the strategy to them. Furthermore. while we will, under limited circumstances, allow outside advisors to participate in reviewing the strategy, you should only do so with my or Randy Bickham's advance approval. If you believe this will be required for the client to execute the strategy, we will make a business decision relative to the specific individual and/or Firm involved. As a general rule, we should strenuously resist sharing this strategy with outside advisors. I am certain that we have a short time frame to market this strategy before legislation will be effective to shut it down. Accordingly, the less publicity, the longer the strategy may be available.
Presidio is meeting next week in New York with Brown and Wood to finalize the legal documents required to execute the strategy. I will let you know when they are ready to receive wire transfers from clients who want to open the trading strategy. We have indicated to DPP that each client will receive an analysis of the investment results expected given anticipated price increases BEFORE the client engages us. In general, client presentations should be coordinated with Presidio so that they may hear the investment strategy from them in the initial visit. John Larson and Kerry Moskalik have each of your names and will only respond to you for client visits (not other KPMG partners/employees). We need your help to keep control of the distribution of this stracegy.
Several of you have asked whether it is appropriate for us to consider the payment of a referral fee with respect to the strateqy. Per my conversation with Larry DeLap, referral fees are to be discouraqed, but may be considered in exceptional cases. Any such fees which are contemplated must be approved in advance. Please send me a message with the facts and reason why you believe such a fee would be in our best interests and the amount of the proposed fee. I will discuss it with you and DeLap to determine if we should make an exception.
I want to again acknowledge the exceptional efforts that Randy Bickham made in order to make this product a reality. The strategy was in the morgue and Randy, through his exceptional technical and writing skills and determination brought it back to life. Jeff Zysik has also played a critical role in bringing the resources of WNT and the TIC to bear on this product. Many thanks to Jeff for all of your efforts.
I know that I have forgotten something important in this message. I would appreciate your immediate attention to reviving the contacts you have made over the last few months and putting this product into our clients hands.
One final note of interest. Quadra Capital Advisors signed our confidentiality agreement today and will be presenting some of their proprietary strategies to us in the next few days.