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Kimberlin (i.e., the warrants transferred to him by Spencer
Trask) is a constructive dividend, return of capital, or capital
gain.
Background
Kevin Kimberlin (Mr. Kimberlin) is an investment banker and
an 87-percent shareholder of Spencer Trask & Co. (Spencer Trask).
Kevin Kimberlin Ltd. Partners (Kimberlin Partners) is a TEFRA
partnership that was established on December 28, 1995. Mr.
Kimberlin is the sole general partner with a 1-percent interest.
The remaining interests in Kimberlin Partners are held by
entities partly or wholly owned by Mr. Kimberlin.
Ciena Corp. (Ciena), a Delaware corporation, was formed in
1992 to develop and market dense wavelength division multiplexing
systems for long-distance fiberoptic telecommunications networks.
Ciena, in need of financing, planned several private stock
offerings and a subsequent initial public stock offering. The
relationship between Mr. Kimberlin and Ciena began in 1993 when
Mr. Kimberlin, through INNO Co., a New York-based investment
company that is wholly owned by Mr. Kimberlin, provided Ciena
with $190,000 in seed capital and a $300,000 letter of credit
pursuant to a stock subscription agreement.
On November 9, 1993, Ciena entered into an exclusive private
placement agreement (1993 PPA) with Spencer Trask Ventures
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Last modified: November 10, 2007