EFTA02662927

From: jeffrey E. <jeevacation@gmail.com> Sent: Saturday, January 21, 2017 5:53 PM To: Hosain Rahman Subject: Re: Final Notes <CONFIDENTIAL SETTLEMENT COMMUNICATION - FOR SETTLEMENT PURPOSES ONLY> Monday On Sat= Jan 21, 2017 at 9:48 AM jeffrey E. <jeevacation@gmail.com <mailto:jeevacation@gmai=.com> wrote: LWyers will talk tomorw On Sat, Jan 21, 2017 at 9:41 AM Hosain Rahman < wrote:<=r> What's a good time today?=C240 On Jan 20, 2017, at 4:30 AM, jeffrey E. <jeevacatio=@gmail.com> wrote: <=div> > > i can talk sometime tomorrowl I would=like you to tell me of ian osbournes role. did he get an= commssion fees, value on my investment. ? CAUTION =you are walking a taut tightrope with me. . suggesting that my=witnesses will be of the same mind in a lawsuit. its clear tha= blackrock will support my complaint - strongly. <=r class="gmail_msg"> On Tue, Jan 17, 2017 at=5:56 PM, Hosain Rahman < > wrote: Hi Jeff=ey, >> Here is some background on the BlackRock and communication t=at we had with the Kuwaitis on it. I got clearance to share it with you. W= are finalizing the other materials to share with you. Ple=se treat this as a settlement communication. Let's=discuss, Hosain Begin forwarded message: To: "Farouk Bastaki Cc: &qu=t;Hussain AlHalabi EFTA_R1_01912039 EFTA02662927 Farouk, <=r class="gmail_msg"> Attached is the bottomline analysis of the option= available to the Company right now. It is a pretty stark difference betwe=n the two paths. Ultimately we are asking BlackRock to chose the path that=is economically best for them - we are killing ourselves for them to have = better financial outcome. Our intentions should be aligned... I've also attached a timeline of our BlackRock re=ationship. There is a one page summary at the beginning and the full detai= behind it. Hey are notes in some key a=eas: Background on the Global Allocation team=/div> • Dennis Stattman is head of the Global=Allocation Team. • Lisa O'Donnell= Co-COO of the team, has been the Fund officer overseeing BlackRock's =osition in our company and has been the chief decision maker in this proce=s. • She has been extremely aggressive, me=n-spirited and difficult to work with since the beginning of their investm=nt. She dislikes all of their private investments and has stated she wants=to make a negative example of Jawbone. She objected to our deal in the beg=nning and feels like the investment was made despite her viewpoint. all> • No one from Jawbone has ever met Lisa in person= She refused to meet us either in her Princeton office nor has she ever vi=ited us. We have tried multiple times. • L=sa has repeatedly stated in front of advisors and bankers on the phone tha= she doesn't care if BR loses all of their capital from this deal- the=loss is insignificant for them with the size of their fund. • Lisa has also stated to me directly that we should neve= expect any help from BlackRock in any situation - "we are your cr=ditor, do not ever expect anything from us" • I have heard from several different people that they refer to me as =E24j*The Terrorist" internally. Terrible given the current stat= of affairs in the world. • David Clayton =s a non-investing Managing Director with the Fund and has recently been ou= primary contact recently (he reports to Lisa). • The Senior Investment Analysts on our deal have been Daniel Daniel =nd Patrick Edelmann. They seem powerless in the situation and do not stand=up to Lisa. • No one from BlackRock has vi=ited Jawbone in 2016. They have not seen any of the new things we are work=ng on. No demos of the prototypes, nothing. Possible anticipated points from BlackRock and our responses=/div> • Management team- we don't trust Hosain, the Board, his man=gement team, everything he and the team have told us has turned out to not=be true, promises are never hit. We have missed targets and it has=been painful. We are taking great care to make sure we don't repea= the mistakes of the past, there are reasons we missed targets - slow sale= in stores, quality issues, product delays. We had a bad product cycle and=we haven't been funded to come out of it. Instead of focusing on t=e business we fight with BR. It's a waste. But to your point it so=t of doesn't matter relative to the economically rational decision=going forward. • <= class="gmail_msg">Wasting money - opex super high put in this much=money three months later they needed more money Again p=rhaps we should have cut expenses earlier but we needed to move the ball f=rward to where it is today in many areas. We have a smart focused plan goi=g forward where 2 EFTA_R1_01912040 EFTA02662928 have a very manageable burn rate and are raising 2 years o= operating capital. We have never done this in the history of the business= • Deals aren't real, <= style="font-weight:bold" class="gmail_msg">they create the term =heets and they aren't real, we can't respond un=il they are real. No one will move forward with closing until ter= sheets are agreed to. This feels like a stall tactic. • They threw thi= Larry/JPM term sheet in front of us, Larry Unrein says he isn't s=re if he will do it or not, we got the feeling that JP Morgan wasn't a sureshot=C24*- Larry hadn't taken the deal to his investment committee and=gotten final approval because he wanted BR to sign off on it before he got=the final approval to ensure he didn't have to go back multiple ti=es. If BR shows flexibility and a willingness, Larry will come through and=fund. Other investors are also happy to participate. <=iv class="gmail_msg">Third party feedback =br class="gmail_msg"> • JP Morgan will tell you that they have never seen a more 4>=804,destructive" $285M put into a Company • Our Skadden lawyer on the re-structuring side is widely considered to =e the top re-structuring lawyer in the country. He will tell you he has ne=er seen anyone behave as BlackRock has behaved in the dozens of deals he h=s worked on - no debtor has not even engaged in a dialogue to give feedbac= on possible solutions. • Skadden has also=stated repeatedly that the Board since May has done more than any other Bo=rd they have ever seen in exploring every option and finding the best solu=ion for all constituents - we have turned over every possible stone we cou=d think of to find a solution. • PJT has never s=en a lender behave this way in any situation they have been involved with<=li> CODE does not understand what BlackRock is doin= and why Thanks again for your help, Hosain =C24, please note The information contained in this communication is confidential, may be attorney-client privileged, mayconstitute inside information, and is intended only f=r the use of the addressee. It is the property ofJEE Unauthorized use, disclosu=e or copying of this communication or any part ther=of is strictly prohibited and may be unlawful. If y=u have received this communication in error, please=notify us immediately by return e-mail or by e-mail=to jeevacation@gmail.com <mailto:jeevacation@gmail.com> , and 3 EFTA_R1_01912041 EFTA02662929 destroy this =ommunication and all copies thereof, including all =ttachments. copyright -all rights reserved </=iv> 4 EFTA_R1_01912042 EFTA02662930