- Ok now, let's get down to fact's and stop emotional squeaking. Where
have you seen the wording of the offer documents? The 10K revealed
that the offer is subject to the state approvals. Lone Star has failed
to obtain the needed approvals for 2 times already. During each of
these failures Lone Star could have scrapped the deal. The extension
allowed by law is 10 days so Loan Star extended the offer for another
10 days. This is what we know so far. In addition you don't sign 400
mill contract on the deal in this market without including an
additional escape clause. Why does Loan Star do it? you don't have to
be a rocket scientist to understand:

1) They are holding LEND by the gills. As the price of LEND
deteriorates they have more negotiating power and can renegotiate the
offer price.

2) If the offer is scrapped LEND is obligated to pay Lone Star 12
mill. Yes LEND will pay Lone Star. That again tells you how desperate
LEND was when it signed the agreement.

3) The agreement is nothing more then an OPTION to buy LEND. and while
regular options have an expiry time in case of LEND Lone Star can
extend an expiration date by 10 days and LEND will agree to this
because without Loan Star, LEND is out of business.

4) In case LEND goes bankrupt before the deal closes. Lone Star can
use the agreement to lay claim to some or  all of the LEND assets.

5) Agreement gave Lone Star access to LEND's books, insider
information.

Not a bad agreement on Lone Stars part. My guess is that Lone Star
would not exercise LEND option because the option is out of the money.
The company at this point is worthless.