Opinion ID: 1799426
Heading Depth: 2
Heading Rank: 5

Heading: Gulf Buys Brainin's Holdings in Fenestra.

Text: After reviewing the financial condition of Gulf, Brainin agreed to go forward with the deal. Brainin expressed a desire to have a large cash down payment and collateral for the balance, which was duly arranged. The terms agreed upon were $1,750,000 in cash and the balance covered by a one-year promissory note secured not only by the Fenestra stock being purchased by Gulf but, also, 500,000 shares of Gulf common stock. In addition, the loan was guaranteed by Gulf and personally by Leonard Rosen. The Atkinson Corporation, controlled by the Pritzkers, agreed to and did lend Gulf the $1,750,000 down payment, which loan was evidenced by a one-year collateral note of $1,995,000, being the amount of the loan plus $245,000 interest. One of the stipulations in an agreement of the same date as the note was that if Gulf obtained any money from Fenestra it would be applied first toward payment of said note. In addition, Gulf gave Pritzker a note for $600,000 and agreed to pay one Herbert Buschman a broker's fee of $37,500. The total number of Fenestra shares deposited with the escrow agent in the next several weeks after the deal was closed amounted to 293,674 shares and sold at $21 per share, for a total of $6,167,154, not including the interest on the down payment loan by the Atkinson Corporation (of the Pritzker group) nor the $600,000 to Jay Pritzker for arranging the deal nor the $37,500 paid to Buschman as a broker's fee. Gulf's total cost then was somewhat in excess of $7,000,000. And although Gulf had pledged a substantial amount of its stock and other security to effectuate the deal, it was not required to advance any cash at that time.