Keating Capital has now completed four portfolio company exits (out of a total of 20 portfolio company investments), three of which have generated a net realized gain. Read more

 On May 28, 2013, the Board of Directors of Keating Capital declared a special dividend of $0.24 per share for each of the second and third quarters. Based on the Company’s shares outstanding as of March 31, 2013, this $0.48 per share distribution represents 99.6% of the $4.4 million of net gains realized by the Company during 2013 through May 28, 2013. Read more

Let us set the record straight: We love Ramsey and his quest to get people educated about debt and making good financial decisions.  We also love that he focuses people on making prudent decisions even if they are counter-cultural, like delaying purchases until you have the cash to pay for them. Those are just a few of the many reasons to love him and his advice.  

When it comes to retirement strategy; however, we feel that Ramsey has gone off the deep end. First of all, it is difficult, if not impossible, to average 12% in any asset class, even stocks. Have you looked at the 10 and 20 year ROI on this asset class?  It certainly isn’t 12% any longer. In addition, it doesn’t work in bad times when you are retired and drawing income. You won’t have the capacity to recover during the next upswing as you will have substantially drawn down your assets. It only works on a pretty spreadsheet where everything is held constant. That, our friends, isn’t the real world!  

Richmond Brothers believes you must be diversified in multiple asset classes. Diversifying by its very nature might decrease your return in any one cycle, but also potentially increases your return over the long run. You must try to limit your losses during bad financial times, but you cannot do this when you own one asset class and its bubble bursts.  If you owned 100% real estate in this last crisis you would still be well below your 2007 high (five years after the bottom)! Stocks may be back to their 2007 highs, but how would you like to have taken five years to recover? What would you have lived off during this time? If you drew money out for income, you would certainly be in rough shape. Retiring and living off your principal is very different than accumulating your principal. If you treat them the same, it may be a very painful lesson.

The article in question reaches a conclusion based on a series of assertions. Unfortunately, many of these assertions are factually inaccurate and directly contradict a series of public announcements and disclosures made by Keating Capital in the last 90 days. 

Novelist/philosopher Ayn Rand summarized this type of situation best when she said: “Whenever you think you are facing a contradiction, check your premises. You will find that one of them is wrong.” 

Since the author’s conclusion is built on a series of premises that are demonstrably inaccurate, the Company has identified eight such inaccuracies and corrects them here to set the record straight.

Assertion/premise #1:  The Company has paid $615,000 in incentive fees over the past three years to Keating Investments, LLC, the investment adviser (the “Adviser”).

Fact:  The Company has never paid any incentive fees to the Adviser. Zero. While there is and has been an accrual on the Company’s balance sheet in the form of an accrued incentive fee, this is a reserve required under U.S. Generally Accepted Accounting Principles. In fact, as of March 31, 2013, the Adviser will not be entitled to payment of an incentive fee until after Keating Capital has generated cumulative net realized gains on its investments in excess of $6.6 million. For a complete discussion of the accounting related to the accrued incentive fee payable on the Company’s balance sheet, please see page 23 of the Company’s Form 10-Q for the quarter ended March 31, 2013 which has been filed with the SEC.

You may click here to download a complete PDF version of this response. 

Assertion/premise #2: The Company has never paid any dividends.

Fact: The Company made its initial portfolio company investment in January 2010, completed its continuous public offering in June 2011, became fully invested in June 2012, and was able to pay its first dividend of $0.03 per share in 2012 based on net realized gains for that year. Moreover, on May 29, 2013—two days before the Author posted his article—the Company declared a distribution of $0.48 per share, which will be payable in two dividends of $0.24 each in June and September. This distribution will be paid from the $4.4 million of net gains realized by the Company during 2013 through May 28, 2013. Anyone who has shorted Keating Capital’s stock, such as the author, will be responsible for paying those dividends to the lender of the shares on the dividend payment dates. For a complete discussion of the Company’s $4.4 million in 2013 net realized gains to date and the details of the dividend, please refer to the Company’s press release dated May 29, 2013.

Assertion/premise #3: The Company pays director fees directly to the Adviser.

Fact: As a matter of policy, the Company does not pay, nor has it ever paid, any director fees to either the executive officers of the Company or anyone affiliated with the Adviser. For a complete disclosure of the director fees paid to Keating Capital’s independent, non-executive directors, and the fact that no director fees have been paid to either Keating Capital’s executive officers or anyone affiliated with the Adviser, please see page 16 of the Company’s 2013 annual proxy statement filed with the SEC on February 21, 2013.

Assertion/premise #4: The Company’s preferred method for financing itself is through dilutive new stock issuances, and this dilution has led to an erosion in NAV.

Fact: Since the completion of the Company’s public offering in June 2011, Keating Capital has not issued a single new share of stock, or any other securities. To the contrary, in May 2012, the Company announced a $5 million stock repurchase plan and has reduced—not increased—the number of shares outstanding in each of the four quarters since the repurchase plan has been in place. Moreover, the repurchases completed to date have all been accretive to NAV. For a complete disclosure of the stock repurchased under this plan, please see page 54 of the Company’s Form 10-Q for the quarter ended March 31, 2013 which has been filed with the SEC.

Assertion/premise #5:  The Company has a poor investment track record.

Fact:  Based on the Company’s complete disposition of four portfolio company investments to date, the Company has generated $4.7 million in net realized gains, with an average return multiple of 1.4x its investment cost, a weighted-average holding period of 1.6 years, and an internal rate of return of 22%.  For additional detail on the Company’s net realized gains to date, please see the Company’s press release dated May 17, 2013.  

Keating Capital made its first portfolio company investment in January 2010 and became fully invested in June 2012.  Over time, more IPO exits are expected to occur, which the Company believes will deliver an acceptable return and the potential for cash dividends to the patient investor.   The Company has an IPO, event-driven strategy, and attempts to generate returns by accepting the risks of owning illiquid securities of later stage private companies.  However, the process of transforming from private to public ownership is subject to the uncertainties of the IPO process.  If this process happened quickly and with certainty, there would be less of an illiquidity discount available (and hence, less potential return) to the Company when making pre-IPO investments.  Instead, the private-to-public transformation process takes time and is subject to market conditions, and the Company therefore incorporates a targeted four-year average holding period for each portfolio company into its strategy.  To mitigate Keating Capital’s downside risk and account for market fluctuations and volatility, the Company seeks structural protections whenever possible.  In short, Keating Capital believes its model is on track and working according to plan. 

So let’s take a deeper look at the Company’s portfolio at March 31, 2013.  As discussed in the Company’s most recent Form 10-Q, the Company had nine portfolio companies that had appreciated with a total unrealized appreciation of $11.0 million (including $4.1 million of unrealized appreciation for LifeLock) and 10 portfolio companies that had depreciated with a total depreciation of $6.6 million.  The Company also acknowledged that its cleantech investments as a whole have not been successful.  As of March 31, 2013, 72% of Keating Capital’s $6.6 million in total write-downs are related to five cleantech investments.  While uncertainty continues to surround the cleantech space, it is possible that these write-downs could be eliminated or reduced if these cleantech companies are able to complete a successful IPO or other exit in the future.  Now let’s turn attention to the 12 non-cleantech, private companies in the Company’s portfolio which, in the aggregate, had been written-up by $4 million as of March 31, 2013.  With the exception of Livescribe which has been completely written-off, the Company believes each of these companies remain positioned to complete an IPO over time and that Keating Capital could be able to benefit from the transformation in value that it expects to occur when they complete their IPOs.  Further, six of the 12 non-cleantech, private companies have “structural protections” such as conversion rights which would result in Keating Capital receiving shares of common stock at a discount to the IPO price upon conversion at the time of the IPO, or warrants that would result in Keating Capital receiving additional shares for a nominal exercise price at the time of an IPO.  The Company believes these structural protections could help it achieve its targeted 2x return goal.  For a complete disclosure of these structural protections, please see page 33 of the Company’s Form 10-Q for the quarter ended March 31, 2013 which has been filed with the SEC.

Assertion/premise #6:  The Company has “virtually no revenue.”

Fact:  Keating Capital is organized as an investment company and, under SEC rules, is required to present its results of operations according to standards established for investment companies.  These standards do not include a line item for revenue.  Instead, the three main categories in an investment company income statement are:  net investment income (effectively all interest and dividends received on investments less operating expenses), net unrealized appreciation/depreciation, and net realized gains/losses.  Since the Company by design is focused on capital appreciation (not income), there has never been any expectation that the Company would ever generate any “revenue” (i.e., net investment income).  To think otherwise is to completely miss how the Company attempts to meet its investment objective.  Instead, the focus is on net realized gains.  For a complete discussion of the presentation of the results of operations, please see page 47 of the Company’s Form 10-Q for the quarter ended March 31, 2013 which has been filed with the SEC.

Assertion/premise #7:  The Company’s fees are exorbitant.

Fact:  Based on a March 2013 survey, there were 37 publicly traded business development companies (or “BDCs”), including the Company, that were externally-managed, meaning that the BDC pays an investment advisory fee to the investment adviser.  Based on this survey, the 2% base management fee paid by the Company to the Adviser is identical to 19 of the other 36 externally-managed BDCs, despite the fact that the Company has consistently had significantly lower net assets than the average BDC, and the fact that eight of the BDCs that charge a 2% management fee have assets greater than $1 billion.  It should also be noted that eight of the 17 externally managed BDCs that have a base management fee less than 2% use leverage and calculate their base management fee on gross assets, inclusive of funds provided through debt financing.  By contrast, the Company does not currently use leverage.    

Assertion/premise #8:  The Company uses “dubious methods” to value its Level 3 assets.

Fact:  Out of 20 portfolio company investments made to date, the Company has four complete exits, three of which were achieved by selling after a portfolio company completed an IPO, and the other of which was achieved through a sale.  For the three portfolio companies that completed IPOs, the return multiple relative to the Company’s investment cost at the time of IPO were:  (i) NeoPhotonics:  1.8x, (ii) Solazyme:  2.0x, and (iii) LifeLock:  1.7x.  With the benefit of hindsight, the fact is that the Company’s increases in the quarterly fair value marks for these portfolio companies prior to becoming public were line with the actual IPO prices of each of these companies.  For a complete discussion of the Company’s valuation methodology, please see pages 55-58 of the Company’s Form 10-Q for the quarter ended March 31, 2013 which has been filed with the SEC.

The Company understands that reading SEC filings can be daunting, and that people who don’t have either an accounting background or significant experience reading financial statements may be easily confused.  The author may fall into this category. That is why Keating Capital goes to great lengths to provide and regularly update supplemental marketing materials to explain the Company’s business and ongoing results of operations.  In addition, the Company hosts quarterly earnings calls that are open to the public, and management makes itself available to answer questions at any time.

5251 DTC Parkway, Suite 1100 • Greenwood Village, CO 80111 • www.KeatingCapital.com • (720) 889-0139

ABOUT LINN ENERGY

LINN Energy’s mission is to acquire, develop and maximize cash flow from a growing portfolio of long-life oil and natural gas assets. LINN Energy is a top-15 U.S. independent oil and natural gas development company, with approximately 4.8 Tcfe of proved reserves in producing U.S. basins as of December 31, 2012. More information about LINN Energy is available at www.linnenergy.com.

ABOUT LINNCO

LinnCo was created to enhance LINN Energy’s ability to raise additional equity capital to execute on its acquisition and growth strategy. LinnCo is a Delaware limited liability company that has elected to be taxed as a corporation for United States federal income tax purposes, and accordingly its shareholders will receive a Form 1099 in respect of any dividends paid by LinnCo. More information about LinnCo is available at www.linnco.com.

ABOUT BERRY PETROLEUM COMPANY

Berry Petroleum Company is a publicly traded independent oil and natural gas production and exploitation company with operations in California, Texas, Utah, and Colorado. The company uses its website as a channel of distribution of material company information. Financial and other material information regarding the company is routinely posted on and accessible at http://www.bry.com.

Additional Information about the Proposed Transactions and Where to Find It

In connection with the proposed transactions, LINN and LinnCo have filed with the SEC a registration statement on Form S-4 (Registration No. 333-187484) that includes a joint proxy statement of LinnCo, LINN and Berry that also constitutes a prospectus of LINN and LinnCo. Each of Berry, LINN and LinnCo also plan to file other relevant documents with the SEC regarding the proposed transactions. INVESTORS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the joint proxy statement/prospectus and other relevant documents filed by Berry, LINN and LinnCo with the SEC at the SEC’s website at www.sec.gov. You may also obtain these documents by contacting LINN’s and LinnCo’s Investor Relations department at (281) 840-4193 or via e-mail at ir@linnenergy.com or by contracting Berry’s Investor Relations department at (866) 472-8279 or via email at ir@bry.com.

Participants in the Solicitation

Berry, LINN and LinnCo and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transactions. Information about LINN’s directors and executive officers is available in LINN’s proxy statement dated March 12, 2012, for its 2012 Annual Meeting of Unitholders. Information about LinnCo’s directors and executive officers is available in LinnCo’s Registration Statement on Form S-1 dated June 25, 2012, as amended, with respect to its initial public offering of common shares. Information about Berry’s directors and executive officers is available in Berry’s proxy statement dated April 6, 2012, for its 2012 Annual Meeting of Stockholders. Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transactions when they become available. Investors should read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Berry, LINN or LinnCo using the sources indicated above.

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements, which are all statements other than statements of historical facts. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those anticipated. Important economic, political, regulatory, legal, technological, competitive and other uncertainties are identified in the documents filed with the SEC by Berry, LINN and LinnCo from time to time, including their respective Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. The forward-looking statements including in this press release are made only as of the date hereof. None of Berry, LINN nor LinnCo undertakes any obligation to update the forward-looking statements included in this press release to reflect subsequent events or circumstances.

CONTACT: LINN Energy, LLC and LinnCo, LLC

         Investors & Media:

         Clay Jeansonne, Vice President, Investor and Public Relations

         281-840-4193

         Berry Petroleum Company

         Investors & Media:

         Zach Dailey, Manager, Investor Relations

               303-999-4071

If you are nearing retirement or are already retired and would like for Richmond Brothers to provide a second opinion on your financial plan, we’d be happy to talk with you further! Please give us a call us at 517-536-5000.

Distribution Payable in Two Dividends of $0.24 per Share in Second and Third Quarters

Top-Line Trial Data Expected in July 2013

WIXOM, MI — (Marketwired) — 05/29/13 — Rockwell Medical (NASDAQ: RMTI), a fully-integrated biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with innovative products and services for the treatment of iron deficiency, secondary hyperparathyroidism and hemodialysis, announced today that its CRUISE-1 Phase 3 efficacy study for SFP has completed patient dosing. SFP is the Company’s late-stage investigational iron-delivery drug for the treatment of iron deficiency in chronic kidney disease patients receiving hemodialysis. CRUISE-1 top-line data is expected in July 2013.

“Completing the CRUISE-1 efficacy study is a major milestone achievement for Rockwell, and we are excited to be so close to top-line results,” stated Robert L. Chioini, Founder, Chairman and CEO of Rockwell Medical. “Our clinical team continues to perform at a high level, and we thank them, the study investigators and certainly the patients for their outstanding effort and participation. We look forward to the upcoming CRUISE-1 study results.”

“We are very pleased to complete this important study,” stated Dr. Raymond Pratt, Chief Medical Officer of Rockwell Medical. “SFP is a very promising iron drug that will address the unmet need for correcting functional iron deficiency in CKD-HD patients. The results of the placebo controlled PRIME study, recently reported at the ERA-EDTA Congress in Istanbul, demonstrated that SFP reduced the ESA dose required to maintain hemoglobin by a statistically significant 35% compared to placebo. The CRUISE studies do not allow changes in ESA dosing, so we are confident that in the CRUISE study design, SFP will show a favorable difference in hemoglobin levels compared to placebo.”

The CRUISE Studies
Rockwell is conducting two pivotal Phase 3 efficacy studies called CRUISE-1 and CRUISE-2. Each study is a prospective, randomized, placebo-controlled, multicenter study to demonstrate efficacy and safety of SFP-iron, delivered via dialysate, in adult CKD patients requiring hemodialysis. Each study comprises approximately 300 patients, randomized equally between SFP and placebo groups with a treatment period of up to 12 months. The primary efficacy end-point for both studies is the mean change in hemoglobin from baseline.

About SFP
SFP is a unique iron compound that is delivered to the hemodialysis patient via dialysate, replacing the 5-7 mg of iron lost during a dialysis treatment. SFP is introduced into the sodium bicarbonate concentrate that subsequently is mixed into dialysate. Once in the dialysate, SFP crosses the dialyzer membrane and enters the bloodstream where it immediately binds to apo-transferrin and is taken to the bone marrow, mimicking the way dietary iron is processed in the human body. In completed clinical trials to date, SFP has demonstrated that it can safely deliver iron and maintain hemoglobin levels while decreasing ESA use, without an increase in iron stores.

About Rockwell Medical
Rockwell Medical is a fully-integrated biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with innovative products and services for the treatment of iron deficiency, secondary hyperparathyroidism and hemodialysis.

Rockwell’s lead drug candidate in late-stage clinical development is for the treatment of iron deficiency in dialysis patients and is called Soluble Ferric Pyrophosphate (SFP). SFP delivers iron to the bone marrow of dialysis patients in a non-invasive, physiologic manner via dialysate during their regular dialysis treatment. In completed clinical trials to date, SFP has demonstrated that it can safely deliver sufficient iron to the bone marrow. SFP is nearing completion of its Phase 3 clinical studies (CRUISE-1 and CRUISE-2) and is expected to address an estimated $600M U.S. market.

Rockwell is preparing to launch its FDA approved generic drug called Calcitriol to treat secondary hyperparathyroidism in dialysis patients. Calcitriol active vitamin D injection is indicated in the management of hypocalcemia in patients undergoing chronic renal dialysis. It has been shown to significantly reduce elevated parathyroid hormone levels. Reduction of PTH has been shown to result in an improvement in renal osteodystrophy. Rockwell intends to launch Calcitriol as soon as it receives FDA manufacturing approval, addressing an estimated $350M U.S. market.

Rockwell is also an established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributors in the U.S. and abroad. As one of the two major suppliers in the U.S., Rockwell’s products are used to maintain human life by removing toxins and replacing critical nutrients in the dialysis patient’s bloodstream. Rockwell has three manufacturing and distribution facilities located in the U.S. and its operating infrastructure is a ready-made sales and distribution channel that is able to provide seamless integration into the commercial market for its drug products, Calcitriol and SFP upon FDA market approval.

Rockwell’s exclusive renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are intended to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience. Rockwell Medical is developing a pipeline of drug therapies, including extensions of SFP for indications outside of hemodialysis. Please visit www.rockwellmed.com for more information. For a demonstration of SFP’s unique mechanism of action in delivering iron via dialysate, please view the animation video at http://www.rockwellmed.com/collateral/documents/english-us/mode-of-action.html.

Certain statements in this press release constitute “forward-looking statements” within the meaning of the federal securities laws, including, but not limited to, Rockwell’s intention to launch Calcitriol and SFP following FDA approval. Words such as “may,” “might,” “will,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan”, “intend” or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While Rockwell Medical believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in Rockwell Medical’s SEC filings. Thus, actual results could be materially different. Rockwell Medical expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.

Michael Rice
Investor Relations
646-597-6979

David Connolly
Media Contact
617-374-8800

Source: Rockwell Medical Technologies, Inc.

• Q1 2013 Financial Results
• 2012 Annual Report

Source: Inland American