X0202 4/A 2008-05-16 2008-05-30 0 0000877931 Vertical Communications, Inc. VRCC 0001044321 MARXE AUSTIN W & GREENHOUSE DAVID M C/O SPECIAL SITUATIONS FUNDS 527 MADISON AVENUE, SUITE 2600 NEW YORK NY 10022 0 0 1 0 Preferred Stock 0.05 2008-05-16 4 P 0 709 A 2008-05-16 Common Stock 14187899 709 I By Limited Partnerships Warrants 0.01 2008-05-16 4 P 0 13995461 0.01 A 2008-05-16 2018-03-13 Common Stock 13995461 13995461 I By Limited Partnerships This is a joint filing by Austin W. Marxe (Marxe) & David M. Greenhouse (Greenhouse). They share voting & investment control over all securities owned by Special Situations Fund III QP, L.P. (QP), Special Situations Cayman Fund, L.P. (Cay), Special Situations Private Equity Fund, LP (PE), Special Situations Technology Fund, L.P. (Tech) & Special Situations Technology II, L.P. (Tech II). QP held a 367,842.03 Note, which was converted into 373 PS convertible into 7,457,997 CS & 7,356,841 Wt, Cay head a 125,880.62 Note which was converted into 128 PS convertible into 2,552,230 CS & 2,517,612 Wt, PE held a 124,212.70 Note, which was converted into 126 PS convertible into 2,518,412 CS & 2,484,254 Wt, Tech held a 13,110.31 Note, which was converted into 13 PS convertible into 265,812 CS & 262,206 Wt and Tech II held a 68,727.42 Note, which was converted into 70 PS convertible into 1,393,448 CS & 1,374,548 Wt. The interest of Marxe & Greenhouse in the shares owned by QP, Cay, PE, Tech & Tech II is limited to the extent of his pecuniary interest. The Special Situations Funds entered into an agreement on April 16, 2008 to purchase Subordinated Convertible Promissory Notes (Note). On May 16, 2008 the principal amount (and estimated accrued and unpaid interest as of May 16, 2008) of such notes, were automatically converted into Series F Preferred Stock (PS) and Warrants (Wt) exercisable for Common Stock. The Preferred Stock is convertible into Common Stock (CS) at a rate equal to 5 cents per share. None Austin W. Marxe 2008-06-13 David M. Greenhouse 2008-06-13