Charred: <<Samsung's Rambus DRAM sales exceed 10 million units>>
That was for 128Mb RDRAM. I don't recall the status (if any) of 256. It'd be interesting to know.
So it looks like Samsung got 17.5% (70,000 shares pre-split) of the Warrants Program, and NO LESS than 25% of the entire program has already been earned / issued. Per the Annual Report, Page 20 (Management Discussion / Contingent Warrants), I paraphrase:
'In Oct. 98, the BOD authorized an incentive program in the form of warrants on a total of up to 400,000 sh of RMBS common to be issued to various RMBS DRDRAM partners upon achievement of certain product qualification and volume production targets. The warrants...will have an exercise price of $10 / share and life of 5 yrs....As at Sept 99, 30,000 of these warrants have been issued.'
In other words, we have an extraordinary charge coming up. If expensed at yesterday's close, a rough calc looks like we are looking @:
(115-2.5)*280,000 = US$31.5MM
Hopefully the Hitachi settlement fee, a cash, extraordinary event, will more than offset these non-cash charges (if both are recognized this Q).
Meanwhile, the cynicism on this issue is flying on other boards.
Message 13939102
It gets worse. This warrants program is then spun into being THE reason for capitulation by Hitachi and Toshiba:
<<I personally believe that the roll-overs to date were probably in response to "an offer you can't refuse" from RMBS>>
Message 13939233
And further expounded upon (this one is real special):
<<Today, the stock price is in orbit, propelled there by the (in my view) childish belief that an entire industry, is going roll over on a patent that covers a small part of a very large and complex technology. Nyet. The world doesn't work that way. We both know that considerable effort will now be expended to "work around" the RMBS patent....Bluntly, I do not blame the involved Dramuria for playing their stage roles in this 2 act play with enthusiasm. Business is business and if a company can book a large, low risk, short term, capital gains profit on proffered RMBS warrants, more power to them. The memory game is brutal and about to become even more so. The market doesn't care where the profits come from.>>
In the opinion of this investor, nothing could be further from the truth. I listened to the cc last week. My hearing loss notwithstanding, I believe I heard Tate EMPHATICALLY reiterate that THERE WERE NO WARRANTS TIED TO THE TOSHIBA SDRAM / DDR LICENSE AND NONE WOULD BE USED TO OBTAIN ANY OTHER SDRAM / DDR LICENSES. This in response to a DIRECT question. Anybody hear differently?
To those that would characterize these warrants as charlatan, nefariously "buying into" the industry, I view these programs as extremely complimentary to the business acumen of Mssrs. Tate, Davidow, etc. God Bless 'em.
JMHO,
BP |
