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Non-Tech : Ashton Technology (ASTN) -- Ignore unavailable to you. Want to Upgrade?

To: M. Frank Greiffenstein who wrote (3110)	1/2/2000 12:41:00 AM
From: Rob W	Read Replies (1) \| Respond to of 4443

I need to look at the last annual report, as I believe it explains the terms of payment of the fees between the Philly Stock Exchange (PSE) and Ashton. The only thing I can seem to recall is the percentage (what amount that is?) of the fees to be paid to the PSE is back loaded over the life of the 5 year contract. I assume Ashton keeps the rest. MST, can you step in and provide some clarity here? I see if I can dig out the annual report.

To: M. Frank Greiffenstein who wrote (3110)	1/2/2000 1:55:00 AM
From: Rob W	Respond to of 4443

Ok, the discussion I was referring to in the annual report begins in the Notes to the Consolidated Financial Statements, page 38, note 12. <<<The PHLX is also entitled to receive an annual royalty from UTTC of 3% of annual gross revenue based on UTTC's average revenue in first three years of operations for each year the PHLX agreement is in effect. These payments are required to begin at the end of the second full year of operation and continue for the life of the PHLX agreement.>>> My understanding is that UTTC would collect the 2, 1.5, and 1 cent fees and these would constitute gross revenue of which the Philly gets 3% as set out above. Keep in mind I am the person who got Richard Yin mixed up so I'd appreciate hearing additional views. I wonder if the clock is ticking during this phase-in period, or if a second agreement will be necessary for NASDAQ stocks that will be added if they are launch not under the SEC approval order but as I pilot project? I believe at the Stockholder meeting, which I did not attend, the company said to use 2 cents for a revenue share, (1 cent for buyer and 1 cent for seller) I really didn't understand that figure except that perhaps it is because the discounts for volume kick in at 10 and 20 million shares per client. They also said to use a profit margin between 40-50% The average figure that is tossed around for first year operation is 10 million shares (conservative I think) and that I believe is 5 millon on the buy side and 5 million on the sell side, or $100,000 gross a day on average. I use 45% for the profit margin so I get $45,000 a day. I think these numbers are conservative because I think they have the best mouse trap in a global market. Best in terms of 1) Commission fees 2)Precision with respect to the VWAP price, 3) anonymity, 4) User friendly 5) Additional efficiencies. The Best part is we shall soon see once an for all if there is interest.