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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: Jan A. Van Hummel who wrote (13934)	1/6/2000 9:04:00 AM
From: conlyjj	Respond to of 14577

My interpretation is that the 1st calender qtr of 2000 entry in its Statement of Operations is an "accounting " entry / still own the shares / and can only sell the shares gradually starting in July 2000,with restrictions lifted on share sales in Jan 2004. So, we have a position in USC currently valued at approximately $10.52 a SIII share (76 million shares divided by $800 million). This would value every thing else-graphics, Rio, patents, etc at about a $1.00 at current prices.

To: Jan A. Van Hummel who wrote (13934)	1/6/2000 9:50:00 AM
From: Bob Sutton	Read Replies (2) \| Respond to of 14577

Okay, now it makes sense. The exchange of USC shares for UMC shares is a disposition of the original asset and requires S3 to update its basis to reflect current value rather than cost, hence the bookkeeping entry for income. UMC's acquisition required S3 and the other minority USC investors to tender their shares upon completion, hence the confusing announcement yesterday that UMC had bought out S3 et al. Per the lockup, the UMC shares received in exchange are frozen until July earliest. SIII will hedge the eventual sale of those UMC shares against declines using treasury derivatives or options. Wonder if this move eliminates S3's participation in any further rise in UMC before July? Bob Sutton