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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Michael Kim who wrote (15974)	10/24/2000 4:15:18 PM
From: Ausdauer	Read Replies (2) \| Respond to of 60323

Michael, It is frustrating to see one of your stocks get absolutely hammered, especially so soon after a record earnings report. AS FRUSTRATING AS IT MAY BE... SanDisk's style is not react in a knee-jerk fashion to a press release like this, but to neutralize the effects with a calm and well thought out reply that addresses the issues at hand. Lexar struck under the cover of night as it did when it released information in an unrelated case against SanDisk shortly after the Taiwan earthquake in 1999. While people on the island were mourning their dead and SanDisk's future swayed in the balance, Lexar Media felt there was a window of opportunity. The goal in that instance, IMHO, was to inflict maximum pain. If I recall correctly, the press release was worded in a rather misleading fashion so as to tie it into the ongoing '987 case. PLEASE READ DR. HARARI's REPLY... sandisk.com For us "old timers" it also was painful as there was a secondary offering on the table at the time which was designed, IMHO, to raise the needed cash to consummate the FlashVision JV before January of 2000. Thus, it was of the utmost importance. What is the take home message? Lexar Media simply cannot be trusted, IMHO. Well, at least not any farther than you an throw them. Ausdauer

To: Michael Kim who wrote (15974)	10/24/2000 4:19:25 PM
From: Andre Williamson	Read Replies (1) \| Respond to of 60323

Maybe this is news to most, but I dug this up from one of Lexar's September filings: "The number of shares of our common stock that will be outstanding after this offering excludes:" <snip> ". up to 195,503 shares of our common stock that we would issue to Sony upon conversion of the $2.0 million convertible promissory note that we issued to Sony in March 2000, assuming an initial public offering price of $11.00 per share;" Also, "In addition, a warrant was issued to Sony in conjunction with the convertible note financing. The warrant is for 400,000 shares of common stock at a price equal to the lower of $5.00 per share or 93% of the public offering price of the common stock in the IPO. The warrant expires upon closing of the Company's IPO or upon a change in control prior to an IPO. In any case, the warrant cannot be exercised prior to September 1, 2000." Also from the filing: "Under our agreement, we and Sony have cross-licensed technology to each other. We have the right to manufacture and sell the current version of the Memory Stick, and are obligated to pay a royalty to Sony for each Memory Stick that we sell. We have agreed to collaborate on technology development with Sony, including the development of a high-speed Memory Stick through the use of our proprietary controller technology. Sony is obligated to pay us royalties on Memory Sticks that it sells that incorporate our technology. Our agreement with Sony will continue indefinitely, unless earlier terminated for the material breach of the agreement by either party or a party's bankruptcy-related event."

To: Michael Kim who wrote (15974)	10/24/2000 6:07:10 PM
From: Art Bechhoefer	Read Replies (1) \| Respond to of 60323

It is a bit of a stretch to think that Sony is behind this latest move of Lexar. But it might be more reasonable to conclude that help could be coming from Microsoft. Why? Because this is a pretty poor case, if you ask me. A court could easily rule against Lexar in its anticompetitive behavior claim, thereby setting a precedent that Microsoft might use to advantage in its appeal of its own antitrust ruling, or as precedent in the ongoing state and private civil actions against Microsoft. Art