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Technology Stocks : Seagate Technology - Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Stu E. who wrote (1971)	2/7/2001 2:04:55 PM
From: Starlight	Respond to of 1989

Per the prospectus sent out last fall, it says that "SEG stockholders will recognize gain, if any, for federal income tax purposes, but only up to the amount of cash received and, in general, the fair market value as of the closing of the merger of their proportionate share of any amounts paid following the completion of the merger for tax refunds and credits attributable to Seagate and the $150 million of retained cash net of potential Seagate tax liabilities. Betty

To: Stu E. who wrote (1971)	2/7/2001 2:14:42 PM
From: Lynn	Read Replies (1) \| Respond to of 1989

Dear Stu: Take a look at a section of SEG/VRTS's SEC filing I have copied at the end. The only reason I do not see how the cash could be considered a return of capital is because some long-term shareholders would then have a negative cost basis in VRTS. Regards, Lynn - The aggregate tax basis of the VERITAS common stock received by Seagate stockholders in the merger will be the same as the aggregate tax basis of the Seagate common stock surrendered in exchange therefore, decreased by the tax basis allocated to fractional share interests for which cash is received and by the amount of cash consideration received (other than cash received for fractional share interests) and by the fair market value of the tax refund right received (unless so-called "open transaction" treatment applies, as discussed below), and increased by the amount of gain recognized on the exchange. The aggregate tax basis of the tax refund rights received by Seagate stockholders in the merger will be the fair market value of the tax refund right at the time of the merger (unless "open transaction" treatment applies). Seagate stockholders can call 1-866-366-2506 to obtain estimates of the amount of cash payable and the number of VERITAS shares issuable in connection with the merger as well as the estimated fair market value of the tax refund right. - The holding period of the VERITAS common stock received in the merger will include the period for which the Seagate common stock surrendered in exchange therefor was held. [copied section from RB posting] ragingbull.lycos.com