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

To: Ken Muller who wrote (7639)	11/9/1997 6:41:00 PM
From: Jan A. Van Hummel	Respond to of 14577

Ken, Even though he was an x-broker (ergo a failed law student -g-) I would support Frank on the Board. I am not familiar with the procedure. When the proxies are sent out you can write in Frank's name and scratch any of current members up for re-election. At this year's Annual Meeting all members have been elected for the term of one year. That approach will give some visibility, but probably not the desired result. If filing for representation on the Board the company would have to release a list of all shareholders so that each and everyone can be approached in regard to this issue, but you may need to represent a certain percentage of shares. Again, this needs to be researched. The make up of the Board is not inducive to significant change soon. Perhaps Banatao, who owns some 800,000 shares that are worth a lot less may feel the need to see his fortunes turned around. To get one seat is not enough. To achieve a meaningful change the company has to either add two outside directors, so that inside vs outside is 4 - 5, or replace and inside with an outside director (3 - 4). Too many insders on the Board creates Groupthink (we know what we are doing and we are doing it right) and a rubber stamp approach to important issues. Those in subordinated positions within the company are unlikely to dissent on fear of losing their job. It is therefore of paramount importance to seek a change in the composition of the Board by ensuring outsiders to be a majority on the Board, and then outsiders who are more visible than the ones presently on the Board. Current stock holdings (i.e. as reported on March 10, 1997) which includes shares issuable upon exercise of options within 60 days from 3/10 (between [ ]). Mind you, it is unclear if, and if so what perecentage of these options were exercised. S3-ers Banatao 802,594 [149,681] Holdt 337,271 [110,844] Johnson 136,212 [131,573] Yara 408,442 [161,406] Outsiders Colligan 25,000 [ 25,000] Lee 35,000 [ 35,000] Santoro 28,536 [ 28,536] You can see how tough it may be for the S3 group to share power in a meaningful way. IMO This is a rubber stamp Board. All directors and executive officers as a group own 1,926,803 shares or 3.9 %. However, and this is important (mind you, this is as of 3/10/97 and this may have changed), J&W. Seligman & Co, NY owns 2,961,800 shares or 6.0 %. If they still own 6 %, they would be rather unhappy to say the least. Getting Seligman on board for our efforts or tailride on theirs may bring the desired result. I am not sure J&W S is lurking on this thread, but if they are perhaps they can let Ken know. If we want to achieve change we better start early. JMHO Jan