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To: Jurgis Bekepuris who wrote (1960)	12/30/1997 2:33:00 AM
From: Tim Bagwell	Respond to of 3696

2. Exposure to DD segment. After the closure of SEG's plant in Ireland, the near future of DD equipment sector is pretty cloudy. I think this might be the issue that the shorts are focused on. There are certain parallels between the DRAM and DD industries. Both are caught in a commodity business where they are being squeezed for profitability. UTEK is in a good long term position as a supplier of highly capitalized equipment necessary for manufacture of high end DD products. But in the short term they will be subject to the ability of the DD makers to manage capacity. Given that UTEK is so dependant on businesses that have not been run well traditionally, I am very concerned that the shorts may be on to something here.

To: Jurgis Bekepuris who wrote (1960)	12/30/1997 3:08:00 PM
From: Justa Werkenstiff	Respond to of 3696

Raimondas: Thank you for sharing your opinion. You essentially confirmed my thinking in previous posts about the large short position. I think what you see on your PSR screen are the last remnants of consideration given by the market to the new product line. P/B seems far more reasonable as compared to the industry. But I do think it interesting that the short position is one of the highest (percentage wise to the float) in the industry and I suppose it is becoming consensus thinking that UTEK will miss its numbers and sink lower and that UTEK's demise will be like printing money. However, the fact that this is becoming consensus thinking would be all the more reason for me to become concerned from your position as you have no doubt considered of late.

To: Jurgis Bekepuris who wrote (1960)	12/30/1997 4:58:00 PM
From: bill	Read Replies (1) \| Respond to of 3696

Raimondas, I too believe that you presented a rational case for the high level of UTEK short interest. However,at the risk of being repetitive, I'd like to make one point about UTEK's relatively high PSR. While almost all of a company's material assets contribute to the generation of sales, there is one type of asset that in most cases cannot - that is its excess cash, or cash in excess of debt beyond that which is required for normal working capital purposes. Because UTEK's cash and cash equivalents so far exceed liabilities (virtually nil), IMO to make a fair across the board comparison of PSR, one should adjust for this excess cash component. For argument's sake, let's say that a more typical level of net cash for a semi equip with UTEK's parameters would be $3 per share. Since UTEK has $8 in net cash, one might subtract $5 (excess cash) from the share price before computing effective PSR. Based on a $21 share price, this would yield a representative PSR of 16/7.2, or 2.2, rather than the 21/7.2, or 2.9, which results without such an adjustment. I should mention that the $3 level I chose is somewhat arbitrary. There are quite a few entities which operate with net cash which is much lower than this, or even with positive net debt.