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Technology Stocks : SSA (SSAX) BPCS/Client Server -- Ignore unavailable to you. Want to Upgrade?

To: MAURICE J. SADOWSKY who wrote (441)	1/25/1998 12:28:00 PM
From: kvogel	Respond to of 915

Maurice, I come up with about 48.5 million shs outstanding now. I don't include the warrants since exercise must be at about $11. or more based on what company gets with exercise. I believe there are 2 important issues now: 1)Who is doing the selling seen on Friday? 2)How much is S.E. Asia affecting future earnings? If CA is unloading some shares they will only unload 2.4 million since 1.2 million shares are tied up in a spread arrangement: (c) On July 15, 1997, in a privately negotiated transaction, Computer Associates purchased from RBC Dominion Securities Corporation as agent for Royal Bank of Canada (together, RBC), at a price of $1.00 per option, 1,200,000 options to sell one share of Common Stock per option to RBC at a price per share of $7.800726 (collectively, the Put Options). Simultaneously with the purchase of the Put Options, in a privately negotiated transaction, RBC purchased from Computer Associates, at a price of $1.00 per option, 1,200,000 options to purchase one share of Common Stock per option from Computer Associates at a price per share of $9.827355 (collectively, the Call Options and, together with the Put Options, the SSA Options). The SSA Options are deemed to be automatically exercised on the expiration date of July 15, 1999 and, except in certain limited circumstances, may not be exercised prior to such expiration date. Unless Computer Associates elects to settle the SSA Options using shares of Common Stock, the SSA Options will be settled by a net cash payment from Computer Associates to RBC or from RBC to Computer Associates depending upon the arithmetic average of the closing prices of the Common Stock on July 13, 1999, July 14, 1999 and July 15, 1999. Since several funds own significant amounts of SSAX it is difficult to say who is dumping but I'm hoping to find out from Mary on Monday. The second issue is more complex since it involves both sales and currency conversions. Some of the currencies have gone down by huge factors i.e. 84% in Indonesia. However, I don't know the distribution of sales in different countries in S.E Asia. Mary in IR said these sales (18-20% total) included Australia and New Zealand. Also Hong Kong currency holding so far. Thus, I expect total downside to be about 5% at worse case. Korea is probably serious but seems to be responding more quickly than the island economies of Malaysia. Karl

To: MAURICE J. SADOWSKY who wrote (441)	1/25/1998 1:07:00 PM
From: kvogel	Read Replies (1) \| Respond to of 915

Maurice, Main impact of Friday's breakdown was failure of uptrend line at 8 5/16 to hold. Previous test at 8 1/4 held and SSAX bounced to 9 1/2. Next support is at 7 and is not strong (was done on low volume). I believe fundamentals and emphasis on sales and marketing will help hold the stock above earlier levels at 4. As you have stated, products are leading edge and financials have improved dramatically since April when the low of 4 was made. Stock is short-term moderately oversold but one or 2 downdays would make it very oversold. Monday could be painful but I don't think we'll have to wait long for a bounce. Karl