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To: Box-By-The-Riviera™ who wrote (385)	5/26/1998 1:00:00 PM
From: Mark Oliver	Respond to of 723

Hi Joel, glad to see you're out there. Any thoughts on Smart Modular? They sure seemed to catch the street by surprise when they said there was too much inventory in the channel. Looking through the comments on these module makers it was clear that only by investing in leading edge equipment could players survive. Again and again, it strikes me that ESI is not selling luxury products, they are selling survival. Smart Modular now expects to have a 24 hour time from order to delivery. They've got a much harder job building the new memory modules, but they can't afford to hold inventory. So, they are in the same boat as many OEM suppliers. BTO means that component inventory problems are transferred to suppliers and they've got to be nimble and quick. Only through improved manufacturing can this happen. This is not going to be an issue of throwing more labor at the problem. Automation makes processes more predictable. Regards, Mark PS Speaking of catching the street by surprise, the news that Diebold would make numbers as they see banking mergers reducing demand for ATM's. Now, that seems so obvious it's almost too simple. I sure hope my view on ESI turns out to be the same sort of observation. It just makes sense.

To: Box-By-The-Riviera™ who wrote (385)	6/1/1998 9:54:00 AM
From: Mark Oliver	Read Replies (1) \| Respond to of 723

Price is very cheap now. Got your finger on the trigger? I'm looking at Cognex and wondering if this will spill over on ESI? They cite weakness for another 2 or 3 quarters. Could well be any issues of machine vision have already been discounted? 09:11 ET Cognex Corp (CGNX) 19: Maker of machine vision systems says expects a yr/yr decline in earnings and revenues in each of the next three quarters. Cites a slowdown in orders from customers in the semiconductor and electronics industries, whose businesses have slowed substantially since the start of the Asian financial crisis. Puts FY98 net income approx. 20% below yr-ago level. Stock indicated 2 1/2 pts lower. Joe Granville is bullish. Does this mean time to sell? Regards, Mark