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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: TimC who wrote (3475)	7/6/1998 7:20:00 AM
From: Ausdauer	Read Replies (1) \| Respond to of 60323

Tim and the rest of the thread, This is an old post I wanted to make people aware of. The important features are the insider trading regulations. Employees and Officers were barred from trading as of May 22, 1998. Rizzi's transaction was before this date according to a recent post on this thread. Thus, if he planned to distract the SEC's attention from any shady insider deals (the "shill") it seems a bit far-fetched. Perhaps he wished to get a few more shares in anticipation of 2Q earnings, not knowing a disappointment was in the making. The deal with Lexar should say "co-licensing" rather than "licensing". Also, add earnings disappointment as another reason for the fall in stock price. To: Craig Freeman (3099 ) From: Ausdauer Saturday, May 23 1998 8:26AM ET Reply # of 3478 Dear Thread, Please accept the following information as factual as I received it from reliable sources. In answer to some of the questions raised in recent posts I would offer the following comments. Why is the stock price falling? Semiconductor manufacturers in general have fallen out of favor and the market has pushed stock prices down. Sandisk manufactures semiconductors and has a small market capitalization. The stock has been buffeted like many others. The small market cap has amplified this effect. What is the current status of the Lexar litigation? It is public knowlegde that Sandisk offered a licensing agreement to Lexar for their CompactFlash product. Lexar Media felt the terms of the agreement were unreasonable. No final agreement could be crafted. Sandisk had no other alternative but to pursue the matter via legal channels. Once a patent infringement suit is embarked upon it may be a long and drawn out process. On the other hand, Lexar could decide to settle at any time. Have any of the prior quarters reflected revenues from the MMC? Prior quarter's licensing and royalty revenues reflect primarily the interest in CF products. The MMC will be handled in a slightly different manner. Siemens will profit from revenues earned from the MMC-ROM sales. These are more static items which would not require updating such as dictionaries, maps,... Sandisk will profit from the sales of MMC-flash products which are read/write. The market for these products is different. Also, Sandisk intends to offer cross-licensing agreements to competitors wishing to use this technology. Why has there been ongoing insider sales? Company employees may make trades at any time except for the six weeks preceeding the last day of the quarter (and several days thereafter). Employees wishing to trade shares in the current quarter had to complete these transactions yesterday (22May98) to be in compliance with SEC regulations. Officers such as Dr. Harari and Mr. Malmed have been selling shares fairly regularly on a quarterly basis. Dr. Harari usually sells 20,000 to 40,000 shares. Mr. Malmed sells a smaller number of shares. These types of transactions are likely to continue in the future. I hope this information is useful to people. Ausdauer