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To: B Tate who wrote (4564)	4/20/1999 5:07:00 AM
From: Dale Baker	Respond to of 118717

Most of the charts I look at lately are so weird I don't know what to make of them. Maybe that's why I am drifting toward issues with more coherent price patterns. AMG buys up successful mutual fund companies once the "founder" generation is ready to step back and let someone else run the actual operations. Former owners keep a stake but AMG has them under its wing. Just downloaded the 10-K. More on this one later. I will probably continue my shift to financials and other alternatives to small cap techs. This is not usually a kind season for the little tykes. From the AMG 10-K: ITEM 1. BUSINESS OVERVIEW We buy and hold equity interests in mid-sized investment management firms and currently derive all of our revenues from those firms. We refer to firms in which we have purchased less than 100%, typically less than 80%, as our "affiliates". We hold investments in 13 affiliates that managed $62.1 billion in assets at December 31, 1998. Our most recent affiliate investments were in Essex Investment Management Company, LLC (March 1998); Davis Hamilton Jackson & Associates, L.P. (December 1998) and Rorer Asset Management, LLC (January 1999). On January 29, 1999, we also entered into a definitive agreement to acquire substantially all of the partnership interests in The Managers Funds, L.P., which serves as the adviser to a family of ten equity and fixed income no-load mutual funds. These mutual funds had a total of $1.8 billion in assets under management at December 31, 1998. We were founded in 1993 to address the succession and ownership transition issues facing the founders and principal owners of many mid-sized investment management firms. We did this because we believed that many of them wanted a new alternative for shifting ownership to the next generation of management. We developed an innovative transaction structure to serve as a succession planning alternative for these firms. The key component of our transaction structure is our purchase of majority interests in these firms. Within this structure, we allow ongoing managers to keep a significant ownership interest in their firms which they may sell to us in the future, we give management autonomy over the day-to-day operations of their firm, and we allow management to decide how to spend a fixed portion of revenues on salaries, bonuses and other operating expenses. We implement our structure through a revenue sharing arrangement with each of our affiliates. This arrangement allocates a specified percentage of revenues, typically 50-70%, for use by the affiliate's management in paying the salaries, bonuses and other operating expenses (the "Operating Allocation") of the affiliate. The remaining portion of revenues, typically 30-50% (the "Owners' Allocation"), is allocated to the owners of that affiliate, including us, generally in proportion to ownership of the affiliate. We believe that our structure is particularly appealing to managers of firms which anticipate strong future growth, because it gives them the opportunity to profit from an affiliate's growth through this revenue sharing arrangement.

To: B Tate who wrote (4564)	4/20/1999 6:23:00 AM
From: Dale Baker	Read Replies (1) \| Respond to of 118717

Since the market is so butt ugly, I decided to start weeding out non-performers. Say bye-bye to DGN, JADEW and NETS. If NETS ever takes off I will play the calls. Starting a position in AMG on the long side after reviewing their 10-K and financials. I like their growth potential. And I like putting money in a company that focuses on - making money. If PROG doesn't move after earnings, it's the next candidate to walk the plank. FOX goes after that if Star Wars doesn't give it a significant bump up.