Date: 05/24/2000 10:27 AM Subject: File No. S7-31-99 Jonathan G. Katz Secretary, Securities and Exchange Commission 450 5th Street, N.W., Washington, D.C May 23, 2000 Dear Mr. Katz: I urge the adoption of the Regulation FD. I provide you with a concrete example below why the Regulation is necessary to protect the investing public. Last Friday, I lost $10,000 in buying Photronics (plab) for one reason: The company gave a handful of analysts and institutional investors "revised guidance" (which was not made public) that a pending merger would adversly affect 2000 and 2001 earnings. The institutional sellers knew these facts, the investing public did not. The scenario: May 17, after the close. : PLAB releases it earnings. Nothing about dilutive effect of MASK merger. May 18, 8:30 AM PLAB hold conference call for analysts--positive tone. Nothing about dilutive effect of MASK merger. I listened to the conference call over the internet. May 18 PM Analysts including WIT Soundview issue positive notes on PLAB. Soundview notes indicate that MASK merger will be accretive. Soundview (4:38 PM) indicates it will raise 2001 estimates by 15 cents to $1.90 per share for 2001. May 19th A.M. Plab begins to fall. Nothing negative on the stock. The stock is a screaming buy. I have been waiting for a chance to get into PLAB. I make the largest stock purchase in almost two years. What I don't know is sellers have information not available to me or the public regarding the dilutive effect of pending merger. May 19th 2:30 PM Soundview indicates it has guidance from PLAB and cuts its 2001 estimate to $1.50, instead of raising it, as it had said less than 24 hours earlier. There has been no knew news. Sound View now believes the MASK merger will be dilutive. May 22 Needam drops its 2001 estimate, also citing "guidance." I call PLAB investor relations. May 23 Mike McCarthy of PLAB calls me back. I question about guidance to Sound View and that there was nothing said in analysts conference call suggesting MASK dilutive effect. McCarthy tells me that the he had called selected analysts and "investors" (after the conference call) and informed them of negative effect of MASK merger. This was remarkable because Sound View spun on a dime within hours: 1) instead of raising estimates, they cut estimates; 2) Rather than the merger being immediately accretive, it would be dilutive. On May 18 at 4:38, Sound View notes to First Call read: "We reiterate our strong buy rating on the shares and our $60 price target. Our estimates remain under review, as we migrate in the assumptions of Align-Rite (schedule to report on Monday). We anticipate that our earnings could be positively affected with revenue up as well. Early indications would be for about $85M of revenue for the July quarter and $15M additive to the October quarter. We believe we could increase our fiscal 2001 estimate by about $0.15, as we are above the Street currently. In all likelihood this will prove to be low. With no new facts (at least to the public), The asme analyst wrote the next say: "We are lowering our estimates for Photronics, in accordance with guidance and our views on how the merger will impact the shares. For the third quarter (July), we are going to $0.22 from $0.29 including Align-Rite. For F01 our new estimate is $1.50 from $1.75." As you point out, this is not the result of analysis. Rather, it is the company playing favorites. Allowing Sound View and its institutional clients to be selling to the public (knowing secret information) is unconscionable. Gary Aguirre