2003-07-18 -- Stevens, Carl and Michael Susi -- Guilty Plea -- News Release

Former President and Sales Representative of Jersey City Graphics Imaging Dealer Admit Insider Trading

NEWARK - The former president and a former sales representative of a Jersey City graphics imaging dealer each pleaded guilty today to insider trading in connection with the stock of PrimeSource Corporation, a publicly-traded company formerly headquartered in Pennsauken acquired by Fuji film, U.S. Attorney Christopher J. Christie announced.

Carl Stevens, 65, of Hoboken, and Michael Susi, 62, of Basking Ridge, entered their pleas in before U.S. District Judge Harold A. Ackerman, who set sentencing for Oct. 17.

Both men are free pending sentencing on $25,000 personal recognizance bonds.

According to the Informations to which they pleaded guilty, after obtaining inside information that Fuji Photo Film U.S.A., Inc. (Fuji) planned to acquire PrimeSource Corporation, Stevens and Susi purchased PrimeSource stock and tipped family members and business associates to do the same. A short time later, when PrimeSource announced that it would likely be acquired by Fuji, Stevens, Susi and those they had tipped off immediately sold their PrimeSource stock at considerable profit.

Stevens and Susi acted on the material information of the impending acquisition of PrimeSource by Fuji, in violation of a confidentiality agreement with Fuji.

Stevens and Susi each face a maximum prison sentence of ten years, and a fine of up to $1 million, according to Assistant U.S. Attorney Amy Winkelman.

The case was referred to the U.S. Attorney's Office by the National Association of Securities Dealers (NASD). Fuji was cooperative and assisted in the investigation.

As set forth in the Informations, Stevens was the President of H.A. Metzger, Inc., a dealer of graphic arts and electronic imaging products for Fuji and other companies, and Susi was an H.A. Metzger sales representative. In or about May 2001, in connection with their employment at H.A. Metzger, Stevens and Susi obtained confidential information regarding Fuji's plans to acquire a number of independent dealers, including PrimeSource, whose stock traded on the NASDAQ. Although Stevens and Susi each signed a confidentiality agreement obligating them to maintain this information in confidence, and in effect prohibiting them from using the information for their own benefit, both men made multiple purchases of PrimeSource stock during the summer of 2001, at prices ranging from approximately $3.95 to $4.41 per share. Stevens purchased a total of 15,900 shares, while Susi purchased a total of 5,000 shares, according to the Informations.

Stevens and Susi also disclosed the confidential information to certain associates and family members who subsequently purchased PrimeSource stock, according to the Informations, at prices ranging from approximately $3.99 to $4.57 per share.

On Aug. 31, 2001, PrimeSource issued a press release announcing that it was engaged in negotiations to be acquired by Fuji in a transaction that would pay each of PrimeSource's shareholders $10.00 per share. On that day PrimeSource common stock, as quoted on the NASDAQ, closed at a price of approximately $9.78 per share. On or about the same day, Stevens and Susi sold their entire holdings of PrimeSource stock, thereby receiving illegal profits of approximately $89,410 and $27,421, respectively. On the same day or shortly thereafter, those individuals who were tipped by Stevens and Susi also sold their PrimeSource stock at a considerable profit.

Under U.S. Sentencing Guidelines, Judge Ackerman will determine the defendants' actual sentences based upon a formula that takes into account the severity and characteristics of the offenses and the defendants' criminal histories, if any.

Parole has been abolished under the federal system. Under the Sentencing Guidelines, defendants who are given custodial terms must serve nearly all that time.

In the filing of a felony Information, a defendant waives the right to have his or her case presented to a federal Grand Jury and, instead, pleads guilty to charges presented by the government.

Christie credited Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Louie F. Allen, with developing the case. Christie also credited the Market Regulation Division of the NASD for its assistance in the investigation.

The Government is represented by Assistant U.S. Attorney Winkelman of the Securities and Health Care Fraud Unit of the Criminal Division of the U.S. Attorney's Office in Newark.

-end-

Defense Counsel:

Carl Stevens: John P. Lacey, Esq. Roseland

Michael Susi: Richard D. Shapiro, Esq. Newark