Sepracor-Looks very promising Message Board

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Biotech / Medical : Sepracor-Looks very promising

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To: Londo who wrote (6034)	6/17/2002 9:50:41 PM
From: Biomaven	Read Replies (2) of 10280

This "6 month plus a day" repricing is a consequence of FASB's new rules (FIN 44) on repricings. A conventional repricing now produces an actual earnings charge combined with variable accounting that penalizes the company each quarter if the stock price increases. The alternatives are either to just leave the old options out there while granting additional new options (this increases the option overhang) or to leave many employees without meaningful options at all. I agree that this form of repricing sometimes produces perverse incentives, but note that here the company has decided not to include officers and directors in this offer. Peter

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