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Technology Stocks : Applied Materials No-Politics Thread (AMAT)
AMAT 256.89-1.2%Dec 31 3:59 PM EST
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To: TI2, TechInvestorToo who wrote (6997)8/28/2003 2:38:05 PM
From: Big Bucks  Read Replies (1) of 25522
 
TI2- good article....I am biased on the issue of stock options. As a regular employee of AMAT I was occasionally
offered options that were about 15% below some recent targeted closing price (only when the company was booming)
and did receive profit sharing (from 8-15% on annual earnings)during prosperous times, but not if the company
profitability was low. I was required to hold the options
for up to 3 years (for employee retention incentive), which
may or may not have been profitable, unless I
happened to catch the top of a cycle.

The top dogs were given options at around 20-25% of the stocks price, regardless of the fortunes of the company, which for all intents and purposes means that they were literally guaranteed profits greater than 80% without
seeming risk.

Most of them make/made greater than 300% to 400% on their
options when they were exercised. I don't know how long
executives are required to hold their options, but it
seems that they ALL generate extremely profitable
windfalls due to how they are initially priced.

IMO,the issue of executive compensation and perks will be
the major issue of funds and investors. It has gotten way out of control, and investors and company bottom lines
suffer because of it. It is the difference between a profitable company or insiders lining their pockets at
the expense of the shareholders.....BB
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