Amazon.com, Inc. (AMZN) Message Board

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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 222.55

-4.4%

3:59 PM EST

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To: GST who wrote (160017)	3/31/2004 11:35:31 AM
From: SI Dave	Read Replies (1) of 164684

I agree with you in that they are a compensation expense. The problem comes in terms of valuation, because they have restrictions in terms of vesting schedules and expirations, plus all of the other Black-Scholes type variables. Outright granting of shares, even with vesting restrictions, removes all of the ambiguity regarding valuation at the time of the grant or vesting anniversaries. The expense can be taken based on unambiguous market valuation, whether it be at the time of grant or subsequent vesting events. It would be easy to set up standardized rules regarding the periodic mark-up(down) and the maintenance of reserves related to non-vested grants.

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