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Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs
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To: rkral who wrote (683)8/1/2004 7:10:57 PM
From: Don LloydRead Replies (1) of 786
 
Ron,

But the connection to the stock price is avoided by the FASB method of determining the expense at the time of the grant. The amount is fixed, no matter the price activity from that point forward. The only modification AFAIK is due to forfeiture.

You consider it an advantage that a totally arbitrary stock price on an arbitrary day is used?

When part of the company is given to employees at the expense of the shareholders it is a gift that never stops.

If you say that the employees are given 5% of the company at a particular time, that 5% will be accurate forever. If you try to convert it into dollars, the result will be no more accurate and useful than a stopped clock.

Regards, Don
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