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Technology Stocks : Intel Corporation (INTC)
INTC 36.82+1.5%Dec 19 9:30 AM EST
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To: willcousa who wrote (180914)4/27/2005 7:24:23 PM
From: ChipGeek  Read Replies (2) of 186894
 
Paranoid much? There are no tricks, no shenanigans. Yes, any company with a stock option plan will issue new option grants every year as part of its annual review and compensation process. The grant values are always the value of the stock on the date of grant, and that exercise price does not change. Certainly not at Intel, anyway. And each grant only fully vests after 4 or 5 years. If you see large windfalls every year from stock option exercises, then it is only because year after year the stock price continues being significantly higher than it was 10 years ago. And that's bad for investors how? (FYI, look for the phat proceeds from option exercises at Intel to end in a couple years if the stock continues going nowhere. The grant value in 1997 was $17.42 and only goes up from there...and yes, that's split-adjusted).

If you see an executive or employee exercise their stock options and pocket a large chunk of cash, any investor out there had the chance to make just as much profit if they had bought the stock back when that grant was issued. Yes, it requires an investment that the employee didn't have to make, that's why they call it a compensation benefit. But how is it wrong to provide a benefit that directly aligns employees' interests with shareholders?
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