Option Granting Practices and exploits Message Board

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Strategies & Market Trends : Option Granting Practices and exploits

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To: Doc Bones who wrote (6)	7/15/2006 6:51:07 AM
From: RockyBalboa	Read Replies (4) of 165

Thanks, nice article. When one thinks about it so much new questions arise and issues pop up: Absent timing issues: is it legal to issue options in times where company insiders are barred from stock transactions (like before quarterlies, or important announcements)? After all an option grant at the money is even better than purchasing stock outright. No wooden ticket needs to be torn up if, godforbid things go in reverse. Thats the point. At the money or not: In the cyberonics case insiders can be totally unaware of the FDA verdict, but the grant itself creates a massive time value, which can always be brokered away OTC or used for a box. They simply could not buy the cyberonics stock but. Grant a few options. Much easier. And zero risk, instant cash. As always, the regulators are not on top of it and no one raises the issue of time value of granted options which is itself expendable, if it was not for the stealing from common shareholders by further diluting the stock.

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