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Technology Stocks : RGFX Raster Graphics

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To: Cody Goebel who wrote (328)	10/8/1997 10:14:00 PM
From: Fred Fahmy	of 593

Cody, Our company IPO'd a couple years ago. All the employees had options at about 1/3 the IPO price. We were not allowed to cash in any of our options for six months. After the lockout period expried, the stock was trading at about 20% below the IPO price but still way above our initial option price. Many employees (me included) cashed in some or all of our options at that time. The stock subsequently doubled in the following 12 months. Our decision to take the money had nothing to do with fundamentals. The fact was we already had huge profits in hand and we wanted some of that money now. This is very common with IPO's. It is amazing to me how people get alarmed by insider selling. As you pointed out many companies compensate their employees with stock otpions. It's hard to buy a new car, boat, house, child's eductation, etc. with options. Insider selling, in and of itself, is completely meaningless unless you know why the shares are being sold. FF

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