Peter, if there is misinformation here it is coming from the proxy which I can assure you I did not write. The following paragraph is cut directly from the proxy word for word and you can verify it for yourself:
" Under the terms of the Corporations 1995 Stock Plan, the Corporation is authorized to make stock awards, provide eligible individuals with the opportunity to purchase stock, grant incentive stock options and grant non-statutory stock options (collectively, the "Stock Rights") to employees, consultants, directors and officers of the Corporation. The 1995 Stock Plan provides for the issuance of up to 9,000,000 shares plus, on January 1 of each year, a number of shares of Common Stock equal to five percent (5%) of the total number of shares of Common Stock issued and outstanding as of December 31 of the preceding year. Notwithstanding the foregoing, no more than 15,000,000 shares of Common Stock may be issued pursuant to the exercise of incentive stock options granted under the 1995 Stock Plan. The terms of such Stock Rights, including number of shares subject to each Stock Right, when the Stock Right become exercisable, the exercise or purchase price of the Stock Right, the duration of the Stock Right and the time, manner and form of payment upon exercise of a Stock Right, are generally determined by the Compensation Committee. As of the Record Date, options to purchase an aggregate of 4,135,864 shares of Common Stock were issued and outstanding under the 1995 Stock Plan, of which options for approximately 396,535 shares were then exercisable."
Using round numbers, there are about 1 million options outstanding under the 1989 plan and 4 million outstanding under the 1995 plan which gives your 5 million number. There are about 10.5 million shares remaining to be issued ynder the 1995 plan. These three numbers added together are remarkably close to the 16 million number mentioned elsewhere in the proxy.
Now I guess you can make the argument that the company is under no legal obligation to actually issue the remaining shares promised under the 1995 plan, but they would have a hard time keeping key employees if they reniged on the benefits promised in the above paragraph. It is obvious from the other wording and the request for additional shares that they intend to abide by the terms of the 1995 agreement and in fact are planning additional incentive options. |
