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Politics : Formerly About Advanced Micro Devices

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To: Ali Chen who wrote (34557)7/15/1998 11:18:00 PM
From: Dale J.  Read Replies (1) of 1571401
 
Ali, Let me say it this way, if Intel buys $50k worth of Intel options and gives them to you as a perk. Intel will record $50K as an expense to Intel. Now whether you sell those options or exercise those options really doesn't matter to Intel and it doesn't change the number of shares outstanding.

Now Intel may purchase the stock and then write a covered option to give to you as a perk. I believe this is the method used.

My point is that either way, it has to be recorded and accounted for as an expense to Intel at some point. So it is not a Ponzi scheme in the true sense. I do agree with you it does get out of hand especially with companies that have poor performance. Huge multi-million dollar bonuses should not be given out to management with poor performance.

Dale
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