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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Michael Bakunin who wrote (67623)	9/13/1999 4:38:00 PM
From: Richard Nehrboss	Read Replies (1) \| Respond to of 132070

Michael, >>That number expenses only options that vest, and ignores all new, unvested grants. I feel this is exactly the way to do it. The vesting options represent incentive to remain employed (or reward for employment) during the time in which they vest. As an employer, I'm not going to expense three years worth of salaries for an employee that gets a paycheck tomorrow. I'm also not going to carry the future salary as a liability on the balance sheet. Even when I with your calculation of 1.6 billion (isn't MSFT's pro-forma saying $1 billion?), we are far stretch from the numbers thrown around such as "earnings of public companies would drop %50 if ESOPs were expenses properly", or MSFT 1998 earnings would drop by $10 billion. Parish doesn't give a lot of detail in his analysis. Looks like he's showboating to get speaking engagements. Richard