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To: porkbay who wrote (21731)3/30/2000 11:57:00 AM
From: Dinesh  Respond to of 54805
 
porkboy

True. Issuing stock options would actually have *added* to
the cash flow.

But there is always the other side of a coin, and the fun
lies in discovering which one is less evil.

Issuing stock dilutes ownership and per share numbers. The
low-end of gain is typically very concrete in a bonus tied
to stock performance while the upper-end is unlimited
(all to the gain of the employee but to the detriment of the
company). My conjecture is that that's what the duo wanted
but couldn't get. Within the framework of CA's case, the
board did us a favor.

There are many examples of hi-tech companies where
the stock has fallen sufficiently to render employee options
meaningless (and even be a dis-incentive to some extent)
the boards have been very reluctant to reset the options.
Instead they try some cash bonuses etc.

Regards
Dinesh