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To: Don Lloyd who wrote (16418)	8/6/2002 2:18:21 AM
From: geode00	Read Replies (2) \| Respond to of 42834

Heard someone pontificate about this today. What about getting rid of options and simply granting stock outright? That way, you get rid of the complications of options like underwater ones and it's clear what the value of the grant is on the day you give them. They would simply be like a bonus promised or given for completion of XYZ tasks or upon achievement of a stock price or whatever. The guy also said executives should not be able to sell while they were still with the company although that doesn't seem like a good idea.

To: Don Lloyd who wrote (16418)	8/9/2002 1:56:19 AM
From: Simba	Read Replies (1) \| Respond to of 42834

Don: you write: <<SB, ok, how about earning be report INCLUDING the ALL outstanding dilution at any given time. unexercised in the money option swill be used to reduce earnings. this will be the headline number by law instead of hiding it on a page 23 footnote. sound reasonable? I'd go a little further. All outstanding options, including far out of the money. This wouldn't be a hardship as they could just be cancelled. Alternately, don't ever let buybacks reverse dilution. If you dilute your shares, it's permanent, at least available for inspection. since it isn't an employee expense, we should do away with the expense deduction, right? No, it still injures the shareholders so they deserve a deduction. It would be much easier to apply the deduction to the company as opposed to each shareholder individually. >> Since it is a non-cash expense whether it be attributed to the company or the existing shareholder, both do not deserve to get any tax deduction. Therefore the question of padding the company balance sheet with cash flow from tax deductions does not arise. The IRS got their taxes from the optionees exercising the options. Cash was created out of thin air just as cash was created during the NASDAQ bubble for many shareholders which could not be realized. Exisiting shareholders are left holding the bag and deserve to be for allowing the company to dilute their equity. The IRS has no business restoring this equity loss created by the company management to benefit the insiders as opposed to the shareholders. Simba