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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Win-Lose-Draw who wrote (98551)	8/25/2002 7:30:39 PM
From: Timothy Liu	Read Replies (1) \| Respond to of 99280

My ulterior motive other than my compensation depends on it? :) My intention is just to counter those claims that option should be expensed, which is so prevalent these days. Bashing option plan seems to be the fashionable thing to do. Wall street may tell you it should not be expensed yesterday now they are saying they should be. Maybe they will tell you it should not be expensed a couple years down the road. And what are you going to believe? Options is net negative for shareholders. But shareholder still make money if the company is growing, even though not as much. For example, if a CEO can double your business but will take away 10% of your company, most of the shareholders will vote a emphatic yes. Option is neither good or bad. It is a incentive from shareholder to employee. Of course options can be abused and shareholder need to get educated on what is an appropriate level of option grant for a company. I think the criterion is the dilution effect should be kept low compare to the growth rate of the company. Just My 0.02$. Tim