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To: hueyone who wrote (174365)	5/5/2003 1:22:15 PM
From: hueyone	Respond to of 186894

And others? online.wsj.com Other critics of option expensing are guilty of the same contradiction. In a 2001 acquisition, Apple Computer issued stock options -- with a four-year life, same as for its employee stock options -- as part of the consideration given to the shareholders of the acquired company, and valued them using a Black-Scholes option-pricing model. In the same year, Medtronic capitalized the cost of employee stock options exchanged in an acquisition -- and in recording the acquisition, valued them using the Black-Scholes model. Palm issued a five-year warrant to a customer in 2001, and valued it with the Black-Scholes model. And QLogic issued warrants to customer Sun Microsystems, valued by -- you guessed it -- the Black-Scholes option-pricing model. Accounting standards governing those transactions did not require the use of that much-demonized mathematical formula; firms have latitude in choosing the methodology used to estimate fair values. I would add Sebl to this list as well. When Sebl offered to repurchase stock options from its employees in the third quarter of 2002, company management used Black Scholes calculations to arrive at its offer price to repurchase the employee stock options. Regards, Huey