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Technology Stocks : BAY Ntwks (under House) -- Ignore unavailable to you. Want to Upgrade?

To: WBendus who wrote (3714)	1/21/1998 9:07:00 PM
From: RFF	Respond to of 6980

A nice ESOP is better than BAY handing out even more options. Besides, it helps build a solid base of shareholders who aren't running for the door with every analyst downgrade. I think a company should have both - I want employees welfare to be tied to the fortunes of the company and they should benefit as much or more when the company does well. Its not that tough to be a shareholder (except on days like today), but these guys work their butts off (I'm hoping and assuming because they compete against Cisco) so they should enjoy a nice chunk of the rewards. Besides, there's so much competition in the valley for good engineers that BAY is probably just trying to hang on to the talent they have - I think there's something like 50,000 unfilled tech jobs in the valley. When the 3rd qtr comes in with good revenues, nobody will even be thinking about the ESOP anymore. We'll just have to wait a little longer for our dessert.

To: WBendus who wrote (3714)	1/21/1998 9:09:00 PM
From: rupert1	Respond to of 6980

Wayde: Your analysis and postings have been first-class. I appreciate the points you have raised about share options to employees. I can see that BAY has lost people in the past to other companies and to start-ups partly because share options were richer there. I can well believe that rich share options will motivate a better corporate performance. I do not know what is an appropriate level and if you can find a norm I would appreciate knowing. But I got a sense from reading your earlier posting after the downgrades and your comments on the CC that you have focused on this as the main causitive factor in the analysts' disillusionment. But this is not mentioned in the summaries of analysts's comments from Reuters and WSJ nor have I found it yet in the texts put out by the analysts. Vepoc

To: WBendus who wrote (3714)	1/21/1998 11:20:00 PM
From: Cruiser	Respond to of 6980

Wayde, You are confusing the Emp Stock Purchase plan with the Emp Stock Ownership Plan. The ESPP allows employees to purchase up to 10,000 worth of stock per year at a predetermined price which also reflects a 15% discount. (The set price is the lower stock price of either the beginning or ending of a purchase period). IF every employee could purchase 10,000, which they cant since it is a max of 10% of your pay, then it would amount to $60M dollars worth of stock. Of that, the company is only subsidizing a portion (depending on the price). The ESOP is totally different. This is where options are granted to employees as an incentive to stay with the company and help it grow. (It has become so common place in the industry that it is expected) The amount of the option grants vary from 50 options to a several thousand (and probably more in rare cases of very senior individuals who the company MUST retain) If these options were not granted, it would seriously hamper Bay's ability to attract and retain top talent... which I know you agree is good for shareholders. Regarding Bay's Management obligations ... if Bay's top priority was simply shareholder growth (as opposed to long-term shareholder growth) you would see very different activities from Bay. We could easily have the stock SKY ROCKET for a short period of time by focusing purely on selling and spending little or nothing on future investments. We could also stuff the channels with TONS of inventory which might go unnoticed for several qtrs and create artificial growth (just like USRX did prior to the COMS purchase)... This hopefully is not why you are investing in BAY. I can't wait until the Willies and other naysayers come out of the closet and scream "Bay is dead" because the stock gets hammered on an EPS announcement... what a game this is. Cruiser (As pissed as the rest of you for the fall in stock price)