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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: Paul W who wrote (10075)	5/20/1998 1:08:00 PM
From: Kerry Phineas	Respond to of 13594

Paul, its significant for a number of reasons. First off, the number of shares being sold by the insiders over the last twelve months is quite significant. That in and of itself is a negative. If Lerner really believed the stock was worth $150 he would not be selling 40K shares. Secondly, it shows the substitution of stock options for cash compensation at not just this company but many tech companies. Of course this overstates current earnings and creates a huge overhang for which the risk to shareholders increases as the stock price increases. A comparison of the cash compensation to their compensation in options is ridiculous, and at AOL options are granted to many employee levels, not just executives. OTOH if the market does go down this could create significant problems re retention, etc. for some of the less established tech high-flyers.