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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: Sun Tzu who wrote (10531)	2/5/1999 5:12:00 PM
From: Michael G. Potter	Read Replies (1) \| Respond to of 16960

If they're so good and it will just take longer for the full effect of their actions to translate into results, then why reprice, they'll make the money anyways when the stock catches up. Now I'm on the side of the people who argue that stock options are not free and that the P&L should recognize their cost. By pricing the options lower, they increased the chance that they will be exercised which means they'll be counted in the diluted earnings number. So 3Dfx has to earn even more for EPS to go up and EPS has a big influence on stock price. The salaries in the 10-K didn't look all that low. I know that options are used as part of compensation, but I see no reason why the current employees should get rich if the owners are not being compensated. Finally, management built way too much V2 inventory. They made a blunder in resource allocation so Banshee was delayed. They didn't win the level of OEM wins they hinted at. Repricing the options is a bonus and I'm not sure they fully earned that bonus. Michael ps - the good news is that there is a 12 month delay in exercising the options. That increases the hold on their engineers and also will cut down on the number of insider sales reports we'll see.

To: Sun Tzu who wrote (10531)	2/5/1999 7:37:00 PM
From: Patrick Grinsell	Read Replies (3) \| Respond to of 16960

The question is, is 3Dfx a significantly better company today than it was a year ago. If yes, then the management deserves a fat pay regardless of the stock price IMO, and if not, I am all ears. Nope. Here's why: If the executives are allowed to reprice options on a whim why not just give them cash bonuses based on job performance? It amounts to the same thing. If the executives had stronger ties to the stock price maybe they'd be rethinking their assinine policy about roadmap disclosure. I guess I think that getting 2.7 million dollars while the owners get screwed seems a little off base. That's more than the whole company made last quarter. If they want performance incentives, fine, but if they want stock options they should live with a crappy stock price like the rest of us. If they don't like it, tough crap. Do something proactive to increase shareholder value. The board made the right decision initially with doing only the non-execs. I'm so angry I'd like to see the whiner fired that got that initial decision overturned. That person shows a singularly horrible combination greed and lack of faith in the company's future. I'd love to own enough shares to pull a Warren Buffet on these guys. Why are we letting the fox watch the henhouse? Pat