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vinnie mirchandani

there is another story which is not being told. Rank and file employees with a few options are subejct to the same quiet period and trading window freezes as management. At Gartner it happened several quarters in a row, just before the window opened the price would drop then go back up after the window closed. Someone deprived employees of 10 to 15% of the prices - I was tempted to go to the SEC then. So in the current mood where investors feel taken advantage of due to option backdating, I would suggest the majority of tech employees have little control of the pricing - and probably get taken advantage of themselves

trader_dave

"Everyone is NOT doing it..."

Sorry, Woodrow, I vehemently disagree. Everyone IS doing it. Options backdating? Probably only with the heavy options granting companies. BUT, is there a fundamental disconnect between shareholder interests and board/management interests? ABSOLUTELY!

I would make a good odds bet that fewer than 10% of public companies have a board and management team that operate with their interests aligned with long term shareholders.

Maybe it's not options backdating. But it might be a performance payment plan that triggers full bonus if some stupid benchmark is achieved.

"The board and CEO will get a 250% success bonus if the company's operating cash flow remains above average cash flow of the Jimmy Deans booth at the vegan convention."

The disclosure requirements emerging today will unmask some of the mystery, but I think shareholder disclosure today is comparable to the details available from 1970's Kremlin sessions. Heck, public shareholder voting is as close to Iron Curtain "elections" as anything else.

Home Depot Shareholder: "We want to vote on a policy that aligns the board and management's interests more closely with our own."

Home Depot Board: "The Board has decided not to allow a vote on that topic this year. We're too busy deciding what fractional jet ownerhip plans to buy for our dog groomers to bother with that."

Mukund Mohan

Good post.

I am concerned that it took an Apple to finally have blogsphere filled with outrage about backdating - but then again I should not be.

Here are a few reasons I have heard why the common person does not care about options backdating.

http://blog.vangal.com/2006/06/28/why-the-general-public-does-not-care-much-about-backdating.aspx

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