This creates a question in my mind: why can they buy and hold when they buy at $29.85, but not hold when they can buy at $22.25. It seems like a much better price to buy a piece of the company at. Isn't that the purpose of such compensation plans?
I suppose the individuals want to take the money while they can book large cap gains. That seems reasonable enough. Still bugs me though. I'd like to see our mangers/owners recieve most of their compensation the same way we do. To quote the proxy posted on 4/30/03, "The objective of the program is to retain and motivate executives to improve long-term stock performance."
I think the insiders own a whole lot of stock, but some are taking this opportunity at new highs to cash in a small portion of that. Nothing wrong with diversifying. And, I don't think anyone who understands the situation would tell you that this stock is not fully valued here in mid- to high $30s. So, a rational time to take some profits.
I would have been surprised to see insiders(or any of us, for that matter) be buyers in here. To hold or sell is the question I am asking myself lately. So far, I am a holder, though I have been nibbling at some puts as a hedge.
All things being relatively stable in the world(which is not a given), this stock should trade anywhere from, say, $32-39 over the next year, depending on interest rates, etc.
Seems reasonable, and rational, I just don't think it's a good way to compensate people, and it isn't accounted for as an expense on the income statement. Option expenses aren't counted in FFO are they? I didn't think so, but I could be wrong.
Had those options been sold as real shares on the open market, it would have netted around $8 million. That would buy a nice property, and it wouldn't dilute things down for years to come.
Good to see Eric held on to a few of his shares though.