BIH Corporation (fka BIHC)

[cyberperm]

I think Galo has 24 Million Restricted Shares. He is smart to create the dividend because then he gets paid the dividend and keeps the RS until he is fully vested. This way he earns over $2 million in dividend payout based on TurboSig's .095 divy estimate. This is a good way to pull his initial investment out or just earn his pay for creating value in BIHC as an entrepreneur.

Otherwise, he would have to wait to sell the shares which would eventually drive down the stock price in a few years. Of course, I guess he could just take a paycheck like everyone else.

http://www.usatoday.com/money/perfi/columnist/block/2003-07-14-ym_x.htm

Here's an excerpt:

"If your restricted stock pays dividends, you'll receive dividend payments, even if your shares haven't vested. The dividends are considered income, so you'll pay your ordinary income tax rate, not the lower 15% rate, Nissenbaum says. Once the stock vests, dividends will be taxed at the lower rate. If you make an 83(b) election, however, you'll pay the 15% rate on dividends right away."

Just having fun with the what ifs,

Perm.