Replies to post #4717 on InterDigital Inc (IDCC)

[mickeybritt]

Dishfan

You sure did a good job of showing the insider actions, and transactions as being a non event. It is a shame that they sold as technically speaking they aren't doing bad on the pay side. I do have to say in relation to total holdings the sales was minimal. I also must say these cats are getting fatter every year even when nothing happens, they gain a serveral thousand more options. Performance can not be rated by shareholders as we have no clue what they are doing that brings these rewards on.

Mickey

[Dishfan]

OT: sorry, the underlining was unintentional, I relly nedd that spielchek feature ;)

[mack12]

Dishfan how can you post such drivel when evidence to the contrary is staring you right in the face.

My bottom line is that insider sales at InterDigital are to be expected and are not, in any way, a bearish indicator.

[rmarchma]

Dishfan re insider sales

Thanks for your input on this issue. You have some valid points. I certainly think that you should post something contrary to my views, if you think my views are wrong or misleading. I have no problem with that whatsoever. However, I think that you might have missed some of my main points regarding the insider selling issue.

The point that I was trying to make with my chart recapping the insider selling according to the SEC form 4s was one of "appearance". Based on these SEC forms, which is what the investing public is seeing, it "appeared" as though many insiders were selling off significant percentages of their holdings. These SEC insider sales forms are new this year, and each one creates an "alert" in most investment software programs. Immediately after providing the table recapping what the SEC form was actually showing the investing public, I did make the point of saying:

..."I know that the form 4 does not factor in the shares that can be obtained in the future through exercising option grants, but total option grants are not shown anywhere on the SEC form 4. Also 10b5-1 planned sales are not indicated on the form 4."

Also I am not naïve enough to think that IDCC insiders are going to quit exercising options and selling stock. I definitely expect this activity to continue when I said:

..."It appears that IDCC insiders definitely consider stock options as part of their compensation, and will exercise stock options, and will continue to sell stock each year to enhance their standard of living. Therefore, what I would like to suggest is for IDCC to establish a 10b5-1 planned sale for each year, and eliminate discretionary insider selling. The only exceptions to the discretionary insider selling policy should be for a very limited number of clearly defined situations. Possible exceptions might include an unexpected hardship in an insider's personal financial situation, or any stock acquired by the insider at the prevailing market price with no additional/special rights thereon."

The main point that I was trying to make was that IDCC needs to be aware of the negative "bearish appearances" being generated by these insider selling form 4s, and to try to do something for the outside shareholders to help ease the sting associated with insider selling as follows:

..."Unless one of the specific exceptions occurs, allow the insiders to sell only once a year at a predetermined time, such as a few specific days in December, through a 10b5-1 planned sale. This predetermined date could be changed each year. If it is part of a 10b5-1 planned sale, then insiders are allowed to sale no matter if you have material undisclosed information or not. A press release could accompany this once-a-year planned 10b5-1 sale to help explain the insider selling to the investment community. If insider selling is part of a planned sale, then much of the negative implications are greatly minimized."

To me the above suggestion is a very workable solution to the problem of appearances and negative perceptions associated with the insider selling form 4s. And it still allows insiders to sell stock. I think my suggestion is a win/win type solution for both outside and inside shareholders.