Replies to post #22294 on InterDigital Inc (IDCC)

[lochnroll]

DD: Nobody claims that the options issue is a panacea. Many here however just don't think that it is the giant disaster that it's being made out to be by some.

[arthritis65]

desert...you are saying dishfan is foolish...do you really want to make this a name calling contest...what makes you think going nuts over this issue and going after a good man such as frank will make you money...get a life...you are way over the line with this,,,plus you are going to loose at the asm...so get prepared for that...have a tums...the stock is going up and the institutions are happy...wish you were...art

[mickeybritt]

Employees And Compensation

Here are some facts, Tilden was looking for a job and needed one when he was hired, Fagan was looking for a job when he was hired, now I believe Hicks was looking for work when he was hired. The engineers was looking for work as the industry has been laying off engineers like there was no tomorrow. Look at Motorola, Lucent, Ericsson, Nokia, Northen Telecom even QCOM to name a few, so IDCC wasn't hurting to find engineers, it was engineers who was hurting for work. Now if there is a one of them that will produce more because they have a option package I would like to know who it is. I also would like any employee that says he or she couldn't work any longer at IDCC because they don't have a option package to step forward, and I promise with in a week that job would be filled and probably by a harder worker who wants a job.

Our attorneys have been well paid for years and well we can see how many license agreements that had real teeth in it were attained. I would put the same proposal about options to the attorneys and officers as the engineers and every day workers, and if any one of them wouldn't work any longer unless they had options, then the door would be hitting them squarely in the rear.

Mickey

[Dishfan]

D_Dweller -

I'm concerned about your blood pressure (lol)

1. You "diminishing returns" theory only applies if the options are granted to employees who already have some. I hope the options will be granted to new engineers, scientists and professional managers. (But not too many attorneys ;)

2. Because the options vest over time, there really can be no question that they serve to enhance employee retention - no studies needed - just human nature (if you leave now, you walk away from $x in options left to vest).

3. Your analysis of the "cost" of the options includes every option issued under the plan, not just the 5,000,000 proposed. To assume or expect that InterDig should never have issued any options is absurd - I've never heard of a public company that does not issue options. The cost of the 5,000,000 proposed shares is small relative to the potential benefits, IMO.

Out of concern for your physical and mental well-being, I promise to cut way back on my pro option posts (after all, we're all friends here ;)

[bulldzr]

D_d...see what I mean...you start out with an insult to a fellow stockholder, and long time good friend of ours on these boards, and then you start shouting. I, and I suspect many others just skipped your diatribe. I agree with many of your points but you just gotta chill.

"Frank you are already appearing foolish, although it is in your support of this increase in options. You are one of those brainwashed investors who actually believe the big lie that options cost nothing

[blueskywaves]

You're being simplistic. That's why you're trying to outshout everybody. Your rant about options is mooted by the fact that FASB is already in the process of implementing the option expensing rule change early next year. The issue is how IDCC can take advantage of interim period before the rule change goes into effect. Remember that even with the weighty litigation risks hanging over the stock, IDCC was still able to prop up its cash flow with option exercises during the lean years and IDCC's solvency and liquidity were keys to its bargaining positions.

The fact is that each exercise of 1M shares at an average of, say, $22 per share generates $22M in CASH and a tax benefit. The higher the actual exercise price, the greater the cash inflow for IDCC. The downside is dilution.

However, dilution is not yet an issue for IDCC since it is still in its high-growth stage and is valued more by its P/S ratio or price to sales ratio than its EPS or earnings per share. In fact, I repeat the argument that IDCC's stock float of 55M shares is still too tight for many mid-cap institutions, forcing many funds to take smaller positions that they would otherwise take if IDCC had something like, say, 100M shares.

Keep your feet on the ground now. Nobody is saying that IDCC should issue 45M shares to management and employees. It should come as no surprise, however, that one of the first decisions made after the 3/14 settlement was to promote its M&A guy, who has 20 plus years of venture capital experience. I figure that the ERICY settlement gave IDCC a merger and acquisition war chest of at least $1B in cash and stock-as-currency in a technology industry that is plagued by overcapacity in many areas. In other words, it's a buyers' market in many areas inside the wireless industry or outside the wireless industry.