Chicago (Feb. 17, 2004) -- Despite a booming stock market, three-quarters of Standard & Poor's 500 companies surveyed said they are planning to shift away from stock options, but not as a result of expensing according to a survey by Deloitte & Touche -- rather, they’re running out of shares for option grants.
Two-thirds (67 percent) of the 165 companies in the Deloitte survey indicated they would run out of shares within 24 months. As a result, companies will need to get investor approval to issue more shares this spring when most businesses hold their annual meetings, or at the same time next year. However, Deloitte noted that leading institutional investors, such as Vanguard and TIAA-CREF, are increasingly voting against company proposals to issue shares for long-term compensation plans because of stock dilution concerns.
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