Comment by frisco

What does this imply about the valuation of the company from an employee stock plan perspective? One of the nice things about convertible debt is that the investment is offset by an equal liability, providing a reasonable justification for continuing to issue stock to employees very cheaply. Does unencumbered cash (ie enterprise value) increase the risk of things like cheap stock charges? Can you use restricted stock with a safe or would you want to stick to ISOs and the 409(a) rules?