On the eve of the 21st century, the buzzword in executive compensation was “airplane wealth”: making enough money to buy an airplane. Top executives were leaving old-economy corporations in droves and joining upstart Internet companies with the idea of boosting their earnings to the level of “airplane wealth.” Executives who stayed with their companies structured spin-offs and tracking stocks and joint ventures to try to capitalize on the value ascribed to their own quick-start, Internet-based ventures.

Stock options, the coin of the realm, were the preferred method of payment for top executives, employees, and anyone else connected with the company. Headhunters, law firms, and even compensation consulting firms were more than willing to take 10 cents on the dollar to have their fees delivered in the form of stock options.

And why not? At its peak, the NASDAQ composite stock index hit 5,048.62 on March 10, 2000, double its value from the previous summer. Stock options had no enemies. Shareholders and investors with bulging portfolios cared little that their own returns were being eroded by 4 percent or more per year when they were earning 40 percent a year.