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Google announced higher-than-expected earnings this afternoon.

Total revenues, including those that they pay to AdSense publishers (like yours truly) and other partners, came in at $5.7 billion for the quarter, which was up 18 percent. For the year, total revenues were $21.8 billion, up 31 percent. Operating income for the quarter was about $1.86 billion, up 29 percent. Google had $8.6 billion in cash at the end of the quarter, much like myself – NOT.

That said, it’s nice to see them do something nice for their emlpoyees.

Seeing how roughly 85 percent of Google employees have some stock options that are underwater (meaning that the exercise price is higher than the current market price of the common stock price), they plan to offer their employees the opportunity to exchange those options.

Here’s how the employee option exchange program would work:

* This will be a one-for-one, voluntary exchange. Employees will be able to exchange part or all of an existing option grant for the same number of new options.
* The offer period will begin on January 29, 2009 and end at 6:00 a.m. Pacific Time on March 3, 2009, unless Google is required or opts to extend the offer period.
* Based on this expected timeline, employees will be able to exchange their underwater options for new options with a strike price equal to the closing price of our stock on March 2, 2009.
* The new options will have a new vesting schedule that adds 12 months to the original vesting schedule. In addition, new options will vest no sooner than 6 months after the close of the offer period.
* Generally, all Googlers with options are eligible to participate (Eric Schmidt, Sergey Brin, and Larry Page do not hold options) except where precluded by legal and tax issues in certain countries. We are working to address these issues and the final offer documentation will specify any countries in which we are not able to offer the program.
* This option exchange program has been approved by our Board of Directors.

This is a nice move by Google. Anything to help out these days, is definitely a good thing.

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