-----Original Message-----
From: 	Morse, Brad  
Sent:	Friday, October 26, 2001 9:48 AM
To:	Reese, Jeanette C.
Subject:	FW: New Football Pool


[Morse, Brad]  If you can think of anyone else who wants in, let me know, but our deadline is around 4 today, so I can get the report out on who owns what and what the total pot will be.
 -----Original Message-----
From: 	Morse, Brad  
Sent:	Wednesday, October 24, 2001 12:50 PM
To:	Morse, Brad; Ahn, Chris; Ashby, Kevin; Conterno, Roberto; Gerry, Robert; Gordon, John; Hiemstra, Nick; Jones, Oliver; Kendall, Heath; Ligums, Jeb; Liu, Charles; Merola, Jeff; Mills, Bruce; Misra, Narsimha; Nguyen, Paul; Pazos, Juan; Ragsdale, Casey; Sharfman, Guy; Sudduth, Julia; Trefz, Greg; Wagner, Joseph; Williams, Devon
Cc:	Segura, Stephanie; Meyn, Jim; Wurlitzer, Rick
Subject:	RE: New Football Pool

OK, Updated rules on the pool. Here is how we are going to do it.

Everyone buys 'shares' in any team they want. Each share is $5 apiece. You have to spend a minimum of $20 to get in (let's pump the pool up). This will be done Friday, October 26. The payout formula has changed, however. It is now the following:

Winner of each game in the wildcard round and divisional round gets 5% of the pot.
Winner of each conference championship gets 15% of the pot.
Winner of the Super Bowl gets 30% of the pot.

Since the Super Bowl winner wins earlier games to get to the Super Bowl, they will end up with either 50% or 55%, depending on if they have to play in the wildcard round.

The purpose of this is to establish some sort of value for 2nd tier teams. New Orleans, for example, may not have a chance (in your mind) as the Super Bowl winner, but may get a payoff as a winner of a wildcard game, etc.

1) The pot will be established on Friday October 26. Nothing will be added to it afterwards. The value of each team (as perceived by the market) can change week to week, and by allowing people to 'pick' later, would dilute the earnings, and de-incentivize people to make choices now, when it is riskier.
2) I will make my choice BEFORE any choices are sent to me. DO NOT send any choices to me today. You may start sending them tomorrow, and I will not look at them. I will NOT have prior information about which teams have small pots and which ones have large ones. Obviously, that information could be useful.
3) After all choices have been made (by 4:00 PM Friday), I will send out a summary to everyone listing how much the pot is, which teams are picked and for how much, how many outstanding shares there are. This information is to be used to establish a market for bilateral trades. You may trade with whomever you wish, how ever you wish. You can trade with people outside the pool. THIS IS YOUR OWN RISK.
All you have is a potential cash flow. You may trade those shares and cash for other shares, for cash, etc; you may structure bilateral options, anything you want. But I have NOTHING to do with it, and it does not affect the payout of the pool at the end. Figure your own hedges out. This can be fun.
4) In the unlikely event that a team wins a game(s) and establishes a payout for cash, and no one owns shares in that team (ie - the Cardinals or something), that money will be added to the Super Bowl winners pot. If the Super Bowl is won by a nobody (very unlikely), we will have to establish a strategy for that. I suggest one of 2 options - 1) Go down the list of Super Bowl loser, loser of conference Championship to Super Bowl winner, loser of conference Championship to Super Bowl loser, etc, until we find a winner, or donate the money to charity for disaster relief. It's up to everyone.


So, let me know today that you are interested, but DO NOT send your picks and money selection. That can start tomorrow, but I can't see the choices. Either call or email today, if possible!

Brad