[ by Melanie Gretchen and Howard Haykin ]

Facebook could not wait any longer - it had to go on the offensive and take action.  Having watched Facebook shares close on Tuesday at $17.73 (53% below its $38 IPO price), and trading as low as $17.55, the company needed to restore shareholder and investor confidence, at least to some degree.

And so, one announcement was that, going forward, Mark Zuckerberg agreed not to sell his shares or options for at least another year.  Facebook further was agreed to permit some employees to start selling their shares earlier than previously scheduled - which, if nothing else, might lift the spirits of employees who have been shackled to the perceived burden of watching share values decline without being able to anything about it - e.g., sell out their holdings, if need be. 

At least it's a start, and the market responded positively to the news - with shares closing on Wednesday at $18.58 - nearly a 5% gain. Without a doubt, the company and its shareholders will be facing many more obstacles over the coming months.

Opening a Dam? In filing with the SEC, Facebook said Facebook employees and early investors will be able to sell hundreds of millions of shares starting at the end of October.  On 10/29/12, the first lock-up will expire slightly early, releasing 220 million shares into the market.  In mid-November, employees will be able to sell some 780 million shares, before a third opportunity in December, and a final one in May 2013.

"While it's great that Mark Zuckerberg isn't selling, you're still saddled with significant selling pressure on the stock.  The lock-up monkey on their back isn't going away because Mark isn't selling." -- Richard Greenfield, an analyst with BTIG Research.

Despite slowed sales and the threat of more employees flooding the market reducing share value on Wall Street, the CEO is sticking by his devalued-but-no-where-near-sinking ship.  After the IPO on Nasdaq, a poster was erected on the company campus, exhorted employees with the following words of wisdom:

"Stay focused and keep shipping." [C-I: That certainly would be incentive enough for us.  Feel free to use the slogan in your office.]

For further details, go to [NY Times, 9/4/12].