*Extra* The Question for Lernout: How Quickly Will Microsoft Sell Its Shares?

The software giant's SEC filing gives it the freedom to sell its Lernout shares at will.
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Don't forget to read this morning's regular edition of Herb on TheStreet

.

Can't help but love this:

Yesterday Jo Lernout, the co-founder of

Lernout & Hauspie

(LHSP)

, the Belgian speech recognition company, was on

CNBC

yakking about how it's possible other well-known companies will follow

Microsoft

(MSFT) - Get Report

and

Intel

(INTC) - Get Report

and take stakes in Lernout. (I didn't see it; just saw the

Dow Jones

report on it.) The report quoted Lernout as saying the company had been given a "credibility boost" by the investments by Microsoft and Intel. Never mind that Intel hasn't yet made the investment.

Now hear this: According to

Federal Filings

, which picked up this information in the

Securities and Exchange Commission's

reference room (because Lernout goes out of its way to avoid disclosure by not filing in the SEC's electronic

Edgar

system), Lernout & Hauspie is registering Microsoft's 3.7 million shares. Translation: Microsoft is free to sell its shares at any time without prior notice.

Doesn't mean it will, but it can, and it really shouldn't come as a surprise to anybody.

Microsoft originally invested $45 million in 1997 as part of a strategic alliance with Lernout to accelerate the development of speech products in multiple languages running on Microsoft Windows platforms. Then, in late March, Lernout & Hauspie made a big deal about Microsoft exercising options to buy an additional 857,000 shares at $17.50 apiece. (At the time Lernout & Hauspie was trading at around 30.)

But the most important part of the press release, which was largely ignored by investors, was the second paragraph, which said that as part of the original deal, "Microsoft has exercised its rights to register" its L&H shares. At the time nobody was focusing on that part of the story. (Just as they probably didn't focus on Intel's caveat that it won't make the investment until it has done due diligence.) Instead, they focused on Lernout CEO Gaston Bastiaens' comments that "Microsoft's additional investment in L&H provides us with an opportunity to strengthen our relationship with them and continue the type of groundbreaking speech and language technology development work we have jointly accomplished thus far."

The announcement helped lift Lernout's stock as high as 44; it currently trades at around 35.

Microsoft is under no obligation to sell the shares. But companies don't usually want their shares registered just for the fun of it.

Herb Greenberg writes daily for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. He welcomes your feedback at

herb@thestreet.com. Greenberg writes a monthly column for Fortune and provides commentary for CNBC.