Here is an abstract from the 2001 Dell Annual Report.
<<< The Company utilizes equity instrument contracts to facilitate its repurchase of common stock. At February 2, 2001 and January 28, 2000, the Company held equity options and forwards that allow for the purchase of 88 million and 50 million shares of common stock, respectively, at an average price of $50 and $45 per share, respectively. At February 2, 2001 and January 28, 2000, the Company also had outstanding put obligations covering 111 million and 69 million shares,respectively, with an average exercise price of $44 and $39 per share, respectively. The equity instruments are exercisable only at the date of expiration and expire at various dates through the first quarter of fiscal 2004. The outstanding put obligations atFebruary 2, 2001 permitted net share settlement at the Company’s option and, therefore, did not result in a put obligation liability on the accompanying Consolidated Statement of Financial Position. >>>
1. Looks like the calls at $50 will expire worthless- small loss.
2. I dont understand the rest about the 'net share settlement' option, but it seems to cover all the puts.
Good or bad?
Sig |
