Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 48.72

+3.0%

Jan 14 3:59 PM EST

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To: Elmer who wrote (151342)	12/6/2001 2:28:23 PM
From: GVTucker	Read Replies (1) of 186894

Elmer, RE: When Intel (or any company) grants stock options they do so at fair market value. Assuming they are buying back stock at the same time they are buying the same stock at fair market value. Buy it at FMV, grant it at FMV. Looks like a push to me. Think about that one again, Elmer. Intel is giving options to employees. The employees are not paying for them at FMV. OTOH, Intel pays cold, hard cash for the stock they are buying back. There is no push. It is a net cost to Intel. The only question is how to calculate that cost. It would be best if you just calculated the FMV of the options and used that as a cost. But i don't think that Black-Scholes is necessarily accurate. That's why I calculate the ex post cost of the options instead. Either way, it most certainly is NOT a push.

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