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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 76.11+0.9%Nov 21 3:59 PM EST
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To: RetiredNow who wrote (63566)4/16/2003 7:18:23 PM
From: Dennis Doubleday  Read Replies (1) of 77400
 
> BTW, here's some interesting news: Chambers gets 2 million options in the latest grant (http://biz.yahoo.com/djus/030415/1255001051_1.html)

There is the problem in a nutshell. It's not that options are too broadly distributed, as mindmeld seems to think, but that they are showered on the people at the top beyond all possible value to the company.

Do they really think that JC was not going to be properly incented without that fresh 2M options? According to the 2002 proxy statement, he already has over 20 MILLION unexercised options, including the 4 million from last year with a $16 strike. (Not to mention nearly 30 MILLION shares owned outright.) If he wasn't going to stay with the company for those old options, then the new 2M options won't change that. And if was going to stay anyway, because he believes those options will be worth a lot, then the new 2M do nothing but further dilute the shareholders without any payback to them.

If I were on the board, I would have distributed an average of 60K options each to my top 1000 sales people and engineers instead of piling another 6M on JC. Then maybe the options would provide a payback to the people who are putting money into the company instead of taking it out.
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