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Technology Stocks : Novell (NOVL) dirt cheap, good buy?
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To: Gary Ku who wrote (22782)6/18/1998 1:22:00 PM
From: Greg Johnson  Read Replies (1) of 42771
 
>NoVL keeps employees in a labor squeeze market by giving them
>options priced at $7.00 a share and allowed to exercise after
>July this year. After July 1, 1998, if the stock price of NOVL
>is anything over $7.00 they will exercise and leave the company.

Well, not exactly.
They weren't "given" any extra options. This was a repricing of
existing options that were previously priced so high as to be totally
demoralizing. They continue to vest on their original schedule, so
the options won't all be exercisable in July. (It's somewhere in the
middle of July, by the way; not July 1.) As part of the repricing
plan, a one-year black-out on exercising options was imposed.
Also, it was not a one-for-one repricing. In other words, employees
lost some of their options in order to reprice them.
So, while a portion of the lower priced options will be exercisable
in July, I would hardly expect a mass exodus of employees.
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