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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (41300)	10/23/2000 11:50:48 AM
From: GVTucker	Read Replies (3) \| Respond to of 77400

Phoenix, RE: If the weighted average cost/share of employee options goes up how do the exposure "explode". You're taking about weighted average exercise price - right? Thinking about it in the most negative connotation possible--which, obviously is what Parish would do--look at the data this way: First of all, the total number of employee options has risen. In addition, the price of Cisco stock has also risen. Thus, the 'cost' of each individual option is higher, and there are more of them out there. Then, on top of that, the total number of diluted shares outstanding has also risen by 376mm shares. Added together and you'll get an 'explosion' in the 'cost' of these options. The main reason it is misleading is that the main reason the 'cost' exploded is because the price of CSCO increased about 100% from the '99 10-K to the '00 10-K, which apples to apples doubles the SFAS 123 exposure. This, even though IMO the actual 'cost' of existing options would be unchanged.