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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Joe NYC who wrote (66334)	12/26/2001 11:40:54 PM
From: Elmer	Respond to of 275872

Or in other words, Intel only started buying back the shares over the recent years, as employee exercises threatened dilution? I guess so. But isn't it the same as saying that they are buying back shares that have been exercised, which is the opposite of what you are arguing. Good question but I don't think it's the same because these shares aren't given away, they're sold. The option price is based on fair market vale at the time of grant. So Intel has the choice of #1 selling stock at $X on the open market or #2 granting an option to an employee at $X to be exerciseable 5 years hence. They are preventing further dilution as you point out by what you might call "recycling shares". They buy them back at $Y and recycle them as new employee options $Y so there is no $$ loss other than opportunity loss and interest loss by holding capitol dormant for 5 years. EP