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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (114591)	2/27/2002 10:05:50 AM
From: Ibexx	Respond to of 152472

QUALCOMM Announces Commercial Launch of Feature-Rich CMX 2.1 Multimedia Software-Offering Enhanced Audio, Animation, Speech and Sound Effects for Wireless Devices, CMX 2.1 Software Features Faith's Compact MIDI Wavetable and NeoMtel's Simple Animation Format Player BUSINESS WIRE, 2/27/2002 7:30:00 AM SAN DIEGO, Feb 27, 2002 (BUSINESS WIRE) -- QUALCOMM Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access (CDMA) digital wireless technology, today announced the commercial launch of version 2.1 of the Company's Compact Media Extension (CMX(TM)) Musical Instrument Digital Interface (MIDI)-based multimedia software. Designed for use with the QUALCOMM CDMA Technologies (QCT) MSM3300(TM) and MSM5100(TM) Mobile Station Modem (MSM(TM)) baseband chipsets, CMX 2.1 software incorporates Faith, Inc.'s Compact MIDI Wavetable, which provides exceptional sound quality as well as smaller file sizes than standard MIDI ringers. The software also incorporates a Simple Animation Format (SAF) player from NeoMtel Co., Ltd, which enables a more robust multimedia experience through the animation of portable network graphics (PNG) files. CMX 2.1 software -- currently being incorporated into Japanese handsets designed by Kyocera and Toshiba, among others -- enables a wide variety of enhanced wireless multimedia applications, including more than 30 sites for downloading content such as ringers, karaoke, greeting cards and horoscopes consisting of MIDI music, speech and sound effects, as well as animation and screen savers. "The CMX 2.1 software solution provides a robust multimedia experience for consumers by enabling speech, sound effects and animation on their handsets," said Mark Frankel, senior director of product management for QUALCOMM CDMA Technologies. "By expanding a content provider's ability to mix sounds with MIDI music and animation on the consumer's LCD screen, CMX 2.1 software aids creativity and enhances the marketability of multimedia applications and products." "We are extremely excited that our partnership with QUALCOMM enables us to deliver high-quality polyphonic ringers to the marketplace," said Shuichi Takeda, technical marketing manager of Faith, Inc. "Ringers are becoming more customized each day, while providing a richer personal experience and more fun." "We are truly excited about the inclusion of our graphic player within QUALCOMM's CMX software," said Dong Heon Lee, CEO of Neomtel Co., Ltd. "We believe this capability offers content providers the ability to create exciting and robust animated content, making for a much richer ich CDMA is deployed, change in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 30, 2001, and most recent Form 10-Q. Ibexx

To: carranza2 who wrote (114591)	2/27/2002 10:16:49 AM
From: engineer	Respond to of 152472

1. try looking up AMT tax.... 2. Most at Q have a 10 year life. 3. when they are underwater, most of hte time.

To: carranza2 who wrote (114591)	2/27/2002 11:37:36 AM
From: Stock Farmer	Read Replies (2) \| Respond to of 152472

Good questions. 1.- Assuming that the stock price at which the option is exercised is the measure of the income tax liability, why wouldn't the employee want to exercise while the price is low? Seems a good tax tactic. After the option is exercised and the (relatively low) basis for capital gains taxes is established, it seems tax efficient to pay cap. gains on the ultimate higher price instead of exercising at a higher price, and paying income taxes on that higher price. Higher taxes? Not necessarily. As long as you hold the options unexercised, they grow as if they were in a tax deferred account. Important to do the math. Let's say you had 1000 options with a strike of $10 and a share price of $50 and you think price might go to $200. Let's say your tax rate on ordinary income is 35% and 20% on cap gains. Now Later Face Value $ 50,000 200,000 Exercise Price $ (10,000) $ (10,000) -------- ------- Tax Base 40,000 190,000 Income Tax @ 35% (14,000) (66,500) -------- ------- Net 26,000 133,500 Shares 520 667 + $100 Just by holding you end up with more shares and a higher tax base. And then what if as you suggest you sell when shares are worth $200 each? if Early Compare to Proceeds 104,000 133,500 Cap Gains 78,000 0 Cap Gains Tax @ 20% (15,600) 0 --------- -------- After Tax Value $ 98,400 $ 133,500 Now, I chose my numbers to illustrate the point that deferring tax costs can be less painful than taking them up front. Even if it did turn out to be tax advantageous, there is the effect of tying up one's capital, time value of that capital, and assuming risk of downside depreciation. There are a lot of folks throughout tech-land sitting on shares exercised early that now aren't even worth the taxes paid. If tax considerations suggest that the option should rationally be exercised while the price is low, the effect John Shannon complains about should be less. Yes. The lower the difference between strike and exercise price, the lower the difference between what the company reports as cost and shareholders bear as cost. The limit is when the employee exercises at par. At which point it is indistinguishable from buying a share at market value. I haven't met anyone who has exercised an underwater option, but that would also have a nondilutive effect and benefit all shareholders <ggg> 2.- Do options expire other than when the employee leaves the company? Yes. Depends on the plan. Generally 10 years from date of grant. Which is QCOM's exercise period. I have also seen plans that include wild and wonderful variants. For example, options that have other rights attached to them, for example a contingent grant of further options depending on whether or not the employee holds shares in the amount of the previous option. These can expire or be retracted if the conditions beneath them change. You need to read the plan. 3.- Do any options simply not get exercised, for whatever reason? Seems unlikely, but you never know. Yes. Happens all the time. First, smart people don't exercise underwater options 'cause it would be cheaper to go buy the shares on the open market. Or options that aren't worth the bother to cash in. Or some times people actually forget (very rare, but it's happened). Worse are the options in private companies that aren't liquid. When you exercise you trigger an immediate taxable liability. If you can't sell the stock then you have to find other ways to cover the tax, and you bear all the risk. If you can't pay the taxes and the carrying cost, or can't afford the risk (or you think the stock's headed down the gurgler) it is sometimes better to skip the exercise. This happens all the time when folks quit one startup to go to another. It's called "leaving money on the table", and it's not rare at all. Then finally there are clawback clauses. Companies often reserve the right to 'claw back' any gains from an employee from stock options exercised within a certain amount of time under certain circumstances. Such as leaving to join a competitor. These clauses may either be embedded within the stock option plan or in an attached agreement (e.g. employment contract). No sense paying the cost of exercise commission only to have the gains clawed back. John