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Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs -- Ignore unavailable to you. Want to Upgrade?

To: hueyone who wrote (20)	6/12/2002 8:26:22 AM
From: rkral	Read Replies (2) \| Respond to of 786

As you said, for SEBL FY2001: FACT 1: Employee compensation implied by the "tax benefit from stock options" is $145M, after adjusting by the "effective tax rate". ($53.8M / 0.37, both numbers from the 10K) FACT 2: The value realized from option exercise by only four executives is $255M per page 17 of the 2002 proxy. CONCLUSIONS: The tax benefit does not tell the entire story. "Tax benefit from stock options" must be read as "tax benefit from *non-qualified* stock options". Incentive stock options (ISOs) may also be used to compensate employees. Comment: ISOs, which remain qualified, do not cause a tax benefit to the company. (I'd provide a link John Shannon provided me on the QCOM Buy Range thread .. but SI's search is broken again. It happens a lot.) So now I'm wondering .. can total employee compensation expense due to option exercise even be discovered from 10-K information alone? And the cynical side of me must ask .. do you ever wonder if this type of information is being intentionally obscured? ;-) Ron