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Technology Stocks : DELL Bear Thread -- Ignore unavailable to you. Want to Upgrade?

To: Bilow who wrote (881)	5/28/1998 12:12:00 AM
From: Thorr	Read Replies (1) \| Respond to of 2578

where do you your #s from the co I would double check the math

To: Bilow who wrote (881)	5/29/1998 3:23:00 PM
From: rudedog	Read Replies (2) \| Respond to of 2578

In fact, options exercise, like secondary offerings, increase the amount of cash in the company. Not necessarily true. Most options now are non-convertible, which means the purchase and sale have to happen in the same transaction when the option is exercised. In this case the company either takes treasury stock which they already own or buys shares from the open market (or exercises their own option, which many are doing now) and then sells to the employee at the grant price, the employee is then immediately required to sell at market. This is at best a wash for the company and usually represents a loss. Look at the case of a Dell employee who exercises options for 1000 shares with a grant price of $20. Dell can either buy at market or sell stock they currently hold, in either case they take a hit of $63 versus what they could do selling that same stock on the open market.