Re: decision time

Ian Andrew Bell (
Wed, 28 Jul 1999 09:28:15 -0700

This is a multi-part message in MIME format.
Content-Type: text/plain; charset=us-ascii
Content-Transfer-Encoding: 7bit

Join Us!

We will love you! Join with John!

Options you say?

As an example, let's say somebody started at Cisco in Oct. 1998 with 2000
options (vesting at 25% per annum). The option price was set at $50. Since
that time the stock has split once, which means he now has 4000 shares, but
still only pays 2000x$50=$100K. At today's price of $62.50 per share that
means his holdings are valued at $250K. On Oct 9, 1999 he can exercise some
of those options and if current value holds he will have $37500 in cash.

Of course, to exercise them early would be foolish. If Cisco's previous
performance is indicative of future performance (ignoring the disclaimer),
then he can expect a 3-for-2 split in November, giving him 6000 shares, and
another 2-for-1 split the following autumn, giving him 12000 shares. If
value holds (of course it will) then he'll have 12000 shares worth, say,

That's $720,000. Only half are vested though, so that's $360,000, minus
(his buyout cost) = $310,000. A tidy profit for two years.

So then.. assume one more 3-2 split (18000) and another 2-1 (36000) in the
next two years, and the stock value is at $60 again... by the time he's
fully vested he has $2,160,000 in holdings after 4 years. Oh, and subtract
that original $100K buyout price, that's $2,060,000.

All of this is completely ignorant of the fact that they load you up with
options as you go along. They all take 4 years to fully vest as well.

Bonuses are twice a year, and total %20 of salary unless you're a useless

The price of all of this is of course hard work, pressure, stress, compet-
ition, confusion, and of course no life.

So, anyone else? & email me so I can get the
referral bonus. :)


"John M. Klassa" wrote:
> Okay FoRKies, I need your help.
> I got a job offer from Cisco yesterday. The work looks like it'd be
> interesting, and the people I'd be working with seem like a decent bunch
> (i.e. I don't think I'd have any trouble fitting in and getting along
> great with everybody).
> The salary and sign-on bonus aren't stellar... Let's just say it's
> pretty much a lateral move that way (perhaps even a slight decrease,
> given the difference in 401k and benefits).
> On the plus side, there are stock options. I don't know if it's kosher
> to talk about such things, but since I don't know better, I will. :-)
> The offer includes 1,500 options (price unknown at this point). It
> sounds like you get more every year, and it also sounds like there are
> quarterly and yearly monetary bonus plans (I haven't seen the written
> offer yet, but this is the impression I'm getting).
> In short, while there's no salary boost, the potential for financial
> gain is there in terms of options and bonuses. If you listen to what
> the folks who already work there say, if you stick around for 5 or 6
> years, you'll probably be a millionaire (or close to it).
> Anybody got opinions on this? I've got a comfortable job now, one
> I really can't complain about, but there's no real medium-term
> bunch-o'-money incentive to stay. The work is a little on the boring
> side, even. If I go, the work will be more interesting (at least for a
> while :-)), and the financial possibilities are nice to think about. I
> can't decide. Help me decide. :-)
> Thanks,
> John
> --
> John Klassa / Alcatel USA / Raleigh, NC, USA

Content-Type: text/x-vcard; charset=us-ascii;
Content-Transfer-Encoding: 7bit
Content-Description: Card for Ian Andrew Bell
Content-Disposition: attachment;

begin:vcard n:Bell;Ian tel;pager:(800) 365-4578 tel;cell:(408) 921-4873 tel;fax:(781) 685-5915 tel;home:(408) 564-2523 tel;work:(408) 525-8630 x-mozilla-html:FALSE url: org:Cisco Systems - Service Provider LOB;Packet Telephony Division version:2.1 email; title:Solutions Manager adr;quoted-printable:version:2.1;;Building SJ-6/4=0D=0A375 East Tasman Drive ;San Jose;CA;95134;USA note;quoted-printable:AOL Instant Messenger ID: ibell SJ=0D=0A=0D=0A x-mozilla-cpt:;-8400 fn:Ian Andrew Bell end:vcard