chief John Chambers just got 17.1 million more reasons to be thankful.
The hard-charging tech chieftain netted $17.1 million last week in options-related sales of 1.27 million Cisco shares. The sales came just a week after a fiscal first-quarter earnings blowout that Chambers said showed the San Jose, Calif., networking giant
"firing on all cylinders."
Since he started his so-called 10b5-1 prearranged selling program in August 2004, Chambers has netted $126.1 million on the sale of 10.6 million shares. That means the CEO has reaped an average of $153,780 a day since the selling kicked in.
The options Chambers most recently exercised were set to expire in May. He kept 83,739 shares in the transaction and he still holds about 2.6 million shares total -- about the same as he held back in August, after his
last cashout. Cisco has said that most of the proceeds in these 10b5-1 transactions go toward paying taxes.
Chambers is more than halfway through his four-year selling plan. The plan allows him to unload up to $300 million worth of stock.
Fat with all the stock option cream, Chambers demonstrated a little largess this summer by renegotiating his pay. After collecting a $1.3 million bonus for fiscal 2006, the networking bigwig asked to waive a bonus increase and had his annual salary frozen at $350,000 for the current fiscal year ending in July.
Chambers has been a strong supporter of employee stock options as both a motivator and as a way to retain talent.
But critics note that Chambers' huge insider selling program coincides with the company's $40 billion stock buyback effort, which started in September 2001. The continued executive cashout highlights concerns that much of the company's cash is
flowing toward employees and executives instead of toward shareholders.
Cisco shares, up more than 50% since August's earnings blowout, rose 16 cents Monday to $27.09.
As originally published, this story contained an error. Please see
Corrections and Clarifications.