Light Reading
John Chambers takes care of some paperwork on the Friday afternoon before the Christmas holiday

CEO Chambers Selling Cisco Shares

Craig Matsumoto
News Analysis
Craig Matsumoto
12/21/2012
50%
50%

CEO John Chambers has prepared a plan to sell 2.8 million shares of Cisco Systems Inc. stock by September 2014, according to a filing with the Securities and Exchange Commission (SEC) Friday afternoon.

Nearly half the shares, 1.3 million, will come from stock options granted in 2005 and set to expire in September 2014; Chambers will be exercising the options and selling the shares. The other 1.5 million will come from his own holdings.

Chambers owned 8.7 million shares of Cisco, 5.7 million of them in the form of unexercised options, as of July, according to a separate SEC filing.

Why this matters
Investors never like to hear that a CEO is selling shares. They'd prefer to see an executive buy shares, showing confidence in his company's future growth and all that. (See Infinera CEO Shows He's a Believer.)

That's probably why this filing was timed for the Friday before Christmas. That said, it's a standard plan under SEC Rule 10b5-1, where Chambers will sell pre-set numbers of shares at regular intervals, the idea being to prevent accusations of unfair inside trading. An executive is only allowed to start a 10b5-1 plan when not in possession of material, non-public information.

For more



— Craig Matsumoto, Managing Editor, Light Reading

(4)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Pete Baldwin
50%
50%
Pete Baldwin,
User Rank: Light Beer
1/5/2013 | 2:03:25 AM
re: CEO Chambers Selling Cisco Shares


Not a bad late-Friday catch, but I wonder if Phil's Overture scoop takes the prize as the bigger Friday news haul.


(Google also invested more in 23andme, for those who care about such things.)

paolo.franzoi
50%
50%
paolo.franzoi,
User Rank: Light Beer
1/5/2013 | 2:03:24 AM
re: CEO Chambers Selling Cisco Shares


Craig,


You have one mistake.  A CEO is ALWAYS in possession of Material Non-Public Information.  Plans are set to start usually a quarter in the future and must be followed or stopped with a delay then to start another plan.  The idea of a selling plan is that it is mechanical.  It can be simple or complex (the formula for selling shares) but it can not be a choice.  So, most of the time a 1q delay before the start represents being out of touch with the material non-public information for 90 days in the future.


These plans are basically for all C level and other registered executives, who I said are ALWAYS in possession of material non-public information.


seven


 

paolo.franzoi
50%
50%
paolo.franzoi,
User Rank: Light Beer
1/5/2013 | 2:03:24 AM
re: CEO Chambers Selling Cisco Shares


 


Craig,


You are missing the subtlety.  The idea is that a plan is put in place before it can be used so that Chambers does not theoretically have material non-public information today about Q2 next year.  He DOES have material non-public information about this quarter.  So, the idea is that the delay in the start of the plan makes the current set of information public by the time the plan goes into execution.


So, again the whole idea of the plan is file now - delay - execute plan.  The delay is supposed to either make public or non-material the information held today.  But both now and 2 quarters from now Chambers has material non-public information.  He just (theoretically) does not have material non public information that far in the future.


seven


 

Pete Baldwin
50%
50%
Pete Baldwin,
User Rank: Light Beer
1/5/2013 | 2:03:24 AM
re: CEO Chambers Selling Cisco Shares


So true, Seven. Thanks. The part about "material non-public information" is the SEC's wording, not mine, so maybe I should have put quote marks around it. Whether such a thing is practical or not, well... talk to the SEC...  :)

Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Is Health the Killer App for the IoT?
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/22/2014
Drones Hover Over the IoT Sector
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/23/2014
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
Roku Raises $25M, But for What?
Mari Silbey, Independent Technology Editor, 10/23/2014
AT&T: Merger Review Halt Won't Hurt Us
Alan Breznick, Cable/Video Practice Leader, 10/23/2014
Like Us on Facebook
Twitter Feed