Expiration date

(redirected from Exercise Date)
Also found in: Dictionary, Medical, Encyclopedia.
Related to Exercise Date: Exercise notice, Exercising an Option

Expiration date

The last day (in the case of American-style) or the only day (in the case of European-style) on which an option may be exercised. For stock options, this date is the Saturday immediately following the third Friday of the expiration month; brokerage firms may set an earlier deadline for notification of an option holder's intention to exercise. If Friday is a holiday, the last trading day will be the preceding Thursday.

Expiration Date

The date by which an option contract is abandoned and becomes worthless unless it is exercised. In an option contract, the holder has the right, but not the obligation, to buy or sell (depending on the type of option) the underlying asset within a certain period of time. The expiration date is the time at which the holder will lose the right to exercise the option. A European option can only be exercised on the expiration date, while an American option can be exercised at any point prior to the expiration date.

expiration date

The last day on which an option holder may exercise an option. This date is stated in the contract at the time the option is written.

Expiration date.

The expiration date is the day on which an options contract expires and becomes worthless. Listed options always expire on the Saturday following the third Friday of their expiration month.

For example, if you hold an American-style September equity option, you can exercise it any time before the end of trading on the third Friday in September, or whatever cutoff time your brokerage firm sets. In contrast, European-style options can be exercised only at expiration, usually on Friday.

Under specific circumstances, listed options will be exercised automatically at expiration unless the owner gives instructions not to exercise them.

Unlike the standard term of a listed option, the expiration date of an over-the-counter option is negotiated at the time of the trade.

References in periodicals archive ?
Many people regard the benefit of share F options to an employee as being the difference between the market value of the shares on exercise of the options and the exercise price paid by the employee to obtain the shares; only exercise date measurement will ensure that the amount recognized by the entity is the same amount as the perceived value of the benefit to the employee.
Income tax is assessed on the difference between the FMV of the shares on the exercise date and the purchase price paid.
In addition, the employee must have been continuously employed by the company that granted the ISO from the grant date up to three months before the exercise date (except in the case of death or disability).
While the exercise date approach results in more volatility in reported results, that is appropriate given the substance of the transaction between the company and the option holder.
THE EXERCISE OF THE CALL WARRANTS IS CONDITIONAL UPON RECEIPT BY THE TRUSTEE OF THE WARRANT EXERCISE PURCHASE PRICE ON THE WARRANT EXERCISE DATE.
If the measurement date for compensation expense is moved to either the vesting date or the exercise date, uncertainty is introduced: The final expense figure will not be known until sometime after the grant date, and there would be constant revision of the estimated total cost as the value of the option changes.
Mary's AMT basis matches the high FMV on the exercise date and if she sells the stock for peanuts in 2001, the transaction will produce minimal if any regular tax (low basis, low sales price) and a large AMT capital loss (high basis, low sales price).
In many foreign countries, local nationals are taxed at the option exercise date in a manner similar to that in the United States.
For purposes of the AMT, a taxpayer's regular taxable income must be adjusted to include the difference between the ISO's exercise price and the underlying stock's fair market value on the exercise date.
On September 24, 2012, the Warrantholder has given notice to the Trustee to exercise all Call Warrants for the purchase of all of the Term Assets held by the Trust, and agrees to make payment equal to the sum of the principal amount of the Term Assets being purchased pursuant to the exercise of the Call Warrants plus accrued and unpaid interest to and including the Warrant Exercise Date, determined to be Tuesday, October 9, 2012 (the "Warrant Exercise Date" or "Redemption Date").
30 for a period of 10 consecutive trading days, then, at the Company's sole discretion and upon the Company sending the holder written notice of such Accelerated Exercise Date (the "Notice") and issuing a news release announcing such Accelerated Exercise Date (the "News Release"), the day that is 21 days following the later of: (i) the date on which such Notice is sent to the holder; and (ii) the date on which the News Release is issued.