employee stock option

Also found in: Dictionary, Thesaurus, Legal, Acronyms, Wikipedia.
Related to employee stock option: Employee Stock Option Plan

Stock Option

A non-tradeable call option giving an employee at a publicly-traded company the right to buy shares in that company for a certain price. Stock options in this sense are often a part of compensation for major and mid-level executives in large publicly-traded companies. If the share price for the company increases, stock options can be very profitable for the employee. These stock options have certain rules governing when and how the option can be exercised.

employee stock option

Employee Stock Option

An option granted to an employee to purchase the employer's stock. Employee stock options to which special income tax treatment is accorded are known as statutory options.
References in periodicals archive ?
Even though most employee stock options are granted at-the-money and so have zero intrinsic value (that is, market price minus exercise price), they have positive value at the grant date because of the volatility value of the option.
Because there is no reference market for employee stock options, SFAS 123 offers companies two ways of presenting their financial reports under Generally Accepted Accounting Principles (GAAP):
Unlike stock options that are traded on an exchange, employee stock options
The Board of Directors shall in accordance with the above described guidelines have the right to determine the detailed terms of the employee stock option program.
SFAS 123 recommends, but does not require, that companies treat the fair market value of employee stock options as compensation expense.
The purpose of the proposed employee stock option program is to provide opportunities for motivating, keeping and recruiting skilled employees and the Board is of the opinion that the adoption of a stock option program is to the benefit of the company and the shareholders.
The Board of Directors shall determine the detailed terms of the employee stock option program.
In total, not more than 700,000 warrants may be issued, of which a total of not more than 100,000 warrants are intended to be used in order to cover the costs that may arise because of the employee stock option program (principally social security contributions or corresponding taxes).
In accordance with the above described guidelines, it is proposed that the General Meeting approves that the company or any other company within the group issues no more than 600,000 employee stock options during the period up to the Annual General Meeting 2007, and as a consequence that no more than 600,000 shares may be transferred to employees within the Biotage group in accordance with the employee stock option program.
They note that issuing stock for less than its current market value, as happens when an employee stock option is exercised, dilutes the value of the other stockholders' holdings.
What is novel is that Google is extending this ability to trade options to employee stock options.
22 /PRNewswire/ -- The John Nuveen Company (NYSE: JNC) today announced its intention to repurchase up to 500,000 shares of the company's Class A common stock to fund the firm's employee stock option program.

Full browser ?