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 optionsThe 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.
