Stock grants, such as options or restricted stock, are typically determined by the group or person that sets cash compensation levels and bonuses at your company. The full board, compensation committee, or authorized officer of the company then...
Unlike public companies or large private companies that may have grant guidelines, most private companies determine the grant size by a combination of factors. Surveys show that...
The value of an option consists of two elements: time premium and intrinsic value. Intrinsic value is the difference...
The full board of directors, the compensation committee, or an executive with expressly delegated authority...
In most cases, your exercise price for stock options is...
Only for ISOs directly, though even NQSO exercise prices need to follow the rules on nonqualified deferred compensation to avoid becoming discounted stock options. ISOs must be granted at a price which is at least equal to the...
You want to know the term of your grant to prevent valuable stock options from expiring. Most options are granted with a 10-year term, but some have a shorter life, such as...
Usually, if the vesting date falls on a non-business day...
You need to check your stock plan's provisions and the procedures/practices followed by your company or any outside stock plan administration firm. Usually...
A stock grant agreement is a form your company uses to grant you an equity award. Grant agreements can be in the form of...
Depending on the type of equity award, a stock grant agreement can have one or several pages setting forth a range of terms for you to review, including...
Guidelines about grant sizes vary among industries and corporate peer groups. Most companies...
With variable grant guidelines, your company determines grant size according to a target dollar value rather than...
Look at your grant agreement...
First, you may be eligible to receive only NQSOs, so read the FAQs on the requirements of ISOs...
While almost all companies make awards to eligible new employees, most companies also...
Companies tend to grant options at hire and only periodically thereafter to reward performance...
Some companies have more than one stock plan. When a company offers just one omnibus plan...
A stock split occurs when a company wants to lower its share price to permit more investors to be able to...
In the context of company stock, dilution is a reduction of shareholders' ownership interests that results from equity compensation. For example, stock options can erode the...
Most stock option plans automatically adjust your options for the stock split. Your number of options will be...
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Rules
In the United States and in most other countries, stock options are not taxed at grant...
No. Companies are not required to have broad-based, company-wide stock grants, although they cannot discriminate in deciding who is eligible. Employers have extraordinary...
Almost none, assuming the legal and other technical formalities are followed in creating...
Many companies have broad-based stock plans that extend to the lowest-level employees, including hourly and part-time workers...
For a public company to issue stock options properly under federal securities laws, it must furnish each participant in its stock option plan with a summary of the...
Amid concerns about the backdating and springloading of stock options, companies have tightened their procedures for approving stock grants and their timing. After grants are properly approved, companies are now...
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Most companies do not require spousal acceptance and no law requires it. However, in community property states, some companies do...
Rules
Nonqualified stock options (but not incentive stock options) can be granted without a formal plan...
Yes, as long as your company's stock-option plan permits both to be granted. The decision to do so belongs to your company...
No, except in very limited circumstances. For example, if you obtained your job by fraudulent means, your grant could be revoked...
Yes. Traditionally, however, union representatives have abjured equity compensation and profit-sharing for...
Yes. Many startup companies cannot give their employees the benefits and human-resource assistance that are provided by large employers...
You do not become a shareholder until you...
Generally, no violation occurs if you receive a grant of stock options when you know secret stock-price-moving information about your company. However, the SEC has focused severely in recent years on...
Tax errors can be costly! Don't draw unwanted attention from the IRS. Our Tax Center explains and illustrates the tax rules for sales of company stock, W-2s, withholding, estimated taxes, AMT, and more.
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