Stock Option Repricing: Employees Benefit But What About Investors?
- Topics:
- Accounting software
- Tags:
- Benefits,
- Stock Options,
- Stock Option,
- Stock,
- Investor,
- Investment,
- Human Resources,
- Financial Accounting,
- Finance,
- Stock Options & Grants
- Source:
- Knowledge@Wharton
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Overview: The article is about the effect of Stock Option Repricing on Employee Turnover. Stock options are basically a promise made by a company to offer a number of its shares at a set price, for a set period of time. If the stock price rises to a level above that offered by the option (the "strike" price), it can mean a windfall for the person who holds the option. If the market price falls below the strike price, however, the option – now said to be "underwater" – may be worthless. One key element of a compensation package is stock options. Companies, however, characterize action as an investment in the long-term health of the enterprise, saying repricing is necessary to retain talented employees during lean times. It explains the effect of it on both employees and investors.
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Format: HTML | Date: Apr 2003 | Pages: 1
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