Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs -- Ignore unavailable to you. Want to Upgrade?

To: hueyone who wrote (140)	7/29/2002 1:42:27 PM
From: rkral	Respond to of 786

Excellent post, Huey ... Thanks especially for pointing out the dilution cost. In the long run, that's really the true cost of options. Let's say a company replaced its option grant plan with a "stock grant" plan. Instead of issuing an option for 10,000 shares, this company promises to give 1,000 shares to the employee at the end of each of the next 5 years the employee works there. For tech companies, the costs of the two plans are very comparable. (The Black-Scholes cost for the option can approximate 50% of the market price on the grant date.) Easy plan to understand, administer, and expense. No smoke and mirrors. Ron