Discussion Week 5 Question 1 Stock Options Chapter 8 Assignment

Discussion Week 5 Question 1 Stock Options Chapter 8 - Assignment ExampleUsing Wal-Mart Company as an example, the company usually gives options to its employees. Each option covers a maximum of ten years from the time when it is granted. For those who at the time the option is granted own channel which represent 10% of the voting power in personal line of credit at the company, the term will non exceed five years. An employee can exercise an option when he gives notice to Wal-Mart and the company receives full pay for the option. An employee can exercise their option when their term ends as long as the option does not carry restrictions. This can be done within sixty days. Options are transferable and are disposable to an prompt family this is a Permitted guide. An option cannot is not transferable to another person other than through the Permitted Transfer or by the laws of distribution.The best way that the company can leverage stock options so as to offset employee compens ation is by allowing employees to sell, transfer and dispose stock in the open market. This is because many employees curb options as being part of their compensation and usually want to exercise them so as to posture money. Restricting this to just family members is likely to make the options unattractive to employees. Employees should also be free to exercise the options at any time without following the process of notifying the company. This is because as they are in the process of notifying the company, they may look across out on making profits the moment that the stock prices go up in the stock