Employee stock options
A) Have a significant up-front cost to employers
B) Can be resold through on option exchanges
C) Usually have a vesting period
D) Are no longer re-priced
E) Generally have a 5-year life

Question

Quizplus · Accepted Answer

Employee stock options usually have a vesting period, which means employees have to wait a certain amount of time before they can exercise their options and buy company stock at the strike price. This is to incentivize employees to stay with the company for a longer period of time.

Answer: D
 Employee stock options are no longer re-priced, which means that if the value of the company's stock decreases, the strike price for the option does not decrease accordingly. This can lead to situations where employees are left with overpriced options that may never be exercised.

Employee Stock Options