Articles Tagged with Employee Stock

AdobeStock_414456803-300x118Both employees and employers need to understand how stock options work. Employers who issue stock options without understanding them can lose significant value or control of their businesses. Employees who do not understand their stock options could miss out on a significant part of the compensation they are owed for their employment. The experienced California stock option lawyers at Structure Law Group help employers and employees understand their legal rights and obligations regarding stock options.

A Timeline Of the Stock Option Life Cycle

Like other financial assets, stock options have a life cycle. Understanding this life cycle can help you understand the true value of the asset. There are three general phases in the life cycle of stock options:

Employee-Stock-Ownership-Plan-300x200The U.S. Securities and Exchange Commission reports that many companies are using stock options as a way to attract and retain employees in the booming California business market. Employees granted stock options can profit by purchasing shares at a set exercise price and trading them at a higher price. Stock option incentives not only make employees more involved in your company but also provide an incentive for employees to help your Palo Alto business succeed. The better your business, the better your employees’ eventual payout.

The experienced Palo Alto business plan and stock option attorneys at Structure Law Group can use their expertise to review your stock option plan. We can analyze market trends and help you choose the best exercise price for your goals while protecting your legal interests. To schedule your stock option consultation, call our Palo Alto, California business attorneys today at 408-441-7500 or contact us online.

California Stock Option Law

Fotolia_180008799_Subscription_Monthly_M-300x200Startup companies often use stock options to attract new quality talent. If you have decided to do so, there are some special considerations when deciding the best approach to compensate your employees. Two common approaches include restricted stock and stock options.

What is Restricted Stock?

Restricted stock is a stock plan that gives particular employees a right to purchase stock shares. These restricted shares may be at a discounted value, fair market value, or even at no cost. Despite the right to buy the restricted stock, the shares are not actually owned by the employee until a particular triggering event occurs. For example, a company may restrict the transfer of the stock until a particular amount of time has elapsed (e.g., three years from the date of hire). Another example would be a condition regarding company performance (e.g., $1m in gross revenue). The employee then takes possession after the triggering event occurs, thereby lifting the “restriction” on the stock.