Understanding Employee Stock Options

Understanding Employee Stock Options (ESOs)
We have put together a web based presentation that will cover these subjects in detail.

INTRODUCTION		Employee Stock Option Planning Fundamentals Presentation Objectives Presentation Agenda

PART I		STOCK OPTION BASICS

		What is an Employee Stock Option? Issuance of Stock Options Who’s Getting The Options? Implementation Constraints Resulting Consequences Key Terminology – Grants Key Terminology – Valuation Underwater Stock Options Consideration for Taking Action Personal Option Profile Report (POP) Time Value Graph Variables affecting Time Value Option Valuation Leverage Time Value vs. In-The-Money Value Black-Scholes Value Time Value: Volatility

PART II		CASE ILLUSTRATION

		SAMPLE CLIENT DATA POP: In-The-Money Value POP: Cash-out Value POP: Position Concentration Achieving Financial Freedom POP: Time Value Table POP: Considering another Job? POP: Option Leverage Value at Risk Analysis Key Ratios – Action Points POP: Monitoring Key Ratios

PART III		STOCK OPTION TAXATION

		Overview Qualified vs. Nonqualified RESTRICTED STOCK Restricted Stock #1 Restricted Stock #2 Pros & Cons – 83(b) Election NONQUALIFIED STOCK OPTIONS (NQ’S) Nonqualified Stock Options #1 Nonqualified Stock Options #2 Nonqualified Stock Options #3 INCENTIVE STOCK OPTIONS (ISO’S) Incentive Stock Options #1 Incentive Stock Options #2 Incentive Stock Options #3 Incentive Stock Options #4

PART IV		ALTERNATIVE MINIMUM TAX

		AMT Discussion Points What is the Alternative Minimum Tax? AMT Triggers Dental Care vs. AMT BACKGROUND HISTORY #1 Cause of Problem CALCULATING THE AMT Tax Rate Comparison