Mercer

Google offers to exchange employee options

Google employees will have a chance to exchange underwater stock options for new, at-the-money options under a program intended to increase retention. Several features of Google's offer are far more generous than typical option exchanges -- for example, a one-for-one exchange ratio and no minimum out-of-the-money amount for determining option eligibility. While Google's program is receiving much attention, it may not serve as a model for other companies with underwater options -- at least if their shareholders must approve the option exchange.  (Select News, 27 Jan 2009)


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