Below are given the differences that Employee stock options have from standardized, exchange-traded options:
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Strike: It has the strike price which is non-standardized and it is usually the current price of the company stock at the time of issue. Alternatively, it is possible that a formula might be used, such as sampling the lowest closing price over a 30-day window on either side of the grant date. Usually, an employee may posses ESOs that struck at different times and different strike prices.
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Quantity: Typically standardized stock options posses 100 shares per contract. Usually ESOs posses some non-standardized amount.
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Vesting: Usually there will be an increase in the number of shares that are available to be exercised at the strike price as time passes according to some vesting schedule. Vesting only takes place during the duration of the employment.
