What Are My Options?
Categories :
Business Law, General Counsel Corner
December 22, 2025
Written by James Sanders
What exactly does a stock option provide to an employee when received? Does an owner lose control by issuing stock options to employees? These are questions that I typically get when a business owner is considering this type of equity compensation.
A stock option is a type of employee benefit where a company grants the right to purchase a set number of shares of the company’s stock at a predetermined price in the future. This type of equity compensation essentially gives employees a chance to share in the company’s success by potentially profiting if the stock price increases.
So, an option is not quite ownership, but it’s also not quite a bonus either.
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