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I hold stock options in a public company, but the exercise price of my options is well above the current trading price of the company's stock. Is it possible for the company to lower the exercise price of my options?
It is possible, but many public companies are not willing to reprice existing options. Under recent accounting interpretations, the repricing of existing options will result in the option being subject to variable accounting treatment. This means that the company will have to recognize a compensation expense (reducing the company's earnings) on the spread of the option, over the remaining option vesting period.
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