Issue A17—Contracts That Provide for Net Share Settlement - FASB He exercises the options when the stock's current market value is per share. Under net share settlement of an option or warrant to purchase common stock, the party with a loss delivers to the party with a gain an amount of common shares.
Trading Dictionary - Stock Market Terms - Stock Trading Terms -. Like a stock-settled SAR, the employee capitalizes on the appreciation in stock price without an output of cash for the exercise price and without a sale of shares. An agency connected with an exchange through which all stock and option transactions are reconciled, settled. The basic unit of trading for options.
Pwc guide to accounting for stock based compensation 2013 However, for the company, net share settlement has the important benefit of reducing the number of shares that must be issued in connection with an option exercise (i.e., reduces shareholder dilution). Stock-Based Compensation Awards” in this chapter for more guidance on accounting for dividends received by holders of options or shares issued.
Accounting for net settled stock options:
Rating: 97 / 100
Overall: 94 Rates