Option, also known as option, is a derivative financial instrument based on futures. In essence, the option is to price the rights and obligations in the financial field separately, so that the transferee of the right can exercise his rights on whether to trade or not within a specified time, and the obligor must perform it.
Option incentive is a typical model of equity incentive, which refers to the phenomenon of low salary and insufficient incentive for senior managers of the company. In order to better motivate operators, reduce agency costs and improve governance structure, it is an attempt to plan stock options within the company.
Option incentives are mainly awarded to the company's senior managers, who play an important role in the company. They control the daily decision-making and operation of the company, so they are the focus of incentives. In addition, the technical backbone is also the main object of encouragement.
For example, a certain number of stock options are granted to executives, who can buy company shares at a pre-agreed price. Obviously, when the company's stock price is higher than the price specified in the grant option, the executives can exercise the option to buy the stock and make a profit by buying it at the specified price and selling it at the market price. In this way, executives will have the motivation to improve the intrinsic value of the company, thus increasing the company's share price and benefiting from it.
Foreigners have no right to get option incentives in the A-share market.
fundamental principle
Fixed stock
1. Stock option model is the most classic and widely used equity incentive model in the world. The main point of its content is that, with the approval of the shareholders' meeting, the company will reserve stock options for the issued and unlisted ordinary shares as part of the "package" reward, and conditionally grant or reward them to the company's senior managers and technical backbones at a predetermined option price. Holders of stock options can make choices such as exercising and cashing within the prescribed time limit. The design and implementation of stock option model requires that the company must be a public listed company, have a reasonable and legal stock source that can be used to implement stock options, and have a capital market carrier whose stock price can basically reflect the intrinsic value of stocks, with relatively standardized operation and good order. Lenovo Group and Founder Technology, which were successfully listed in Hong Kong, both implemented the stock option incentive model.
2. Restricted stock model Restricted stock refers to a certain number of shares of the company granted by a listed company to the incentive object according to predetermined conditions. Incentive objects can only sell restricted stocks and benefit from them if their working years or performance targets meet the conditions stipulated in the equity incentive plan.
3. stock appreciation rights model.
4. Virtual stock model.
Ding ren
Three principles of employing people: 1, the potential human resources are not developed; 2. The degree of information hiding in the process of work; 3. Whether there are special senior managers of human capital accumulation refers to those who are responsible for the company's decision-making and operation, including the manager, deputy manager, chief financial officer (or other personnel who perform the above duties), secretary of the board of directors and other personnel stipulated in the company's articles of association. Three-level theory of economy and state: 1, core layer: mainstay (with the fate and development of enterprises and the spirit of sacrifice); 2, the backbone: safflower (opportunists, they are the focus of equity incentives); 3. Operation layer: Green leaves (work is work) should treat people at different levels differently, and often the backbone layer is the key object of our equity incentive plan.
opportunity
The validity period of the equity incentive plan is calculated from the date of adoption by the shareholders' meeting, and generally does not exceed 10 year. After the expiration of the equity incentive plan, the listed company shall not grant any equity according to this plan. 1 Within the validity period of the equity incentive plan, set the exercise restriction period and exercise validity period for each stock option granted, and exercise in batches according to the set schedule. 2. During the validity period of the equity incentive plan, the lock-up period of restricted shares granted in each issue shall be no less than 2 years. Upon the expiration of the lock-up period, the number of shares that can be unlocked (transferred or sold) by the incentive object shall be determined according to the completion of the equity incentive plan and performance targets. The unlocking period shall not be less than 3 years, and the unlocking period shall be unified in principle.
Make an offer
According to the principle of fair market price, the grant price (exercise price) of equity is determined. The grant price of the equity of a listed company shall not be lower than the higher of the following: 1. Summary of the draft equity incentive plan announces the closing price of the company's target stock on the previous trading day; 2. The average closing price of the underlying shares of the company in the 30 trading days before the announcement of the draft equity incentive plan.
quantify
Fixed total and fixed quantity
Fixed amount: 65,438+0. Article 15 of the Trial Measures: The equity of any incentive object granted to a listed company through all effective equity incentive plans shall not exceed 65,438+0% of the company's total share capital, unless approved by a special resolution of the shareholders' meeting. 2. "Trial Measures" During the validity period of the equity incentive plan, the expected income level of individual equity incentives for senior managers should be controlled within 30% of their total salary level (including expected options or equity income). The total salary level of senior managers should be determined by referring to the principles of state-owned assets supervision and administration institutions or departments and the performance appraisal and salary management measures of listed companies.
Set the total amount as 1, refer to the internationally accepted option pricing model or the fair market price of stocks, and scientifically and reasonably calculate the expected value of stock options or the expected return of restricted stocks. 2. According to the equity incentive income and equity grant price (exercise price) predicted by the above method, determine the number of equity grants for senior managers. 3. The total salary level of each incentive object and the proportion of expected equity incentive income to the total salary level shall be determined according to the job analysis, job evaluation and job responsibilities of listed companies.