| An incentive given to company directors and employees to promote loyalty and commitment. The employee is offered an option to buy shares in the company at a fixed price, which may be below the then market price. The option specifies the time during which the employee can exercise the right, and often this will be a period of years. If the companys share price rises in that period, the employee can exercise the option, acquire the shares at the option price and immediately sell them for a capital gain.
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