Google Employees Exchange 93% Of 'Underwater' Stock Options

  • March 11, 2009
Google disclosed on Tuesday that its employees exchanged about 93% of "underwater" stock options for new options with a lower exercise price.

According to a regulatory filing, 15,642 Google employees participated in the program, which allowed employees to swap stock options with exercise prices above the stock's current market price for new options with an exercise price of $308.57--Google's Friday closing price.

Google's stock has fallen 49% from its 52-week high of $602.45. The company has said resetting the price of stock options is a way to motivate and retain employees. Google previously estimated it would take a $400 million charge to account for the exchange, assuming the new options were priced at $350 and that 100% of eligible options were exchanged.--Tanya Irwin

1 comment about "Google Employees Exchange 93% Of 'Underwater' Stock Options".
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  1. John Jocke from Infuzer.com, LLC, March 11, 2009 at 10:52 a.m.

    What Google probably realizes is - that even at these adjusted prices, the new stock options will be underwater again before being exercised.

    Great goodwill gesture, but I don't see it actually ending up as a $400 million write down.

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