Larry Steffen: Valuing Stock Options in a Compensation Package Harvard Case Solution & Analysis

A new MBA graduate, Larry Steffen, has taken an attractive job offer from Athena Global Technology; however, he must now choose one of two alternative compensation plans. The first settlement strategy choice and include a base salary plus a $25,000 cash bonus along with base salary plus employee stock options respectively.

For Larry to make a choice on these initiatives, he should evaluate the worth of the stock options that are offered and contemplate several complicating factors, including whether he will stay at Athena for the five-year vesting period needed to receive the options. This case introduces students to option valuation and facilitates a discussion about the effectiveness and possible advantages and problems associated with the usage of stock options in compensation packages.

Publication Date: 12/02/2013

This is just an excerpt. This case is about Finance

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