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Say Company X offers or grants its workers options to buy a hundred shares of inventory at $5 a share. You get choices on one hundred shares of stock in your company. In the instance with Company X, employees could exercise their choices and purchase all 100 shares without delay in the event that they wished to. If an employee sells these a hundred shares, that's a gain of $5 a share, or $500 in profit. Again, the worker has to buy the stock at $5 a share first. One question you might need is: How does a privately held firm set up a market and grant (strike) price on every share of its inventory? The last selection is to alter all the options to stock, buy it at the discounted value and keep it with the thought of promoting it later, maybe when each share is value $15. Since those options cannot be exercised for some time, the hope is that the price of the shares will go up in order that promoting them later at a higher market price will yield a revenue.

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