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Question

What is the full form of ESOP?

A Employer Shareholding & Ownership Plan Correct Answer Incorrect Answer
B Employer Security & Ownership Plan Correct Answer Incorrect Answer
C Employee Share Opportunity Program Correct Answer Incorrect Answer
D Employee Stock Option Plan Correct Answer Incorrect Answer

Solution

ESOPs stand for Employee Stock Option Plan or Employee Stock Ownership Plan. It is an employee benefit plan that gives workers ownership interest in the company. An organization grants ESOPs to its employees for buying a specified number of shares of the company at a defined price (exercise price) after the exercise period (a certain number of years). Before an employee could exercise his option, he needs to go through the pre-defined vesting period which implies that the employee has to work for the organization until a part or the entire stock options could be exercised

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