ESOP

ESOP : Employee Stock OPtion

Under any Esop, a company first grants options to its employees. The option stays with employee as it is for some time. This is called the vesting period. Employee can exercise the option after the vesting period and acquire share against it. When an employee exercises an option, employer has to allot and transfer requisite number of shares in the company to employee. Employee cannot transfer or sell the option during vesting period. An employee can chooses not to exercise the option at all even after it has vested with him