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Stock option gains represent the value realized by an executive by exercising option awards.
Fig. 4 Probabilities of exercising option for various operating time within ECAs.
In particular, when a ship operates the whole year inside an ECA, the probability of no investment is reduced to below 10% and that of exercising option at the first year is clearly increased to 90%.
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Sure, he made $94 million in 2002, mostly by exercising options.
He also realized $23 million from exercising options, the proxy shows.
Of this gap, roughly 26percentt was attributable to exercising options.
According to company filings, he made $49 million from exercising options in 1999 and $131.7 million from exercising options in 2000.
Company filings show those shares were restricted, unlike the shares Mr. Genovese received from exercising options.
Indeed, 98percentt of Mr. Ellison's 10-year total of $875.7 million came from exercising options.
That means highly compensated executives can be subject to substantially higher tax rates when exercising options.
Such gaps may be largely the result of managers exercising options at the wrong time.
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