This second edition, which includes critical legislative updates, is designed for anyone attempting to maximize their employer's ability to attract, motivate and retain key employees. It provides a specific detailed overview of long-term incentive alternatives to non-fair market value options. From phantom stock to performance unit plans to stock appreciation rights to restricted stock, the author details how each plan works, the tax and accounting issues surrounding each plan and the advantages and disadvantages of each.

Companies still putting 'all of their eggs in the stock option basket' are at the market's mercy, subject to rampant volatility. In light of today's new governance standards, for compensation committees and consultants on the front lines, a proactively designed long-term incentive (LTI) package — with three to four LTI vehicles — is a viable strategy. A healthy mix of option alternatives helps strengthen a company's ability to overcome thorny issues such as repricing, overhang and run-rates.

In a day when the most popular long-term incentive the United States has ever known — the fair market value stock option — is under attack and now carries a prohibitive charge to earnings, it is imperative that anyone dealing with executive compensation be in an educated position to compare and contrast stock option alternatives. This book provides the information your company needs to protect its assets, maximize its market position and get a competitive edge in today's challenging rewards environment.

The Appendix includes an abundance of sample documents, forms and LTI plans, as well as practical, insightful tips and a glossary of terms.