I am interested in hearing from anybody who has implemented Net-Settled Stock Option Exercises (no output of cash & no sale of shares). It is my understanding that this might become more popular since ASC 718 (FAS 123R) eliminated the adverse accounting consequences associated with net exercises that existed under APB 25. We currently allow cashless / same-day-sale exercises and sell to cover, but we do not allow net-settled option exercises.
Did you face any communicatin or administrative complications?
Did you administer the transactions in-house or through a 3rd-party stock administrator?
Did you have a high participation rate?
Any feedback on the pros and cons of your experience is appreciated.