| More and more studies has focused on compensatory stock option in China in recent years, but less attentions deal with the research of related legal problems, and the prevailing laws and legislations lag behind the stock option practice. As a result, the application of stock option is hindered. Furthermore, the possibilities for future disputes are increased. This article presents several suggestions on how to perfect related laws and legislations, and how to prevent and settle stock option disputes on the basis of legal analysis of stock option. This article consists of four parts:The first chapter analyzes the nature and elements of stock option. As a motivation mechanism, stock option includes two interrelated contracts: compensation, buying and selling of stocks of the company. Stock option is a propriety that is attached to the specific proprietor. The grant and the exercise of such propriety have considerations. The parties of stock option correspond to the corporate governance; the rights and obligations of each party must conform to company law, employment law and contract law.The second chapter studies the laws and legislations of stock option. The major purpose of laws and legislations adjusting stock option is to provide remedies for the weak group. It focuses on building infrastructure and maintaining normal order of the application of stock option. Some efforts have been made by the legislative departments inChina to regulate stock option, but these efforts have led to few formal laws and legislations. This article presents not only a legislative framework for regulating stock option, but also some suggestions to improve company law, labor law, contract law and security law in China.The third chapter analyzes disputes in stock options. The focus of lawsuits in stock options can be divided into three categories: the setting of stock option plan and related terms and conditions, the application of claw-back provisions and effects of corporation mergers and acquisitions to employees. The first dispute in stock option in China is in nature an employment dispute. Lacking laws and legislations, it caused enormous difficulties for the related party to seek for remedy. This article analyzes this case and presents a few suggestions to avoid litigations.The last chapter is a summary of the conclusions and suggestions. In the author's opinion, to facilitate the application of stock option, the corporate governance should be perfected and the rights and obligations of related parties clarified. At the same time, an integrated legal system needs to be set up. We should use the experiences from other countries to improve stock option plans, prevent and settle disputes, and protect the legal rights of related parties.
|
PDF Full Text Request