Google Lets Staff Sell Vested Options

Employees will be able to both exercise their options and sell them to financial institutions.
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Google

(GOOG) - Get Report

announced an innovative program to allow its employees to sell their vested stock options early in a move that is intended to let workers cash in ahead of time.

The new program announced late Tuesday, which excludes top executives and is limited to options granted after the company went public in 2004, will begin in the second quarter of 2007.

It will raise the cost of options to the company, which will take an undisclosed charge as part of the new program.

Employees will only be able to sell options to qualified financial institutions, and the process will be conducted through a private auction managed by investment bank Morgan Stanley.

Financial institutions will have two years from the time of the sale to settle with Google.

"In addition to increasing the value of every option employees receive, the TSO

Transferable Stock Option program makes the value of their options much more tangible," Google director of recognition and HR systems Allan Brown wrote on the company's blog.

With a greater range of choices to cash out on their options, employees will have greater flexibility and are likely to see options as a bigger prize.

Shares of Google rose 31 cents in extended trading to $482.09.