A Practice Note providing an overview of stock options, including non-qualified stock options and incentive stock options. It addresses the pros and cons of granting stock options, distinguishing them from other types of equity compensation. It also addresses the different tax treatment of non-qualified stock options and incentive stock options, shareholder approval requirements, and securities law considerations, including Form S-8 and exemptions from registration for private issuers, such as Rule 701, Section 4(a)(2) of the Securities Act, and Regulation D. It also discusses the myriad of issues raised by stock option repricing and exchange programs.