Option exercise (Swedish: optionslösen), also called exercising an option, means that an option holder uses their right to buy or sell the underlying asset at the strike price. For an employee stock option, this can mean that the holder receives shares or a cash settlement. Terms and vesting govern when exercise can take place.
When a warrant is exercised, new shares in the company are subscribed for. The new shares must be registered with Bolagsverket and entered in the share ledger with owner and share numbers. The ownership picture then reflects the exercised options.
An option gives the holder the right, but not the obligation, to buy or sell an asset at a set price.
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A strike price is the predetermined price per share at which an option entitles the holder to trade.
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A warrant gives the right to subscribe for new shares in a company at a set price.
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An employee stock option gives an employee the right to buy shares in the company in the future.
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