Vest Fleece

DEFINITION of 'Vest Fleece'

A slang term used to describe a situation in which a company's executives accelerate the vesting of their employee stock options. Usually, accelerated vesting is preceded by a period of excessively high employee stock option grants. The result of vest fleecing is that shareholders' ownership is reduced, and option holders are able to turn their options into stock in a shorter time period than if they had not accelerated vesting.

BREAKING DOWN 'Vest Fleece'

A vest fleece results in option holders being given an increased share of ownership in their employers' companies.

This term was coined by Jack Ciesielski, founder of The Analyst's Accounting Observer.

RELATED TERMS
  1. Cliff Vesting

    The process by which employees earn the right to receive full ...
  2. Graduated Vesting

    The accelerated benefits employees receive as they increase the ...
  3. Vested Benefit

    A financial incentive of employment that an employee is fully ...
  4. Vesting

    The process by which employees accrue non-forfeitable rights ...
  5. Fully Vested

    A person's right to the full amount of some type of benefit, ...
  6. Vested Interest

    1. The lawful right of an individual or entity to gain access ...
Related Articles
  1. Investing

    What Does Vesting Mean?

    Vesting is the process of accruing non-forfeitable rights.
  2. Retirement

    401(k) And Qualified Plans: Eligibility Requirements

    By Denise ApplebyAny business, including sole proprietorships, partnerships, corporations and government entities may adopt a qualified plan. An employee may not adopt a qualified plan, but an ...
  3. Investing

    How Restricted Stocks and RSUs Are Taxed

    Many firms pay a portion of their employees’ compensation in the form of restricted stock or restricted stock units.
  4. Retirement

    How do you calculate penalties on a 401(k) early withdrawal?

    Find out how to calculate the penalties on early withdrawals from your 401(k), including the impact of the additional 10% tax penalty, vesting and income tax.
  5. Trading

    How Restricted Stock and RSUs Are Taxed

    This form of executive compensation limits how these stocks can be sold. Find out more here.
  6. Retirement

    Five Questions to Ask About Your Company's 401(k) Plan

    Having a comfortable retirement depends on taking maximum advantage of your company's 401(k), if it's offered. Here's what you need to know.
  7. Financial Advisor

    Is HD Vest Financial Services Right for You?

    Here's what you need to know about HD Vest Financial Services.
  8. Managing Wealth

    Get The Most Out Of Employee Stock Options

    These plans can be lucrative for employees - if they know how to avoid unnecessary taxes.
  9. Investing

    Employee Stock Options: Definitions and Key Concepts

    By John Summa, CTA, PhD, Founder of HedgeMyOptions.com and OptionsNerd.comLet's begin with the participants – the grantee (employee) and grantor (employer). The latter is the company that ...
  10. Trading

    The Benefits And Value Of Stock Options

    The pros and cons of corporate stock options have been debated since the incentive was created. Learn more about stock option basics and the cost of stock options.
RELATED FAQS
  1. What is a vest fleece?

    A vest fleece is a term first coined by Jack Ciesielski, founder of The Analyst's Accounting Observer, and it relates to ... Read Answer >>
  2. What is cliff vesting?

    An employee is considered "vested" in an employer benefit plan, once they have earned the right to receive benefits from ... Read Answer >>
  3. Can my company ever be entitled to take my 401(k)?

    Find out why your employer may be able to take part of your 401(k) if you leave your employment too soon, including how different ... Read Answer >>
  4. How do I "vest" something?

    Vesting is a term usually related to pension plans that some employer's provide to their employees.An employer may make contributions ... Read Answer >>
  5. Based on the Employment Retirement Income Security Act (ERISA), a retirement plan ...

    The correct answer is b. With regard to eligibility, the plan must cover all employees 21 and older who have worked for the ... Read Answer >>
  6. What are the SEC regulations on exercising stock options?

    Learn how the SEC and IRS regulate employee stock options, including the exercise of options and the sale of options, and ... Read Answer >>
Hot Definitions
  1. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  2. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  3. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  4. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
  5. Russell 3000 Index

    A market capitalization weighted equity index maintained by the Russell Investment Group that seeks to be a benchmark of ...
  6. Enterprise Value (EV)

    A measure of a company's value, often used as an alternative to straightforward market capitalization. Enterprise value is ...
Trading Center