Vacaro Corporation provides a variety of share-based compensation plans to its employees. Under its executive stock option plan, Vacaro granted options on January 1, 2009, that permit executives to acquire 20 million of the company's $1 par common shares within the next 8 years, but not before December 31, 2012 (the vesting date). The exercise price is the market price of the shares on the date of grant, $18.50 per share. The fair value of the 20 million options, estimated by an appropriate option pricing model, is $5 per option. No forfeitures are anticipated. Ignore taxes.