From Wikipedia regarding contract differences between standard (exchange traded options) and Employee stock options:
Employee stock options have the following differences from standardized, exchange-traded options:
Exercise price: The exercise price is non-standardized and is often the current price of the company stock at the time of issue. Alternatively, a formula may be used, such as sampling the lowest closing price over a 30-day window on either side of the grant date. On the other hand, choosing an exercise at grant date equal to the average price for the next sixty days after the grant would eliminate the chance of back dating and spring loading. Often, an employee may have ESOs exercisable at different times and different exercise prices.
Quantity: Standardized stock options typically have 100 shares per contract. ESOs usually have some non-standardized amount.
Vesting: Initially if 10,000 shares are granted to employee, then all 10,000 will not be in his account. This is a four year plan in which options will increase by 2,500 every year. Some companies provide cliff vest in which first year options start with 0.
Duration (Expiration): ESOs often have a maximum maturity that far exceeds the maturity of standardized options. It is not unusual for ESOs to have a maximum maturity of 10 years from date of issue, while standardized options usually have a maximum maturity of about 30 months.
Non-transferable: With few exceptions, ESOs are generally not transferable and must either be exercised or allowed to expire worthless on expiration day. There is a substantial risk that when the ESOs are granted (perhaps 50%) that the options will be worthless at expiration. This should encourage the holders to reduce risk by hedging with listed options.
Over the counter: Unlike exchange traded options, ESOs are considered a private contract between the employer and employee. As such, those two parties are responsible for arranging the clearing and settlement of any transactions that result from the contract. In addition, the employee is subjected to the credit risk of the company. If for any reason the company is unable to deliver the stock against the option contract upon exercise, the employee may have limited recourse. For exchange-trade options, the fulfillment of the option contract is guaranteed by the Options Clearing Corp.
Tax issues: There are a variety of differences in the tax treatment of ESOs having to do with their use as compensation. These vary by country of issue but in general, ESOs are tax-advantaged with respect to standardized options.
So the way I read it is that you can have stock Options but one thing that they do have to have is vesting period after which the options can be exercised in full. Granted that the vesting can be cliff vesting, which means that you can have options become vested all at once rather then piecemeal but nonetheless at some point an employee will have a complete control and ownership of those options and will be able to exercise them. The company of course can be sold before full vesting of the options could potentially prevent an employee from ever becoming a shareholder of record.
Now as far as shareholder of record is concerned the number of shareholders is counted by the number of people registered as owners of a particular security in this case shares of company so if you own options to buy these shares you don't actually have them hence you are not a shareholder of record and hence you won't count into the number of shareholders of record SEC requires for registration.
Here is from SEC with regards to Employee Stock Option Plans. Based on what I am reading you have to have options vested after a certain period of time but nowhere does it say that you can't sell the company in the mean time. :)
Ye Standard Disclaimer: IANAL.