In option 1 if the stock price drops, you don't have to excercise the option and you don't lose money. If you bought now at 50 and it dropped to 25 you lose. If it dropped to 25 and had options you don't have to use the option.
Yea to option 2, usually if you remain an active employee through the vesting period.
I don't know cvs's policies on their ESPP but I know some techs that have it so I assume it's available for all full time employees. Generally, an ESPP is a benefit but not a performance reward like cash bonuses, options, restricted stock etc.
Over a period of time called a purchase period (let's use 6 months) an employee contributes a % of their paycheck (posttax) for the ESPP. At the end of purchase period the company provides stock at a discounted rate off of the lowest available stock price during that 6 months. All the contributions made are executed at that discounted share price and the employee gets that many shares. Usually this has to vest and time periods must occur to avoid some tax penalties but all in all if you feel the company is growing and the % discount is a lot (if it really is 15% seems like a no brainier) then I'd recommend.
Looking at CVS's growth in a year is pretty impressive and then tack on an additional 15%? Wish I could get in on that action. Seems like some positive ROI.