What happens to my stock options in an acquisition?
When your company (the "Target") merges into the buyer under state law, which is the usual acquisition form, it inherits the Target's contractual obligations. Those obligations include vested options. Therefore, your vested options should remain intact in a merger/reorganization scenario.
What happens to stock options after leaving company?
When you leave, your stock options will often expire within 90 days of leaving the company. If you don't exercise your options, you could lose them.
Should I exercise my stock options before acquisition?
This is simple: if you have confidence in the company, it is almost always better to exercise than let your hard-earned options drop off the table for nothing. If you have already left the company, then you need to know how long you have before your options expire.
Can a company take away stock options?
Yes, in some instances, a company may take away stock options. This may be disguised in language such as: Company repurchase rights; Redemption; and.
Can I cash out my employee stock options?
If you have been given stock options as part of your employee compensation package, you will likely be able to cash these out when you see fit unless certain rules have been put into place by your employer detailing regulations for the sale.
What happens if you don't exercise stock options?
If you don't exercise an out-of-the-money stock option before expiration, it has no value. If it's an in-the-money stock option, it's automatically exercised at expiration.
Is it better to sell or exercise an option?
Occasionally a stock pays a big dividend and exercising a call option to capture the dividend may be worthwhile. Or, if you own an option that is deep in the money, you may not be able to sell it at fair value. If bids are too low, however, it may be preferable to exercise the option to buy or sell the stock.
Should I exercise my stock options as soon as they vest?
Early exercise is the right to exercise your stock options before they vest. Your option grant should say whether you can early exercise. Early exercising could benefit you in a few ways: If you have ISOs, early exercising could help you qualify for their favorable tax treatment.